Speaker 1: From Mahard where Innovation, money and power Collie in Silicon
Speaker 1: Vallet NBN. This is Bloomberg Technology with Caroline Hyde.
Speaker 2: And Ed Ludlow.
Speaker 3: I met Ludlow in San Francisco. Caroline Hyde is off today.
Speaker 3: This is Bloomberg Technology coming up. We have full market
Speaker 3: coverage ahead as investors scale back on geopolitical concerns, with
Speaker 3: stocks bouncing off their lows.
Speaker 4: Plus Netflix shares.
Speaker 3: Full after a disappointing revenue outlook and plans to stop
Speaker 3: reporting its subscriber numbers. Details to come, and financial services
Speaker 3: platform Ramp raises an additional one hundred and fifty million
Speaker 3: dollars to reach a seven point six billion dollar valuation
Speaker 3: with new backup coastal adventures. We sit down exclusively with
Speaker 3: CEO Eric Lyman later this hour.
Speaker 4: Let's get to those markets. We know the themes.
Speaker 3: Geopolitical concern kind of some caution, if not risk off
Speaker 3: mentality Israel with a muted retaliatory strike against Iran.
Speaker 4: We will go to DC in just a moment and.
Speaker 3: Discuss the politics of it and operationally what's happening nas
Speaker 3: that one hundred is down a full percentage point. Tech
Speaker 3: is actually where there is the most downward pressure right now.
Speaker 4: There are other stories.
Speaker 3: Within that, and on the board you'll see names like
Speaker 3: Tesla and Netflix. Tesla with a cybertruck recor I'll give
Speaker 3: you the details later in the program. Netflix had a
Speaker 3: mega start to the year, but the investor base is
Speaker 3: spooked by its outlook for the future and how it
Speaker 3: plans to communicate.
Speaker 4: I'm also looking at crude.
Speaker 3: We did see oil move higher based on what happened
Speaker 3: in the Middle East. That's not hugely a surprise. Let's
Speaker 3: get to the top story. Israel launched a retaliatory strike
Speaker 3: on Iran less than a week after Tehran's rocket and
Speaker 3: drone barrage. Iranian media appeared to downplay the incident in
Speaker 3: the hours that followed the initial reports. For more, let's
Speaker 3: get out to Washington, DC and Bloomberg Balance of Power
Speaker 3: host Kaylee Liones.
Speaker 4: This is the framing.
Speaker 3: It is a retaliation that muted and seems to be
Speaker 3: that Israel listened to the United States who were urging
Speaker 3: them to show restraint.
Speaker 5: Yeah, not just the United States, but other allies and
Speaker 5: partners as well, including officials from the UK and Germany,
Speaker 5: which actually made a trip to Israel earlier this week.
Speaker 5: To encourage Prime Minister Netanyahu to have restraint here in
Speaker 5: the response to that unprecedented attack we saw Aron conducting
Speaker 5: over last weekend. More, of course, the more than three
Speaker 5: hundred missiles and drones sent Israel's way were largely intercepted
Speaker 5: by air defenses by not just Israel and other allies.
Speaker 5: Now RNY and media have confirmed that there was a
Speaker 5: drone attack in in Safon, where there was a military operation. However,
Speaker 5: it did not actually hit any nuclear facilities, according to
Speaker 5: our understanding at the moment, and that perhaps could have
Speaker 5: been one of the most escalatory things of all. It
Speaker 5: does not seem that that happened. Instead that this was
Speaker 5: relatively a limited strike with very little damage that seems
Speaker 5: to have resulted from it. US officials have confirmed to
Speaker 5: Bloomberg that Israel was behind this attack. Israel, as is
Speaker 5: typical in military operations relating to Iran, has not confirmed
Speaker 5: or denied it, not commenting at all. In the US
Speaker 5: Secretary of State Anthony Blincoln, also who was at a
Speaker 5: G seven meeting in Italy, didn't directly comment on this attack,
Speaker 5: but did go out of his way to say that
Speaker 5: the US has not been involved and any offensive operations
Speaker 5: and remains committed to de escalation between Israel and Iran,
Speaker 5: knowing of course that the US is primary objective throughout
Speaker 5: this entire saga that really has taken place, not just
Speaker 5: in the most immediate past, but since October seventh, when
Speaker 5: Hama's first attacked Israel. Is to have this not spread
Speaker 5: into a wider conflict. Right now, the signal from both
Speaker 5: Israel and Iran does not seem to be that there
Speaker 5: is interested in escalating this further. The sign seems to
Speaker 5: be that Iran is not immediately in flying to launch
Speaker 5: another counter strike against Israel for this, as the Ranian
Speaker 5: media saying largely the strike was unsuccessful.
Speaker 4: I'm just passing over the markets.
Speaker 3: Later in the program, Paily, we're going to do a
Speaker 3: deep dive on bitcoin, and I thought that actually the
Speaker 3: reaction over is sort of twenty four hour time period
Speaker 3: was interesting, kind of came down. I think we're back
Speaker 3: up in the session that the Nasdaq one hundred. On
Speaker 3: the equity side, it is the kind of megacat tech
Speaker 3: names that are pushing lower and points basis they're.
Speaker 4: A big drag on the index.
Speaker 3: My point being markets are trying to work out how
Speaker 3: serious this is operationally. The only kind of update that
Speaker 3: I've seen is from Secretary Blincoln, who in summary, basically said,
Speaker 3: you know, the United States did not participate, but do
Speaker 3: we have any sense of strategy here on the US side,
Speaker 3: given how they've operated in a basically advisory capacity in
Speaker 3: this situation so far?
Speaker 5: Well, the US has been quite clear that they will
Speaker 5: stand by their Iron Cloud commitment to Israel as an
Speaker 5: ally and a in Israel's defense, as we saw last
Speaker 5: weekend when it was US Air Defense that also contributed,
Speaker 5: alongside the UK and Jordan to making sure that the
Speaker 5: vast majority of those drones and missiles did not actually
Speaker 5: end up in Israeli airspace. But that is really where
Speaker 5: the US seems to have drawn the line. Yes, we
Speaker 5: will help defend you, However, we will not join you
Speaker 5: and any offensive operations. It was widely reported that when
Speaker 5: President Biden spoke to Netanyahu after last weekend's attack, he
Speaker 5: suggested that he should take the win essentially not go
Speaker 5: any further in that the US would not be joining
Speaker 5: them if the Israelis decided to counter attack against Iran again.
