Speaker 1: From the heart of where Innovation, money and power Collie
Speaker 1: in Silicon Valley and beyond. This is Bloomberg Technology with
Speaker 1: Emily Jay. Hi'm Emily Chang in New York and this
Speaker 1: is Bloomberg Technology. Coming up in the next hour. He
Speaker 1: helped introduce RYL Samberg to Mark Zuckerberg and the rest,
Speaker 1: they say is history. I'll be joined by Roger mcnaman
Speaker 1: to talk about that meeting, Samberg's legacy and where the
Speaker 1: company goes from here. Plus he sat on Facebook's board
Speaker 1: for seven years, He's known Samberg for more than twenty.
Speaker 1: My exclusive conversation with Don Graham on Samberg's role in
Speaker 1: building the company and where Meta goes from here? And
Speaker 1: inflation keeps raging, no relief in sight according to President
Speaker 1: By This as the market and tech and cryptos dock
Speaker 1: in particular, keep whip sawing. We will be joined by
Speaker 1: Sebastian Malaby, author of a new book, The Power Law,
Speaker 1: about whether Silicon Valley can hold onto its role as
Speaker 1: a center of power. Later in the hour, why do
Speaker 1: you want to stay on Samberg's exit now from met
Speaker 1: end what it means for the company going forward. I'm
Speaker 1: joined by Jasmine Emberg principal analysts for Insider Intelligence. She
Speaker 1: covers social media and influencers look jasmine from a business perspective.
Speaker 1: Controversy about the business model aside. How confident are you
Speaker 1: that Meta can keep the money machine running without Cheryl Samberg? Well,
Speaker 1: I think you know. First of all, we have to
Speaker 1: address how powerful um Sandberg was able to build um
Speaker 1: Meta's ad business When she started In two thousand and eight,
Speaker 1: we at the market are now Insider Intelligence estimated that
Speaker 1: Facebook's worldwide ad revenues were just two hundred and fifty
Speaker 1: million dollars. Now, within two years that figure had grown
Speaker 1: to one point three billion dollars, and flash forward to today,
Speaker 1: Meta is the second largest digital ad seller in the
Speaker 1: world after Google. I mean, it's safe to say that
Speaker 1: the new leadership certainly has their work cut out for
Speaker 1: them to continue growing um metas business. But um It's
Speaker 1: still in a pretty good place despite all of the
Speaker 1: headwinds that it is facing right now. One Bloomberg take
Speaker 1: put it like this, Cheryl Sandberg is leaving Facebook at
Speaker 1: a perilous moment. What is your outlook on how fast
Speaker 1: Facebook and Instagram and WhatsApp can continue to grow while
Speaker 1: the company is making this massive pivot to the metaverse,
Speaker 1: and you're absolutely right. I mean, Meta is in the
Speaker 1: process of undergoing this massive shift towards the metaverse, and
Speaker 1: you know it is going to be something that is
Speaker 1: you know, pretty far down the line. It is still
Speaker 1: years and years away for the metaverse to become a reality.
Speaker 1: And right now there are some really immediate challenges that
Speaker 1: Facebook has to grapple with and Instagram has to grapple
Speaker 1: with as well. That as an ad revenue slowdown, that
Speaker 1: is a slowdown in user growth, it is also slowdown
Speaker 1: in time spent on on Facebook. Now Instagram of course,
Speaker 1: has been able to pick up the flack for Facebook
Speaker 1: for quite some time. That's proving to be more difficult.
Speaker 1: Um So it's going to require quite a bit of
Speaker 1: discipline and innovation to continue growing all of Meta's platforms.
Speaker 1: Jasmine Hamburg, Insider Intelligence principal analyst. Thank you, Jasmine. Obviously
Speaker 1: lots remains to be seen. Now Sandberg might never have
Speaker 1: been at Facebook if it wasn't for my next guest.
Speaker 1: He was an early investor and a mentor to Mark Zuckerberg.
Speaker 1: Here's Roger McNamee describing how he helped broker their partnership.
Speaker 1: It's Sheryl Sandberg. Have you ever met her? He said,
Speaker 1: I think I sugar hands once at a party I
Speaker 1: don't know at all, and I said, I want to
Speaker 1: try to get her to come and talk to you
Speaker 1: about being your chief operators somewhere, And next thing you know,
Speaker 1: she goes there is the chief operating officer, at which
Speaker 1: point basically they didn't need me anymore. I mean, she's
Speaker 1: way smart, and I am I mean one of the
Speaker 1: most I mean one of the most capable people I
Speaker 1: have ever met in any way. Joining me now Roger mcmee,
Speaker 1: co founder of Elevation Partners and author of the book
Speaker 1: Zucked Waking Up to the Facebook Catastrophe. So, Roger, we
Speaker 1: all know that your feelings about Facebook have changed over
Speaker 1: the years. I'm so curious what your first thought was
Speaker 1: when you saw the news that Cheryl was leaving. I
Speaker 1: take no joy in Sheryl Sandberg's resignation is CEO of Meta.
