1 00:00:02,080 --> 00:00:05,480 Speaker 1: Global business news twenty four hours a day. If Bloomberg 2 00:00:05,519 --> 00:00:08,600 Speaker 1: dot com the radio plus Mobile act and on your radio. 3 00:00:08,880 --> 00:00:13,160 Speaker 1: This is a Bloomberg business flash from Bloomberg World Handquarters. 4 00:00:13,200 --> 00:00:16,160 Speaker 1: I'm Charlie Pellot. SMP five hundred Index now at a 5 00:00:16,320 --> 00:00:20,079 Speaker 1: seven month high amid signs of steady job gains that 6 00:00:20,160 --> 00:00:23,599 Speaker 1: indicate the economy is strong enough for higher interest rates 7 00:00:23,600 --> 00:00:26,759 Speaker 1: as early as this summer. Stocks to close at or 8 00:00:26,840 --> 00:00:29,280 Speaker 1: near the best level of the day. SMP up five 9 00:00:29,360 --> 00:00:32,080 Speaker 1: to one oh five, a gain of three tents of 10 00:00:32,120 --> 00:00:34,800 Speaker 1: one percent, and has stack up nineteen, a gain of 11 00:00:34,840 --> 00:00:38,600 Speaker 1: four tenths of one percent. Down Industrials up forty eight points, 12 00:00:38,600 --> 00:00:41,519 Speaker 1: a gain also of three tenths of one percent. So 13 00:00:41,600 --> 00:00:44,000 Speaker 1: the SMP now at one oh five, the Dow at 14 00:00:44,120 --> 00:00:48,000 Speaker 1: seventeen thousand, eight hundred thirty eight, Gold down a dollar 15 00:00:48,120 --> 00:00:50,839 Speaker 1: sixty the ounce to twelve thirteen ten, a drop of 16 00:00:50,880 --> 00:00:53,760 Speaker 1: point one percent. Ten You up ten thirty seconds, Deal 17 00:00:53,800 --> 00:00:57,560 Speaker 1: there one point eight percent, and Crew down six cents 18 00:00:57,600 --> 00:01:01,280 Speaker 1: forty eight nine. Apparel a drop of point one I'm 19 00:01:01,360 --> 00:01:06,120 Speaker 1: Charlie Peloton. That's a Bloomberg business flash. You're listening to 20 00:01:06,280 --> 00:01:10,759 Speaker 1: taking stock with bim box and Kathleen Hayes on Bloomberg Radio. 21 00:01:12,319 --> 00:01:16,720 Speaker 1: Uber in the news on two very big front fronts. Uh, 22 00:01:16,920 --> 00:01:21,679 Speaker 1: there's a big settlement being considered that would leave Uber 23 00:01:21,800 --> 00:01:26,640 Speaker 1: and lift drivers as independent contractors. And of course these 24 00:01:26,680 --> 00:01:30,200 Speaker 1: are two the biggest names in the on demand economy. 25 00:01:30,319 --> 00:01:33,000 Speaker 1: And uh, it might avoid policy changes that would have 26 00:01:33,319 --> 00:01:35,560 Speaker 1: would force them to rethink their business models. Okay, so 27 00:01:35,600 --> 00:01:37,280 Speaker 1: there you go, this whole question of you know, how 28 00:01:37,360 --> 00:01:40,720 Speaker 1: you treat Uber workers right the demand economy. Ah, Saudi 29 00:01:40,720 --> 00:01:43,119 Speaker 1: Arabia isn't paying any attention because it looks like the 30 00:01:43,240 --> 00:01:46,920 Speaker 1: Saudi Arabian public Investment Fund, their big sovereign wealth fund, 31 00:01:47,400 --> 00:01:51,400 Speaker 1: is going to be investing over three billion dollars in Uber. 32 00:01:51,600 --> 00:01:54,960 Speaker 1: Uber joining us now is a Ja Chopra general partner 33 00:01:54,960 --> 00:01:58,360 Speaker 1: Trinity Ventures, joining us from San Francisco. He's a long 34 00:01:58,440 --> 00:02:01,240 Speaker 1: time Silicon Valley BCNE. He's got lots to say about this. 35 00:02:01,360 --> 00:02:04,680 Speaker 1: Welcome and Ji, thanks for joining me. Glad to be here. 36 00:02:05,040 --> 00:02:07,640 Speaker 1: So let's start on the settlement because that is something 