Speaker 5: It seems that Israel has decided to do so, but
Speaker 5: in a limited fashion, and it has done very clear
Speaker 5: messaging from the Secretary of State that the US was
Speaker 5: not involved in any particular offensive attack, including this one.
Speaker 6: Ed.
Speaker 3: There is a lot happening in DC at the moment,
Speaker 3: and in the coming week we're going to be talking
Speaker 3: a lot about TikTok. How much of the focus has
Speaker 3: been captured by the situation in the lease, both at
Speaker 3: the sort of federal level in the White House and
Speaker 3: through Congress as well well.
Speaker 5: A great deal at especially considering that Congress as we
Speaker 5: speak is getting ready to advance supplemental aid for other
Speaker 5: allies too, including Ukraine and Taiwan, but billions of dollars
Speaker 5: in aid for Israel. It's working its way through the House.
Speaker 5: We expect a procedural vote will tappen on the House
Speaker 5: floor today to advance that for a full floor vote tomorrow,
Speaker 5: either in the late afternoon or evening, which would then
Speaker 5: go on to the Senate and presumably be signed by
Speaker 5: President Biden in the not so distant future. So the
Speaker 5: US is actively thinking about the military support that it
Speaker 5: is providing allies. This has been a bit of a
Speaker 5: difficult journey, especially because the Ukraine aid itself has been
Speaker 5: complicated but I would just note that there's other political
Speaker 5: factors specifically with the Middle East here, including very high
Speaker 5: domestic pressure on President Biden from within the progressives in
Speaker 5: his own party, who also are not very supportive of
Speaker 5: the Israeli operation that we have seen in Gaza, given
Speaker 5: the high death toll of Palestinians, which authorities in Gaza
Speaker 5: say has now surpassed thirty four thousand. So at the
Speaker 5: same time that the US has been come to the
Speaker 5: defense of Israel in the case of Iran wants to
Speaker 5: make sure Israel is secure, it also has been putting
Speaker 5: a lot of pressure on the net Yahoo government to
Speaker 5: take higher account of the civilian toll of this war
Speaker 5: to make more easier to get humanitarian aid. In has
Speaker 5: been encouraging them not to conduct an operation in the
Speaker 5: city of Ratha, where there are remaining Hamas battalions, until
Speaker 5: they can safely evacuate the more than a Thousandtinian civilians
Speaker 5: that are there. So it's been a very difficult dance
Speaker 5: for the US to still be supportive of Israel, stand
Speaker 5: behind it as an ally, but also try to exercise
Speaker 5: some leverage to change Israeli policy, perhaps in regard to
Speaker 5: its ongoing war with.
Speaker 3: Hamas Bloombas k Lines in DC. Just terrific and deep
Speaker 3: reporting on what is a geopolitical situation, but just looking
Speaker 3: purely at the index level, and as that one hundred
Speaker 3: super tech heavy it's the megacat tech names that are
Speaker 3: dragging us down and they're really underperforming the benchmarkt S
Speaker 3: and P five hundred and the TAO is actually in
Speaker 3: positive territory. That's why we're focused there. The reaction in
Speaker 3: the markets is being felt in tech right now.
Speaker 7: This remotely operated vehicle offers a glimpse into what lies
Speaker 7: of thousands of meters underwater. It's one of several deep
Speaker 7: sea vehicles on board this repurposed ship from Ray Dalio's
Speaker 7: philanthropic venture. The Ocean Explorer behind me that's currently dogged
Speaker 7: in Singapore, will set off on its mission very soon
Speaker 7: to explore the deep waters of Southeast Asia. There's lots
Speaker 7: of advanced tech at creatre like this remotely controlled underwater.
Speaker 8: Vehicle that can go six thousand meters deep.
Speaker 7: To collect data any summer siples that contee passengers as
Speaker 7: deep as one thousand meters underwater. The vessel was once
Speaker 7: used in the oil and gas sector, but the revamped
Speaker 7: diesel electric ship now travels around the world, collaborating with
Speaker 7: governments and working with local scientists. It's in Southeast Asia
Speaker 7: to study the region's marine environment in an attempt to
Speaker 7: protect the oceans from the effects of climate change.
Speaker 3: Just such deep reporting on marine propulsion navigation. Bloomberg's Ainsley
Speaker 3: as a can with that report. Okay, let's get to
Speaker 3: talking tech and in the news, Apple is pulling metas
Speaker 3: WhatsApp from its app store in China amid orders from
Speaker 3: Beijing to close more loopholes in the country's long standing
Speaker 3: Internet firewall. The iPhone maker also removed the messaging services
Speaker 3: Telegram and Signal, according to consultants who are tracking that space.
Speaker 3: Plus sticking with Meta, the social giant has unveiled a
Speaker 3: new version of its powerful Lama artificial intelligence model. LAMA
Speaker 3: three is an upgrade from an AI model that Meta
Speaker 3: released last summer, and it's the latest effort to keep
Speaker 3: pace with similar technologies from companies like Open Ai and Google.
Speaker 3: And finally, Apollo and Sony are considering a joint offer
Speaker 3: for Paramount Global. According to sources, the two firms have
Speaker 3: held discussions about teaming up on and offer, but have
Speaker 3: not yet submitted an official proposal. Sony and Apollo's entry
Speaker 3: would complicate a deal that's already in the works for
Speaker 3: the studio, which is currently holding exclusive talks with Skuidance Media.
Speaker 3: Stick with Media digging into Netflix shares falling after earnings.
Speaker 4: But need them and Co.
Speaker 3: Actually upgrading Netflix today to buy from hold with an
Speaker 3: updated price target seven hundred US dollars. Laura Martin, senior
Speaker 3: entertainment and Internet analysts over at Needham and Co, is
Speaker 3: here with us live Bloomberg Technology. I really enjoyed your note. Hello,
Speaker 3: good morning, Happy Friday. Not so happy based on Netflix
Speaker 3: share response. The anxiety I think is the idea that
Speaker 3: they just won't report monthly subscriber gains or losses.
Speaker 4: Why so, I think.
Speaker 2: It's a great point.
