WEBVTT - Bloomberg Businessweek Weekend - May 15th, 2021 0:00:01.040 --> 0:00:05.440 This is Bloomberg Business Week Inside from the reporters and 0:00:05.600 --> 0:00:09.200 editors who bring you America's most trusted business magazine, plus 0:00:09.240 --> 0:00:13.160 global business finance and tech news as it happened. Bloomberg 0:00:13.240 --> 0:00:16.759 Business Week with Carol Messier and Bloomberg Quick Takes. Tim 0:00:16.800 --> 0:00:21.400 Stinevin on Bloomberg Radio. Hi, everyone, welcome to the weekend 0:00:21.480 --> 0:00:24.720 edition of Bloomberg Business Week, Week sixty one. Working from home. 0:00:24.760 --> 0:00:26.920 We were both in the office this week and Tim, 0:00:26.920 --> 0:00:29.360 it was a week full of a lot of economic data, 0:00:29.760 --> 0:00:33.840 volatile markets. We saw global stock slide on inflation concerns. Yeah, 0:00:33.880 --> 0:00:36.120 we did a busy week here at Bloomberg headquarters. Lots 0:00:36.159 --> 0:00:38.040 of our colleagues return into the office for the first 0:00:38.080 --> 0:00:39.720 time in over a year. So it's good to see 0:00:39.760 --> 0:00:41.760 that things are slowly getting back to normal. I talk 0:00:41.800 --> 0:00:44.120 about this all the time. More and more traffic, Yeah, 0:00:44.120 --> 0:00:45.960 and a lot more traffic on the roads and in 0:00:46.040 --> 0:00:49.000 the elevators. Coming up on Bloomberg Business Week, We've got 0:00:49.000 --> 0:00:51.680 a jam packed show. We've got live person CEO Rob 0:00:51.840 --> 0:00:55.640 Lacazio on the proliferation of artificial intelligence. Also an inside 0:00:55.640 --> 0:00:58.560 look at the volatile nature of the multibillion dollar video 0:00:58.640 --> 0:01:01.360 game industry. And we've got in music legend joining us 0:01:01.360 --> 0:01:03.840 as well. Rock and Roll Hall of Famer Nancy Wilson 0:01:04.240 --> 0:01:07.520 on self discovery with live music. She is putting out 0:01:07.560 --> 0:01:10.360 her first solo album ever. And you guys talk a 0:01:10.400 --> 0:01:13.160 little bit about the late great Eddie Van Halen as well. 0:01:13.360 --> 0:01:15.280 Just some great stories. Well, all that to come. We're 0:01:15.319 --> 0:01:18.000 gonna begin this week with the cover story in Bloomberg 0:01:18.000 --> 0:01:21.120 business Week, The spack boom has sputtered thanks to SEC 0:01:21.240 --> 0:01:25.280 warnings and some disappointing performances. One guiding voice admitted all 0:01:25.400 --> 0:01:28.480 the former immigrant kid who is now worth billions, the 0:01:28.520 --> 0:01:31.200 so called pied piper of the recent blank check craze. 0:01:31.319 --> 0:01:35.520 We're talking about venture capitalist to moth Pollyopatia. Bloomberg Projects 0:01:35.560 --> 0:01:39.160 and Investigations reporters Zeke Fox explores how Pollyopatia shaped the 0:01:39.200 --> 0:01:42.440 media and Wall Street narratives around Clover. It's a middling 0:01:42.480 --> 0:01:44.960 health insurer in New Jersey that he reframed as a 0:01:45.120 --> 0:01:48.680 disruptive and game changing profit machine. We're also joined by 0:01:48.680 --> 0:01:51.480 Bloomberg Business Week editor Joel Weber. So the pitch for 0:01:51.560 --> 0:01:54.400 Clover Health is that it was a tech company that 0:01:54.600 --> 0:01:58.280 was going to revolutionize healthcare, and if you weren't listening 0:01:58.280 --> 0:02:00.720 to that closely, you might not even really pick up 0:02:00.760 --> 0:02:04.760 that it was really a health insurance company. And of 0:02:04.800 --> 0:02:06.720 course you can find this all out from its securities 0:02:06.760 --> 0:02:08.799 filings if you're the kind of person who reads those. 0:02:08.840 --> 0:02:13.919 But really it's a medicare advantage plan that almost exclusively 0:02:13.919 --> 0:02:16.840 operates in New Jersey. Not really a very big company, 0:02:16.880 --> 0:02:20.840 and from talking to former employees, one that's had a 0:02:20.880 --> 0:02:23.840 lot of trouble hitting its growth targets in the past 0:02:24.080 --> 0:02:27.239 expanding the way it wanted to. Now, of course they 0:02:27.280 --> 0:02:30.840 have this pitch now that they've invented uh tech tool 0:02:30.880 --> 0:02:33.880 that's sort of the culmination of, you know, a decade 0:02:33.880 --> 0:02:36.600 of their existence that's really going to bring together all 0:02:36.639 --> 0:02:41.760 their machine learning technology to analyze patient data and recommend treatments, 0:02:41.800 --> 0:02:43.680 and that this is