37 00:02:07,680 --> 00:02:10,359 Speaker 1: that has been going on for a while. It's it's 38 00:02:10,400 --> 00:02:13,960 Speaker 1: already controversial because there's been some settlements and the companies 39 00:02:14,000 --> 00:02:16,720 Speaker 1: are changing the way they hire their workers. And the 40 00:02:16,800 --> 00:02:20,840 Speaker 1: kind of contracts they make, So maybe those previous constraints 41 00:02:20,880 --> 00:02:23,880 Speaker 1: won't apply. Now, what's important to you as a VC, 42 00:02:24,000 --> 00:02:28,880 Speaker 1: as a potential investor? Yeah, so I think, UM, this 43 00:02:28,919 --> 00:02:33,920 Speaker 1: issue about ten workers whore contractors versus doubly two employees 44 00:02:33,960 --> 00:02:37,240 Speaker 1: who are hourly um, you know, full time employees for 45 00:02:37,240 --> 00:02:40,040 Speaker 1: the company. UM, is you know, going to not be 46 00:02:40,120 --> 00:02:43,160 Speaker 1: resolved with this settlement. I believe that this will be 47 00:02:43,200 --> 00:02:47,079 Speaker 1: just a stepping stone in that direction, and we will 48 00:02:47,120 --> 00:02:52,119 Speaker 1: continue to see UM more and more legal issues around 49 00:02:52,120 --> 00:02:56,440 Speaker 1: this over the next several years. UM. Still, eventually perhaps 50 00:02:57,200 --> 00:03:01,400 Speaker 1: regulations might might change, UM so that you know, all 51 00:03:01,440 --> 00:03:04,400 Speaker 1: of the Uber drivers and other on demand workers you 52 00:03:04,560 --> 00:03:07,359 Speaker 1: get a fair play. UM. I don't think this issue 53 00:03:07,360 --> 00:03:09,480 Speaker 1: is going to be resolve. It just one settlement that's 54 00:03:09,520 --> 00:03:12,079 Speaker 1: going on right now. If you were an investor in Uber, 55 00:03:12,480 --> 00:03:14,600 Speaker 1: would you sell now? Would you say, oh, if they're 56 00:03:14,600 --> 00:03:16,680 Speaker 1: going to start changing the rules of the game in 57 00:03:16,760 --> 00:03:19,440 Speaker 1: terms of government regulations and the way we can pay 58 00:03:19,480 --> 00:03:22,600 Speaker 1: and higher workers, it won't be as profitable. Or would 59 00:03:22,600 --> 00:03:25,600 Speaker 1: you say, hey, look, especially if I'm in Uber, there 60 00:03:25,440 --> 00:03:28,080 Speaker 1: there are the name in the in this whole, this 61 00:03:28,120 --> 00:03:30,560 Speaker 1: whole area now and they're going to continue to grow 62 00:03:30,600 --> 00:03:33,840 Speaker 1: and they'll they won't make that much difference. I would 63 00:03:33,880 --> 00:03:36,120 Speaker 1: sell some of my shares. I think the company has 64 00:03:36,160 --> 00:03:39,240 Speaker 1: got pretty good prospects, but also a lot of challenges. 65 00:03:39,800 --> 00:03:42,040 Speaker 1: They have a big battle that they're fighting in China, 66 00:03:43,000 --> 00:03:45,000 Speaker 1: which with the company called d D which is a 67 00:03:45,160 --> 00:03:48,640 Speaker 1: local competitor there that just you know, strengthened itself by 68 00:03:48,640 --> 00:03:51,680 Speaker 1: a billion dollar investment from Apple, So they are now 69 00:03:51,800 --> 00:03:55,040 Speaker 1: more formidable competitors. So they've got that challenge. They've got 70 00:03:55,040 --> 00:03:57,440 Speaker 1: the issue that they're not profitable in that market, They're 71 00:03:57,440 --> 00:04:00,480 Speaker 1: not profitable in Europe, and they may be ostable in 72 00:04:00,600 --> 00:04:03,280 Speaker 1: certain cities in the US, so they've got an overall 73 00:04:03,320 --> 00:04:06,800 