Speaker 1: For me, it's a really complicated situation because Cheryl was
Speaker 1: for many years a friend of mine and somebody I
Speaker 1: advised when she worked in the Clinton White House. She
Speaker 1: was responsible for introducing me to my future business partner,
Speaker 1: bono and for that, I'll always be incredibly grateful, and
Speaker 1: I tried to reciprocate. She came out to Silicon Valley
Speaker 1: in two thousand one, hung out in my office for
Speaker 1: a few weeks, and I introduced her to John Dore,
Speaker 1: who was on the board at Google, which began the
Speaker 1: process of her going to work at Google and creating
Speaker 1: the add engine behind AdWords, which obviously put Google on
Speaker 1: the map economically. So Cheryl and I were really close,
Speaker 1: and when she made it clear to me that she
Speaker 1: was thinking about leaving Google, I thought that Facebook was
Speaker 1: the right place for her, and so I talked to
Speaker 1: Mark about it for months, and you know, he definitely
Speaker 1: wanted a strong number two, and I think he was
Speaker 1: trying to figure out in his own mind what factors
Speaker 1: would really matter. But Cheryl had I thought two things
Speaker 1: that really were decisive. The experience at Google was the
Speaker 1: closest you're ever going to get to the business problem
Speaker 1: faced at Facebook. And secondly, you know, she had a
Speaker 1: maturity and an experience both in the political and the
Speaker 1: business realm that I thought would really complement mark strengths.
Speaker 1: And keep in mind, I think when she went there,
Speaker 1: they had fewer than a hundred million users. And so
Speaker 1: it was for me at least not possible at that
Speaker 1: time to imagine the kind of harms that eventually came
Speaker 1: out of Facebook, in part because the business model that
Speaker 1: did the harm wouldn't be invented for another five years.
Speaker 1: And so it you know, I look back on it
Speaker 1: and I go, oh my god, what could have been?
Speaker 1: I mean, Cheryl is so talented, you know, she could
Speaker 1: have both made a very successful company at Google and
Speaker 1: been a hero for democracy and public health. And how
Speaker 1: could she have done that? How could she have done that? Roger, Well,
Speaker 1: let's take a few simple examples. So in Facebook was
Speaker 1: implicated by the United Nations in an ethnic cleansing that
Speaker 1: took place in mean Mar, a country in Asia in
Speaker 1: which Facebook had no employees on the ground, had almost
Speaker 1: no employees that spoke the language, and they certainly had
Speaker 1: no expertise in need of the politics or the culture
Speaker 1: of the country. And it became clear that the product
Speaker 1: was being used by bad actors to instigate in ethnic cleansing.
Speaker 1: And different company, a different group of people might have
Speaker 1: taken that as a warning. It might have said, you know,
Speaker 1: we really shouldn't be doing business in countries where we
Speaker 1: don't have an economic interest in having people on the ground,
Speaker 1: where we're not willing to invest in the language, where
Speaker 1: we're not willing to invest in the culture. That kind
Speaker 1: of thing is super oubes. The FBI warren Facebook in
Speaker 1: early that Q and On was a very dangerous extremist
Speaker 1: group and they weren't Facebook. That there was a lot
Speaker 1: of recruiting going on on Facebook, and Facebook ignored it.
Speaker 1: Between twenty nineteen Spring of twenty nineteen the spring, about
Speaker 1: a one year period, roughly two million people were radicalized
Speaker 1: into Q and On on Facebook. And again that's based
Speaker 1: on Facebook admitting that there were at least three million
Speaker 1: members of Q and on groups by and internal Facebook
Speaker 1: reports released by the whistle Blower that showed that's sixty
Speaker 1: percent of the time when people joined an extremist group
Speaker 1: on Facebook, it's just Facebook recommended, and so they were
Speaker 1: responsible for that. Those are things that a different group
Speaker 1: of people I would have said, you know what, we
Speaker 1: don't want to be involved in that, because if they've
Speaker 1: taken action on Q and on, they might have prevented
Speaker 1: the insurrection, because the people who participated the insurrection have
Speaker 1: been radicalized into Q and at first, and again, all
Speaker 1: of these things are about the culture of the company.
Speaker 1: Do you prioritize the well being of the people who
Speaker 1: use your product? Do you prioritize the well being of
Speaker 1: the people affected by your product? And the reality was
Speaker 1: they viewed shareholder interest as the only thing that matters,
Speaker 1: and so when it came time to thinking about their
Speaker 1: users or the other people affected by it, that just
Speaker 1: wasn't a consideration. And it's that's certainly not unique to Facebook.
Speaker 1: What was unique to Facebook was the impact that it
Speaker 1: could have on those people, either in a pandemic or
Speaker 1: in an election cycle, or related to some kind of
Speaker 1: extreme it. So clearly you think her legacy is complicated,
Speaker 1: and I think many people would agree with you. Let's
Speaker 1: talk about where Facebook or Meta is now going. I
Speaker 1: asked her about this pivot to the metaverse and whether
Speaker 1: having to create a whole new business model or evolve
Speaker 1: Facebook's current business model for a future that doesn't yet
Speaker 1: exist was one of the reasons she's leaving. Take a
Speaker 1: listen to what she told me when we spoke. We
Speaker 1: have a current business, which is our current apps connecting
Speaker 1: customers to businesses, and I think there's a lot of
Speaker 1: opportunity there right right now, but also over the long run,
Speaker 1: and then the metaverse is a much longer term business opportunity,
Speaker 1: and it's going to take some of the same form
Speaker 1: and that I believe we will be a place and
Speaker 1: then the metaverse will be a place where businesses and
Speaker 1: consumers connect. But I think the exact form that takes
Speaker 1: in something that will be figured out over the next
Speaker 1: number of you a much longer term. How optimistic are
Speaker 1: you about Meta realizing this future of the metaverse, turning
Speaker 1: it into a business, And what do you think the
Speaker 1: company looks like without Cheryl Sandberg as it moves towards
Speaker 1: this new, but you know, very uncertain future. Emily, I
Speaker 1: think Facebook's near term is complicated enormously by Apple's application tracking,
Speaker 1: transparency and whatever things that follow that, which give iPhone
Speaker 1: users the ability to opt out of having their data
Speaker 1: shared with Facebook and others. Facebook's already said that that's
Speaker 1: going to be a ten million, ten billion dollar hit
Speaker 1: to revenue this year, and it wouldn't shock me if
Speaker 1: the number got bigger than that, because I don't think
Speaker 1: Apple's done. Secondly, Instagram, which has really been supporting the
Speaker 1: growth of the business, is under assault from TikTok, and
Speaker 1: I do think that TikTok is essentially locking Instagram into
Speaker 1: the group of users it has today by siphoning off
Speaker 1: all the new entrants into social media, and that's really
Speaker 1: bad for Facebook's growth long term. And then you get
Speaker 1: to the metaverse, where I think Facebook's current concept of
Speaker 1: the metaverse is insane. I mean, to my mind, virtual
Speaker 1: reality is a brilliant idea, and if you focus narrowly,
Speaker 1: if you say focus on video games, for example, the
Speaker 1: opportunities are unlimited. But the way Facebook's looking at it,
Speaker 1: where they're essentially going to try to replace reality with
Speaker 1: a virtual reality across every possible doll mean, entertainment, work, sports,
Speaker 1: the whole nine yards. To me, that's just that's never
Speaker 1: gonna work. And the amount of money they're spending on
Speaker 1: it today, I just think it's certifiably insane. If I
Speaker 1: were a shareholder, I would be incensed about this, because
Speaker 1: it's not that the metaverse is a terrible idea, it's
Speaker 1: that their idea of the metaverse is a terrible idea.