what's really going to make the 0:02:43.680 --> 0:02:47.920 company take off. Um. But I hope that the investors 0:02:48.000 --> 0:02:50.920 that are buying it understand that, you know, this is 0:02:51.000 --> 0:02:55.720 a pretty risky new business rather than something that is 0:02:56.840 --> 0:03:00.960 you know, guaranteed to go up, and you say, decade 0:03:00.960 --> 0:03:04.680 in business still losing money, So that if it was 0:03:04.720 --> 0:03:07.920 being taken public, you know, and it was going on 0:03:07.919 --> 0:03:10.720 a road show, you would certainly see, Zeke, it become 0:03:10.919 --> 0:03:15.560 under a lot of scrutiny. Yeah, that's sort of the 0:03:15.600 --> 0:03:18.280 appeal of SPACs for a lot of companies is when 0:03:18.320 --> 0:03:22.760 you go public, the un writers are worried about getting 0:03:22.760 --> 0:03:26.680 sued if they make projections that are wrong, So you're 0:03:27.280 --> 0:03:30.760 almost forced to dwell on your recent results. So if 0:03:30.760 --> 0:03:33.959 you're a company with like Clover that's losing huge amounts 0:03:34.000 --> 0:03:37.440 of money every year, but you're on the verge of 0:03:37.520 --> 0:03:41.480 a turnaround, you say, um, when you do a spack, 0:03:41.600 --> 0:03:45.640 you can talk more about your great future prospects and 0:03:46.400 --> 0:03:51.240 you can hopefully investors won't dwell on your recent losses. 0:03:51.840 --> 0:03:54.200 And there's been just like a huge wave of these 0:03:54.280 --> 0:03:59.600 unprofitable UH companies with big dreams going public through spacts 0:03:59.600 --> 0:04:01.480 this year, and for a while it just seemed like 0:04:01.520 --> 0:04:04.440 all of them went up almost people were talking about 0:04:04.440 --> 0:04:06.360 it like it was almost a new asset class. You 0:04:06.400 --> 0:04:10.400 could just invest in SPACs and get great returns well. 0:04:10.440 --> 0:04:13.160 And then um, gravity kind of came in and and 0:04:13.200 --> 0:04:15.480 things have changed a little bit um and hence the 0:04:16.240 --> 0:04:19.600 spacticost flat cover. Um. Zeke, though, I wanted to ask 0:04:19.680 --> 0:04:23.360 because despite what what we'll publish in the magazine. And Um, 0:04:23.400 --> 0:04:26.600 despite maybe that data, it doesn't seem like it might 0:04:27.120 --> 0:04:30.080 stop Jamas. Right, And even as you were working on 0:04:30.120 --> 0:04:32.719 this story, he announced that there was another one coming 0:04:33.480 --> 0:04:36.160 with a certain gym chain. So how do you how 0:04:36.160 --> 0:04:39.440 do you make sense of of of where Jamas could 0:04:39.480 --> 0:04:43.920 go with his vision of SPACs. So he has turned 0:04:43.960 --> 0:04:47.760 himself into kind of a brand name like Goldman Sacks. 0:04:47.800 --> 0:04:50.200 And if you're a company that wants to go public, 0:04:50.279 --> 0:04:52.920 maybe you hire a bank to do an I p O. 0:04:53.080 --> 0:04:55.960 And now people are aware that there's another option that 0:04:56.000 --> 0:05:01.480 you could merge with one of Pollhopatia's SPACs. And my 0:05:01.600 --> 0:05:05.960 big question is whether the brand name can survive one 0:05:06.080 --> 0:05:09.039 or two bad deals. Um, if it was it was 0:05:09.080 --> 0:05:12.520 built on just sort of this to the moon idea. Um, 0:05:13.279 --> 0:05:16.039 is he gonna lose his appeal if he has a 0:05:16.080 --> 0:05:20.599 mixed track record like anyone who's bringing companies public is 0:05:20.640 --> 0:05:23.159 likely to have. In the long run, you can't all 0:05:23.200 --> 0:05:26.120 be winners. But you're right, he's just the other day 0:05:26.120 --> 0:05:30.600 Bloomberg News broke that he is planning to bring the 0:05:30.800 --> 0:05:35.599 Jim chain Equinox public um. But he hasn't raised any 0:05:35.640 --> 0:05:38.280 new blank check companies for a while, So that's something 0:05:38.279 --> 0:05:41.400 to keep an eye on. If he's uh, raise those 0:05:41.839 --> 0:05:45.880 more gets closer to his goal of like he said, 0:05:46.240 --> 0:05:49.000 that was Bloomberg's Zeke Fox on the King of Spacks 0:05:49.040 --> 0:05:52.040 Chamas Pollopatia. But I think to his followers he's more 0:05:52.040 --> 0:05:54.760 of like a one name person Chama. People tweet it, 0:05:54.800 --> 0:06:00.000 you know who they're talking about, like Madonna. He's definitely 0:06:00.080 --> 0:06:03.680 we within that world. And listen. I think for SPACs, uh, 0:06:03.800 --> 0:06:07.159 the history books will see how they