Speaker 9: I mean, first of all, they're not going to do
Speaker 9: it until the first quarter of twenty five, so all
Speaker 9: of this year are sort of safe. Second, I'm really
Speaker 9: skeptical they can do this because, other than Apple, which
Speaker 9: I do not think Netflix is Apple, every company that
Speaker 9: has a subscriber driven business reports subscribers because we calculate
Speaker 9: value on a per subscriber basis. So I don't know
Speaker 9: if they'll actually do away with it, even though they've
Speaker 9: said they will. They're pretty good about listening to feedback,
Speaker 9: and Wall Street's feedback is pretty negative about this, like
Speaker 9: opaqueness that they're adding to the fundamentals. So but anyway,
Speaker 9: it's not an issue until the first quarter of twenty
Speaker 9: five at the earliest. I also think people are having
Speaker 9: issues with sort of below like a negative sub ad
Speaker 9: number compared to first quarter.
Speaker 2: They don't like that.
Speaker 9: And also the guidance for Q two is a little
Speaker 9: light compared to consensussessments. So I think people are worried
Speaker 9: about a slow down in revenue growth.
Speaker 3: I like the phrasing opaque. I mean Netflix managements thing
Speaker 3: has always been like judge USh on these traditional financial metrics,
Speaker 3: you know, profit. Basically, what I found interesting if you
Speaker 3: look at the nine point three to three million customers
Speaker 3: added in the first quarter, that there's a story behind it, right,
Speaker 3: which is that the password crackdown seemed to bring to
Speaker 3: them people that were forced to sign up for their
Speaker 3: own account and they were willing to do that. What
Speaker 3: was your interpretation of that number in the moment.
Speaker 9: So I also think that what's happening is when someone
Speaker 9: calls to disconnect because they're angry that they're going to
Speaker 9: have to buy, you know, buy a whole another subscription,
Speaker 9: or that the price is going up with the ad
Speaker 9: driven tier. Instead of canceling your fifteen dollars subscription that's
Speaker 9: on its way to twenty dollars, you can go to
Speaker 9: a seven dollars per month heer.
Speaker 2: You just have to take ads.
Speaker 9: But right now they tell us it Netflix if they
Speaker 9: don't have that many ads, that they have way more
Speaker 9: supply of AD units available to sell than they do
Speaker 9: have demand for AD units, which means the AD loads
Speaker 9: here are very minimal, like one or two ads an hour.
Speaker 9: So that's a pretty good deal for consumers right now
Speaker 9: because you can pay seven dollars a month and get
Speaker 9: almost no ads in what's called the AD tier. So
Speaker 9: three years from now there'll be five minutes of AD loads,
Speaker 9: but today there's like one minute of AD loads and
Speaker 9: you're paying seven dollars. I think that is helping their
Speaker 9: reported sub number, although it's hurting the art what they
Speaker 9: call arm what the rest of the world caused arpoo
Speaker 9: because the average the subscriber that used to disconnect and
Speaker 9: go to zero is now going to seven dollars, So
Speaker 9: it's pulling down the average revenue per subscriber as people
Speaker 9: sign up for these ad driven tears.
Speaker 3: Just a quick update for our Bloomberg Technology audience, laur
Speaker 3: I just wanted to talk about the shares really quickly.
Speaker 3: We're down more than eight percent off session lows that
Speaker 3: at one point that the stock was on track for
Speaker 3: its biggest drop since April of twenty twenty two. Let's
Speaker 3: see where we end up at the end of the day.
Speaker 3: I don't understand why we don't talk a little bit
Speaker 3: more about the strength of the content slate. I have
Speaker 3: just finished watching The Gentleman, for example, the TV or
Speaker 3: series adaptation of the Guy Richie film. Thought it was
Speaker 3: good for what it's worth, content wise, continuity wise, Netflix
Speaker 3: seems to be okay.
Speaker 4: Why are we not discussing that more.
Speaker 9: I think because Wall Street sort of feels that's the
Speaker 9: that's their They make widgets, right, their widget happens to
Speaker 9: be content. We assume they're going to do a good
Speaker 9: job of that. With the seventeen billion dollars a year
Speaker 9: that public shareholders give them, we expect them to maximize
Speaker 9: the quality of that seventeen billion of content.
Speaker 2: We sort of think that's their core business.
Speaker 9: Like just because Apple makes great phones like that, you
Speaker 9: don't give them kudos for that, Like they better make
Speaker 9: great phones otherwise people aren't going to keep the service.
Speaker 9: So I think that's their core business. And I also
Speaker 9: think Wall Street is skeptical of hit driven businesses because
Speaker 9: you may love The Gentleman, which I also thought was
Speaker 9: excellent content, but somebody else wants to watch the Kardashians
Speaker 9: on a different service. Like you know, what quality content
Speaker 9: is to different people is different, and so you know,
Speaker 9: what we care about on Wall Street is what is
Speaker 9: what's happening with the return on investment for the seventeen
Speaker 9: billion of content.
Speaker 2: And I will tell you sports.
Speaker 9: Is really important to Wall Street, and I think it's
Speaker 9: really important to these streaming services.
Speaker 2: So they are doing more with sports.
Speaker 9: As you saw on the car, there's a lot of
Speaker 9: talk about this big fight that's coming up. They've now
Speaker 9: signed up WWE to do live sports let's call it
Speaker 9: entertainment sports, yes.
Speaker 2: Every week for next year. That's a big deal.
Speaker 9: They are softening on sports, but they also said they
Speaker 9: are not going to spend any more money on sports.
Speaker 9: They're going to have to the sports fees will have
Speaker 9: to come out of the seventeen billion in total content cast.
Speaker 2: That's really important. I think there need to be in news.
Speaker 3: Also, Laura, we got to go with some breaking news,
Speaker 3: but we'll have you back to talk Jenai and the
Speaker 3: context of Netflix.
Speaker 4: Thank you. This is the breaking news.
Speaker 3: First of all, in the House, the Ukraine Aid and
Speaker 3: TikTok bills have cleared the procedural hurdle in.
Speaker 4: The House that we were waiting for.
Speaker 3: Separately, on the Senate floor, Majority Leader Chuck Schumer is
Speaker 3: speaking and saying that lawmakers should plan to work this
Speaker 3: weekend to take up the Ukraine Aid bill quickly, and
Speaker 3: we'll keep an eye on TikTok. Those are stories we're
Speaker 3: tracking here on Bloomberg Technology. We'll be right back. This
Speaker 3: is Bloomberg takelogy.
Speaker 4: Let's go back to.
