WEBVTT - OpenAI's Mega Valuation and SpaceX's First Commercial Spacewalk 0:00:01.440 --> 0:00:05.080 From the heart where innovation, money and power. Collie in 0:00:05.200 --> 0:00:10.160 Silicon Valley, NBN. This is Bloomberg Technology with Caroline Hyde 0:00:10.160 --> 0:00:11.080 and Ed Ludlove. 0:00:24.920 --> 0:00:26.680 We are live from New York and San Francisco. This 0:00:26.760 --> 0:00:30.400 is Bloomberg Technology coming up. Open ai gets closer to 0:00:30.440 --> 0:00:33.880 a new AI model that reasons and a new mega 0:00:34.000 --> 0:00:36.720 valuation of one hundred and fifty billion dollars. 0:00:37.200 --> 0:00:40.519 An inteler at a crossroads, the chipmaker reaching a pivotal 0:00:40.600 --> 0:00:43.720 moment with a decade of dominance at risk. 0:00:43.479 --> 0:00:47.800 And the first commercial spacewalk plaras Dawn hits mission goals 0:00:47.800 --> 0:00:52.720 seven hundred kilometers above the Earth. But first, let's just 0:00:52.800 --> 0:00:56.520 check in on these markets, because we are rallying once again, 0:00:56.560 --> 0:00:58.480 four straight days agains on then aw's that one hundred 0:00:58.480 --> 0:01:00.400 I'm looking at ED four and a half the high 0:01:00.400 --> 0:01:03.160 we add a trillion dollars in large part because some 0:01:03.200 --> 0:01:06.040 single names like in video, but in video is also 0:01:06.200 --> 0:01:09.040 linked to the world of artificial intelligence and exactly where 0:01:09.040 --> 0:01:09.800 we want to dig in on. 0:01:10.600 --> 0:01:12.840 Yeah, let's get to our top story. Open ai is 0:01:12.880 --> 0:01:16.400 in talks to raise six point five billion dollars from investors, 0:01:16.480 --> 0:01:20.400 catapulting the AI startup to a one hundred and fifty 0:01:20.400 --> 0:01:23.160 billion dollar valuation. This is the company gets ready to 0:01:23.200 --> 0:01:28.160 release its latest AI model, code named Strawberry. For more Bloombergs, 0:01:28.240 --> 0:01:30.479 Rachel Metz joins us and Rachel You and I working 0:01:30.480 --> 0:01:35.279 with Gillian tan mark Bergen on reporting this primary round 0:01:35.959 --> 0:01:38.800 and long story short, one hundred and fifty billion dollars 0:01:39.000 --> 0:01:41.240 is a very big number in terms of valuation. What 0:01:41.280 --> 0:01:43.640 do we know about open AI's latest fundraise. 0:01:45.240 --> 0:01:47.760 Well, we know that they are trying to raise quite 0:01:47.760 --> 0:01:50.040 a bit of money, and they're also trying to raise 0:01:51.000 --> 0:01:53.480 an amount in the form of debt. And then as 0:01:54.120 --> 0:01:56.400 as you and I and some of our colleagues reported 0:01:56.440 --> 0:01:58.520 that they are hoping to do this at quite a 0:01:58.560 --> 0:02:01.160 high valuation. This would be on hundred fifty billion, would 0:02:01.200 --> 0:02:05.040 be much higher than the amount that we've previously reported, 0:02:05.040 --> 0:02:08.440 which was under one hundred million, sorry, under one hundred billion. 0:02:09.480 --> 0:02:11.639 And I mean, I think we have to think about 0:02:11.680 --> 0:02:13.600 when we think about this company trying to raise a 0:02:13.600 --> 0:02:17.400 lot of money, is that what you're doing is extremely expensive. 0:02:17.520 --> 0:02:20.520 I mean, they are building enormous AI systems and they're 0:02:20.600 --> 0:02:23.560 running enormous AI systems, and that costs a lot of money. 0:02:24.320 --> 0:02:26.480 Let's just talk about where the money is being spent. 0:02:26.919 --> 0:02:30.880 The latest model Strawberry. This is where training of these 0:02:30.880 --> 0:02:34.080 models the compute the talent, but what's the outcome. 