Speaker 1: And I don't think it matters how long they take.
Speaker 1: They're just by the time they get there, it won't
Speaker 1: be interesting. Roger McNamee Elevation Partners. Always great to have
Speaker 1: you here, Roger, thank you for sharing your thoughts with us.
Speaker 1: Now onto a Bloomberg exclusive. We've learned that Tiger Global's
Speaker 1: hedge fund has lost a whopping fifty this year, and
Speaker 1: in a letter to investors, the firm is vowing to
Speaker 1: try and earn that money back. Joining his now Sebastian Malaby,
Speaker 1: Senior Fellow at the Council on Form Relations, for more
Speaker 1: on this and the wider venture capital landscape. He is
Speaker 1: also the author of The Power Law, Capital and the
Speaker 1: Making of the New Future, a book on the rise
Speaker 1: of VC and Silicon Valley. Sebastian, so great to have
Speaker 1: you with us. I want to start on this Tiger
Speaker 1: Global news because you have pointed out that Tiger Global
Speaker 1: has been writing massive checks for companies with very little revenue.
Speaker 1: How big a problem has this been in Silicon Valley.
Speaker 1: I think it has been a problem. It's come with
Speaker 1: a lot of weak governance, right because the Tiger Global
Speaker 1: model included writing a huge check to somebody who was
Speaker 1: already running a Unicorn. That person, of course, because they've
Speaker 1: created Unicorn, is a bit imperious and then on top
Speaker 1: of that, you say, we don't want to go on
Speaker 1: your board. We're not going to exercise governance, and we
Speaker 1: defer to you because you were the founder and you're
Speaker 1: so great, and I think that's a good way of
Speaker 1: overseeing companies basically decide I'm not going to oversee them.
Speaker 1: And that's why you had this governance vacuum for unicorns.
Speaker 1: That's why you see companies like we Work or Uber,
Speaker 1: which actually started out pretty well in their early phases,
Speaker 1: go off the moral and commercial rails because nobody was
Speaker 1: monning the store on the board. So what's your wead
Speaker 1: on this massive market correction and how it will impact
Speaker 1: venture capital and private companies. Well, clearly it's bound to
Speaker 1: effect these late stage growth investors like Tiger Glogle first
Speaker 1: because they were investing late, so the exit that was
Speaker 1: anticipated was only a year away. That's in the public markets.
Speaker 1: Of the public markets correct by like the nurse Back
Speaker 1: has done this year, of course, your late stage privates
Speaker 1: are going to go down with it. The second thing
Speaker 1: is that the cost of capital matters when you're writing
Speaker 1: a check for a hundred million bucks, right if you're
Speaker 1: doing early stage VC, you're writing a ten million dollar check.
Speaker 1: It doesn't matter so much what the interest rate is,
Speaker 1: but it is material when it gets to these very
Speaker 1: big checks the Tiger Global is writing. So they've faced
Speaker 1: the brunt of the correction. They've announced that they're going
Speaker 1: to move into doing earlier stage investing, do more seed
Speaker 1: and so forth. That's obviously a smart pivot if they
Speaker 1: know how to do seed, because it is a different discipline.
