WEBVTT - Tech Selloff Day 2 and DoorDash Earnings 0:00:02.400 --> 0:00:05.760 From the heart of where innovation, money and power collive 0:00:06.519 --> 0:00:11.080 in Silicon Valley and beyond. This is Bloomberg Technology with 0:00:11.119 --> 0:00:26.720 Emily Jay I'm only changing in San Francisco, and this 0:00:26.720 --> 0:00:30.400 is Bloomberg Technology coming up of the next hour market malaise, 0:00:30.520 --> 0:00:33.599 the SMP five hundred and the tech heavy NASDAQ one 0:00:33.680 --> 0:00:37.640 hundred having their worst weekly run of declines for a 0:00:37.800 --> 0:00:41.320 decade as US job numbers reinforce the idea that the 0:00:41.400 --> 0:00:45.680 FED stay in the course on rates plus Doordas shares 0:00:45.720 --> 0:00:48.440 get caught in the down draft, selling off for another day, 0:00:48.520 --> 0:00:51.720 hitting an all time low, this despite strong earnings that 0:00:51.720 --> 0:00:55.000 show customers still paying for takeaway as we move into 0:00:55.080 --> 0:00:58.600 our post pandemic world. A conversation with DoorDash CEO Tony 0:00:58.680 --> 0:01:03.280 Shoe is coming up, and Meta's latest leap into the 0:01:03.320 --> 0:01:07.039 metaverse is a real world store. We go behind the 0:01:07.080 --> 0:01:10.840 scenes and the company's first retail location ahead of its 0:01:10.840 --> 0:01:13.600 grand opening. I want to stick with that volatility that 0:01:13.680 --> 0:01:16.200 continues to dominate the markets and bring in Mark Mahaney 0:01:16.720 --> 0:01:18.839 of ever Car and Mark. Some of these companies actually 0:01:18.840 --> 0:01:22.039 a strong earnings results, but they're still getting caught up 0:01:22.680 --> 0:01:25.400 in this down draft. You know, what's your take here, 0:01:25.440 --> 0:01:29.320 how are you reading through this? Well, okay, Emily, I 0:01:29.760 --> 0:01:31.399 think my take on it would be the companies that 0:01:31.440 --> 0:01:34.240 actually had strong earnings actually did trade up, but there 0:01:34.240 --> 0:01:36.440 were very few of those companies in tech land. So 0:01:36.560 --> 0:01:38.440 let me try this. You know, you mentioned door Dash, 0:01:38.760 --> 0:01:41.600 Door Dash, you know is fulminentals got stronger, but they're 0:01:41.600 --> 0:01:44.480 not really yet putting up sustained gap earnings, and so 0:01:45.120 --> 0:01:48.520 the market is not willing to bid up stocks despite 0:01:48.520 --> 0:01:50.680 what happens on the top line. If they don't have 0:01:50.720 --> 0:01:52.720 a lot of bottom line cushion, then they don't trade 0:01:52.720 --> 0:01:54.800 somewhat close to our market multiple. It's gonna be a 0:01:54.880 --> 0:01:57.880 challenge for pure growth equities like DoorDash. I like doordashes 0:01:57.960 --> 0:02:00.440 the stock, but in this market it's gonna be challenge. 0:02:00.480 --> 0:02:03.480 Airbnb put up really good numbers earlier this week, stock 0:02:03.520 --> 0:02:06.560 couldn't hold the gains. Uber put up good numbers, Stock 0:02:06.600 --> 0:02:08.880 couldn't hold the games. The one that could, though, was Booking, 0:02:09.480 --> 0:02:12.040 and Booking had positive results. But they also have a 0:02:12.120 --> 0:02:15.800 market multiple app you know, real earnings. Uh, they've had 0:02:15.840 --> 0:02:18.560 them for a long time, a bulletproof balance sheet, etcetera. 0:02:18.680 --> 0:02:21.600 So this market is very discriminating and it won't. It 0:02:21.639 --> 0:02:25.080 won't tolerate growth assets right now. If you're a growth stock, 0:02:25.160 --> 0:02:28.440 you better have a good earnings track record. In that case, 0:02:28.480 --> 0:02:30.120 the stock can trade up. I think that's kind of 0:02:30.120 --> 0:02:32.400 what's happening. People are just going to the defensive end 0:02:32.840 --> 0:02:35.240 of growth tech in the Usually there's not too many 0:02:35.320 --> 0:02:38.000 names in that space. Based on the actions the FED 0:02:38.120 --> 0:02:41.200 is taking here, how concerned are you about a recession 0:02:41.360 --> 0:02:47.280 and just a prolonged market meltdown? Well, I don't know. 0:02:47.680 --> 0:02:49.480 I'm certainly no expert on that, but I can all 0:02:49.480 --> 0:02:52.480 my My interpretation is simply that the market on Thursday 0:02:52.480 --> 0:02:55.399 and Friday said we don't believe the FED can orchestrate 0:02:55.400 --> 0:02:58.440 a soft landing. That's how I interpret what happened. Maybe 0:02:58.440 --> 0:03:00.880 the FED can, maybe the FED can't. No expert on that, 0:03:01.120 --> 0:03:03.360 I think the odd that's not going to be an 0:03:03.360 --> 0:03:05.720 easy thing to do, but that's what the market is saying. 