Speaker 1: profitability problem. And then they have this looming issue of 74 00:04:06,840 --> 00:04:11,840 Speaker 1: autonomous cars. Because when autonomous vehicles become more prominent than 75 00:04:11,920 --> 00:04:14,120 Speaker 1: all of a sudden, one of the main advantages that 76 00:04:14,240 --> 00:04:17,800 Speaker 1: Uber has, which is that the drivers are bearing all 77 00:04:17,839 --> 00:04:20,720 Speaker 1: the burden of the automobile, including the cost of the automobile, 78 00:04:20,839 --> 00:04:25,400 Speaker 1: the insurance, the maintenance, and so forth, sort of goes away. 79 00:04:25,400 --> 00:04:29,279 Speaker 1: And now Uber's model shifts from being asset light, in 80 00:04:29,279 --> 00:04:31,159 Speaker 1: other words, they don't have any assets. The drivers have 81 00:04:31,240 --> 00:04:33,719 Speaker 1: to worry about that to asset heavy where they have 82 00:04:33,800 --> 00:04:37,960 Speaker 1: to actually own or leave cars, and so that transition 83 00:04:38,000 --> 00:04:39,680 Speaker 1: could be a pretty tricky one for them. So I 84 00:04:39,680 --> 00:04:41,520 Speaker 1: would sell some, but I would hold quite a bit 85 00:04:41,520 --> 00:04:43,800 Speaker 1: of it. And for sure, you know, we're at the 86 00:04:43,800 --> 00:04:45,920 Speaker 1: the Internet in the North American International Auto Show in 87 00:04:45,960 --> 00:04:48,720 Speaker 1: Detroit a few months ago, and four GM, all these 88 00:04:48,760 --> 00:04:50,560 Speaker 1: they're they're rushing into this space. So they're going to 89 00:04:50,640 --> 00:04:53,800 Speaker 1: have definitely also a lot of competition there. So the 90 00:04:53,839 --> 00:04:57,760 Speaker 1: Saudi so three billion dollars. The Saudis are trying to 91 00:04:57,800 --> 00:05:00,520 Speaker 1: diversify their economy right in their going to end up 92 00:05:00,560 --> 00:05:05,000 Speaker 1: with you know, a very big, big amount of global investment. 93 00:05:05,480 --> 00:05:07,760 Speaker 1: Are they making a mistake to put their money in Uber? Now? 94 00:05:09,240 --> 00:05:13,600 Speaker 1: I think they're looking at it primarily as a financial investment. UM. 95 00:05:13,880 --> 00:05:16,680 Speaker 1: This is something that you know, UM sovereign funds do 96 00:05:16,760 --> 00:05:19,160 Speaker 1: from time to time. They do so very selectively. They 97 00:05:19,200 --> 00:05:22,800 Speaker 1: do so in companies where the outcome is fairly certain 98 00:05:22,880 --> 00:05:26,120 Speaker 1: to be successful. It's just a magnitude of success that 99 00:05:26,279 --> 00:05:28,880 Speaker 1: is not clear. I think that's certainly true for Uber. 100 00:05:29,360 --> 00:05:31,719 Speaker 1: They are going to be a successful company, it's just 101 00:05:32,120 --> 00:05:34,320 Speaker 1: are they going to be Facebook size or they're going 102 00:05:34,360 --> 00:05:37,000 Speaker 1: to be smaller. That's the question in terms of evaluation 103 00:05:37,040 --> 00:05:39,760 Speaker 1: a few years out. So they're making a financial bet 104 00:05:39,960 --> 00:05:42,760 Speaker 1: and and I think that's that's how they have They 105 00:05:42,880 --> 00:05:44,680 Speaker 1: probably thought about it and figured that they can buy 106 00:05:44,800 --> 00:05:47,640 Speaker 1: five percent at this point in time. It also implies 107 00:05:47,680 --> 00:05:50,080 Speaker 1: that Uber is probably not thinking of going public in 108 00:05:50,120 --> 00:05:53,479 Speaker 1: the new future. They'll probably take this capital and deal 109 00:05:53,520 --> 00:05:55,640 Speaker 1: with some of the problems that I talked about earlier, 110 00:05:55,720 --> 00:05:59,760 Speaker 1: the challenge in China, the profitability, the issue with autonomous vehicles. 