Speaker 1: From the heart of where innovation, money and power COLLI
Speaker 1: in Silicon Valley and beyond. This is Bloomberg Technology with
Speaker 1: Emily Jay I'm Emily changing San Francisco, and this is
Speaker 1: Bloomberg Technology. Coming up. In the next hour, Broadcom makes
Speaker 1: it official, striking a deal to buy vm Whare for
Speaker 1: sixty one billion dollars. We will have all the details
Speaker 1: on how one of the tech's biggest deals could reshape
Speaker 1: the cloud and chip industries. Coming up. Plus, I'm joined
Speaker 1: exclusively by Google Cloud CEO Thomas Curia. I'll get his
Speaker 1: thoughts on that Broadcom deal, plus how Google and its
Speaker 1: cloud customers are weathering this market termoil, and how one
Speaker 1: startup raised a new round with all female investors, seventy
Speaker 1: five of them. I'll speak to investor Kara Northman and
Speaker 1: Solve co founder Heather Fernandez about how more companies can
Speaker 1: change the gender balance of their cap tables in one
Speaker 1: fell sweep all of that in a moment, But first
Speaker 1: I want to get a look at the market where
Speaker 1: tech stacks stage to come back at Ludlow here with
Speaker 1: the latest and finally some good news. Yeah, finally we
Speaker 1: saw kind of this broad equity market rally. Tech at
Speaker 1: the heart of it, Retail the heart of it will
Speaker 1: touch on it just the moment. You see then as
Speaker 1: that one hundred up two point eight percent, biggest jump
Speaker 1: for that tech heavy index in a week. It was
Speaker 1: interesting because I was going through the bloomberg. It's the
Speaker 1: first back to back gains. We've seen two days of gains.
Speaker 1: And then as that one hundred in almost four weeks,
Speaker 1: which kind of shows how things have been recently right,
Speaker 1: very much in the red. And you see that across
Speaker 1: the technology sector, semi conductors up, the mega caps. Also,
Speaker 1: if there was an area of pressure or some selling
Speaker 1: across financial markets, it was in old coins. You see
Speaker 1: Ether on your screen, there's green there because we're going
Speaker 1: into the next day session, but it's at around one thousand,
Speaker 1: eight hundred dollars per token, well below the two thousand
Speaker 1: level that technical and lists are looking for. And come
Speaker 1: with me into my bloombotuminal. Let's call it right now.
Speaker 1: Let's end it right here, because then as that one
Speaker 1: on a weekly basis is in the green, it's Thursday,
Speaker 1: let's just call it because then that way we snap
Speaker 1: seven straight weeks of declines. It looks like we've turned
Speaker 1: a corner. You can't hang your hat on one week,
Speaker 1: but my goodness, do we need some positivity? Do we
Speaker 1: need some green? R up almost four percentage points, and
Speaker 1: that's that one so far this week. Please Friday, don't
Speaker 1: ruin it. I've had enough. A big part of the
Speaker 1: story when you come back to me in the studio
Speaker 1: is earnings and Video actually missing estimates, particularly on the forecast,
Speaker 1: but that stock up five percent. The market sanguine, Macy's
Speaker 1: incredible lots of confidence, upgrading their profit outlook. People still
Speaker 1: want to buy fancy stuff. I love fancy stuff. And
Speaker 1: how do you think all the M and A we're
Speaker 1: seeing this big tech deal, the number of deals we've
Speaker 1: seen in general is a signal that maybe maybe we're
Speaker 1: turning a corner. Well, it's interesting because I joke about
Speaker 1: that chart, but there is a feel good fact write
Speaker 1: a lot of activity, A love M and A. In
Speaker 1: the tech sector, Twitter up six percentage points on Thursday.
Speaker 1: Tests are up almost eight percent. And the big story here,
Speaker 1: of course, is Musque adjusting the financing package for his
Speaker 1: bid to buy the company, getting rid of the margin
Speaker 1: loan component and bring in more equity financing. Some bullishness
Speaker 1: that this deal might happen. Of course, the other big
Speaker 1: story is Broadcom vm Ware massive sixty one billion dollar deal.
Speaker 1: Bloomberg scoop we refers to report that they were in talks.
Speaker 1: We got official confirmation on Thursday. What does this mean
Speaker 1: for the company? What does this mean for this health
Speaker 1: of the technology sector broadly? It's a really interesting timing. Indeed,
Speaker 1: Ed Ludlow, thank you. I want to stick with that
Speaker 1: Broadcom deal for vm Ware now and bringing angel as
Speaker 1: you know of cf A as well as our very
Speaker 1: own Leanna Baker, Leona, your team broke the news of
Speaker 1: this deal. Here we are officially being announced. Talk to
Speaker 1: us about the nuts and bolts, the new things that
Speaker 1: we know now that maybe we didn't know earlier this week. Sure,
Speaker 1: so we saw the exact price of the deal, although
Speaker 1: it does key sort of fluctuating because it's fifty percent
Speaker 1: cash and fifty percent stock, so it'll change day by day.
Speaker 1: But we did see that it's about sixty one billion,
Speaker 1: which is a pretty big premium for vm Ware, but
Speaker 1: maybe not as high as it would have been had
Speaker 1: it not been for this text sell off. Another interesting
Speaker 1: angle on the deal is that vm Ware can solicit
Speaker 1: other offers. So we're gonna be monitoring whether there's a
Speaker 1: bidding war and who else could emerge because they have
Speaker 1: forty days to potentially find a new buyer. Angelo, are
Speaker 1: you thinking there could be a bidding war here? Are
Speaker 1: there other suitors out there? I mean, were likely others
Speaker 1: that might pick up the phone and enquire about it.
Speaker 1: But to be honest with you, as far as you know,
Speaker 1: the terms of this deal is concerned the price here. Um.