Speaker 3: Those breaking news headlines out of Washington, d C. In
Speaker 3: the House, the Ukraine Aid and TikTok bills have cleared
Speaker 3: a key procedural hurdle.
Speaker 4: Separately out of the.
Speaker 3: Senate, Majority Leader Chuck Schumer speaking saying that lawmakers should
Speaker 3: plan to work this weekend in the context of the
Speaker 3: TikTok bill, the divest or ban bill. That's one that
Speaker 3: we've been tracking on this program because we're trying to
Speaker 3: understand the cadence of how quickly that could be ratified,
Speaker 3: if at all. I think my colleague and friend Bluembos
Speaker 3: Kylee Lines hosts a balance of power.
Speaker 4: Is good and joins us from Washington, d C.
Speaker 3: I was trying to pass two things happening in parallel, Kayley,
Speaker 3: from the House and the Senate.
Speaker 4: What are you seeing?
Speaker 5: Yeah, well, a this was a massive vip artis and
Speaker 5: majority that this procedural vote advanced under. It was more
Speaker 5: than three hundred members of the House to be exact,
Speaker 5: three hundred and sixteen who voted for passage of the rule,
Speaker 5: which will clear the way tomorrow for them to pass
Speaker 5: one by one this series of bills. It will likely
Speaker 5: happen over the course of Saturday afternoon to evening. One
Speaker 5: bill that will have more than sixty billion dollars in
Speaker 5: military aid for Ukraine billions more, and a separate bill
Speaker 5: for Israel, and then a separate one for the Indo Pacific.
Speaker 5: And that will be a fourth bill as well, which
Speaker 5: we are calling the sidecar here in Washington, that includes
Speaker 5: a variety of other measures including that divestiture bill relating
Speaker 5: to TikTok At, as well as others like the Repo Act,
Speaker 5: which will allow for the seizure of frozen frozen Russian
Speaker 5: assets that could be used to pay for Ukraine's war effort. So,
Speaker 5: once all of this passes the House, presumably there's going
Speaker 5: to be two quick key questions. One is how quickly
Speaker 5: can it be repackaged together to be sent to the
Speaker 5: Senate for passage to get to the desk of President
Speaker 5: Biden for a signature, and also what will happen to
Speaker 5: the House Speaker Mike Johnson. As a result of this,
Speaker 5: he has been under tremendous pressure from a few members
Speaker 5: of his republic conference who do not want to see
Speaker 5: Ukraine Aid go to the floor of the.
Speaker 4: House for a vote.
Speaker 5: One of the most outspoken has been Congressman Marjorie Taylor Green,
Speaker 5: who has filed a motion to vacate, which is what
Speaker 5: Oust Speaker Kevin McCarthy just months ago. Has not yet
Speaker 5: acted on it, but has long signals she could if
Speaker 5: indeed he put Ukraine Aid on the floor. So we're
Speaker 5: going to wait to see for action on that. Other members,
Speaker 5: including Republican Congressman Tom Massey have suggested they will join
Speaker 5: her in that effort, however, ed and this is where
Speaker 5: it gets really interesting. It took Democrats to get this
Speaker 5: rule pass, to get it over the finish line now,
Speaker 5: and it does seem that Democrats may step in to
Speaker 5: help save the gavel of Speaker Johnson if it proves necessary.
Speaker 5: There's been a lot of talk here in Washington this
Speaker 5: morning about this kind of being like a coalition government
Speaker 5: because Mike Johnson is relying on the other party to
Speaker 5: basically get everything over the line, and potentially might be
Speaker 5: relying on them to help him keep his job.
Speaker 3: That's kind of focused on the House level. Let's take
Speaker 3: a moment here. There's a lot happening, and there are
Speaker 3: a lot of headlines in parallel. Chuck Schumer in the
Speaker 3: Senate is saying that lawmakers should plan to work this
Speaker 3: weekend is needed. You know, there will be audience members
Speaker 3: around the world, but particularly around the country in the
Speaker 3: United States, saying why are they working through the weekend
Speaker 3: on this Why is it so important?
Speaker 5: Well, because this aid is desperately needed. If you listen
Speaker 5: to US intelligence officials that I was speaking with the
Speaker 5: chair of the House Intelligence Committee, Congressman Mike Turner just
Speaker 5: last night, who was suggesting that it needed to pass
Speaker 5: this week based on the intel they are getting on
Speaker 5: the ground in Ukraine. Just procedurally because of the way
Speaker 5: the House works and the requirement that members have to
Speaker 5: have seventy two hours to read the bill. Because of
Speaker 5: when the text is released, they can't actually have the
Speaker 5: vote until Saturday night. Now, the Senate is going to
Speaker 5: very want to quickly take this up, which could mean
Speaker 5: that they take it right as soon as the House
Speaker 5: passage passes it and begin to do the procedural work
Speaker 5: in the Senate to get this over the finish line,
Speaker 5: which maybe why they end up staying the weekend. I
Speaker 5: would also point out that the Senate tonight is facing
Speaker 5: a midnight dadlight of the expiration of FISA. The Foreign
Speaker 5: Surveillance Act, which of course has been passed in the House,
Speaker 5: has been running into some her in the Senate as well,
Speaker 5: and that could potentially lapse for a bit at midnight
Speaker 5: if they can't figure out a way to get the
Speaker 5: unanimous consent needed to advance that. So it could be
Speaker 5: a working weekend for everyone, which is probably not going
Speaker 5: over well for some considering they were supposed to leave
Speaker 5: on recess beginning today. There were a number of members
Speaker 5: who were scheduled to be on congressional delegations to a
Speaker 5: number of different localities, and instead they may stay here
Speaker 5: to get this work done.
Speaker 3: Ed Okay, So it sounds like we're in for a
Speaker 3: busy weekend, probably you more so than I out here
Speaker 3: in San Francisco. Is there anything we should be watching
Speaker 3: for this Friday afternoon?