0:03:05.760 --> 0:03:08.040 And then as a as an investor in tech stocks, 0:03:08.280 --> 0:03:10.160 one thing I have to worry about is if there 0:03:10.160 --> 0:03:13.280 really is a recession that's not estimated in. It maybe 0:03:13.280 --> 0:03:16.720 priced in, but it's not estimated in. Almost all consumer 0:03:16.760 --> 0:03:19.320 tech is cyclical, So if the consumer if they're gonna 0:03:19.400 --> 0:03:21.960 entering in a recession. You know. Amazon on its earnings 0:03:21.960 --> 0:03:24.720 call said they hadn't seen any sign of consumer softening. 0:03:24.720 --> 0:03:26.520 They had a lot of issues in terms of costs, 0:03:26.680 --> 0:03:29.000 but not in terms of demand. So things could get 0:03:29.000 --> 0:03:31.080 worse at Amazon, they could get worse at Google, they 0:03:31.120 --> 0:03:33.760 could get worse at Apple. None of these companies skated 0:03:33.800 --> 0:03:36.320 away from a real recession. So that's potentially the other 0:03:36.360 --> 0:03:39.200 shoe to drop here. That's what the market, the markets 0:03:39.240 --> 0:03:41.440 fearing that it's pricing it in. And I hope the 0:03:41.440 --> 0:03:44.320 market is wrong, but but that's the until proven otherwise. 0:03:44.360 --> 0:03:46.720 I think that's what's gonna hold back tech stocks and 0:03:46.760 --> 0:03:49.440 growth equities, you know, for the foreseeable future. I don't 0:03:49.480 --> 0:03:51.600 know if that's a couple of weeks months, hopefully it's 0:03:51.640 --> 0:03:53.920 not quarters, but it's that time of that that kind 0:03:53.920 --> 0:03:56.600 of time frame we also might see be seeing a 0:03:56.760 --> 0:03:59.040 changing of the guard in terms of what counts as 0:03:59.080 --> 0:04:02.120 a tech company. Is folk With Robert Knwell of Upholding 0:04:02.640 --> 0:04:06.920 Portfolio yesterday, he had this to say about Netflix and NATA. 0:04:07.080 --> 0:04:11.400 Take a listen. Netflix is now being valued like a 0:04:11.480 --> 0:04:16.360 cable station. Other investors are looking at Facebook's meta's capital intensity, 0:04:16.400 --> 0:04:19.000 and saying is this does their future look more like 0:04:19.080 --> 0:04:21.800 a T and T S than it does Google? And 0:04:22.040 --> 0:04:24.920 you've seen multiples re rate faster than we've seen in 0:04:25.000 --> 0:04:27.880 a really long time across these assets because investors not, 0:04:28.080 --> 0:04:30.480 in our opinion, they've likely moved too far in that direction. 0:04:30.960 --> 0:04:32.479 But you know, we've got to do our jobs and 0:04:32.520 --> 0:04:36.200 passed through it and find the good deals here, Mark's 0:04:36.200 --> 0:04:39.680 all you're nodding there? Do you agree? I think there's 0:04:39.839 --> 0:04:41.240 a lot of really good points there. Look, you look 0:04:41.240 --> 0:04:44.480 at Netflix, It's trade off seventy year to date. There's 0:04:44.480 --> 0:04:46.200 about five or six someties. I looked at the trade 0:04:46.240 --> 0:04:49.000 off seventy year to date now with Netflix because they 0:04:49.040 --> 0:04:51.240 hit a growth wall. This stock was priced as if 0:04:51.279 --> 0:04:53.000 and I thought it very beginning of the year. I 0:04:53.000 --> 0:04:56.480 thought they could sustain million subs. You know going forward, 0:04:56.480 --> 0:04:58.680 say's not the case, and that stock was standing at 0:04:58.720 --> 0:05:00.719 a high multiple. So we had to take out the 0:05:00.760 --> 0:05:02.800 premium that it had, uh and then you had the 0:05:02.839 --> 0:05:06.240 lower estimates. That's what got me off the Netflix train, 0:05:06.360 --> 0:05:09.280 you know, earlier this, earlier this year. But yeah, when 0:05:09.320 --> 0:05:12.400 companies go X