Speaker 1: I actually think it's a very compelling author out there
Speaker 1: for more vm Ware investors. And you know, at the
Speaker 1: end of the day, I do think that fell kind
Speaker 1: of go through, um, you know, via the hands of Broadcom. Leanna,
Speaker 1: What do we know about how Broadcom intends to run
Speaker 1: vm ware? Will it stay independent, Which of broadcast services
Speaker 1: will they emphasize, which might be de emphasized. So I
Speaker 1: interviewed the Broadcom executive Tom Krause today, who helped engineer
Speaker 1: the deal, and he mentioned that they're going to rename
Speaker 1: the whole software division of Broadcom vm Ware. So I
Speaker 1: think vm Ware almost is sort of going to run
Speaker 1: the rest of Broadcom's software. So we'll have to see,
Speaker 1: but it may take a year for the deal to close,
Speaker 1: so we won't see anything just yet. But Broadcom does
Speaker 1: like to keep its franchises intact. I'm sure they'll try
Speaker 1: to you know, raise margins, but I would expect that
Speaker 1: not a lot will change once the deal closes. So Angelo,
Speaker 1: how optim how competitive do you think a software portfolio
Speaker 1: within Broadcom under this VM where Umbrella will actually be?
Speaker 1: You know that I think Yale Hawk has done an
Speaker 1: absolutely fantastic job here, um kind of transitioning the company
Speaker 1: around into one that's also definitely sold by driven and
Speaker 1: I think this really is going to kind of be
Speaker 1: that crowned the world for their software business. That really
Speaker 1: doubles the size of that business, right, so it gets
Speaker 1: them to nearly half of their revenue base there, um,
Speaker 1: you know, was the run rate was about a sales
Speaker 1: so at the end of the day, and you know,
Speaker 1: I think this definitely kind of um significantly improves the
Speaker 1: growth profile of that software business, which is extremely important.
Speaker 1: This was a business that was kind of growing very
Speaker 1: low single digit pace. When you kind of look at
Speaker 1: somebody assets they've acquired a lot of you know, a
Speaker 1: lot of those acquired assets was really kind of just
Speaker 1: you know, from a free cash flow potential, um, just
Speaker 1: improve the cash flow generation of that company. What vm
Speaker 1: Ware does here is it really kind of catapults at
Speaker 1: least the the growth potential within that software business towards
Speaker 1: one that's more kind of mid single digit range, So
Speaker 1: definitely more compelling I think long term for that software business.
Speaker 1: Within Broadcom Leana, we were looking at a chart of
Speaker 1: the big tech deals that have been done in the
Speaker 1: last few months, going all the way back to Microsoft
Speaker 1: and Activist, and are you expecting more big deals this year?
Speaker 1: Are are we moving into an environment you know, given
Speaker 1: what we're seeing in the markets, given valuations coming down,
Speaker 1: given potentially companies looking for a safe exit, are are
Speaker 1: we moving into a time of big time m and A. Well,
Speaker 1: the tech bankers I talked to would love to say, sure,
Speaker 1: there's gonna be big deals and deals to get more deals,
Speaker 1: but you have to understand that Broadcom is a very
Speaker 1: unique animal. They've been searching for a big elephant acquisition
Speaker 1: for years. They hadn't done once since, So that's a
Speaker 1: company that really likes doing deals. And I wouldn't necessarily
Speaker 1: say that Broadcom's competitors are suddenly going to follow suit.
Speaker 1: But it is interesting that the tech sector has been
Speaker 1: one of the bright spots of the M and A market,
Speaker 1: which is down year over year. So software companies especially
Speaker 1: are very resilient. So I'd expect we're going to see
Speaker 1: probably some more big deals this year, which will keep
Speaker 1: me busy well. And Broadcom did want to buy Qualcom
Speaker 1: a few years back, it didn't happen under the Trump administration. Angelo,
Speaker 1: are you expecting any regulatory pushback here? I mean, listen,
Speaker 1: I think as far as this deal is concerned, the
Speaker 1: stuff we're gonna get looked at. I mean, additionally, if
Speaker 1: you would have kind of asked me, I'd say this
Speaker 1: very little little overlap between kind of you know, Broadcom
Speaker 1: and vm ware here. But at the end of the day,
Speaker 1: I mean clearly both companies operating significantly within UM you know,
Speaker 1: the data center you know group, and as a result,
Speaker 1: UM there definitely could kind of be UM some concern
Speaker 1: with how Broadcom operates kind of that VM where business
Speaker 1: along with its chip side business chip business as well
Speaker 1: as you know, Listen, I think I just to the day, Um,
Speaker 1: there's definitely geopolitical pressures going on out there. Someone w
Speaker 1: we started thinking about getting the necessary and regulatory approvals
Speaker 1: across search of certain regions like a China. Um, I'd imagine,
Speaker 1: you know, a region like that probably will drag their
Speaker 1: feet similar to what they've done in other deals. So
Speaker 1: I know Broadcome is looking for a deal to kind
Speaker 1: of get you know, to get done by the undeficial twenties.
Speaker 1: I wouldn't be surprised if that kind of drags further
Speaker 1: than that, uh, Leanna or what are your Broadcom sources
Speaker 1: saying about whether Hawk Tan will be doing more deals
Speaker 1: or is this it for a while? It's a big one,
Speaker 1: So I would say, as Angelo mentioned, there's a lot
Speaker 1: of regulatory bodies that have to weigh in on this,
Speaker 1: So I don't think Tan wants to you know, muddy
Speaker 1: the waters with more deals. Uh. They're really going to
Speaker 1: be focused on getting this one through and whatever it takes.
Speaker 1: So expect Broadcom not to do much except focus on
Speaker 1: this and then integrate it. So it could be a
Speaker 1: while before they do anything that's big. And Angelo, well, Bradley,
Speaker 1: how do I think this deal will actually impact the
Speaker 1: potentially change the cloud market? Will it make much of
Speaker 1: a change? You know, I don't know if it if
Speaker 1: it changes things, much. I think it just it just
Speaker 1: gives the broadcom a lot work power. At the end
Speaker 1: of the day, I think it gives them the ability
Speaker 1: to kind of leverage a wheel their power or a
Speaker 1: lot more than maybe some of their peers or competitors
Speaker 1: out there want them to. And you know, whether or not,
Speaker 1: you know, that ends up kind of being a sticking
Speaker 1: point when they kind of have to kind of get
Speaker 1: the regular necessary regulatory approvals, I think remains to be seen.