0:02:36.000 --> 0:02:38.320 So Strawberry is a model that's been in the works 0:02:38.360 --> 0:02:42.640 for a while, and essentially what they are hoping that 0:02:42.720 --> 0:02:46.400 it can do is some tasks that are similar to 0:02:46.440 --> 0:02:50.320 how humans would conduct reasoning. It's going to be aimed 0:02:50.520 --> 0:02:56.080 at things like more complicated math and coding questions and 0:02:56.160 --> 0:02:59.480 prompts than have been possible in the past. Source that 0:02:59.560 --> 0:03:02.040 I spoke to that has tried it out said it 0:03:02.080 --> 0:03:04.840 was able to solve a problem that's been kind of 0:03:04.840 --> 0:03:07.760 popular on social media lately. Is nine point one point 0:03:07.760 --> 0:03:11.440 one larger than nine point nine, which is the kind 0:03:11.480 --> 0:03:14.480 of thing that a human might find simple but convex computers. 0:03:15.600 --> 0:03:18.079 The other thing we reported rachel our sources telling us 0:03:18.120 --> 0:03:21.200 that open ais one to the banks and is looking 0:03:21.200 --> 0:03:23.560 at doing about five billion dollars of debt in the 0:03:23.600 --> 0:03:27.040 form of a revolving credit line. It's not sort of unusual, 0:03:27.120 --> 0:03:29.079 but it makes me think that open ai is kind 0:03:29.080 --> 0:03:33.000 of getting to company scale. We keep calling it a startup, 0:03:33.360 --> 0:03:35.160 but do we actually have any sense of how much 0:03:35.200 --> 0:03:38.160 money all of this technology is bringing in for them. 0:03:38.360 --> 0:03:41.160 How much of a business they have beyond just constant 0:03:41.280 --> 0:03:42.760 R and D and new model innovation. 0:03:44.040 --> 0:03:46.800 Yeah, they actually have been able to scale their business 0:03:46.920 --> 0:03:49.720 quite a bit over the past year. They've released several 0:03:49.720 --> 0:03:53.720 different enterprise products, and we actually know from our recent 0:03:53.760 --> 0:03:58.600 reporting that they reached over they reached a milestone in 0:03:58.680 --> 0:04:02.680 terms of how many people are using their enterprise versions 0:04:02.760 --> 0:04:06.960 of chat GBT. This would be individual users, not customers. 0:04:07.240 --> 0:04:09.920 So if they're able to keep growing and growing on 0:04:09.920 --> 0:04:11.760 that side, then they're bringing in lots of money. So 0:04:11.800 --> 0:04:14.480 the money that they're raising, perhaps that could be there'd 0:04:14.480 --> 0:04:15.600 be a little less pressure on that. 0:04:16.839 --> 0:04:21.279 Bloombost Rachel Mets brilliant reporting, deep reporting, and something that 0:04:21.320 --> 0:04:23.200 a lot of people talking about online as well. Thank 0:04:23.200 --> 0:04:25.920 you very much. Now, this week is a pivotal one 0:04:25.960 --> 0:04:28.719 for Intel. Intel's board has been weighing how to move 0:04:28.800 --> 0:04:32.120 forward after its latest earnings report and plans to slash 0:04:32.120 --> 0:04:35.320 fifteen thousand job which leaves Intel with a few options, 0:04:35.320 --> 0:04:39.320 including scaling back some of its multi billion dollar factory projects, 0:04:39.480 --> 0:04:44.280 selling off subsidiaries, or splitting Intel's core operations into separate 0:04:44.560 --> 0:04:48.920 units or companies. Bloomberg's Ian King pend this big take 0:04:49.320 --> 0:04:51.600 and actually you kind of get it all in the 0:04:51.640 --> 0:04:57.200 first paragraph is slow motion disaster. Where are they in 0:04:57.240 --> 0:04:58.960 the slow motion action that's happening. 0:05:00.080 --> 0:05:02.360 It's been tough for a while, right, They've been trying 0:05:02.360 --> 0:05:06.880 to do too fundamentally competing things, which is to spend 0:05:07.200 --> 0:05:09.920 a lot of money on restoring this company to where 0:05:09.920 --> 0:05:13.320 it was at a time when business has turned against 0:05:13.360 --> 0:05:16.560 them and away from them. 0:05:16.640 --> 0:05:20.200 And in just jumping in here, what's so interesting is 0:05:20.240 --> 0:05:23.080 what's on the exact agenda over these three days which 0:05:23.120 --> 0:05:26.640 culminates today. Pat Gelsinger in any trouble here. 0:05:27.839 --> 0:05:31.120 Yeah, I mean not according to our reporting. As you 0:05:31.160 --> 0:05:33.839 saw in the story. One of the sources that we 0:05:33.920 --> 0:05:37.359 spoke to said that that's not the kind of board 0:05:37.400 --> 