Speaker 1: And then the question for the broader venture capital businesses,
Speaker 1: how does this ripple down the stack? And it doesn't
Speaker 1: mean that Series C valuations go down a lot, because
Speaker 1: Tiger Global is no wanting to not wanting to pay
Speaker 1: quite so much. In Seriously, if serious C goes down,
Speaker 1: does that mean Serious A goes down? And there's a
Speaker 1: certain point, Emily where there's a problem because the cost
Speaker 1: of hiring engineers is ultimately set by Google. If Google
Speaker 1: is going to continue paying a lot, then the startups
Speaker 1: have to pay a not to get good engineers. And
Speaker 1: if that price is not reset the price of talent,
Speaker 1: then you know, a small adventure capital check in a
Speaker 1: Series A is going to make it difficult for the
Speaker 1: company to work. Now, your book tells a riveting story
Speaker 1: of the history of venture Capital, which you'll have to
Speaker 1: read if you want to learn more. You argue that
Speaker 1: Silicon Valley and venture capital is the main reason that
Speaker 1: Silicon Valley is Silicon Valley. How confident are you that
Speaker 1: other Silicon Valleys can emerge or are emerging elsewhere, whether
Speaker 1: it is Boston or Austin, or New York or London
Speaker 1: or China. So I think the story up to around
Speaker 1: two thousand five is basically the Silicon Valley venture capitalists
Speaker 1: had a special source that other people didn't understand. They
Speaker 1: had this power law approach where they were quite happy
Speaker 1: to write eight checks out of ten that would end
Speaker 1: up losing money, and then a couple would have these
Speaker 1: extreme right tail power law returns that would make up
Speaker 1: for allal losers. And although that sounds a bit obvious now,
Speaker 1: before around two thousand five, vcs in Boston didn't really
Speaker 1: get it, vcs in New York mostly probably didn't get
Speaker 1: it either, and certainly nowhere else in the world, maybe
Speaker 1: with the exception of Israel, did anybody get it. And
Speaker 1: then in two thousand five American vcs from Silicon Valley
Speaker 1: went to China and they moved into India. The whole
Speaker 1: Israel e Consistent took off south the station began, and
Speaker 1: during code we've seen it spread to Austin, Miami and
Speaker 1: so forth. My belief is that the fundamental mindset of
Speaker 1: Silicon Valley venture capital is now spreading pretty much everywhere,
Speaker 1: and that as it arrives in different geographies, it transforms
Speaker 1: the attitude entrepreneurship. People take more risk, and you start
Speaker 1: up cultures which hitherto had been kind of concentrated. Cilicon
Speaker 1: Valley is going to be everywhere. Now. We've been covering
Speaker 1: the big story of Cheryl Samberg leaving Meta, and I've
Speaker 1: heard so many vcs over the years say we're just
Speaker 1: trying to find the next Facebook. Facebook story of course
Speaker 1: has got a lot more complicated. But what is going
Speaker 1: to drive the next cycle of venture capital and the
Speaker 1: quest to find the next Facebook or maybe it's a
Speaker 1: next something else? Well, you know, Facebook was amazing because
Speaker 1: it was this software company that scaled unbelievably fast. And
Speaker 1: the characteristic of both sas and consumer software is that
Speaker 1: you don't need very much capital to have an enormous
Speaker 1: value creation effect, right, And if you're looking at something
Speaker 1: that can do an equivalent miracle, the most likely frankly
Speaker 1: is crypto, right. I know we've had this big correction recently,
Speaker 1: but if you think of the story of unite swap okay,
Speaker 1: a guy called Haydn is in his apartment in New
Speaker 1: York City and he gets laid off from a engineering
Speaker 1: job at Siemens, and then he starts to write code
Speaker 1: because his flatmate, his housemate is is somebody who works
Speaker 1: for Ethereum, and he creates this automatic market maker which
Speaker 1: goes on the Ethereum blockchain. And this individual, pretty much
Speaker 1: as an individual creates a unicorn by himself. I mean,
Speaker 1: that's even more amazing than Instagram, which was people creating
Speaker 1: a unicorn. So I think if you're asking specifically, what
Speaker 1: can do a Facebook style value creation with enormous leverage
Speaker 1: on a small number of talented people, I think it's
Speaker 1: crypt We will be watching if it is. Indeed. Sebastianality,
Speaker 1: senior fellow at the Council on Foreign Relations, author of
Speaker 1: a new book, Power Law. Please check it out. Thanks Sebastian.
Speaker 1: We'll have much more head this this blue work a
Speaker 1: few other stories we continue to watch. Ford is investing
Speaker 1: three point seven billion dollars in factories across three midwestern
Speaker 1: US states to pump out more electric cars and traditional
Speaker 1: gas fueled cars, and a sweeping expansion that will create
Speaker 1: in union jobs. Five four plants will be expanded to
Speaker 1: proce more hot sellers like the electric F one fifty
Speaker 1: lightning pickup, and roll out new models, including a new
Speaker 1: battery powder commercial car. Plus. The crypto business, run by
Speaker 1: billionaire brothers Cameron and Tyler Winklevoss, is making its first
Speaker 1: ever job cuts. Gemini Trust is slashing ten percent of
Speaker 1: its staff as trading across the industry plunges. In a
Speaker 1: memo obtained by Bloomberg, the brothers blame the job called
Speaker 1: so what they called Crypto Winter. Last year, Gemini said
Speaker 1: it raised four million dollars in a round of funding
Speaker 1: that valued the company at seven point one billion dollars.
Speaker 1: Coming up, my exclusive conversation with former Facebook board member
Speaker 1: Don Graham on Cheryl Sandberg's departure and what he thinks
Speaker 1: is next for a woman he's known for more than
Speaker 1: twenty years. He joins us, next, this is Bloomberg. Welcome
Speaker 1: back to bloomber Technology. I Emily Chang in New York.
Speaker 1: Shares of the electric truckmaker Nicola rising Bloomberg reporting the
Speaker 1: latest twist in the story of the company's founder, Trevor Milton,
Speaker 1: who had to resign as chair last year. I mean
Speaker 1: regulatory probes voted against the company at its annual meeting
Speaker 1: to issue more stock are ed Ludlow broke that story
Speaker 1: and has all the details on what it means. Ed. Yes,
Speaker 1: So the proposal the annual general meeting was to include
Speaker 1: the shares increase the shares outstanding from six d million
Speaker 1: to eight hundred, meaning down the line Nikola could sell
Speaker 1: equity to raise money. Now, the biggest shareholder, the former chairman,
Speaker 1: the founder, Trevor Milton, according to sources, voted against that measure,
Speaker 1: and it's really hard to understand why. On the one hand,
Speaker 1: he wouldn't want to dilute his own holdings and diminish
Speaker 1: the value of his holdings. On the other, voting against
Speaker 1: that could inhibit the company from raising money, which means
Speaker 1: the company suffers, and down the line the shares full. Oh,
Speaker 1: there he is in the screen. We've all been wondering
Speaker 1: where he is because he faced his trial next month.