Speaker 1: But at the end of the day, I mean, you
Speaker 1: couldn't have an impact. Yes, so it like we will
Speaker 1: angelous you know, cfr right, Leanna Baker who helped break
Speaker 1: this story earlier this weekly on a great job. Thank you.
Speaker 1: With inflation putting pressure on just about everyone, Apple is
Speaker 1: raising salaries for workers across the US by ten percent,
Speaker 1: also in the midst of a type labor market joining
Speaker 1: US now. Bloomberg's Mark German, who of course covers Apples,
Speaker 1: So Apple raising salaries for corporate and retail employees, right, Mark, Yes,
Speaker 1: So that's right in the face of inflation other pressures globally.
Speaker 1: Obviously in the face of unionization when it comes to
Speaker 1: retail employees, Apple is doing a few things. Let's start
Speaker 1: with retail. One, they're raising the minimum salary for hourly workers.
Speaker 1: That's for retail, that's for Apple Care other hourly workers
Speaker 1: from twenty dollars per hour to twenty two dollars per hour.
Speaker 1: Now that's ten from last year, that twenty, and it's
Speaker 1: closer to the company says since in terms of corporate
Speaker 1: and more generally across Apple, they're raising their overall compensation
Speaker 1: budget for this year. So that's gonna result in some
Speaker 1: salary increases based salary increases UH in the US and
Speaker 1: globally for salaried employees, not hourly employees. And they're also
Speaker 1: bringing up raises. Typically those are done around September. The
Speaker 1: company told employees are going to bring that up to
Speaker 1: around July now for both corporate some corporate teams as
Speaker 1: well as the hourly workers. Meantime, you're also reporting that
Speaker 1: Apple is planning to keep iPhone production flat in part
Speaker 1: because of all of these macroeconomic headwinds, the pressure on consumers.
Speaker 1: What exactly do we know? Yeah, there's two ways to
Speaker 1: really look at this, right, there's the positive and there's
Speaker 1: a negative. Let's start with the positive, right. The positive
Speaker 1: is that the overall smartphone market led by Android is
Speaker 1: not a very good spot right now. Right, You're seeing
Speaker 1: those companies do job cuts and hiring slowdowns, and you're
Speaker 1: seeing people buy Android phones to smaller degrees and they
Speaker 1: were in previous years. Right. A lot of that has
Speaker 1: to do with the inflationary pressure, the war in Ukraine,
Speaker 1: and other factors globally, right, And so Apple's ability to
Speaker 1: keep units flat from two in the face of a,
Speaker 1: you know, a larger slowdown in the smartphone industry, obviously,
Speaker 1: that's a good thing for Apple that they're not guiding
Speaker 1: down in terms of their union output. Now, on the negative,
Speaker 1: Apple has a major iPhone upgrade plan for this year.
Speaker 1: That's the iPhone four teen. It'll look mostly similar to
Speaker 1: the iPhone thirteen, but it's a much bigger update than
Speaker 1: the iPhone thirteen. What's the iPhone twelve. So Apple is
Speaker 1: not going to be increasing its units even though they
Speaker 1: have this bigger handset update than they did last year. Meantime,
Speaker 1: let's talk about what else Apple has to come this year.
Speaker 1: WWDC now coming up in a couple of weeks. The
Speaker 1: official invitations have gone out. It's gonna be Christmas in
Speaker 1: they say for developers, What are you expecting to happen
Speaker 1: at this event? Yeah, so WWDC, this is going to
Speaker 1: be a pretty significant one. You're gonna see a pretty
Speaker 1: large update uh to iOS with iOS sixteen. You're gonna
Speaker 1: see changes and new apps and new designs for some
Speaker 1: apps across the board. You're gonna see big multitasking improvements
Speaker 1: for the iPad. You're gonna see some new audio messaging features.
Speaker 1: You're gonna see a new lock screen for the iPhone,
Speaker 1: and you're gonna see major updates to health on the
Speaker 1: iPhone as well as the Apple Watch. You're gonna see
Speaker 1: some smart home compatibility improvements for the Apple TV UH
Speaker 1: and the Home Pod. Like I mentioned, the iPad is
Speaker 1: gonna get a pretty big update uh, and the Mac
Speaker 1: is going to get a little bit more flavor from
Speaker 1: iOS and the iPhone interface as well. So a lot
Speaker 1: to look forward to there. I don't believe you're gonna
Speaker 1: see a full blown unveiling of the Apple Mixed reality headset.
Speaker 1: That's probably going to come later, but obviously augmented in
Speaker 1: virtual reality is gonna be on the minds of lots
Speaker 1: of developers at this year's conference, and of course in
Speaker 1: the future. When you say later, how much later? Is
Speaker 1: that something we could see this year? You know, I
Speaker 1: believe the headset. I believe it's possible we could be
Speaker 1: doing one of these shows a year from now and
Speaker 1: I could have my headset on. Obviously I would look ridiculous,
Speaker 1: But what I mean to say is I think it
Speaker 1: will be available by this time next year. Huh, Okay.
Speaker 1: And what happens come September? You know, obviously w W
Speaker 1: dcs typically where we see uh, you know, the unveiling
Speaker 1: of Apple's next generation of software. September is where we
Speaker 1: see the next generation of hardware. What are we going
Speaker 1: to see this September? Yeah, I mean, I think the
Speaker 1: pattern for this September and the fall launches this year
Speaker 1: is going to probably be quite similar to what you've
Speaker 1: seen from Apple, uh in the fall launch periods in
Speaker 1: previous years. So you could imagine that the iPhone fourteen,
Speaker 1: in the new version of the Apple Watch will be
Speaker 1: unveiled in September. I think the Apple Watch actually, interestingly,
Speaker 1: is going to be one of the bigger new pieces
Speaker 1: of tex from Apple this year for the first time.
Speaker 1: There's gonna be three new models, right, so a lot
Speaker 1: to look forward to if you're an Apple Watch fan
Speaker 1: as well. Mark German for us there, Thanks Mark as always.