hype premium growth, they go X growth, 0:05:12.680 --> 0:05:14.680 you can have a real reckoning in terms of the 0:05:14.720 --> 0:05:17.120 stock price if they go x premium growth when they 0:05:17.120 --> 0:05:19.640 are sitting there with high multiples. That was absolutely the 0:05:19.680 --> 0:05:21.440 case with Netflix. Now I think there's a lot of 0:05:21.520 --> 0:05:23.960 very interesting valuation arguments think be made about Netflix. You've 0:05:23.960 --> 0:05:26.760 got thirteen dollars in pure gap burnings. What multiple do 0:05:26.800 --> 0:05:29.159 you want to put on that a market multiple seventeen times, 0:05:29.160 --> 0:05:32.160 fifteen times, twenty times were in that ballpark. So now 0:05:32.200 --> 0:05:34.880 there's a lot of valuation support for the name Facebook. 0:05:34.920 --> 0:05:36.440 I think it's different. And by the way, I really 0:05:36.480 --> 0:05:38.720 like Facebook here. I think the stock can rerate. I 0:05:38.720 --> 0:05:40.359 think the multiple can go higher. I think this is 0:05:40.360 --> 0:05:42.640 going to recover to have being a premium growth name. 0:05:42.880 --> 0:05:45.520 But I understand it's very controversial here. I like it. 0:05:45.600 --> 0:05:47.520 It's also got a lot of cash on the balance sheet. 0:05:48.520 --> 0:05:51.160 And you also, of course cover Twitter, which has got 0:05:51.200 --> 0:05:54.039 its own story going on with this Elon Musk takeover. 0:05:54.120 --> 0:05:57.320 He's lined up this long list of unusual investors to 0:05:57.480 --> 0:06:00.640 back his bid to buy Twitter, from Larry Ellison to 0:06:00.800 --> 0:06:04.840 a Saudi prince to the cryptocurrency firm Finance. He also 0:06:04.920 --> 0:06:08.039 was tweeting earlier today some more incess to what he 0:06:08.080 --> 0:06:11.440 plans to do with Twitter that'll be focusing on hardcore 0:06:11.480 --> 0:06:16.279 software engineering, design, information security, server hardware. What do you 0:06:16.279 --> 0:06:21.400 make of that? Well, I, um, I'm sorry I didn't 0:06:21.400 --> 0:06:24.120 see his tweets earlier today, But if he's started to 0:06:24.160 --> 0:06:26.240 develop a more detailed plan for what he wants to 0:06:26.240 --> 0:06:28.760 do with the asset, I think that's great. Um. You know, 0:06:28.839 --> 0:06:31.160 I think there's been a product innovation problem with Twitter 0:06:31.279 --> 0:06:33.360 for I don't know the better part of five, six, 0:06:33.400 --> 0:06:35.880 seven years, and so if somebody, if if it takes 0:06:35.920 --> 0:06:38.520 new management team, takes a new owner to shake it 0:06:38.560 --> 0:06:40.240 up and to really improve it, I think that's gonna 0:06:40.240 --> 0:06:42.520 be great for all of us. I do worry one thing, 0:06:42.600 --> 0:06:44.640 which is all the money for Twitter comes really from 0:06:44.640 --> 0:06:47.720 marketers and advertisers, and I haven't heard anybody talk about 0:06:47.720 --> 0:06:49.680 how they're going to improve the tools for them because 0:06:49.680 --> 0:06:51.120 they're the ones who paid the bills. At the end 0:06:51.120 --> 0:06:52.839 of the day. I don't think you're gonna make that 0:06:52.920 --> 0:06:56.200 much money if you try to charge a subscription for 0:06:55.880 --> 0:06:58.760 for for Twitter. So I hope he can improve Twitter 0:06:58.839 --> 0:07:00.800 as a as a service as a user, right, I 0:07:00.800 --> 0:07:03.120 think I want that. As an investor, I don't think 0:07:03.120 --> 0:07:04.680 there's much to do with Twitter here, I think the 0:07:04.680 --> 0:07:06.920 steel is going to go through. I think it's largely closed, 0:07:07.640 --> 0:07:09.400 but but maybe we'll see it to get into public 0:07:09.400 --> 0:07:11.280 markets in a few years. That's what I heard that 0:07:11.360 --> 0:07:12.760 he intends to do. If he can come out with 0:07:12.800 --> 0:07:14.880 a better asset, the market will be very interested in 0:07:14.920 --> 0:07:18.640 Twitter all right. We'll always appreciate your insights here and 0:07:18.720 --> 0:07:21.760 helping us wrap a really painful week for a lot 0:07:21.760 --> 0:07:34.880 of investors. Mark Mahaney of Evercore, Thank you. The music 0:07:35.080 --> 0:07:38.720 is stopping for some pandemic darlings like Peloton and Netflix's 0:07:38.760 --> 0:07:41.360 people get back out into the world to live their lives. 