Speaker 1: You'll remember, and Emily accused of deceiving investors and exaggerating
Speaker 1: about the company's technology and claims he made about the
Speaker 1: company's performance. What's also interesting is a lot of retail
Speaker 1: investors are really into this stock. So the other problem
Speaker 1: that Nicola had it it's a GM and one of
Speaker 1: the reasons they had to adjourn it is because nobody voted.
Speaker 1: They needed a majority of the outstanding stock to vote
Speaker 1: on the clause to pass it. But even though Trevor
Speaker 1: Milton voted no, they still didn't get enough shareholders to
Speaker 1: vote generally speaking, So this is a stock there's not
Speaker 1: fed as badly as others years. Today it's getting back
Speaker 1: on its feet, trying to get over the ghost of
Speaker 1: Trevor Milton. But this was an interesting roadblock and a
Speaker 1: twist in the story that we probably didn't expect. All right,
Speaker 1: thanks for the update. I want to get back now
Speaker 1: to the impending departure of Cheryl Samberg at Facebook now
Speaker 1: met US chief operating Officer. This is a role she's
Speaker 1: held for the last fourteen years, growing the company into
Speaker 1: what it is today. I spoke with her ahead of
Speaker 1: the announcement and she told me how she came to
Speaker 1: the decision and how she feels about the company as
Speaker 1: she leaves it. This was a decision I made that
Speaker 1: I did not come too lightly, And it really is
Speaker 1: about how I will spend my time, not how much
Speaker 1: I believe in the company. I believe in the company,
Speaker 1: but as much as I ever did, and staying on board.
Speaker 1: And I really have complete confidence in the key Mark
Speaker 1: and I have built. I think they're going to do
Speaker 1: a great job building the future. Or accompanied us a
Speaker 1: huge part of my life and a huge part of
Speaker 1: my heart joining me now, Donald Graham. He served on
Speaker 1: Facebook's board for seven years. He was also the lead
Speaker 1: independent director when the company went public, and he's known
Speaker 1: Cheryl Samberg and Mark Zuckerberg since the early two thousands.
Speaker 1: He's also the former publisher, of course, of the y
Speaker 1: Shington Post and chair of Graham Holdings Down. So great
Speaker 1: to have you with us. Thank you for joining us today.
Speaker 1: Tell us about that Chryl Sandberg you met all those
Speaker 1: years ago in two thousand one, and what you make
Speaker 1: of her leaving at this moment today. I met Cheryl
Speaker 1: in November December of two thousand when I was fishing
Speaker 1: around as the Clinton administration went out of office to
Speaker 1: see if there were any business minded people who wanted
Speaker 1: to stay in Washington maybe worked for a business, So
Speaker 1: I offered Sheryl a job at the Washington Post. At
Speaker 1: that point I knew she was a super hot property.
Speaker 1: Every single person I talked to in the White House said,
Speaker 1: this is the person you've got to get it is. Ironically,
Speaker 1: she was offered jobs both by me and by Arthur Salzberger,
Speaker 1: the publisher of the New York Times. So Cheryl had
Speaker 1: her choice between the New York Times and the Washington Post,
Speaker 1: and was crazy enough to pick this Google place that
Speaker 1: she thought might have a future. So she went off
Speaker 1: to Silicon Valley. We stayed in touch. I called on
Speaker 1: her when whenever I would go out there, and then
Speaker 1: I tried to hire her again. In two thousand seven.
Speaker 1: I tried to get her to come back to our company,
Speaker 1: this time as president. I felt that I knew that
Speaker 1: our company badly needed somebody who knew a lot about
Speaker 1: technology and Sheryl. Sheryl knew both a lot about technology
Speaker 1: and a lot about advertising, and knew every big advertiser
Speaker 1: in the United States, so that would have been quite good.
Speaker 1: She couldn't do that because she was married to Dave Goldberg,
Speaker 1: who was making a career as the CEO in Silicon Valley.
Speaker 1: So then later on she and Mark both called me
Speaker 1: when she was thinking about going to Facebook. It's clear
Speaker 1: you think very highly of her. For many people, I
Speaker 1: think she has a complicated legacy. The critics think she
Speaker 1: didn't do enough to address the negative consequences of face
Speaker 1: s book. What do you think, you know? Fourteen years
Speaker 1: isn't that long a time. But let us start with
Speaker 1: Facebook when Cheryl Sandberg joined it two thousand eight. When
Speaker 1: she joined, happened to be there that she and Mark
Speaker 1: invited me to join their board. So I went out
Speaker 1: to Facebook for the first time in late two thousand eight.
Speaker 1: Advertising at Facebook at this point consisted of three little
Speaker 1: three line ads on your home page, one of which
Speaker 1: always used the word belly fat. There was absolutely not
Speaker 1: a brand advertising on on Facebook at that point. There
Speaker 1: was next to no revenue because there were next to
Speaker 1: no ads that advertises goodbye and uh Cheryl. As Mark
Speaker 1: had to build Facebook, Cheryl had to build its business.
Speaker 1: It is not too strong to say that in two
Speaker 1: thousand eight, the business, the revenue, the advertising didn't interest
Speaker 1: Mark a lot, and Cheryl had to hire the people
Speaker 1: who were gonna turn Facebook into an actual business, build
Speaker 1: the business, make it work for advertisers. And I knew one. Uh,
Speaker 1: I had one odd status on the board. I was
Speaker 1: the only person who came from an advertising support a bit,
Speaker 1: and I knew that advertising, if you had good advertising,
Speaker 1: it made television or newspapers or Facebook better for users.