Speaker 5: Well, I would watch what happens in the Senate related
Speaker 5: to Faiza, in particular whether they can reach some kind
Speaker 5: of agreement on amendment votes or things of that nature
Speaker 5: to make sure that this can indeed get over the
Speaker 5: finish line by the deadline. But really watch what happens
Speaker 5: in the House now that this rule has advanced, to
Speaker 5: see if we actually see any action for Marjorie Taylor Green,
Speaker 5: for example, to launch the process to vacate the speaker,
Speaker 5: and what could unfold from there. Also, given that there
Speaker 5: are so many things attached to this that including the
Speaker 5: TikTok bill, which did pass, why bipartisan majority in the
Speaker 5: House originally now has a revision that would allow byte
Speaker 5: dance longer than six months to divest it potentially up
Speaker 5: to a full year, which may make it easier to
Speaker 5: digest in the Senate, where many had issue with the
Speaker 5: original bill. But just look to see now that the
Speaker 5: TikTok measure does appear to be on track for a
Speaker 5: passage in the House, whether there or anyone is vocal
Speaker 5: in the Senate suggesting that they don't like the fact
Speaker 5: that this is attached to the package. So it'll kind
Speaker 5: of be just digging into the nuances of who may
Speaker 5: be upset here, even as vast bipartisan majorities seem to
Speaker 5: be liking what they're seeing and looking.
Speaker 4: To advance this.
Speaker 3: At Bloomberg's Kadi Alliance, thank you, aid and TikTok bills,
Speaker 3: will keep a close eye on. Welcome back to Bloomberg Technology,
Speaker 3: im Ed Ludlow in San Francisco. We should talk about bitcoin,
Speaker 3: and it's interesting because bitcoin has its own story in
Speaker 3: the markets, which is the harving, and we will have
Speaker 3: a deep disc about that in just a moment. But
Speaker 3: if you look at the trading of bitcoin, which trades
Speaker 3: twenty four to seven over the last twenty four hours,
Speaker 3: it tells you an interesting story about that asset in
Speaker 3: the context of geopolitics and volatility in markets. So when
Speaker 3: the headlines first started to come out Thursday evening US
Speaker 3: time about a Israel retaliation in Iran, there was this
Speaker 3: clear downward move on Bitcoin. Actually in the session we're
Speaker 3: now up higher and on a two day basis up
Speaker 3: six percent. All told, Bitcoin just south of sixty five
Speaker 3: thousand US dollars per token. Then there's the other big story,
Speaker 3: the hotly anticipated bitcoin harving is approaching. Here's what our
Speaker 3: Bloomberg guests have had to say about the event.
Speaker 1: Every time we'd come up to one of these having events.
Speaker 1: It really does come back to the fundamentals of supply
Speaker 1: and near the.
Speaker 8: Cripple industry gust cycle is to be expected. That's going
Speaker 8: to be market volatility. It doesn't only impact the set Frank,
Speaker 8: I mean, given jee political tension, given the interest rate
Speaker 8: environment that you're seeing, the inflation are environment.
Speaker 10: Obviously Bitcoin and crypto in general is out of the
Speaker 10: global financial system, so we are not completely disconnected from
Speaker 10: what's happening in equities, for example, and what's happening with
Speaker 10: monetary policy, or with what's happening in the geo political environment.
Speaker 4: We've been preparing for many years.
Speaker 11: You know, our business is one that requires long term planning,
Speaker 11: and these havings are known events, and so the evolution
Speaker 11: of mining has really changed since previous havings where we
Speaker 11: had a really fragmented market.
Speaker 1: I think a lot of investors are eagerly anticipating to
Speaker 1: see what the market reaction will be.
Speaker 3: Joining us now is Cavita Gupta Delta Blockchain Fund general partner,
Speaker 3: just deep expertise in the underlying technology that supports digital assets,
Speaker 3: also some pretty strong awareness of what's happening in markets.
Speaker 4: Covi, just forgive me. I'm going to go back to
Speaker 4: basics here.
Speaker 3: I've said the word harving, some people call it a
Speaker 3: halve then many times, and I'm going to cheat. I'm
Speaker 3: just going to read the Bloomberg definition of what it is,
Speaker 3: and then you can tell me whether it's important or not.
Speaker 3: A harving, sometimes referred to as a harvening, is a
Speaker 3: planned reduction in the rewards miners receive. Halving's happen once
Speaker 3: every four years, or every two hundred and ten thousand blocks.
Speaker 3: Just for awareness out there, are you really excited about this, Kavita?
Speaker 12: I think excitement may not be the word I would
Speaker 12: be using. What does bitcoin happening really means? It just
Speaker 12: means that it makes it more difficult for the miners
Speaker 12: to have the rewards associated with mining, and also definitely
Speaker 12: that results in having mining difficulties. Basically you have to
Speaker 12: put more energy, more complicated theorems out there, and it
Speaker 12: basically ultimately increase the cost of mining. That's what we
Speaker 12: are looking at. It is important because it makes sure
Speaker 12: that it is much more secure. Mining is secure.
Speaker 2: All the bitcoin layer is secure.
Speaker 12: Now this definitely gets it's a lot of attention because
Speaker 12: of the price movement, the expected especially now with the
Speaker 12: expected the DF which has already happened. Now for the
Speaker 12: first time, we're going to expect a new price curve
Speaker 12: because the supply and the demand curve for bitcoin has
Speaker 12: been very unique this time. The supply has been huge.
Speaker 12: Usually what we see that before bitcoin having and around
Speaker 12: bitcoin having a lot of people start putting bitcoins out,
Speaker 12: So the supply has been there, but the demand has
Speaker 12: been so high that we see volatility instead of the
Speaker 12: straight curves down or up. So it is exciting in
Speaker 12: that way.
Speaker 3: You make a really interesting point, which is basically one
Speaker 3: of liquidity. It's quite a liquid market and the counter
Speaker 3: argument is that there will always be a finite supply
Speaker 3: of bitcoin a definitive number, and that is largely what
Speaker 3: those that build a thesis of bitcoin reaching a much
Speaker 3: higher number in the long term rely on. Are those
Speaker 3: people in that camp, correct.
Speaker 12: I absolutely believe that at the end of the day,
Speaker 12: bitcoin has a lot of value and even though it
Speaker 12: is more difficult to not produce and the supply is
Speaker 12: going to be more and more limited. But that's what
Speaker 12: we see with most of the commodities, whether it's cold,
Speaker 12: whether it's platinum, silicon, anything which has limited supply, but
Speaker 12: a lot of value long run, especially storage value like
Speaker 12: bitcoin has been considered. Now it's just going to increase
Speaker 12: the price. You will see volatility, which you still see
Speaker 12: in gold today, but the value is just in finite
Speaker 12: and for a very long period of time.