0:05:40.240 meeting that we're up to at this particular point. What 0:05:40.279 --> 0:05:42.720 we're up to is looking at what Intel does. It's 0:05:42.760 --> 0:05:46.320 a huge company, one hundred thousand people, what it does, 0:05:46.360 --> 0:05:49.480 where it's focusing, where it's spending, to look at perhaps 0:05:49.600 --> 0:05:51.640 discontinuing some of the things that are a little bit 0:05:51.680 --> 0:05:55.599 peripheral to save some money to focus on trying to 0:05:55.600 --> 0:05:58.560 push that plan. And that's Pat Gelsinger's plan forward at 0:05:58.560 --> 0:06:00.839 this point that's kind of where we are. 0:06:01.160 --> 0:06:03.719 As best you can then take us inside the room 0:06:03.920 --> 0:06:06.599 of the board meeting and kind of of all the 0:06:06.640 --> 0:06:11.119 options available to them. What are they considering right now? 0:06:11.440 --> 0:06:13.440 Yeah, I mean the first thing on the agenda, as 0:06:13.480 --> 0:06:17.520 far as we understand it, is this factory network. You'll 0:06:17.560 --> 0:06:20.480 remember we've done all of these stories and spoken about 0:06:20.880 --> 0:06:24.640 big plants in Ohio, big plant in Magdeburg and Germany. 0:06:24.720 --> 0:06:27.600 Obviously an extension of what they already have in Arizona, 0:06:27.680 --> 0:06:30.640 and smaller projects around the world. That is a lot 0:06:30.680 --> 0:06:33.960 of money being poured into the ground in anticipation of 0:06:34.000 --> 0:06:37.920 business growing significantly. What we learned from earnings was that 0:06:38.000 --> 0:06:41.400 business is not growing to match that footprint, whether it's 0:06:41.400 --> 0:06:45.400 a footprint physically or whether it's a headcount. So clearly 0:06:45.480 --> 0:06:49.240 that focus is on right sizing the company around what 0:06:49.320 --> 0:06:52.080 they've got coming in in terms of orders and money, and. 0:06:52.279 --> 0:06:54.800 In what you do so well in the story. It's 0:06:54.800 --> 0:06:58.160 a context, isn't it that this isn't an overnight issue. 0:06:58.279 --> 0:06:59.400 This has been long time coming. 0:07:00.560 --> 0:07:03.120 Yeah, I know, that's that's absolutely true. I mean, you know, 0:07:03.160 --> 0:07:05.600 the focus that the traditional Wall Street playbook would be 0:07:05.680 --> 0:07:07.880 or look at the management, do we need a new management. 0:07:07.960 --> 0:07:09.720 Do we need to spit all of those kind of 0:07:09.720 --> 0:07:13.760 standard playbook things don't really apply here, at least not yet. 0:07:13.760 --> 0:07:16.480 I mean Pat Gelsinger, remember, was brought in to fix 0:07:16.560 --> 0:07:18.240 the problems that already existed. 0:07:18.520 --> 0:07:19.120 He gave a. 0:07:19.040 --> 0:07:22.280 Prescription that everybody signed off on and agreed with. The 0:07:22.360 --> 0:07:25.280 problem that we have is that that prescription is being 0:07:25.400 --> 0:07:30.120 proving more painful than perhaps we had expected, and clearly 0:07:30.160 --> 0:07:31.480 the market does not like that. 0:07:32.240 --> 0:07:34.880 We're just looking at the revenue growth that the market 0:07:34.920 --> 0:07:38.480 does not like. Inking we so appreciate it, thank you. 0:07:39.320 --> 0:07:41.360 Let's just talk about what the market's also having to 0:07:41.400 --> 0:07:43.400 digest with Microsoft saying it's going to be cutting six 0:07:43.520 --> 0:07:46.400 hundred and fifty jobs in its Xbox unit, the third 0:07:46.520 --> 0:07:49.040 such layoffs this year, as the company is just trying 0:07:49.080 --> 0:07:51.800 to rein in costs and integrate that massive sixty nine 0:07:51.880 --> 0:07:55.320 billion dollar acquisition of Activision Blizzard. The roles to be 0:07:55.360 --> 0:07:59.239 eliminated are, in quote, mostly corporate and supporting functions, according 0:07:59.240 --> 0:08:02.720 to a memo sent staff like Xbox chief Phil Spencer. 