111 00:06:00,200 --> 00:06:01,960 Speaker 1: So I think this is a good thing for Uber 112 00:06:02,120 --> 00:06:06,839 Speaker 1: from that standpoint. So Jay Training Training Ventures in the 113 00:06:06,839 --> 00:06:12,680 Speaker 1: Bay Area, very big prestigious VC firm fed Reserve. We 114 00:06:12,680 --> 00:06:14,600 Speaker 1: don't know when they're gonna start raising rates, but they're 115 00:06:14,640 --> 00:06:17,680 Speaker 1: gradually making this turn. Right, there's going to be less liquidity, 116 00:06:18,200 --> 00:06:20,159 Speaker 1: certainly a lot of the activity less several years in 117 00:06:20,160 --> 00:06:22,240 Speaker 1: Silicon Valley people reaching for Yale that's kind of been 118 00:06:22,279 --> 00:06:24,440 Speaker 1: supported by that. Is this gonna affect you? And and 119 00:06:24,480 --> 00:06:26,400 Speaker 1: I guess even more broadly, what are you where are 120 00:06:26,440 --> 00:06:31,680 Speaker 1: you looking now for VC for investment opportunities? I think 121 00:06:31,720 --> 00:06:35,160 Speaker 1: that if you look at the major transformations that are 122 00:06:35,160 --> 00:06:38,200 Speaker 1: going on in our industry and the technology front, which 123 00:06:38,240 --> 00:06:42,919 Speaker 1: is the mobile device and its implications UM and the 124 00:06:43,000 --> 00:06:47,599 Speaker 1: core transformation from on premise deployment of technology to in cloud. 125 00:06:48,200 --> 00:06:51,120 Speaker 1: We are just in the middle of a major industries 126 00:06:51,600 --> 00:06:54,320 Speaker 1: are still in the earliest stages of being transformed. If 127 00:06:54,320 --> 00:06:57,880 Speaker 1: you look at transportation, for example, we are in the 128 00:06:57,920 --> 00:07:00,560 Speaker 1: first innings of autonomous cars. I mean it's just the 129 00:07:00,600 --> 00:07:03,919 Speaker 1: beginning with people like Tesla and others that are giving 130 00:07:04,000 --> 00:07:09,600 Speaker 1: some capability to drivers which are automated. I think there's 131 00:07:09,640 --> 00:07:11,480 Speaker 1: a lot more that's going to happen. If you look 132 00:07:11,520 --> 00:07:16,160 Speaker 1: at the entire medical sector, the way the records are kept, 133 00:07:16,200 --> 00:07:20,360 Speaker 1: the way delivery of medical services, particularly developing countries, there's 134 00:07:20,400 --> 00:07:22,840 Speaker 1: so many opportunities in this sector. If you look at education, 135 00:07:23,640 --> 00:07:26,320 Speaker 1: we're probably even before the first inning. So I think 136 00:07:26,320 --> 00:07:29,160 Speaker 1: there are huge opportunities because of these major transformations with 137 00:07:29,240 --> 00:07:32,720 Speaker 1: a powerful computer and everybody's profit called the mobile phone 138 00:07:33,120 --> 00:07:35,840 Speaker 1: and the cloud computing. J. H. Oprah, thank you so 139 00:07:36,000 --> 00:07:39,000 Speaker 1: very much joining us from Trinity Ventures in San Francisco. 140 00:07:39,360 --> 00:07:41,480 Speaker 1: This is taking Stock. Thanks for joining us today on 141 00:07:41,520 --> 00:07:50,480 Speaker 1: Bloomberg Radio. Up next Bloomberg Law, tackling the big issues 142 00:07:50,760 --> 00:07:53,360 Speaker 1: of the day on the legal front from all their 143 00:07:53,440 --> 00:07:57,679 Speaker 1: business and monetary angles that's coming up now on Bloomberg Radio.