0:07:41.400 --> 0:07:43.760 But it is still humming so far for door Dash 0:07:44.160 --> 0:07:47.040 revenue beating analysts estimates and a strong outlook ahead with 0:07:47.080 --> 0:07:50.480 people still ordering more and more food for delivery. But 0:07:50.520 --> 0:07:52.840 how long does that keep up with inflation and a 0:07:52.880 --> 0:07:55.800 potential recession bearing down. I want to bring in door 0:07:55.840 --> 0:07:58.640 Dos CEO Tony Shoe for more on all of this, 0:07:58.800 --> 0:08:01.240 and Tony, it's a tough mark it to be in now. 0:08:01.320 --> 0:08:04.880 Despite your strong results, we saw shares take a leg down. 0:08:05.360 --> 0:08:09.280 You know, what is your takeaway from how investors are 0:08:09.320 --> 0:08:13.760 evaluating these results? Well, I think it's certainly a tough 0:08:13.800 --> 0:08:16.120 market out there, as you acknowledge, but you know, at 0:08:16.120 --> 0:08:18.560 the same time at DoorDash, we're focused on the fundamentals, 0:08:18.560 --> 0:08:21.480 and the fundamentals for doordesh are incredibly strong, as you saw, 0:08:21.640 --> 0:08:23.840 you know, with this for most recent quarter, we announced 0:08:23.880 --> 0:08:28.080 all time highs in our monthly active users or dash 0:08:28.080 --> 0:08:31.560 has subscribers, as well as order frequency across cohorts. We're 0:08:31.560 --> 0:08:34.920 continuing to build into new categories beyond restaurants and two grocery, 0:08:35.000 --> 0:08:38.200 convenience retail. We're launching more than just you know, the 0:08:38.320 --> 0:08:41.120 United States as a global business, and we're also making 0:08:41.240 --> 0:08:45.400 tremendous progress on building our platform in which we're helping 0:08:45.400 --> 0:08:50.040 physical businesses become digital powerhouses in addition to the local 0:08:50.040 --> 0:08:54.640 marketplace that we've been building. So in times like these, especially, um, 0:08:54.679 --> 0:08:56.840 you know, what I tell our teams is to focus on, 0:08:57.080 --> 0:09:00.760 you know, the fundamentals and keep building the business. Investors 0:09:00.800 --> 0:09:04.480 seem to really be punishing or at least questioning growth stocks, 0:09:04.760 --> 0:09:07.720 and I know some are wondering, oh, was it because 0:09:07.720 --> 0:09:10.280 of a Macron that DoorDash saw this boost in the 0:09:10.360 --> 0:09:13.160 last quarter. Is not going to keep up quarter after 0:09:13.240 --> 0:09:16.160 quarter after quarter. How do you respond to that well, 0:09:16.200 --> 0:09:18.560 it's been two years now or maybe a little over 0:09:18.640 --> 0:09:22.040 that um in during the pandemic season, and we've continued 0:09:22.120 --> 0:09:25.200 to see growth. I mean, our US restaurants business has 0:09:25.240 --> 0:09:28.040 grown two fifty percent over the last couple of years. 0:09:28.240 --> 0:09:31.040 We've gained fourteen points of absolute share in the category. 0:09:31.320 --> 0:09:33.400 And I think what you've seen, whether it was you know, 0:09:33.440 --> 0:09:35.960 early on in the pandemic, is certain states opened up 0:09:36.000 --> 0:09:38.319 maybe a little bit ahead of others or now where 0:09:38.559 --> 0:09:41.559 everyone thankfully or finally getting back into their normal lives 0:09:41.559 --> 0:09:44.920 of seeing their friends and family in person. It's that people, 0:09:45.280 --> 0:09:48.240 you know, even though they can they eat out and celebrate, 0:09:48.640 --> 0:09:51.840 they're continuing to order delivery. I mean, that's why you're seeing, 0:09:52.000 --> 0:09:54.040 you know, the all time highs that we've seen in 0:09:54.040 --> 0:09:57.240 the business. In addition to that, we've also increased our 0:09:57.280 --> 0:10:02.520 profitability on top of it already profitable business um altogether, 0:10:02.600 --> 0:10:04.680 and so you know, we've seen a lot of strength 0:10:04.679 --> 0:10:06.920 in the business, both in terms of the demand but 0:10:07.040 --> 0:10:10.800 also in terms of our bottom line. Consumers