Speaker 3: Calvi to good to Delta Blockchain Fund general partner someone
Speaker 3: investing at the technology level. But I just really appreciate
Speaker 3: your market insights.
Speaker 4: Thank you.
Speaker 3: There's another big story out there today in the world
Speaker 3: of ev and I want to talk about Tesla. The
Speaker 3: TV maker recalled over thirty eight hundred cyber trucks to
Speaker 3: rework or replace accelerator pedals that can dislodge and cause
Speaker 3: the vehicle to unintentionally accelerate, which increases the risk of
Speaker 3: a Tesla received notice of two customer claims related to
Speaker 3: that issue, and that's all. According to a recall report
Speaker 3: submitted to the US National Highway Traffic Safety Administration or NITZER.
Speaker 3: The company said that when high force is applied to
Speaker 3: the cyber trucks accelerator, the pedal may dislodge and become
Speaker 3: trapped by the interior trim. Tesla is going to fix
Speaker 3: the acce rat of pedals free of charge for me.
Speaker 4: The other big thing.
Speaker 3: About this story is we now know how many cyber
Speaker 3: trucks are out there in the wild and how many
Speaker 3: have been delivered to customers, which is quite interesting. Tesla
Speaker 3: shares basically flat, all right. Coming up on Bloomberg Technology,
Speaker 3: we're going to be joined by RAMP CEO Eric Glyman
Speaker 3: to discuss their new fundraise.
Speaker 4: There are some big numbers.
Speaker 3: And there's an interesting conversation ahead. This is Bloomberg Technology, Okay,
Speaker 3: a lot of people talking about this one financial services platform.
Speaker 3: RAMP just raise an additional one hundred and fifty million
Speaker 3: dollars for its Series D Round Part two at evaluation
Speaker 3: of around seven point six billion dollars with a new backup.
Speaker 3: Coast of Adventures delighted to bring in RAMP CEO Eric
Speaker 3: Lyman out in New York, and this is a really
Speaker 3: interesting round. The venture firm leading it was Coast of Adventures,
Speaker 3: but Keith Raboy, who recently rejoined Coastler on the East Coast,
Speaker 3: kind of spearheaded this. Just explain the rationale behind doing
Speaker 3: the round.
Speaker 6: I mean, there's a couple of things that and by
Speaker 6: the way, thank you so much for having me first.
Speaker 6: The rationale is the company is growing and we aim
Speaker 6: to accelerate it. Not only is Ramp one of the
Speaker 6: fastest growing businesses in US history, but investors were deeply
Speaker 6: exciting Keith the most who's one of our board members,
Speaker 6: who saw the business at its large scale accelerating and growth.
Speaker 6: So typically they tend to slow down as they grow.
Speaker 6: The rationale is to increase the pace of customers that
Speaker 6: we serve. We power over approximately one percent of all
Speaker 6: corporate card transactions in America. We want to serve the
Speaker 6: next ninety nine percent. But more than that, it's a
Speaker 6: high conviction bet both by investors in by Ramp to
Speaker 6: transform the way finance is done from highly manual, very
Speaker 6: tedious to increasingly automated and leveraging the potential of AI
Speaker 6: to bring it to the average business.
Speaker 3: Eric, you previously came on the show when you guys
Speaker 3: had done a down round and you were really honest
Speaker 3: about the willingness to do a down round. This is
Speaker 3: an up round, and I just wondered, how you think
Speaker 3: about the dynamic this time around.
Speaker 6: I mean for sure, I mean, look, I think that
Speaker 6: for all companies, being valued mark to market is a
Speaker 6: very good thing. Over the last summer, part of what
Speaker 6: we recognized is that it was really the fastest interest
Speaker 6: rate rise in really a forty year period. And so
Speaker 6: even though RAMP had at that time grown by leaps
Speaker 6: and downs brounds, I think between rounds that had grown
Speaker 6: by seven times over a year and a half period,
Speaker 6: we wanted to be valued fairly. Fast forward to now,
Speaker 6: just months later, Ramp's business has grown dramatically, an investor
Speaker 6: conviction has increased, and so we're thrilled that some of
Speaker 6: the best investors in the world, from public markets investors
Speaker 6: to extraordinary privates like Coastala Ventures founder's fund, Sequoya Graylock
Speaker 6: and others joining for the first time.
Speaker 4: They're thrilled for.
Speaker 6: RAMP is but I think to invest at this valuation
Speaker 6: for the first time, at this juncture, there is a
Speaker 6: high conviction belief that there is not just a fifteen
Speaker 6: percent plus growth per year ahead of RAMP, but there's
Speaker 6: ten x plus more ahead. And so we're thrilled.
Speaker 3: Eric to the Bloomberg Technology audience member, that's less financially
Speaker 3: inclined marked market, meaning the method of getting fair value
Speaker 3: by benchmarking contemporaneously against similar companies. So I noticed on
Speaker 3: social media a lot of people were talking about your round,
Speaker 3: and so I went on social media and said you
Speaker 3: were coming on the show, and our audience something about
Speaker 3: technology actually had some pretty good and straightforward questions. One
Speaker 3: of them was, Eric, can you just simply explain what
Speaker 3: rampays and what it does? Which I thought was a
Speaker 3: pretty good starting point.
Speaker 6: Of course, so the way to think about it, we
Speaker 6: built a command and control system for companies finances. What
Speaker 6: this means is from a single place company finance teams,
Speaker 6: business owners can issue cards, make payments of all kinds,
Speaker 6: manage approvals, and even automate accounting to close their books.
Speaker 6: And so this means that some of the tedious aspects,
Speaker 6: things like collecting receipts, tagging transactions properly is done automatically
Speaker 6: for you. We surface up data in ways for companies
Speaker 6: to spend less, and the upshot is that the average
Speaker 6: company using RAMP is able to reduce their expenses by
Speaker 6: five percent per year, whether that's a publicly traded scale
Speaker 6: like a Shopify to earlier stage to even nonprofits like
Speaker 6: the Boys and Girls CBS of America. And I think
Speaker 6: really what's different and interesting about RAMP is it's not
Speaker 6: only the tools and bones to make payments, but it
Speaker 6: is focused on how can you make people more productive
Speaker 6: with their time. Instead of having expense reports take you
Speaker 6: an hour at the end of the month, have it
Speaker 6: be done for you and get your time back to
Speaker 6: focus on your core business.