Speaker 1: Coming up, Google Cloud CEO Thomas Currian with me next,
Speaker 1: Mrs Bloomberg. In the midst of a massive market downturn,
Speaker 1: Google cloud numbers were array of sunshine in Alphabet's latest
Speaker 1: earnings results. Google's cloud business growing in the quarter, though
Speaker 1: Google is still a distant third to a WS and
Speaker 1: Microsoft's Azure in the cloud infrastructure market. Joining me now
Speaker 1: to talk more about how Google will continue to scale
Speaker 1: Thomas curriean CEO of Google Cloud. Thomas, great to have
Speaker 1: you back with us. So I'm so curious what your
Speaker 1: outlook is on this market turmoil and what you're seeing
Speaker 1: in terms of demand. Are you seeing any signs of
Speaker 1: a slowdown in spending. We're seeing that the market is
Speaker 1: entering all it has some volatility in different parts of
Speaker 1: the world, but technology is seen as helping organizations, you know,
Speaker 1: address supply change shortages of customers better get online digitally,
Speaker 1: and so demand for cloud remains very strong for us.
Speaker 1: What's I take on this Broadcom vm Ware deal and
Speaker 1: how will it change or potentially reshape the cloud landscape.
Speaker 1: Broad Common VMware have both partners of Google, and we're
Speaker 1: you know, we're thrilled that they are looking at moving
Speaker 1: forward together. We think a lot of customers use a
Speaker 1: combination of VMware and Google Cloud together, and we have
Speaker 1: a strong program with them to help people my great
Speaker 1: vm O workloads the cloud. So we look forward to
Speaker 1: continuing of work with both companies. Now, Google Cloud is
Speaker 1: still growing, as I said, but you know it is
Speaker 1: third to AWS and Microsoft and there's a lot of
Speaker 1: work to do to close that gap. What is the
Speaker 1: secret weapon going to be how are you going to
Speaker 1: scale your market share and how long is that going
Speaker 1: to take to see you get closer to those other competitors. Well,
Speaker 1: we are seeing very strong demand for our products, whether
Speaker 1: that is new kinds of infrastructure we're delivering. We are
Speaker 1: now delivering infrastructure capabilities not just to run I T workloads,
Speaker 1: but telecommunications network the announcement we had with Belt Canada
Speaker 1: for example. Uh, we're seeing a lot of interest in
Speaker 1: our cybersecurity tools to protect people's networks and applications and
Speaker 1: data in the cloud. And we're seeing very very strong
Speaker 1: interests for analytics and data products which are being used. Recently,
Speaker 1: there was a case study with data about ups optimizing
Speaker 1: how they were out trucks using our capability for analytics
Speaker 1: and data. So we remain focused on providing great solutions
Speaker 1: with customers, bringing the innovation of Google to customers, and
Speaker 1: doing so at scale around the world. And if you
Speaker 1: do that well, will continue to grow and will continue
Speaker 1: to grow and gain market share as we have been
Speaker 1: these last three years. You recently did a sustainable ability
Speaker 1: survey that found that fifty of executives believe there's hypocrisy
Speaker 1: in their organization on this topic. How so no sustainability
Speaker 1: what we found from the survey Number one, it's a
Speaker 1: super important priority for eighty percent of organizations around the world,
Speaker 1: yet they have difficulty. Thirty five of organizations struggle with
Speaker 1: being able to measure their progress because the data about
Speaker 1: sustainability is not as easily measurable for a variety of reasons.
Speaker 1: And a number of organizations now need help uh to
Speaker 1: progress towards their sustainability objectives, and we at Google are
Speaker 1: helping many organizations do that. Now, how do you make
Speaker 1: sure that hypocrisy doesn't exist at Google? And this has
Speaker 1: been a criticism of of all the big cloud companies.
Speaker 1: For example, you do work with oil and gas companies,
Speaker 1: you do sell your services to those companies. Where do
Speaker 1: you draw the line? We sell our services to all
Speaker 1: in gas companies, not for exploration production, but to the
Speaker 1: environmentally clean or the green parts of these companies for
Speaker 1: work that they're doing. We're also helping all in gas
Speaker 1: companies de carbonized in a variety of different places, and
Speaker 1: we help them with things like distribution, et cetera in
Speaker 1: their retail stores and other things. But we're not doing
Speaker 1: work in the exploration production business. The second we do
Speaker 1: help many many companies in the sustainable energy business, both
Speaker 1: by providing our technology to them as well as being
Speaker 1: the largest procurer of renewable energy in the world. We
Speaker 1: power our data centers and our global network of cloud
Speaker 1: regions using green energy more and more, and we've been
Speaker 1: common neutral for fourteen years now. Even as we provide
Speaker 1: technology for many organizations around the world to run their
Speaker 1: I T in a more renewable way, does Google still
Speaker 1: have that deal with Aramco? For example, we work with
Speaker 1: the Ramicles system integration division, not with the oil and
Speaker 1: gas division, and we work with their system integration division
Speaker 1: to provide our technology to customers in different parts of
Speaker 1: the Middle East. We have said that again and again
Speaker 1: that we don't work with the oil and gas division
Speaker 1: within ARAMCO or with the system integration of for Ramco. Now,
Speaker 1: Google did recently strike a deal to buy mandy And
Speaker 1: for five point four billion dollars. I know the goal
Speaker 1: is that this will help enhance Google's cloud offerings quickly.
Speaker 1: How would you characterize the cyber threat landscape right now,
Speaker 1: especially in the midst of this ongoing war between Russia
Speaker 1: and Ukraine. Cyber threat landscape is changing in the kinds
Speaker 1: of threats, the scope of the threats, the scale of
Speaker 1: the attacks. And we at Google, along with our technology
Speaker 1: how people detect threats, protect against them, and analyze if
Speaker 1: they have been compromised. And we are seeing strong growth
Speaker 1: for our product portfolio. Chronicle simplify a lot of US
Speaker 1: cybersecurity products being adopted by regulated industries like financial institutions,
Speaker 1: commercial customers, critical infrastructure organizations like telecom, networks and utilities,
Speaker 1: as well as by government agencies. Thomas Carrian, CEO of
Speaker 1: Google Cloud, thank you for joining us today. Welcome back
Speaker 1: to Boner Technology. Emily Chang in San Francisco. Well venture
Speaker 1: capital firms like Sequoya and y combinator have been sharing
Speaker 1: their playbooks on how to weather stormy market conditions, and
Speaker 1: as startups begin to focus on the fundamentals once again,
Speaker 1: another key element is ensuring fair representation on their cap tables.