are under 0:10:10.800 --> 0:10:14.600 pressure though inflation is rising, gas prices are rising. These 0:10:14.600 --> 0:10:17.400 are factors beyond your control. How are you thinking about 0:10:17.440 --> 0:10:21.880 the macroeconomic environment ahead? I mean, are you just kind 0:10:21.880 --> 0:10:26.880 of preparing for more uncertainty. Well, we've been studying inflation 0:10:26.880 --> 0:10:29.040 pretty carefully now for the past four or six quarters, 0:10:29.080 --> 0:10:32.680 because I think it happened, actually, or the growth of inflation, 0:10:32.720 --> 0:10:35.280 I should say, you know, occurred maybe a bit more 0:10:35.320 --> 0:10:38.800 sharply than some had anticipated, and it certainly continues to 0:10:38.800 --> 0:10:41.199 be a real concern. Um. So for us, the focus 0:10:41.240 --> 0:10:43.040 is on taking care of all the audiences. You know, 0:10:43.120 --> 0:10:45.679 obviously we can't control the rate of change of inflation, 0:10:45.960 --> 0:10:48.440 but we can control um you know what we do 0:10:48.520 --> 0:10:51.160 for dashers, making sure that we're giving tem percent cash 0:10:51.200 --> 0:10:54.280 back on fuel expenses, making sure that we are paying 0:10:54.320 --> 0:10:58.200 bonuses for longer distances driven, making sure that we're working 0:10:58.200 --> 0:11:01.480 with merchants to find in new ways to grow as 0:11:01.480 --> 0:11:05.359 they're dealing with both labor shortages as well as inflationary pressures. 0:11:05.440 --> 0:11:07.559 And we can do that because we have a robust 0:11:07.840 --> 0:11:11.440 restaurants business for consumer demand is still very resilient, which 0:11:11.440 --> 0:11:16.000 gives us the ability to reinvest those profits into absorbing 0:11:16.040 --> 0:11:19.240 any costs from inflation so that consumers don't have to 0:11:19.480 --> 0:11:22.240 bear any of that burden. We did see a number 0:11:22.280 --> 0:11:25.760 of analysts cut price targets on DoorDash this morning, and 0:11:25.800 --> 0:11:28.559 I wonder how tight the labor market is for you 0:11:28.679 --> 0:11:31.120 in particular. I mean, because it's not just you know, 0:11:31.200 --> 0:11:34.280 restaurants that need labor. It's it's DoorDash and Uber and 0:11:34.480 --> 0:11:39.560 Left and Domino's Pizza that are fighting for for drivers. Well, 0:11:39.679 --> 0:11:43.760 we you know, we haven't actually seen any challenges in 0:11:43.800 --> 0:11:46.800 getting drivers on the road. In fact, even before the 0:11:47.240 --> 0:11:49.840 recent rises and fuel expenses or the sharp uptick I 0:11:49.840 --> 0:11:52.640 should say in fuel expenses, we had plenty of drivers 0:11:52.720 --> 0:11:55.400 on the road. And that's because structurally we have a 0:11:55.480 --> 0:11:59.480 pool of drivers that that is just much larger than 0:11:59.480 --> 0:12:02.880 other serve is like right sharing. Um, you know, of 0:12:02.920 --> 0:12:05.360 the dashers on door Dash, of the three million plus 0:12:05.400 --> 0:12:08.559 that come to our platform and and and does deliveries 0:12:08.640 --> 0:12:13.120 on a quarterly basis, them deliver more fewer than ten 0:12:13.120 --> 0:12:16.640 hours a week. The average dasher only completes about four 0:12:16.679 --> 0:12:18.800 hours of work every week. And and so when you 0:12:18.840 --> 0:12:21.360 think about it from that context, where it's truly part 0:12:21.440 --> 0:12:24.200 time and supplemental income, and you compare to something like 0:12:24.280 --> 0:12:27.480 right sharing, which is more full time, it's just orders 0:12:27.480 --> 0:12:29.960 of magnitude larger in terms of the base of drivers 0:12:30.000 --> 0:12:33.520 we can address and for those reasons, we actually haven't 0:12:33.559 --> 0:12:36.880 seen any of those pressures of getting drivers on the road. 0:12:36.960 --> 0:12:40.760 But that said, we do recognize that inflation is very real, 0:12:40.840 --> 0:12:43.079 and that's why we decided to invest in those dasher 0:12:43.160 --> 0:12:47.440 programs to make sure that their earnings would not be impacted. Interesting, Well, 0:12:48.000 --> 0:12:50.160 on one hand, you're hearing Lifts say they're going to 0:12:50.200 --> 0:12:54.120 have to invest significantly to incentivize drivers. We're saying they 0:12:54.160 --> 0:12:56.840 don't have to. What they are making some changes to 0:12:56.920 --> 0:13:00.560 the app, more transparency to keep those drivers coming back. 0:13:00.600 --> 0:13:03.720 And I wonder are you going to prioritize the courier 0:13:03.760 --> 0:13:08.000 app experience and how if your competitors are trying to 0:13:08.000 --> 0:13:12.360 step up those levers. Well, we don't really compete against 0:13:12.559 --> 0:13:16.160 right sharing for drivers. I mean nine cent of drivers 0:13:16.160 --> 0:13:18.280 that we've surveyed, you know, on the door Dash platform 0:13:18.600 --> 0:13:22.640 have no interest in um, you know, driving other people. Um. 0:13:22.679 --> 0:13:24.720 They just prefer to do deliveries. I mean, if you 0:13:24.760 --> 0:13:26.960 think about it, I mean, the two user basis couldn't 0:13:26.960 --> 0:13:29.280 be you know, further apart in terms of how they 0:13:29.320 --> 0:13:32.680 self select which platforms to work on. Um if what 0:13:32.760 --> 0:13:38.920 about eight? What about Instacart? But you know, Dominoes. Sure sure, 0:13:39.040 --> 0:13:42.720 sure sure. I mean, as the largest platform UM in 0:13:42.760 --> 0:13:45.880 the US that you know, provides more work opportunities on 0:13:45.920 --> 0:13:49.880 a daily basis across more geographies. Um, we're just the 0:13:49.880 --> 0:13:53.200 first consideration for most of these workers. I mean we're 0:13:53.200 --> 0:13:55.240 always going to you know, your question about investing the 0:13:55.840 --> 0:13:59.199 Dasher app. Of course, we're always investing, you know, behind 0:13:59.240 --> 0:14:02.320 that experience to make sure that it's lower friction UM 0:14:02.440 --> 0:14:04.920 to earn whenever you want, wherever you want, and to 0:14:05.040 --> 0:14:07.840 do it, you know, with consistent expectations of what you 0:14:07.880 --> 0:14:09.800 will learn when you are on the road because the 0:14:09.840 --> 0:14:13.440 work is so part time. Investors are also suggesting we're 0:14:13.440 --> 0:14:15.840 going to see a lot more consolidation in this space. 0:14:16.080 --> 0:14:19.520 And given that door Dash is the big player in 0:14:19.560 --> 0:14:23.480 this market, that makes you potentially a prime acquirer. We 0:14:23.520 --> 0:14:26.040 saw you buy volt for example. Are we going to 0:14:26.120 --> 0:14:28.520 see you do more deals? Are you looking for more deals? 0:14:28.640 --> 0:14:32.120 And if so, in what areas well? The bar for 0:14:32.480 --> 0:14:34.680 M and A is is very high for us at Doorash, 0:14:34.720 --> 0:14:38.200 and that's because we really respect how difficult it is 0:14:38.240 --> 0:14:40.880 to actually do it really well. UM, So for us, 0:14:40.920 --> 0:14:43.240 two things have to be true. Number one, it certainly 0:14:43.240 --> 0:14:45.760 has to be a creative to the business. Number two, 0:14:45.840 --> 0:14:48.960 it also has to be creative to the management bandwidth 0:14:48.960 --> 0:14:50.560 that we have at DoorDash. I mean, we're trying to 0:14:50.600 --> 0:14:53.280 build the largest local commerce business globally, so we have 0:14:53.320 --> 0:14:55.120 a lot of work on our plate, so we have 0:14:55.200 --> 0:14:57.600 to make sure that there can't be any distractions. That's 0:14:57.800 --> 0:15:00.400 entirely focused. That's why you know volt with such a 0:15:00.400 --> 0:15:03.600 perfect example. You know, Vulture only adds to our international 0:15:03.680 --> 0:15:08.000 global footprint, doubling almost our addressable market. But the way 0:15:08.000 --> 0:15:11.160 in which they build their business, the culture around building 0:15:11.200 --> 0:15:13.520 the best product, making sure that they do it in 0:15:13.560 --> 0:15:16.480 a capital efficient way that aligns very well with how 0:15:16.520 --> 0:15:18.520 we do things. That dortsh and that was a perfect 0:15:18.560 --> 0:15:22.120 example of when M and A made sense. All right, well, 0:15:22.240 --> 0:15:25.560 we'll be watching your next moves there, do you know, 0:15:25.640 --> 0:15:28.160 and co founder Tony Schu always going to have you 0:15:28.200 --> 0:15:39.520 thank you for taking the time. Monday is opening day 0:15:39.560 --> 0:15:42.640 for Meta's first ever physical store. It is a brick 0:15:42.680 --> 0:15:46.320 and mortar bet on the metaverse. Facebook's parent Hoping hardware 0:15:46.760 --> 0:15:50.240 plays a central role in its virtual and augmented reality strategy. 