Speaker 1: If you had terrible advertising and made it worse for users.
Speaker 1: So Cheryl, I watched Cheryl build that business and it
Speaker 1: was pretty awesome. David Kirkpatrick wrote that Mark Zuckerberg brought
Speaker 1: Cheryl's Hamburg on board in part because of her experience
Speaker 1: and governance and to help Facebook govern itself one day,
Speaker 1: and also to help build a bridge to Washington. This
Speaker 1: is another thing that critics seem to think she failed
Speaker 1: to do. You are at the center of power in Washington.
Speaker 1: How do you think she excelled at that part of
Speaker 1: the role. Well, again, I would go back and ask
Speaker 1: another set of questions. Uh, how many people can you name, Emily,
Speaker 1: with your deep knowledge of American business, who are made
Speaker 1: and made an enormous record as a number two of
Speaker 1: a company currently? How many one two teams are there
Speaker 1: that built a big business? Is where you know the
Speaker 1: number two as well as you know the number one. Yeah,
Speaker 1: I knew people. You know, don KEYO and ROBERTA. Gazetta
Speaker 1: is the first one that comes to mind at Coppec
Speaker 1: who had had a fantastic run. But uh, what always
Speaker 1: strikes me about Cheryl is that as one of the
Speaker 1: as Silicon Valley Royalty is, they're not really the number
Speaker 1: three or four person at Google. She went to work
Speaker 1: for a twenty three year old. She had the curry
Speaker 1: to say, I think Facebook is going to be important.
Speaker 1: I think Mark is a good person, and I'm going
Speaker 1: to go work with him and see what we could
Speaker 1: build together. But they again, you have to remember that
Speaker 1: when she enters the company, there's almost nothing there. There
Speaker 1: is very little revenue, very little advertising, and very little team,
Speaker 1: and she has to build that justice. Mark is building
Speaker 1: the product right, and she talked about that. When I
Speaker 1: spoke with her yesterday, she was thirty eight, he was
Speaker 1: twenty three. It was a leap, a big leap of faith.
Speaker 1: Um I asked her what she's going to do next.
Speaker 1: She talked about her philanthropy, focusing on women's advocacy, spending
Speaker 1: more time with her family, getting married this summer. I
Speaker 1: asked about business in particular, and politics and whether we
Speaker 1: will see her in another business role or a political role.
Speaker 1: Take a listen to what she had to say. I
Speaker 1: learned a long time ago and never make any predictions
Speaker 1: about the future. But I think I think a lot
Speaker 1: of that is pretty unlikely. And I'm really I really
Speaker 1: think there's a lot, hopefully, that I can do with
Speaker 1: my foundation and phil topically. What do you think she'll
Speaker 1: do next on or maybe you know, well, will we
Speaker 1: see her again in business or politics? I don't know,
Speaker 1: because I'll guarantee you Chryl Sandberg doesn't know. But you
Speaker 1: are correct, Emily when you said that Facebook's you know, Facebook.
Speaker 1: Cheryl had fourteen years at Facebook, aid of which where
Speaker 1: people couldn't say enough great things about Facebook and about her,
Speaker 1: And for the last six years, Facebook has been the
Speaker 1: subject of an unusual amount of criticism. I think both
Speaker 1: the praise and the criticism got a little overheated. But
Speaker 1: Cheryl is leaving at a time when Facebook is down
Speaker 1: in reputation, although up in business, and it'll you know,
Speaker 1: she doesn't know what she's going to do next. She
Speaker 1: doesn't know what she's going to be doing five years
Speaker 1: from now or ten years from now. But she is young,
Speaker 1: she is incredibly talented, and whatever she does in the
Speaker 1: rest of her life, she'll do it very well. She'll
Speaker 1: make an enormous fact. She's written two best selling books
Speaker 1: while she was also the CEO of Facebook, and I
Speaker 1: have a feeling that that would that that will continue
Speaker 1: to be a part of her life. It'll be it
Speaker 1: will be a very impressive life, ambitious. Indeed, you wrote
Speaker 1: an op ed don in twenty nineteen titled Why I
Speaker 1: Still Have Faith in Facebook? Do you still have faith
Speaker 1: in Facebook today, knowing the critiques, knowing the negative consequences.
Speaker 1: Do you have faith in Facebook without Cheryl Sandberg? And
Speaker 1: do you believe in the metaverse? Emily? I was an
Speaker 1: insider in Facebook for seven years. I left the board
Speaker 1: in two thousand fifteen. I haven't been an insider since then.
Speaker 1: I am not party to their discussions. I don't know
Speaker 1: in depth any of the most recent business issues you're
Speaker 1: referring to. Yes, I have faith in Facebook. I think
Speaker 1: Mark is a very good CEO. I think Mark Zuckerberg
Speaker 1: is a very good person. I think Cheryl Sandberg is
Speaker 1: a very good person. They have faced decisions that would
Speaker 1: be daunting for anybody. There's never been anything like Facebook,
Speaker 1: just as there's never been anything like Google or Amazon
Speaker 1: or Apple. And they've done their best. I know that.
Speaker 1: I know that they've always done it in a principled manner.