Speaker 1: My next guests found a way to raise their latest
Speaker 1: round from all female investors, and they're here to share
Speaker 1: their secret. I m joined now by Heather Fernandez, the
Speaker 1: CEO and co founder of Solve, as well as Karen Northman,
Speaker 1: managing partner at Upfront Ventures and a founding member of
Speaker 1: All Rays. Karen had they're great to have both of
Speaker 1: you back here on the show. So you managed to
Speaker 1: not just get all women on the cap table in
Speaker 1: this round, but seventy five different women investors. Heather, how
Speaker 1: did you do it? Well, let me tell you a
Speaker 1: bit of this story, Emily. So you know, as you know,
Speaker 1: people talk about fundraising is a very easy thing. As
Speaker 1: every founder knows, it's not. It's stressful. It's arduous. And
Speaker 1: when I completed my seriously financing and followed last year,
Speaker 1: I called my good friend here Northman, frankly from my
Speaker 1: victory lap. In that call, she said to me, for
Speaker 1: twenty years we've been talking about cap table diversity, how
Speaker 1: important it is to bring more women and women of
Speaker 1: color onto cap tables. Let's use this opportunity to make
Speaker 1: some space and figure out a way to really drive
Speaker 1: that in this round for us solve And we made
Speaker 1: it happen, and you made it happen fairly quickly as
Speaker 1: I understand it, right, Carol, I mean, just just give
Speaker 1: us a little more of the how, because you've got
Speaker 1: a lot of venture capital firms out there who say
Speaker 1: they can't find enough talented women to add on as partners. Yeah. No,
Speaker 1: I mean I think what what ended up happening was, Um,
Speaker 1: I think, um, a couple of things. Heather and I
Speaker 1: are fortunate enough to be doing these jobs now for
Speaker 1: twenty years, were much much younger than we look. Are
Speaker 1: older than we look, perhaps I should say, and so
Speaker 1: um we um. We reached into our networks, and our
Speaker 1: networks are specific people in some specific stages of their careers.
Speaker 1: So we reached out, um to a number of senior
Speaker 1: women in tech and actresses, people that we knew were
Speaker 1: active angel investors. But then we took it a step
Speaker 1: further and we said, listen, we really want to use
Speaker 1: this as an opportunity where there's a lot of demand.
Speaker 1: Had there had many term sheets. It was it's a
Speaker 1: company SolV is serving one in five Americans now, which
Speaker 1: is pretty awesome. UM to say, reach out to a
Speaker 1: woman in your network who we may not know ideally
Speaker 1: a woman of color, but a woman who is just
Speaker 1: as talented as you, who is either an angel investing
Speaker 1: and we don't know or wants to get into it,
Speaker 1: and invite them to join. And it had the snowball
Speaker 1: effect in a way. It's um. It's a bit like
Speaker 1: the Freemasons, which is, you know, were groups of men
Speaker 1: in the olden days, or Paul Revere would yell to
Speaker 1: another group of men, he wasn't just yelling into the
Speaker 1: streets of Boston. UM. And that's how the revolution spread.
Speaker 1: And it's finding these loose connectors, um that brought it
Speaker 1: into others. And one quick example there is a woman
Speaker 1: named Layla Saka whom is a longtime salesforce exact and
Speaker 1: she brought it into the Black Venture Institute and so
Speaker 1: she brought in a terrific group of black black angel
Speaker 1: investors and we had a lot of different examples of that.
Speaker 1: Revolution is a perfect metaphor and good to hear how
Speaker 1: you are leading this one. How there if there's a
Speaker 1: blueprint for other startups, other founders who want to do this,
Speaker 1: what are three simple steps. If maybe you don't have
Speaker 1: a network that goes back twenty years of powerful women, yes,
Speaker 1: I got you. Number one, designed to do it early.
Speaker 1: This is something that for me with the eleventh hour,
Speaker 1: it caused a bit of a scramble and frankly, was
Speaker 1: really intimidating. So one, decide early, align that with your
Speaker 1: board as well as your internal team. Number two, I'm
Speaker 1: gonna say tap your network. We have a twenty year
Speaker 1: long relationship, but every founder has investors, you have professors,
Speaker 1: you have people in your world who are connected to others,
Speaker 1: and it was really managing that network that enabled us
Speaker 1: to do us so quickly. Third, find a back end partner.
Speaker 1: We were used a family office. You can use Angelist
Speaker 1: or Carter. And number four this is the final one
Speaker 1: set guidelines in our world. Because we were trying to
Speaker 1: bring and new investors into growth investing, we reduced the
Speaker 1: minimum down to zero, but we decided we would do
Speaker 1: it over a constrained timetable and that ended up enabling
Speaker 1: us to meet our goals and do it very quickly. Okay,
Speaker 1: Now I want to talk a little bit about the
Speaker 1: market environment, Kara, because obviously there's public market turmoil. Startups
Speaker 1: are having trouble raising new rounds right now. We're seeing
Speaker 1: hiring freezes and even layoffs. You know, in times of turmoil,
Speaker 1: often women take a step back. Investors invest in what
Speaker 1: they know and they understand, rather than taking that risk.
Speaker 1: Are you concerned that could happen now? Well? Yeah, so
Speaker 1: I am concerned that can happen. And I think, you know,
Speaker 1: the message to put out there is that, um uh,
Speaker 1: now is the best time to take risk in a
Speaker 1: way that is good for you as an individual. But
Speaker 1: we're so emotional about risk, and actually, um the great
Speaker 1: thing about venture uh is that you know, we're we're
Speaker 1: building the long term trends and the problems we need
Speaker 1: to solve are bigger than ever. And so I think
Speaker 1: it's really important though that each individual really understand their
Speaker 1: risk profile. And if you were going to allocate to
Speaker 1: venture capital, I always say, allocate a certain amount of money,
Speaker 1: whether it's five thousand, ten thousand, a hundred thousand, whatever
Speaker 1: the right amount is for you, and then divide it
Speaker 1: up into five or ten investments UM, and then be
Speaker 1: thoughtful about where you're gonna, you know, place those investments,
Speaker 1: knowing that no one of them may you know, generate
Speaker 1: a return. UM prices are down. Founders who start businesses
Speaker 1: now are deeply convicted and not just doing it because
Speaker 1: they watch some HBO special And so there's never been
Speaker 1: bigger problems to solve, and now is you know, I
Speaker 1: think a huge part of what came out of the
Speaker 1: SOLVESTPV and cannily we did. I had done something just
Speaker 1: like this for Angel City, which is the soccer team
Speaker 1: I had started, which was my first blue print, which
Speaker 1: is why I had the conviction to bring it to Heather.