0:15:50.240 --> 0:15:52.960 Bloomberg's at Ludlow got a behind the scenes look at 0:15:53.000 --> 0:15:57.200 the store in Burlingame, California. If you needed any more 0:15:57.240 --> 0:15:59.960 proof that Meta is going cool in on Web three, 0:16:00.240 --> 0:16:02.720 then look no further. Come take a look inside the 0:16:02.720 --> 0:16:06.760 company's first retail store where VR and are hardware, or 0:16:06.840 --> 0:16:11.040 at the forefront as the company charges into the Metaverse. Yes, 0:16:11.200 --> 0:16:18.600 this is a Metaverse store in the real world. This 0:16:18.720 --> 0:16:21.080 store is the size of a small house, less than 0:16:21.160 --> 0:16:24.760 six square feet opening it is a pretty gutsy move 0:16:24.800 --> 0:16:27.840 for Meta, considering other tech giants have tried and failed. 0:16:29.080 --> 0:16:32.720 Microsoft shut down its store locations permanently to focus on 0:16:32.720 --> 0:16:36.400 online sales, and earlier this year, Amazon announced it was 0:16:36.440 --> 0:16:40.800 closing its physical bookstores, Amazon four Star locations, and more 0:16:40.840 --> 0:16:43.640 pop up kiosks so that the company could better focus 0:16:43.680 --> 0:16:46.640 on its grocery business. So why does Meta think it 0:16:46.640 --> 0:16:49.960 will be more successful than its peers? Well, CEO Mark 0:16:50.040 --> 0:16:53.880 Zuckerberg said quote the best way to understand virtual reality 0:16:54.240 --> 0:16:57.400 is to experience it, and he believes that the metaverse 0:16:57.760 --> 0:17:01.200 is the next major computing revolution after the invention of 0:17:01.240 --> 0:17:05.359 cell phones. Here we have metas virtual reality goggles, the 0:17:05.440 --> 0:17:18.040 quest to which sell for about two are the RayBan stories. 0:17:20.000 --> 0:17:27.439 Hold tap for a photo, single tap, start filming, double 0:17:27.520 --> 0:17:33.160 tap you get some music going volume up, volume down. 0:17:34.280 --> 0:17:36.600 Meta wants this store to be a bridge that connects 0:17:36.680 --> 0:17:39.400 users to the metaverse, but that means that it has 0:17:39.440 --> 0:17:42.639 to rely on users actually being interested in the metaverse. 0:17:45.920 --> 0:17:48.760 That might not be so hard. One out of the 0:17:48.800 --> 0:17:51.720 eleven point to million A R and VR units sold 0:17:51.760 --> 0:17:56.919 worldwide were metas quest two. So Meta does have a 0:17:56.960 --> 0:17:59.920 large market share, but can it keep up the moment 0:18:00.080 --> 0:18:02.439 to and will stores like this one help the company 0:18:02.480 --> 0:18:10.639 expand its metaverse footprint. Bloomberg's ad Ludlow there at The 0:18:10.720 --> 0:18:14.680 store opens next week, and here are some other stories 0:18:14.760 --> 0:18:18.200 we are following. Peloton still trying to turn its business around. 0:18:18.359 --> 0:18:21.400 According to Bloomberg sources, the fitness company trying to sell 0:18:21.400 --> 0:18:24.160 a stake of about hoping to find a big name 0:18:24.200 --> 0:18:27.160 corporation or a private equity firm that could help validate 0:18:27.200 --> 0:18:32.000 the business with its investment. Peloton has been contacting potential buyers, 0:18:32.040 --> 0:18:36.400 but the process is still at an early stage. Palant 0:18:36.440 --> 0:18:39.840 Here meantime, just struck a ten million pound contract that's 0:18:39.840 --> 0:18:42.520 twelve and a half million dollars with the UK's Ministry 0:18:42.560 --> 0:18:45.480 of Defense. The data analytics company will offer support with 0:18:45.520 --> 0:18:49.240 its Foundry platform which lets users cut costs by automating 0:18:49.280 --> 0:18:52.399 work and reducing data processing time. This is the firm's 0:18:52.480 --> 0:19:04.800 largest contract to date with the high profile department. Welcome 0:19:04.800 --> 0:19:07.000 back to Bone More Technology and Emily Check in San Francisco. 