Speaker 4: So that's how we think about it.
Speaker 2: Eric.
Speaker 3: The other audience question I got for you was about you.
Speaker 3: You are generally regarded as a very nice person. I
Speaker 3: hear that a lot in my circles, at least out
Speaker 3: West as well. But the question from the audience was
Speaker 3: are you needing to be a bit more roothless at
Speaker 3: this stage of the company's growth as a founder CEO
Speaker 3: that's now playing at a pretty high level valuation wise
Speaker 3: and scale wise.
Speaker 4: It you know, for us.
Speaker 6: Look, the broader backdrop is I actually think the US
Speaker 6: business environment has gotten much more mean and nasty for
Speaker 6: the average business owner. Most companies are reducing their investment
Speaker 6: in their products. They're hiking the prices, the value they're
Speaker 6: offering in the service level is going down. We want
Speaker 6: to lean in and doing the right thing. Having more
Speaker 6: capital allows us to not just be nice, but frankly
Speaker 6: offer better service. In the last time Ed we were
Speaker 6: on the show, we were saving the average company on
Speaker 6: the order to three to four percent per year. We
Speaker 6: want to extend that idea of maybe, as you put it,
Speaker 6: being nice, we want the average company to save five
Speaker 6: percent to be more productive. And we think over time,
Speaker 6: doing right by customers is what creates long lasting and
Speaker 6: enduring businesses. And so it's not just a personality. We
Speaker 6: think it's a good way of doing business.
Speaker 4: Well.
Speaker 3: You also now have a couple more investors that you'll
Speaker 3: have to account to along the way as well. RAMP
Speaker 3: CEO Eric Glyman, it's great to catch up and have
Speaker 3: you back on the program.
Speaker 4: Thank you.
Speaker 3: Let's stick with the world of venture in startups may
Speaker 3: have in Venture, as a seed stage venture firm investing
Speaker 3: in consumer tech companies, announced sixty million dollars in new
Speaker 3: capital for its latest fun It brings the firm's total
Speaker 3: assets to two hundred million dollars. Let's bring in Sarah Dishpande,
Speaker 3: general partner at may Have in Ventures, in today's VC Spotlight.
Speaker 3: This was interesting, a sizable seed fund coming together. Was
Speaker 3: it a smooth process?
Speaker 13: Sarah, First of all, thank you so much for having me.
Speaker 13: It's great to be here today. You know, we're really
Speaker 13: excited to bring this new seed fund to the world.
Speaker 13: MAB Inventors is best known for investing in tech companies
Speaker 13: that are addressing emerging consumer trends, and consumer trends never
Speaker 13: go away, so that's an area that we've continued to
Speaker 13: be excited about. And you know, I won't lie. This
Speaker 13: has been the hardest funding market for startups and vnor
Speaker 13: capital firms alike. So to be able to close a
Speaker 13: sixty million dollar vehicle if our fourth and latest fund,
Speaker 13: we think is really a testament to our strategy to
Speaker 13: the market opportunity. And we're grateful to our founders and
Speaker 13: LPs for continuing to have their trust in us.
Speaker 4: Sarah.
Speaker 3: It's so hard because if you just split technology into
Speaker 3: hardware and software, you know, the companies that are working
Speaker 3: on consumer facing application in both domains are giant. You're
Speaker 3: trying to get the disruption at the earliest possible stage.
Speaker 4: How do you make it worthwhile?
Speaker 13: We really look at emerging consumer trends and technology companies
Speaker 13: that are fueled by those big consumer trends, and so
Speaker 13: that's what we're looking for, especially in today's universe where
Speaker 13: you see the bloom of AI technology. There have been
Speaker 13: so many companies invested in in B to B and infrastructure,
Speaker 13: in foundational models of AI that we think now is
Speaker 13: the time for those consumer opportunities to bloom. We also
Speaker 13: take a really wide lens of what means consumer to us.
Speaker 13: You know, we were known for our early investment in
Speaker 13: Zoom and no company was a more consumer company than
Speaker 13: Zoom in the year of twenty twenty. So for us,
Speaker 13: we're looking at what are these new points of technology,
Speaker 13: what are these new emerging trends, and can we find
Speaker 13: and partner with visionary bold founders that we think we
Speaker 13: can help to unlock their potential to bring these iconic
Speaker 13: companies to the world so that consumer lens is actually
Speaker 13: for us quite broad.
Speaker 3: Sarah, what is the number one emerging consumer trend?
Speaker 13: The number one consumer trend right now is consumer applications
Speaker 13: of AI. Where do we think AI can actually deliver
Speaker 13: on the grand dream of doing something for a consumer
Speaker 13: of you know, making something of value for consumers that
Speaker 13: actually bring something positive to their lives. So that's the
Speaker 13: biggest area we're looking at. But it applies across so
Speaker 13: many sectors. It can apply across, you know, technology for families,
Speaker 13: can apply across you know, search, it can apply across
Speaker 13: anything that might plan or book something on your behalf.
Speaker 13: So there's a pretty wide range of sectors that consumer
Speaker 13: AI touches, and that's where we're spending our time right now.
Speaker 3: I think that you saying AI was not a huge
Speaker 3: surprise to many people, Sarah Deshfondi General partner.
Speaker 4: It may even bene his great to have you on
Speaker 4: the show. Thank you.
Speaker 14: It's not the legislation that we would write if Republicans
Speaker 14: were in charge of both the House and send it
Speaker 14: in the White House. This is the best possible product
Speaker 14: that we can get the circumstances to take care of
Speaker 14: these really important.
Speaker 3: Obligations US House Speaker Johnson has just been talking about
Speaker 3: votes some foreign aid bills. Bloomberg's Katie Lines is back
Speaker 3: in DC, and I think it is around US Speaker
Speaker 3: Johnson that the latest headlines involve.
Speaker 4: Yeah.