0:08:02.760 --> 0:08:04.960 Today and what have we got coming up? 0:08:05.560 --> 0:08:08.480 Yes, some breaking news on the Bloomberg terminal. Apple has 0:08:08.560 --> 0:08:13.880 got FDA authorization for its AirPods to act as hearing 0:08:13.920 --> 0:08:17.440 aids in a hearing aid feature. We were tracking this 0:08:17.480 --> 0:08:20.440 one because they said just on Monday during the presentation 0:08:21.000 --> 0:08:24.080 that they were going to get it, and they did. 0:08:24.080 --> 0:08:27.600 And you look at some of the other hearing aid stocks, 0:08:27.600 --> 0:08:30.000 they're not moving right now. They were when that news 0:08:30.000 --> 0:08:33.320 first came out. Apple flat in what's been an interesting week. 0:08:34.600 --> 0:08:36.640 But we've got a lot coming up on the show too. Yeah, 0:08:36.640 --> 0:08:39.160 we've got to talk about what's happening up in the Skycarrier. 0:08:39.240 --> 0:08:41.160 Historic day for SpaceX and Polarist. 0:08:41.200 --> 0:08:41.400 Dawn. 0:08:41.480 --> 0:08:44.360 I'm very much looking forward to this one. Stick with us. 0:08:44.400 --> 0:08:59.840 This is Bloomberg Technology. Some quick cause. Micron under pressure 0:08:59.840 --> 0:09:02.960 this morning. They start stock touching it's lowest level nearly 0:09:03.040 --> 0:09:08.040 seven months. As some analyst reactions. BNP with a double downgrade, 0:09:08.080 --> 0:09:11.600 cutting shares to underperform from outperform with a street low 0:09:11.679 --> 0:09:14.760 price target. The analyst warning of a correction in DRAM 0:09:14.880 --> 0:09:17.280 prices due to some oversupply risks. 0:09:17.320 --> 0:09:20.320 Carroc now some breaking new some brumbo that General Motors 0:09:20.400 --> 0:09:23.240 is in discussions to buy EV batteries that we use 0:09:23.280 --> 0:09:27.160 technology from China's c at L and be assembled at 0:09:27.200 --> 0:09:29.160 a new plant slated actually to be built here in 0:09:29.160 --> 0:09:32.599 the United States. It's all according to sources. Gabikopole is 0:09:32.600 --> 0:09:35.120 here to break it down, and well, this is a 0:09:35.200 --> 0:09:36.840 political handball. 0:09:36.880 --> 0:09:41.960 It feels like, yes, you know, it is very sensitive. 0:09:43.000 --> 0:09:45.240 You know, we've got US and China. 0:09:45.320 --> 0:09:48.480 The US is trying really hard to decouple from China, 0:09:48.559 --> 0:09:51.280 and Chinese companies are trying really hard to access the 0:09:51.400 --> 0:09:55.240 US market. And the automakers, the American automakers are cart 0:09:55.320 --> 0:09:59.160 in the middle because you know, GM for you know, 0:09:59.360 --> 0:10:02.520 every st they've all poured billions of dollars into making 0:10:02.600 --> 0:10:07.160 batteries and forming joint ventures with their Korean battery makers, 0:10:07.240 --> 0:10:08.839 and you know, I've gotten a lot of subsidies from 0:10:08.840 --> 0:10:12.240 the US government order to do so. But because evs 0:10:12.280 --> 0:10:16.800 are not selling well, because they've had struggles making batteries, 0:10:16.800 --> 0:10:19.760 which is normal, you know, making batteries and evs for 0:10:19.840 --> 0:10:21.920 the first time in your one hundred year history. It's 0:10:21.960 --> 0:10:23.599 not going to go smoothly right off of bat It 0:10:23.720 --> 0:10:26.520 never does. Didn't for Tesla, it doesn't for anybody. So 0:10:27.040 --> 0:10:29.880 they're under pressure. And so this potential deal, which is 0:10:29.920 --> 0:10:32.920 still tentative, you know, it's just talks. Nothing is finalized. 0:10:33.400 --> 0:10:36.000 Would be a way for American car companies to get 0:10:36.000 --> 0:10:40.559 access to cheap, you know, really cutting edge battery technology 0:10:40.640 --> 0:10:43.959 from China without tripping up all the political wires that 0:10:44.320 --> 0:10:46.400 could you know, potentially trip up when you work with 0:10:46.480 --> 0:10:47.280 a Chinese company. 