0:19:07.119 --> 0:19:09.679 Let's stay on Zillo and welcome back Spencer Raskov, one 0:19:09.680 --> 0:19:11.560 of Zilla's co founders who ran the company for more 0:19:11.600 --> 0:19:14.000 than a decade. He is also the co founder of 0:19:14.040 --> 0:19:17.399 S and Sonny, a venture firm based in l A. 0:19:17.680 --> 0:19:20.679 So I want your view, Spencer on the big market picture. 0:19:20.760 --> 0:19:23.800 But let's start with the housing market and how all 0:19:23.840 --> 0:19:27.959 of these trends, rising inflation, rising rates for the foreseeable future, 0:19:28.200 --> 0:19:32.000 how that's going to bear down on the housing market. Well, 0:19:32.040 --> 0:19:36.679 what's driving home price appreciation is limited supply. So for 0:19:36.760 --> 0:19:39.679 most decades, starting in the sixties, we had twenty million 0:19:39.720 --> 0:19:42.840 new homes be built. In the decade after the financial 0:19:42.840 --> 0:19:45.080 crisis of two thousand eight, we only had ten million 0:19:45.119 --> 0:19:47.840 homes that were built, and so there's just a lot 0:19:47.920 --> 0:19:51.159 of missing supply and that's what's driven this huge uptake 0:19:51.160 --> 0:19:54.040 and home price appreciation over the last five or so years. 0:19:54.080 --> 0:19:56.840 So as mortgage rates have gone up and and they're 0:19:56.840 --> 0:19:59.639 gonna they still have further to go. Clearly, homebuyers are 0:19:59.640 --> 0:20:01.959 gonna have to trade down to slightly lower price points. 0:20:02.359 --> 0:20:04.399 But most of the data that I've seen around housing 0:20:04.480 --> 0:20:07.879 still predicts strong housing appreciation, not as high as it was, 0:20:07.920 --> 0:20:11.320 not uh ten, but probably five to ten percent home 0:20:11.359 --> 0:20:14.800 price appreciation. Now, the stocks that underlie this, like Zillo, 0:20:14.880 --> 0:20:17.640 that's a bit of a whole other question. And there's 0:20:17.640 --> 0:20:20.080 obviously been a risk off trade in the public markets 0:20:20.119 --> 0:20:23.240 away from growth and more towards profitability, and that's hurting 0:20:23.240 --> 0:20:26.120 companies like Zello and many other prop tech companies as well. 0:20:26.760 --> 0:20:28.440 So I just want to lean around this because there's 0:20:28.440 --> 0:20:30.080 a lot of people trying to get into the market 0:20:30.119 --> 0:20:33.320 who think they just can't right now if they didn't 0:20:33.359 --> 0:20:36.479 buy something first ten years ago. You're saying, prices are 0:20:36.480 --> 0:20:39.719 still gonna go up, and there's still a lack of supply, 0:20:39.880 --> 0:20:43.680 so there's still gonna be competition. Even though we're we're 0:20:43.680 --> 0:20:46.680 seeing forty year inflation and rates going up and people's 0:20:46.720 --> 0:20:51.240 portfolios are getting pummeled, we're still only at about one 0:20:51.280 --> 0:20:54.280 to two months supply of housing, which is amazing. I mean, 0:20:54.280 --> 0:20:57.040 a normal's market would have six months supply of homes 0:20:57.040 --> 0:21:00.000 for sale, So homes there's just are not enough homes 0:21:00.000 --> 0:21:02.000 for sale. We need home builders to build more homes 0:21:02.040 --> 0:21:04.119 if you want this supply demand and balance to to 0:21:04.200 --> 0:21:08.360 come back, uh, you know, into balance. So if if 0:21:09.240 --> 0:21:11.520 home prices are still going to keep going up in 0:21:11.760 --> 0:21:13.919 most major markets, not as quickly as they were, but 0:21:14.000 --> 0:21:17.159 home prices are in fact still appreciating. So let's talk 0:21:17.200 --> 0:21:19.200 about the sell off. How much worse does it get? 0:21:19.280 --> 0:21:22.360 Has a bubble popped? Is this you know what we're 0:21:22.359 --> 0:21:26.160 going to see for you know, the next several years. Well, 0:21:26.160 --> 0:21:28.080 it's a bit of a blood blath out there. Obviously, 0:21:28.320 --> 0:21:31.359 public market investors and viewers can see in the public 0:21:31.440 --> 0:21:34.639 markets just how bad it is in among public companies. 0:21:34.680 --> 0:21:36.400