Speaker 1: And yes, I still have faith in Mark outlined a
Speaker 1: team under him, almost all of whom I know. It's
Speaker 1: a team of very good, very highly principled, very admirable
Speaker 1: people who've been at Facebook for most of them for
Speaker 1: eight or ten years and more. Chris Cox, who Mark
Speaker 1: referred to, who runs product at Facebook, uh, is someone
Speaker 1: you should have on your air. He is one of
Speaker 1: the most impressive people I've ever met. He left for
Speaker 1: a time because he didn't like certain business decisions, talked
Speaker 1: it over with Mark returned in the same role. You
Speaker 1: couldn't the Facebook has deep issues to address us. You
Speaker 1: couldn't have better people addressing them than Facebook. Cat Chris
Speaker 1: Cox will be up next. I'm going to send him
Speaker 1: that clip down and see if we'll join us. Don Graham,
Speaker 1: former Facebook board member, thank you so much for joining us.
Speaker 1: So uh important to have your rich historical perspective on
Speaker 1: the company, and Mark and cherw really appreciate it. Thanks
Speaker 1: so much. Bitcoin rebounded after slumping along with stocks Thursday
Speaker 1: met some resistance at the thirty dollar level, where it's
Speaker 1: been trading for the last month. Bloom Works. Katie Greifeld
Speaker 1: here with more on this case. Take it away. I
Speaker 1: can't break the spell. Can't break the spell. Didn't have
Speaker 1: a good day today, I mean tech stock throws. So
Speaker 1: Bitcoin did as well, like you said, over two percent
Speaker 1: on Thursday, right around that thirty thou dollar per coin level.
Speaker 1: And that's important because Bitcoin has been stuck there for
Speaker 1: the better part of a month really since we saw
Speaker 1: the blow up of that terrorist stable coin. What it
Speaker 1: feels like a long time ago, but it was only
Speaker 1: a month ago. So if we can sustainably break above
Speaker 1: per coin, you do have some technical analyst saying that
Speaker 1: there's more blue sky on the charts, but I mean
Speaker 1: it's been a really rough go. We've really been mired
Speaker 1: here and we're still down thirty five percent so far
Speaker 1: this year. And the story about Gemini layoffs, hiring phrases,
Speaker 1: you know, it seems like what's happening at you know,
Speaker 1: general tech companies and tech startups is starting to in
Speaker 1: fact the crypto market as well. Yeah, like the point
Speaker 1: you just made, you're seeing this across the startup industry,
Speaker 1: but particularly in crypto right now. Actually before the show,
Speaker 1: I saw news break that coin base it's extending its
Speaker 1: hiring pause that have been announced two weeks ago. But
Speaker 1: then we just got news that actually they're going to
Speaker 1: resend a number of accepted job offers. Just very painful.
Speaker 1: And that was hours after we got that Gemini news
Speaker 1: that they planned to layoff up to ten percent of
Speaker 1: its workface first, and remember in April Robin Hood laying
Speaker 1: off nine percent of their workforce. This draw down that
Speaker 1: we're seeing, it goes obviously beyond the price of the coins,
Speaker 1: beyond the equity shares. In some cases, it includes layoffs,
Speaker 1: hiring freezes, reduced spending, an investment. It's all playing out
Speaker 1: in cryptol regy. Is there silver lining silver lining depends
Speaker 1: on who you ask, but it did catch my eye.
Speaker 1: There was a fantastic Bloomberg News article today about crypto
Speaker 1: political donations. Actually it is full steam ahead the last
Speaker 1: three months and all of one that's spending total about
Speaker 1: twenty six million dollars, which is amazing because if you
Speaker 1: compare it to other industries, it only falls behind the
Speaker 1: investment industry. That political donation that's more than you saw
Speaker 1: from big tech, big farm, at defense. Crypto really stepping
Speaker 1: up ahead of the mid term elections, so we could
Speaker 1: see it grow even more. But what is also interesting
Speaker 1: that the biggest individual spender Sam Bacuman Freed, he is
Speaker 1: the founder of f t X. Of course he overall
Speaker 1: has pumped in about thirty two million dollars. That is
Speaker 1: seventy of the crypto industries total given SPF of f
Speaker 1: t X, making waves yet again. Okay, Katie, thank you.
Speaker 1: Coming up tackling career development as we navigate a tight
Speaker 1: labor market on a potential downturn, as we were just discussing,
Speaker 1: we'll talk about all that and more with Guild Education
Speaker 1: just at a four point four billion dollar valuation. Guild
Speaker 1: founder Rachel Carlson with me next. This is Bloomberg. Guild
Speaker 1: Education just announced a hundred seventy five million dollars in
Speaker 1: new funding, hitting a four point four billion dollar valuation.
Speaker 1: The company partners with the likes of Macy's and Walmart
Speaker 1: to create new growth opportunities for employees. This at a
Speaker 1: time when there are so many open jobs, which begs
Speaker 1: the question where are the workers? Let's talk about all
Speaker 1: this and more with Guild Education co found or CEO
Speaker 1: Rachel Carlson. So, Rachel, on the one hand, there are
Speaker 1: open jobs. On the other there are layoffs and hiring freezes.
Speaker 1: How do we square these two treads? You know? I
Speaker 1: think at some level, I remember you and others talking
Speaker 1: about the K shooped economy at the beginning of COVID.
Speaker 1: I think that K is now inverting into the X.
Speaker 1: So the layoffs everything we're talking about, those are happening
Speaker 1: in tech and insectors that road the COVID wave. But
Speaker 1: for the average frontline worker, uh, that's not what they're experiencing.
Speaker 1: They're sixty five of frontline workers are talking about looking
Speaker 1: for new work. The great resignation remains, and for most
Speaker 1: of those workers, it's no longer about pay. They've seen
Speaker 1: meaningful pay wage increase to the fifteen dollar an hour.