0:10:48.000 --> 0:10:50.319 Right, Well, I think the basics of what we heard 0:10:50.360 --> 0:10:53.120 from sources is really important. The mechanics are such that 0:10:53.960 --> 0:10:58.079 the battery technology is licensed from c ATL, a Chinese company, 0:10:58.600 --> 0:11:02.480 but the operations around by a conglomerate from Japan called TDK, 0:11:03.080 --> 0:11:05.040 which many of the people on this show probably haven't 0:11:05.080 --> 0:11:09.319 heard of, but they're basically a consumer electronics company, and 0:11:09.440 --> 0:11:12.120 then GM and other automakers, I think is what we're hearing, 0:11:12.200 --> 0:11:15.920 right Gabby would buy the batteries on fixed term contracts, 0:11:15.920 --> 0:11:18.839 so they're kind of insulated from price wings take it 0:11:18.920 --> 0:11:19.280 from there. 0:11:19.320 --> 0:11:22.400 What else do we know, Well, I think, you know, 0:11:22.520 --> 0:11:24.559 I think one of the most interesting things about this 0:11:24.960 --> 0:11:28.080 is that you've got a Japanese company acting as a middleman. 0:11:28.280 --> 0:11:30.560 You know, up until now, we've seen Ford and Tesla 0:11:30.679 --> 0:11:33.560 do these kind of cute kind of licensing the hills 0:11:33.559 --> 0:11:36.160 where they can use c ATL technology without you know, 0:11:37.080 --> 0:11:40.839 violating rules or tripping any political wires. Now this is 0:11:40.880 --> 0:11:43.480 a new development and how the auto industry is adapting 0:11:43.559 --> 0:11:46.040 to the political environment and the UV environment and the 0:11:46.080 --> 0:11:46.840 fact that they're. 0:11:47.040 --> 0:11:49.760 You know, not profitable on making VS yet. 0:11:50.240 --> 0:11:53.120 So we know that, yes, we know that GM and 0:11:53.280 --> 0:11:57.839 CTL and Japan's TDK, which makes battery, there's employer for 0:11:57.920 --> 0:12:01.160 the iPhone. They you know, make batteries consumer electronics. They 0:12:01.240 --> 0:12:03.920 want to get into the EV battery business and this 0:12:04.040 --> 0:12:07.640 could be a way into it. So they're looking at 0:12:07.679 --> 0:12:10.959 states in the southern US, you know. And I think 0:12:11.040 --> 0:12:13.280 that you know, obviously this is so sensitive politically that 0:12:13.360 --> 0:12:16.120 I think the results of the presidential election November it 0:12:16.160 --> 0:12:18.559 could potentially, you know, affect the outcome. 0:12:18.200 --> 0:12:18.920 Of these talks. 0:12:20.080 --> 0:12:23.040 That's what sources told us. Bloombergs Gavy Coppl are great reporting, 0:12:23.559 --> 0:12:27.800 really interesting reporting alongside you. Thank you. Okay. It was 0:12:27.840 --> 0:12:31.800 a historic day for SpaceX. The company's polarist, Dawn Crewe, 0:12:32.200 --> 0:12:38.599 successfully completed the first commercial spacewalk. Tech billionaire Jaredisingcman was 0:12:38.640 --> 0:12:42.280 the first of the crew to step foot outside. Here's 0:12:42.320 --> 0:12:43.240 what he experienced. 0:12:44.360 --> 0:12:44.839 Back at home. 0:12:44.880 --> 0:12:46.560 We all have a lot of working here, but from 0:12:46.600 --> 0:12:49.640 here works looked like a perfect. 0:12:49.360 --> 0:12:55.040 World for more ez in a Uzukoro of the Harvard 0:12:55.040 --> 0:12:58.480 Belfa Center joins us. She was formerly Assistant Director for 0:12:58.559 --> 0:13:01.920 Space Policy at the White House, where she led advancements 0:13:02.160 --> 0:13:05.040 in space launch capabilities, as well as a former NASA 0:13:05.160 --> 0:13:10.800 executive with over sixty space mission contributions. And let's start 0:13:10.800 --> 0:13:13.600 with your reaction to what happened in just a few 0:13:13.679 --> 0:13:14.120 hours ago. 0:13:16.480 --> 0:13:21.360 This is a huge success at its monumental not just 0:13:21.600 --> 0:13:26.040 for astronauts, but for anybody with a dream for space 0:13:26.120 --> 0:13:31.360 ACX to test the market viability of space tourism, for 0:13:31.679 --> 0:13:37.080 us to determine if space tourism can really grow quite 0:13:37.200 --> 0:13:41.520 like the early days of aviation. So this is fantastic. 