Speaker 1: Is that now the best time to take the right
Speaker 1: kind of risk with people you trust in things that
Speaker 1: seem very obvious in your high conviction around um. You
Speaker 1: just have to do it in the right way for
Speaker 1: your balance sheet. Thank you for bringing up Angel City
Speaker 1: because that was my next question. And I see the
Speaker 1: soccer ball behind you. US Soccer. US Soccer just reached
Speaker 1: a landmark deal to split pay equally among the women's
Speaker 1: and men's teams. What was the real secret to getting
Speaker 1: that done? And do you think can really be translated
Speaker 1: to other sports when the skeptics are saying, well, in soccer,
Speaker 1: the women do make the money. Yeah. I mean, there's
Speaker 1: a terrific article that came out today on this topic,
Speaker 1: so Joe google it. It's not on Bloomberg. So I'm
Speaker 1: not going to mention. But um uh, that lawsuit that
Speaker 1: you in that case is what got me. I started
Speaker 1: as an activist. Um and working with a woman named
Speaker 1: Becau who led the charge and having extraordinary leadership like
Speaker 1: Heather and Solved. Taking the time to actually build a
Speaker 1: syndicate someone like Beccau, who has been fighting this battle
Speaker 1: as the head of the Players Union for many many
Speaker 1: years behind the scenes is critical. And so for the
Speaker 1: first time, the next woman's World chap is going to
Speaker 1: is negotiating their own broadcast deal and their own sponsorship deal.
Speaker 1: It's gonna be a half a billion dollars on its
Speaker 1: way to a billion dollars. We've never had that, and
Speaker 1: so it's all of this stuff builds on each other.
Speaker 1: Um And I mean, I guess the one thing I'd
Speaker 1: say to tie this back to solve also is that
Speaker 1: you know, my just interest in supporting the pay equity fight,
Speaker 1: which is how Nataliepportman and I first came together as
Speaker 1: activists supporting a union not as not as capitalists, led
Speaker 1: to this capitalist moment with Angel City, which led to Solve.
Speaker 1: And so I think the most important thing is building
Speaker 1: not just building wealth for women, but building those relationships
Speaker 1: and even amongst me and Heather and some of the
Speaker 1: our twenty year relationships. This was the first transaction we
Speaker 1: all did together, and since then we've done many more,
Speaker 1: and we're pulling each other into each other's deals and
Speaker 1: the like. And so I think it is about find
Speaker 1: joy and play and energy amongst your female and diverse
Speaker 1: relationships and then just lean into that energy and hold
Speaker 1: each other accountable and make it a possible side hustle
Speaker 1: and you know, good things will happen. We'll build our
Speaker 1: own Freemason's network. UM. Heather, uh, solid is anything but
Speaker 1: side hustle for you. And I'm so curious how these
Speaker 1: you know, recent downturn and market conditions is impacting you
Speaker 1: and your strategy. We saw you know, doubling of of
Speaker 1: exits last year fifty seven billion dollars and exit value
Speaker 1: UM for public listings. But right now folks are saying
Speaker 1: the I P O window is closed for you know,
Speaker 1: a fast growing venture back startup like yours. You know,
Speaker 1: how are you navigating this time? Yeah? I mean, Emily,
Speaker 1: what we do has never been more relevant. And so
Speaker 1: when I think about our value prop for consumers, help
Speaker 1: me figure out where I should go, when can I
Speaker 1: be seen and how much does it cost? In an
Speaker 1: economic downturn, we are extraordinarily relevant on the provider side
Speaker 1: of what we do help providers, innovative providers deliver a
Speaker 1: more consumer first experience on the heels of COVID, where
Speaker 1: consumers have experienced more digital first healthcare, same day healthcare
Speaker 1: than they ever had previously. So realistically, I am focused
Speaker 1: on the fundamentals and delivering real value both to consumers
Speaker 1: and providers in terms of our growth. And as you
Speaker 1: do that, good things will happen. And we aren't on
Speaker 1: a short term time horizon in order to get to
Speaker 1: UH like what Cure Nortman said the HBO exit. We're
Speaker 1: here to build stinable company that delivers real value in
Speaker 1: R o I and this is a great environment for
Speaker 1: us to be able to do that. How the Fernandez
Speaker 1: CEO and co founder Assault and Karen and Upfront venture
Speaker 1: is so great to have you back here on the show.
Speaker 1: Thanks for sharing some of your secret sauce with us.
Speaker 1: Time now for our crypto report, and it's to see
Speaker 1: a read in the world as alt coins lead the
Speaker 1: route or at Ludlow back here with the latest. What's
Speaker 1: happening with all coins so heavy setting, you know, declines
Speaker 1: in between eleven p sevent a lot of volatility. We're
Speaker 1: talking about Avalanche, Polka Dot Salana, and there's a lot
Speaker 1: of movement away from anything that it's associated or has
Speaker 1: any residents of being assoted with terror. And what's happened
Speaker 1: in the last couple of weeks back that up a
Speaker 1: lot of it, you know, because we've seen, you know,
Speaker 1: some big changes with terror. They're trying to save it,
Speaker 1: trying to save it. So the Terror blockchain and you
Speaker 1: have Terror USD or us T, and the whole point
Speaker 1: of the platform is that allows traders to be nimble,
Speaker 1: to stay within it. It's supposed to be pegged to
Speaker 1: the dollar in that chart that you see on your screen.