Speaker 1: They're looking for career advancement, and they're going to companies
Speaker 1: that will prepare them for the future of work. So
Speaker 1: how many workers who get up through up skilled through
Speaker 1: Guild are moving to these open jobs. Yeah, So we're
Speaker 1: really fortunate that we find that of the workers that
Speaker 1: we serve, somebody who engages in the learning program. While
Speaker 1: it work relative to their peer who has the same
Speaker 1: job title but doesn't learn, the learner has a two
Speaker 1: point six x greater increase of being promoted on the job,
Speaker 1: and at some companies like Chipotle, you see that increase
Speaker 1: get all the way up into the seven x so
Speaker 1: sent higher likelihood getting promoted on the job, which obviously
Speaker 1: achieves the economic mobility that so many frontline workers are
Speaker 1: looking for now. Big raise today, and I'm just so
Speaker 1: curious whether you ran into some of these market conditions
Speaker 1: as you were doing this fundraise, did it close before
Speaker 1: all the volatilities we've seen it? And how do you
Speaker 1: plan to conserve this cash that you now have in
Speaker 1: this macro environment? Uh? You know, I've been quoting my
Speaker 1: mom during the fundraise. She always talks about rainy day
Speaker 1: savings accounts, which is what we went out to raise,
Speaker 1: and we kind of did it on a rainy day. So, yes,
Speaker 1: it was an odd time time to be pursuing a fundraise,
Speaker 1: but it was the right move for us. We often
Speaker 1: at Guild talk about our hundred year goals and what
Speaker 1: does it take to build an enduring company, and so
Speaker 1: we're calling this rainy day funding. It's not savings or
Speaker 1: excuse me, it's not spending money, as my mom would say,
Speaker 1: it's to make sure that we can achieve the goals
Speaker 1: we want many years from now, and and we're raising it,
Speaker 1: uh with a mind towards cost discipline, not a goal
Speaker 1: to go spend it or change our budgets. Now, there
Speaker 1: have been some questions about guilds business and how often
Speaker 1: it really does take employees to the next level. How
Speaker 1: are you addressing that? Yeah, I mean we're thrilled with
Speaker 1: the outcomes that we see from our working adult learners. Obviously,
Speaker 1: working to learners move slower, and so we do need
Speaker 1: to change our mindset about how we measure their outcomes.
Speaker 1: UM higher ed's trained to say how fast do you graduate?
Speaker 1: And and that matters, But we think about graduation as
Speaker 1: an input and economic mobility as the outcome. And so
Speaker 1: when our learners are advancding and you know, interestingly enough,
Speaker 1: a large percentage of our learners see a promotion even
Speaker 1: before they complete their program. And that's not how the
Speaker 1: typical professor or hired institution thinks. But if you move
Speaker 1: away from a degree based world to a skills based world,
Speaker 1: you can get rewarded for those skills even before you
Speaker 1: complete the degree. So we're trying to change the paradigm
Speaker 1: of how we think about how do we reward people
Speaker 1: for the skills and the advancement that they want to
Speaker 1: see in their career. I'd love to get your thoughts
Speaker 1: on Cheryl Samberg. You know, obviously it's kind of a
Speaker 1: big historical moment her leaving Meta, you know, after fourteen
Speaker 1: years and writing lean In, and you know, I know
Speaker 1: for many women and many women in business, she's a
Speaker 1: role model. She's also a very controversial figure and some
Speaker 1: people don't necessarily buy into the lean in mentality. Well,
Speaker 1: what's what's your take? I mean, what a Cheryl Samberg
Speaker 1: sort of symbolize to you? Yeah, it's interesting. Um, I've
Speaker 1: been thinking a lot about female leadership of late as
Speaker 1: you know, Oprah joined this round and I often talk
Speaker 1: about her as my my favorite model of empathetic leadership.
Speaker 1: To talk then about Cheryl and many others, like, we
Speaker 1: need lots of models of female leadership there. Men for
Speaker 1: hundreds of thousands of years have had a whole catalog
Speaker 1: of different models to choose from and find what feels
Speaker 1: authentic to each individual as a leader. You can't be
Speaker 1: what you can't see, and so I think having strong
Speaker 1: female leaders with a whole variety of leadership styles is
Speaker 1: super critical, especially for those of us in an industry
Speaker 1: where fewer than two percent of us in the venture
Speaker 1: space of our female Absolutely, So, how do you spend
Speaker 1: plan to spend this money or do you plan to
Speaker 1: maybe spend it a little more slowly than you might
Speaker 1: have in a different environment. Quickly? Yes, So if you know,
Speaker 1: if my mom's watching, we committed this is a rain
Speaker 1: this is a rainy day fund. We're not spending it.
Speaker 1: We're not changing our budget this year, um, but we're
Speaker 1: you know, we're solving a societal problem at Guild that's
Speaker 1: gonna last for many decades to come. And so we're
Speaker 1: thinking about how do we fund our busines this into perpetuity,
Speaker 1: not how do we fund it for this year, but
Speaker 1: what we are maintaining in an in a time of uncertainty,
Speaker 1: as many other companies are changing their plans, were maintaining
Speaker 1: our commitments um first to ensure that we're capturing all
Speaker 1: the amazing employer momentum we're seeing. Far more companies are
Speaker 1: now ready to take this jump and fund their employees
Speaker 1: going back to school, and then we're really advancing and
Speaker 1: career development, making sure that all of our members can advance. Rachel,
Speaker 1: thanks for joining us, and shout out to your mom.
Speaker 1: She's jumping up and down right now. Rachel Carlson, CEO
Speaker 1: of Guild, thank you. That doesn't for the sedition of
Speaker 1: Bloomberg Technology. We'll be back tomorrow. I'm Emily Trying in
Speaker 1: New York. This is Bloomberg