0:13:43.360 --> 0:13:46.880 The images on the screen that you're seeing are from 0:13:47.000 --> 0:13:52.400 Jared Isaigman's helmet camera from the custom spacesuit, and now 0:13:52.480 --> 0:13:57.400 what you're seeing is the nose cone camera from atop 0:13:57.480 --> 0:14:00.560 the Dragon capsule. But this is the question so many 0:14:00.600 --> 0:14:04.480 people asked me this morning. Was it actually a spacewalk? 0:14:08.960 --> 0:14:13.280 Yes, technically it was because they were outside their capsule, 0:14:13.640 --> 0:14:19.800 their spacecraft, and they have a railing that they were 0:14:19.880 --> 0:14:22.320 holding on to and they were outside their capsule for 0:14:22.400 --> 0:14:28.080 ten minutes each, Both tired and Sarah the other astronaut, 0:14:28.240 --> 0:14:31.440 and this is risky. You think of a spacesuit as 0:14:31.720 --> 0:14:36.920 a spacecraft in itself because it monitors their temperature and 0:14:37.840 --> 0:14:42.360 controls their vitals while they are outside. And what we 0:14:42.560 --> 0:14:47.720 see is is how successful this was after a mere 0:14:47.840 --> 0:14:52.080 few years of training versus the decade that one trains 0:14:52.160 --> 0:14:54.040 for when you were a professional astronaut. 0:14:54.840 --> 0:14:58.360 Phenomenal when it comes to commercial space success as an 0:14:58.400 --> 0:15:03.200 a what we love when they come back and they're tested, 0:15:03.360 --> 0:15:07.360 because this is about radiation exposure as well. How tough 0:15:07.440 --> 0:15:08.720 could this have been on their bodies? 0:15:10.840 --> 0:15:14.160 Absolutely tough. You can be hot for one moment, you 0:15:14.240 --> 0:15:16.760 could be cold another moment. Your fingers could hurt. 0:15:17.280 --> 0:15:18.040 So even though it's. 0:15:18.000 --> 0:15:22.120 Cold in space, there could be pressures within the suit 0:15:22.440 --> 0:15:26.040 that make you feel a very warm. So this was 0:15:26.160 --> 0:15:30.960 a complete thorough test of the spacesuit which SpaceX intends 0:15:31.000 --> 0:15:35.320 to use for future Moon missions, for future Mars missions, 0:15:35.600 --> 0:15:38.040 and so there will be a lot of lessons learned 0:15:39.360 --> 0:15:41.120 in those regards. But I think if you think of 0:15:41.200 --> 0:15:46.560 the trillion dollar space economy that has been discussed for 0:15:47.360 --> 0:15:51.120 decades now, this is really an exciting point to see 0:15:51.120 --> 0:15:54.200 if there is viability in that market, to see how 0:15:55.120 --> 0:16:00.960 much growth the sector will endure due to this SASS Today. 0:16:01.520 --> 0:16:04.360 Sarah Gillis was out there as well, and I think 0:16:04.440 --> 0:16:07.200 it was hers saying, this is really integral for data 0:16:07.800 --> 0:16:10.400 to back to SpaceX, but they don't really know yet 0:16:10.480 --> 0:16:12.920 what they'll be doing with it. At the moment, it 0:16:13.000 --> 0:16:15.680 just feels like SpaceX is cleaning up when it comes 0:16:15.720 --> 0:16:17.280 to space success is. 0:16:17.320 --> 0:16:24.720 It and they are doing remarkably well. It's it's obviously 0:16:26.520 --> 0:16:30.040 due to their their vision, their hard work, and this 0:16:30.240 --> 0:16:35.240 success is just so so impressive because space walks are 0:16:35.360 --> 0:16:40.680 risky and you have astronauts that are not professional astronauts, 0:16:40.720 --> 0:16:43.800 and the company has been planning this mission for years 0:16:43.840 --> 0:16:47.600 and not decades and they pulled it off us successfully. 0:16:47.760 --> 0:16:52.280 So it's it's very critical to realize the feed that 0:16:52.440 --> 0:16:55.440 was accomplished today. It's incredibly impressive. 