Speaker 1: Is that it's just seen a complete collapse. Terror us
Speaker 1: D and also its sister Crypto tooken Lunar. The other
Speaker 1: big point of it was that it was supposed to
Speaker 1: give you a yield, a set interest rate where you'd
Speaker 1: have a really tasty return for keeping your assets within
Speaker 1: the blockchain, and is that's collapsed. What we've seen across
Speaker 1: old coins but also Ethereum and to a certain extent,
Speaker 1: Bitcoin is just bearishness across the market. You know, some
Speaker 1: evidence being the demand for the ethereum block has just
Speaker 1: dropped off, and it shows there's a lot of nervousness
Speaker 1: out there. Why is bitcoin by even differently? Right now?
Speaker 1: All right, Bitcoin has been hovering around twenty nine thousand,
Speaker 1: thousand dollars token for some days, some weeks. There's two theories, right,
Speaker 1: One is that it's like the haven asset within the
Speaker 1: world of crypto that if you're going to move into something,
Speaker 1: and you want to stay within the world of cryptocurrencies,
Speaker 1: you move into Bitcoin. The other problem that we have
Speaker 1: you and I discussed this all the time. It has
Speaker 1: a very high correlation to stocks, and in periods where
Speaker 1: stocks are selling off, the correlation increases. Now stocks have
Speaker 1: stopped selling off, so Bitcoin's kind of stood static and
Speaker 1: treading water at twenty dollars are token. So one are
Speaker 1: the crypto balls waiting for I haven't really heard a
Speaker 1: lot of people saying by now by now by now Yeah, Well,
Speaker 1: we've asked this question before. What is bitcoin? Is it
Speaker 1: an inflation hedge. We're a bit more sanguine on inflation
Speaker 1: at the moments. There's been no big move into a
Speaker 1: bitcoin for that reason. If you look at Inferium, for example,
Speaker 1: there's a lot of technical analysis that it's stuck at
Speaker 1: this kind of token level. It can't go higher. It
Speaker 1: really needs to push beyond two thousand dollars per token,
Speaker 1: as we see on our screen there. That's the severity
Speaker 1: of the kind of plunge we saw Thursday session going through.
Speaker 1: And look, we we kind of paired some of the
Speaker 1: losses that we saw, but there's a lack of direction,
Speaker 1: and they have tried to restart the terror block. They've
Speaker 1: tried to get some life back into this USD pegged
Speaker 1: crypto currency. Not a lot of evidence that it's going
Speaker 1: very well well, and one of our guests last week
Speaker 1: said she expects crypto winter to last at least twelve months,
Speaker 1: maybe eighteen, and it's not going to get back to
Speaker 1: sixty for a while. Yeah, And we had folks from
Speaker 1: Davos telling our co anchors we called it. We told
Speaker 1: you bitcoin would fall from sixty to thirty, It happened,
Speaker 1: and it will go back up in a shorter time frame.
Speaker 1: I think it's a little bit of like, right, where
Speaker 1: are we going? So what are you gonna be watching
Speaker 1: tomorrow and through the weekend, because obviously crypto will continue trading. Yes,
Speaker 1: So this is the problem you and I have. We
Speaker 1: go home on a Friday, thank goodness, and we come
Speaker 1: back on a Monday and it's seven. What's different is
Speaker 1: the psychology of the Asian session Sunday night. You have
Speaker 1: a lot of people that have had the weekend to
Speaker 1: digest it. They get back to their desks in Hong Kong,
Speaker 1: in Singapore, and sometimes when you and I wake up
Speaker 1: on a Monday, they've traded for because of the words
Speaker 1: that have been spoken over the weekend. Remember Krypto seven
Speaker 1: is so the media outlets to cover it. So I
Speaker 1: guess whatever the big thinking is of the weekend, well,
Speaker 1: lucky for us, we get a weekend. Thank you, Ed Ludlow.
Speaker 1: Thanks Okay, Coming up, have the tech bubble first. Many
Speaker 1: are calling the current tech route long overdue a poor holdings.
Speaker 1: Portfolio manager Robert kentwell with us next for his thoughts
Speaker 1: on the market moves now. As our Bloomber Technology Senior
Speaker 1: executive editor Bradstone put it in this week's Big Take,
Speaker 1: years of wildly inflated valuations, crypto flavored pyramid schemes and
Speaker 1: all manner of naked opportunism have led us to the
Speaker 1: tech bust. Of he has such a way with words that, Brad.
Speaker 1: So far this year, the tech heavy SMP five has
Speaker 1: lost just under one five of its value, among the
Speaker 1: worst hit Amazon, Tesla, Meta, and Zoom. But that's just
Speaker 1: the start. So has the tech bubble burst? Let's bring
Speaker 1: in Robert Kentwell, portfolio manager at Upholdings. Robert, what do
Speaker 1: you think has a bubble burst? Well, some air has
Speaker 1: has definitely come out of the balloon, but believe it
Speaker 1: or not, it has fall are from burst companies. There's
Speaker 1: too much cash on balance sheets, there's too much trypowder
Speaker 1: and venture capital. A lot of technology companies have hardly
Speaker 1: tapped debt markets, and so until you really see companies
Speaker 1: extended with short runways, frankly, there's there's there's still a
Speaker 1: little bit of ways to go. But what what's been
Speaker 1: interesting with with this kind of wholesale sell off is
Speaker 1: that we've been kind of putting companies into one of
Speaker 1: three buckets. You either have businesses that have been big
Speaker 1: growers for ten years that are hitting a wall. These
Speaker 1: are streamers like Netflix and Spotify that have to call
Speaker 1: their business models into question. You have this middle group
Speaker 1: of businesses like Meta and Amazon with a lot of
Speaker 1: e commerce exposure, and it's very clear that just as
Speaker 1: the market goes up and down, those businesses are going
Speaker 1: to be affected. So we'll call them in the yellow
Speaker 1: category of well, we'll see what e commerce does and
Speaker 1: then those businesses will do just fine. And then there's
Speaker 1: the green category of business models that are proving to
Speaker 1: be unbelievably resilient. You had Thomas uh you know, from
Speaker 1: the Google Cloud team on here earlier. He couldn't stop smiling,
Speaker 1: and that's because cloud computing is just doing so well
Speaker 1: in spite of how challenging of an environment that we're
Speaker 1: in right now. And so that's definitely the one area
Speaker 1: where we're probably spending the most time as investors because
Speaker 1: prices have come down on a lot of stocks like
Speaker 1: Snowflake and Data Dog in aws that all have exposure
Speaker 1: to that end cloud computing segment. Interesting. Of course, as
Speaker 1: you mentioned, Google Cloud was that one bright spot in
Speaker 1: Alphabet results just a few weeks ago. Now, let's talk
Speaker 1: about your strategy, because your E T F Kings is,
Speaker 1: you know, down with the rest of the market thirty
Speaker 1: year to date. How are you evolving your own strategy.