Speaker 5: Of course, what we saw happen on the House floor today,
Speaker 5: ed was a procedural vote advancing that will pave the
Speaker 5: way for funding for US allies to pass the House
Speaker 5: later Saturday. These are four separate bills, one for Ukraine, Israel,
Speaker 5: the Indo Pacific, and a so called sidecar which is
Speaker 5: attaching other measures, including the TikTok divestiture Bill, all of
Speaker 5: the same to getting more than ninety five billion dollars
Speaker 5: in aid two US allies. However, it does seem that
Speaker 5: the House Speaker could face a threat to his job
Speaker 5: as a result. This has long been threatened by Congressman
Speaker 5: Marjorie Taylor Green, who had suggested if Johnson were to
Speaker 5: put Ukraine eight on the floor for a vote, she
Speaker 5: would act on her motion to vacate, essentially trying to
Speaker 5: kick him out of the job. Already, one other member,
Speaker 5: Republican Congressman Tom Massey, had joined her in that effort,
Speaker 5: and now, according to a statement from Congressman Paul Gosar Arizona,
Speaker 5: he too has added his name in support of the
Speaker 5: motion to bay Kate. So now that's three members of
Speaker 5: the Republican Conference. We're working to identify that Ghostsar statement
Speaker 5: or verify it independently, as this has been reported by
Speaker 5: other outlets. But of course this suggests because of the
Speaker 5: way the math works in the House at and how
Speaker 5: tight the margin is, that it will require Democrats to
Speaker 5: show up and support the speaker so that he is
Speaker 5: able to keep hold of the gavel. Whether or not
Speaker 5: that's just not showing up to a new speak an
Speaker 5: ouster vote, whether that is actually outright voting for him.
Speaker 5: Will see what form it takes, but it will require
Speaker 5: help from Democrats to save his job, just as it
Speaker 5: took massive Democratic support to get this procedural vote over
Speaker 5: the line.
Speaker 3: Today, there is math on the votes and the bills,
Speaker 3: and then there's procedure, which you explained really well. Earlier
Speaker 3: in the show, we were talking about how Majority Leader
Speaker 3: Schumer in the Senate had put lawmakers on notice to
Speaker 3: be working this weekend. Just explain why the press to
Speaker 3: work through the weekend on these bills.
Speaker 5: Well, the Senate won't have a chance to act on
Speaker 5: these bills until the House passes all of them, repackages
Speaker 5: them together, and sends them to the Senate for a vote.
Speaker 5: And the way the rules in the House are structured,
Speaker 5: and what was agreed to when Kevin McCarthy was Speaker
Speaker 5: all those months ago, was that members had to have
Speaker 5: seventy two hours to read the text of a bill
Speaker 5: before a vote, And because the text of this bill
Speaker 5: was released less than seventy two hours ago, it cannot
Speaker 5: be voted on until Saturday. So even though that we've
Speaker 5: seen the rule vote today, which essentially just sets the
Speaker 5: procedure for how this ultimately will pass when it comes
Speaker 5: to final package, the House isn't going to be able
Speaker 5: to clear all of this until Saturday afternoon, perhaps evening,
Speaker 5: and then the Senate would be able to act after
Speaker 5: the Senate Majority Leader Chuck Schumer has said they will
Speaker 5: do so quickly, which is why they may be staying
Speaker 5: in town. This maybe a Sunday vote or later. And
Speaker 5: of course, keep in mind ed that in the US Senate,
Speaker 5: where it is required to do anything quickly is unanimous consent.
Speaker 5: Any One Senator, should they so choose, has the ability
Speaker 5: to slow down the process. One like Senator Ran Paul,
Speaker 5: for example, if he takes issue with this bill, could
Speaker 5: refuse to accelerate the process until he has an a
Speaker 5: vote on an amendment or something like that. So it'll
Speaker 5: be a matter of how quickly the Senate can get
Speaker 5: this done after the House completes its work this weekend.
Speaker 4: Okayley, just very quickly.
Speaker 3: The situation in the Middle East is that impacting the
Speaker 3: passage of any of these bills.
Speaker 5: It is when you first saw the Iranian attack against Israel,
Speaker 5: the more than three hundred missiles and drones that were
Speaker 5: sent toward Israel last weekend, you heard an outcry that
Speaker 5: this underscored the need to get aid for Israel out
Speaker 5: the door quickly. Of course, that has been attached in
Speaker 5: large part to aid for other allies, including Ukraine, which
Speaker 5: has been a much more difficult endeavor. But there also
Speaker 5: had been growing calls to make sure that you aid
Speaker 5: for Ukraine comes so quickly as intelligence was suggesting that
Speaker 5: it was desperately needed in immediate fashion. So certainly the
Speaker 5: hot wars we are seeing not just in the Middle
Speaker 5: East but also on the continent of Europe have really
Speaker 5: provided a lot of impotence to get this done. The
Speaker 5: House Speaker himself said, the intelligence he had seen recently
Speaker 5: really underscored to him that this was the right thing
Speaker 5: to do, that this aid did indeed need to be passed.
Speaker 5: And of course it's a decision that Johnson had to make.
Speaker 5: Decide to do the right thing, even if you potentially
Speaker 5: might lose your job as a result. That, of course,
Speaker 5: ed will remain to be.
Speaker 3: Seen Bloombo's Katie Lines and tune into Balance Power later
Speaker 3: in the day for more updates.
Speaker 4: Thank you.
Speaker 3: Okay, Now, you'll never believe who is going viral. That's right,
Speaker 3: it's Taylor Swift. Swifties worldwide are gushing about the singer's
Speaker 3: new album, The Tortured Poets Department. The sixteen song record
Speaker 3: dropped at midnight Eastern Time on Friday. The singer then
Speaker 3: announced a surprise two hours later at two am. She'd
Speaker 3: actually written a double album titled The Tortured Poets Department
Speaker 3: The Anthology, with fifteen additional songs. So there I am
Speaker 3: in my vehicle on my way to do Bloomberg Technology,
Speaker 3: and I got through the first ten. I'm not going
Speaker 3: to give my favorites just now, but check out social
Speaker 3: There are some interesting titles in there.
Speaker 4: Let's keep talking about it.
Speaker 3: That does it for this edition of Bloomberg Technology. A
Speaker 3: lot of headlines out of Washington, d C.
Speaker 4: The Middle East.
Speaker 3: We are paying attention to the passage of the TikTok
Speaker 3: divestor Band bill as well.
Speaker 4: Recap on the pod.
Speaker 3: Listen is what Kaylie had to say about the process
Speaker 3: in the coming forty eight hours in Washington, d C.
Speaker 3: Check out the pod on Apple, Spotify, iHeart, and of
Speaker 3: course we published all the Bloomberg platforms. It's been a
Speaker 3: week in the world of technology. Thanks for watching. This
Speaker 3: is Bloomberg Technology.