0:16:56.080 --> 0:17:00.400 Thanks for giving the context it deserves as in a Okura, 0:17:00.600 --> 0:17:02.600 Great to have you with us. Harvid Belfer Center senior 0:17:02.640 --> 0:17:13.920 fellow and former NASSER executive. Broadening out to the world 0:17:13.960 --> 0:17:17.280 of tech investing investing more broadly, Betterment, which builds itself 0:17:17.320 --> 0:17:20.760 as the largest independent digital financial advisor, just come out 0:17:20.840 --> 0:17:23.360 with first of it's kind survey showing four in five 0:17:23.480 --> 0:17:27.360 advisors using AI in their work to discuss how artificial 0:17:27.400 --> 0:17:30.359 intelligence is managing your money. Vetterment CEO Sarah Levy is 0:17:30.400 --> 0:17:34.160 here with us. Sarah, what made you run these sorts 0:17:34.200 --> 0:17:36.240 of numbers. I know that you're looking at this particular 0:17:36.280 --> 0:17:38.399 part of the business, you're rebranding it, but you just 0:17:38.480 --> 0:17:41.520 wanted to understand how these advisors are getting to groups 0:17:41.520 --> 0:17:41.840 of AI. 0:17:42.440 --> 0:17:44.800 So the key for us is that the advisor we 0:17:45.000 --> 0:17:48.399 serve tends to be more of a millennial advisor, and 0:17:48.520 --> 0:17:50.879 this is a growing group and they're much more technically 0:17:50.920 --> 0:17:54.200 sophisticated than their predecessors, and so they don't sort of 0:17:54.280 --> 0:17:57.359 suffer fools lightly when you think about the technology choices, 0:17:57.400 --> 0:18:00.320 the user interface, the power, we really they need to 0:18:00.320 --> 0:18:03.760 provide them with powerful tools and so Betterment Advisor Solutions 0:18:04.000 --> 0:18:07.480 is our advisor arm and our roots were originally with 0:18:07.720 --> 0:18:10.520 the retail investor, where we learned a lot, But what 0:18:10.840 --> 0:18:13.880 we've learned for advisors is they can harness the power 0:18:13.920 --> 0:18:16.840 of technology just so much more, and AI for. 0:18:16.960 --> 0:18:19.040 Me is really a continuation on that spectrum. 0:18:19.119 --> 0:18:19.239 Right. 0:18:19.440 --> 0:18:22.840 We introduced automation to save time, to save money, to 0:18:22.920 --> 0:18:26.720 help with customer retention, and AI just furthers that journey. 0:18:26.760 --> 0:18:29.440 Really, what are they using are they're using generative AIPSA, 0:18:29.880 --> 0:18:32.640 and how are they saving themselves time? How they're more productive? 0:18:33.160 --> 0:18:35.639 So I think of AI a lot like digital. 0:18:35.680 --> 0:18:37.720 If you think back to call it two decades ago, 0:18:37.760 --> 0:18:39.240 when we talked about digital and you said, you have 0:18:39.320 --> 0:18:42.520 digital companies and you have analog companies, right, And at 0:18:42.560 --> 0:18:44.480 the time people would ask, you know, are you going 0:18:44.560 --> 0:18:45.320 to work in digital? 0:18:45.400 --> 0:18:47.199 And then digital became sort of part of the fabric 0:18:47.280 --> 0:18:47.840 of everything we do. 0:18:48.520 --> 0:18:51.200 That's how we think about AI, which is it's really 0:18:51.320 --> 0:18:54.719 just powering the humans to do better, stronger, faster. Right, 0:18:54.960 --> 0:18:59.200 So everything from pair of planning right before you meet 0:18:59.200 --> 0:19:01.640 with a client as advisor, and then after you meet 0:19:01.680 --> 0:19:02.920 with that client, there's a lot of work to do. 0:19:03.280 --> 0:19:05.680 AI can just take a lot of that administrative burden 0:19:05.760 --> 0:19:06.320 off the plate. 0:19:06.440 --> 0:19:08.960 That's just one great example, Sarah. 0:19:09.080 --> 0:19:13.600 The better question posed by the Better Men survey is 0:19:13.800 --> 0:19:17.760 whether those four out of five financial advisors who are 0:19:17.880 --> 0:19:20.199 using AI, because loads of people watching this program will 0:19:20.240 --> 0:19:23.600 have a financial advisor, whether AI actually makes them better 0:19:24.400 --> 0:19:26.800 in managing people's money. Is there any evidence of that? 0:19:27.640 --> 0:19:30.600 Well, I think I wouldn't think about AI as actually 0:19:30.760 --> 0:19:34.520 managing people's money. Remember, as a financial planner, we are fiduciary. 0:19:35.000 --> 0:19:38.480 Our advisors are fiduciaries. We as an RIA or fiduciaries. 