Speaker 1: I know some of your top stocks are Meta, Amazon
Speaker 1: and Alphabet yep Um and as I as I've been mentioning,
Speaker 1: we're you know, moving more into some of these cloud
Speaker 1: computing businesses like service now um. So our our our
Speaker 1: strategy is it looks sometimes like a technology and desks,
Speaker 1: but we're very pure investors. Where we start at the
Speaker 1: industry where we find really big industries with a small
Speaker 1: number of competitors. We find who the market leaders are
Speaker 1: that are dating market share or have a dominant position.
Speaker 1: We make sure that management is being responsible with how
Speaker 1: they're allocating that capital, and then ultimately got to make
Speaker 1: sure that you're paying a fair price for it. And
Speaker 1: being down, you know, thirty four percent year to day
Speaker 1: when Amazon is down thirty four percent year to date
Speaker 1: is painful and it means that we paid too much
Speaker 1: for some of the companies that we own. For the
Speaker 1: most part, we're holding onto the businesses that we own,
Speaker 1: as I mentioned Spotify as an example of a stock
Speaker 1: that we dropped because we just don't believe in the
Speaker 1: expansion into podcasts, even managements pulling back investment there. But
Speaker 1: we're continuing to move money into these cloud computing businesses.
Speaker 1: And that's the beauty of being one of these early
Speaker 1: actively managed ets is we can move between stocks without
Speaker 1: creating tax problems for investors, and everything we do is transparent,
Speaker 1: so folks can follow along with us while we do
Speaker 1: it as we do now, it's not really spooked a
Speaker 1: lot of investors. I mean, the market was like shaking
Speaker 1: in its boots. How booked were you by Snap? You know,
Speaker 1: not necessarily Snap in particular, but the signal it's sent
Speaker 1: about the macro environment and the digital ads business. It
Speaker 1: was pretty interesting to watch the market process the Snap
Speaker 1: information thirty days. It was only a month since Snap
Speaker 1: was just out publicly reporting that they announced that they
Speaker 1: were going to miss the low end of their guided
Speaker 1: So that's scared a lot of people. Google and Meta
Speaker 1: had a really bad day, But on that same day
Speaker 1: you heard Service Now they had there There's a lot
Speaker 1: of investor days happening right now they up their five
Speaker 1: year revenue target by a billion dollars, and so investors
Speaker 1: are getting a lot of mixed signals. Visa reported that
Speaker 1: while they're seeing variability across different markets, for the most part,
Speaker 1: they don't think we're in a recession. So you're getting
Speaker 1: a lot of different data points that are out there,
Speaker 1: and I'd say, clearly with what the markets in the
Speaker 1: past couple of days, people view this more as an
Speaker 1: idiosyncratic issue with snap because they've had while they've been
Speaker 1: growing users, they've had a declining share of usage relative
Speaker 1: to the rise of TikTok and reels on Instagram, and
Speaker 1: that's been a hard thing for Snapchat to have to navigate.
Speaker 1: So so far we've seen the Snapchat news be um
Speaker 1: potentially isolating, but we're really not going to know for
Speaker 1: another six to eight weeks when earning season lights up again.
Speaker 1: Now we saw this big broad com VM where deal
Speaker 1: get announced today, tech stocks bouncing back. Where where are
Speaker 1: you pleasing your bets for next week? I mean, you know,
Speaker 1: there's so much concern that we're you know, you know,
Speaker 1: heading into a recession, that this is going to be
Speaker 1: some long drawn out period of pain, and then other
Speaker 1: signs that maybe it's it's it's it's just a blip.
Speaker 1: It's noisy, it's very noisy. Um, you know, we're I
Speaker 1: think you're right that this is just the beginning of
Speaker 1: a wave of acquisitions. You had a chart up earlier
Speaker 1: with five different acquisitions that we've already seen this year,
Speaker 1: all in the multi billion dollar phase. I think it
Speaker 1: is extremely reasonable to assume that the second half of
Speaker 1: this year will have an even faster pace of act positions.
Speaker 1: There's simply too much dry powder out there. There's too
Speaker 1: much cash sitting on corporate balance sheets, and there's too
Speaker 1: many valuations that are really attractive. So if you're if
Speaker 1: you're Google and you're sitting there and wondering how to
Speaker 1: you know, turn Google images into Pinterest, Uh, you're like, wow,
Speaker 1: this could take a few years, or we could try
Speaker 1: and go and buy the company for billion dollars. That's
Speaker 1: just something that wasn't in the cards a couple of
Speaker 1: years ago when prices were too high. And so when
Speaker 1: you have some of these larger businesses whose growth rates
Speaker 1: are slowing, with some of these smaller businesses that still
Speaker 1: have penetrating growth rates. By the way Snapchat might be
Speaker 1: up for sale fifteen billion dollars for one of the
Speaker 1: world's very few social networks that works internationally. Uh, it's
Speaker 1: gonna get be a really interesting conversation, I think for
Speaker 1: a lot of these assets that are that are pretty unique. Um,
Speaker 1: and we'll see how it goes. You just gave our
Speaker 1: print reporters, uh, some homework there to chase some deals.
Speaker 1: Robert Cantwell of Upholdings as always great to have you.
Speaker 1: That does it for this edition of Bloomwork Technology. Emily
Speaker 1: Chang in San Francisco, Solar Winds CEO, will be joining
Speaker 1: us to talk cyber tomorrow