0:19:38.720 --> 0:19:40.359 So I think the way you want to think about 0:19:40.440 --> 0:19:45.280 AI is basically giving back time and saving money for 0:19:45.400 --> 0:19:47.399 the advisor so that the advisor can focus on the 0:19:47.440 --> 0:19:50.520 client and on the investment solutions. And that's really the 0:19:50.560 --> 0:19:53.359 benefit that they're getting AI. The computers are not taking 0:19:53.440 --> 0:19:56.040 over the world, right, The human advice is still a 0:19:56.160 --> 0:20:00.399 critical component of getting people to great outcomes and great plans. 0:20:02.119 --> 0:20:04.560 An extension of that is whether it then becomes the 0:20:04.640 --> 0:20:08.520 economics kind of change, right, and fees and the incentive 0:20:08.600 --> 0:20:12.680 of somebody using a service or a digital format such 0:20:12.720 --> 0:20:13.200 as yours. 0:20:14.040 --> 0:20:14.200 Well. 0:20:14.320 --> 0:20:17.320 I think look in the early days of where we began, 0:20:17.560 --> 0:20:20.119 our roots were robo advisory, right, and there was a 0:20:20.160 --> 0:20:23.280 lot of sort of dismay in the advisor community, Right, 0:20:23.440 --> 0:20:25.960 is technology going to take over the human interaction? And 0:20:26.320 --> 0:20:28.359 I just think that was very overblown And I would 0:20:28.400 --> 0:20:30.959 say the same about AI, which is not to diminish 0:20:31.000 --> 0:20:32.800 its potential. I think it is going to be a 0:20:33.040 --> 0:20:35.320 huge sort of power tool enhancer. 0:20:35.440 --> 0:20:35.920 If you will. 0:20:36.240 --> 0:20:38.960 But we've been building power tools for both advisors and 0:20:39.080 --> 0:20:41.840 retail investors for the better part of a decade and 0:20:41.880 --> 0:20:44.399 a half, and this just takes that really to the 0:20:44.480 --> 0:20:46.840 next level. That's the way we're thinking about it. 0:20:47.720 --> 0:20:50.680 Okay, so cools Classic sixty forty portfolio. It's just that 0:20:50.800 --> 0:20:53.679 the financial advisor will have more time being freed up 0:20:53.680 --> 0:20:56.960 by AI Betterment CEO Sarah Levy really appreciate you being 0:20:57.000 --> 0:20:58.480 here on Bloomberg Technology. 0:21:06.160 --> 0:21:08.439 Welcome back to Bloomberg Technology. I'm Caroline Hyed. 0:21:08.320 --> 0:21:10.879 In New York and I met love Low in San Francisco. 0:21:11.080 --> 0:21:13.399 Make check on these market said, because actually we have 0:21:13.600 --> 0:21:15.840 SAD now four straight days and gains on the NASAC 0:21:15.880 --> 0:21:16.879 and NASDAQ one hundred. 0:21:17.160 --> 0:21:17.840 We're on a roll. 0:21:17.920 --> 0:21:20.360 We've actually added a trillion dollars in terms of market 0:21:20.440 --> 0:21:24.320 capitalization over those four days. Despite those headwinds of perhaps 0:21:24.359 --> 0:21:26.400 that CPI coming in a little hot on the core 0:21:26.520 --> 0:21:28.959 basis two year yields actually just pushing up a little bit. 0:21:29.080 --> 0:21:31.920 So maybe we're still anticipating what the Fed will do. 0:21:32.040 --> 0:21:34.920 Will they be able to cut as much has been anticipated? 0:21:35.000 --> 0:21:37.600 Many now seeing just twenty five basis point cup coming 0:21:37.640 --> 0:21:39.800 for September I'm looking at Bitcoin just have a quarter 0:21:39.840 --> 0:21:41.840 of percent, so a little bit of risk on there 0:21:41.880 --> 0:21:43.159 as well. Move on and have a look at the 0:21:43.200 --> 0:21:46.600 individual movers. Look a lot of the push forward in 0:21:46.680 --> 0:21:48.760 the Nasdaq is thanks to Nvidia and some of the 0:21:48.840 --> 0:21:51.040 chip names. I think Broadcom is one of the biggest 0:21:51.600 --> 0:21:55.040 names for points contributing today. Warner Brothers Discovery doing well 0:21:55.160 --> 0:21:57.640 up almost two percent. Child Communications, yes, they will still 0:21:57.880 --> 0:22:01.720 have that distribution deal. Both arising. We're looking at MasterCard 0:22:01.720 --> 0:22:04.000 off by six tens percent, but big deal. More than 0:22:04.040 --> 0:22:07.639 two billion dollars being spent in cybersecurity for this particular company, 0:22:07.800 --> 0:22:09.960