cover this era 0:06:07.520 --> 0:06:09.280 because back is not a new thing. But man, we've 0:06:09.279 --> 0:06:11.159 had quite a boom in the past year. We really have. 0:06:11.560 --> 0:06:13.320 The big question is how sustainable is it because the 0:06:13.400 --> 0:06:15.760 last few months haven't seen that similar boom. Right, we're 0:06:15.800 --> 0:06:18.000 not seeing it in the returns either. Coming up the 0:06:18.080 --> 0:06:20.960 changing face of consumer interactions, that is, they have no 0:06:21.120 --> 0:06:24.600 face at all, live person CEEO Rob Licasio on earnings 0:06:24.720 --> 0:06:28.480 and the booming market for conversational artificial intelligence software. It's 0:06:28.480 --> 0:06:32.000 about bots. It's when we go on a website, tim 0:06:32.080 --> 0:06:34.360 and we get to actually kind of talk with somebody. 0:06:34.400 --> 0:06:37.000 I feel like I'm talking with the person. Yeah, it's working, 0:06:37.240 --> 0:06:39.880 It is working. You're listening to Bloomberg Business Week. This 0:06:40.200 --> 0:06:58.240 is Bloomberg. This is Bloomberg Business Week with Carol Masser 0:06:58.480 --> 0:07:03.680 and Bloomberg Quick Takes to insinivate from Bloomberg Radio to 0:07:03.839 --> 0:07:05.600 the next couple of segments. We're gonna take a look 0:07:05.720 --> 0:07:10.120 at consumers and shopping because we've seen a lot of changes, 0:07:10.360 --> 0:07:14.400 increasingly everybody going digital in the last twelve thirteen months 0:07:14.440 --> 0:07:16.560 because of the pandemic. And I guess some of the 0:07:16.640 --> 0:07:19.080 questions are what happens in a post pandemic world? And 0:07:19.400 --> 0:07:21.800 this one next guest kind of gives us some clues. Yeah, 0:07:21.840 --> 0:07:24.320 it's Rob Lacatio, the founder, chairman, and CEO of the 0:07:24.360 --> 0:07:27.800 publicly held application software company it's called Live Person. He 0:07:27.920 --> 0:07:30.679 joined us after his company reported he's strong first quarter. 0:07:30.840 --> 0:07:33.040 He's someone we've talked to you though throughout the pandemic, 0:07:33.280 --> 0:07:36.240 keeping my Live Person. It's an a I powered conversational 0:07:36.240 --> 0:07:40.440 platform for consumers to essentially talk with companies, engaged with companies, 0:07:40.560 --> 0:07:42.920 and Lacascio says, there's a good chance you've interacted with 0:07:43.000 --> 0:07:45.360 his platform, whether you know it or not. We're talking 0:07:45.360 --> 0:07:49.480 about bots, so much demand for UM you know, AI 0:07:49.600 --> 0:07:53.960 and conversationally on bots and messaging consumers, we want to 0:07:53.960 --> 0:07:56.640 do things differently, and so we had like you know, 0:07:56.760 --> 0:08:00.720 Dunkin Donuts now is using it for their consumers to 0:08:00.800 --> 0:08:04.440 sign up for their loyalty programs. And there we got 0:08:04.480 --> 0:08:06.840 a big jewelry company, one of the public company's they're 0:08:06.840 --> 0:08:08.960 selling diamond jewelry with it, sort of like daun it's 0:08:09.000 --> 0:08:12.040 the diamonds. It's kind of like it's moving beyond care 0:08:12.200 --> 0:08:16.720 right now. We just sawty growth in the quarter. That's 0:08:16.720 --> 0:08:19.520 our highest glowth quarter in the history of our companies. 0:08:19.520 --> 0:08:21.960 So so for people who aren't familiar with the actual technology, 0:08:22.040 --> 0:08:24.600 explain where they might have interacted with it. You mentioned 0:08:24.600 --> 0:08:28.120 a couple of companies there, and what exactly they're doing 0:08:28.240 --> 0:08:30.560 when they're communicating and do they know that they're not 0:08:30.600 --> 0:08:33.760 necessarily communicating with a real person. Yes, So like if 0:08:33.800 --> 0:08:37.079 if you've ever been on Delta Airlines or T Mobile 0:08:37.360 --> 0:08:41.560 or City Bank there, you'll be basically if you've messaged 0:08:41.760 --> 0:08:45.319 into using Apple Business Chatter or SMS or even in 0:08:45.360 --> 0:08:47.840 their app, if you're messaging with them like you do 0:08:47.920 --> 0:08:51.240 your friends and family, you're using our technology. So sometimes 0:08:51.640 --> 0:08:54.280 it's not a live agent, and we provide an automated 0:08:54.280 --> 0:08:56.600 what we call botty chiplte that you can order a 0:08:56.640 --> 0:09:00.720 burrito now with a bot called Pepper and pick that 0:09:00.760 --> 0:09:04.080 burrito up at the store. So that's where you would 0:09:04.080 --> 0:09:06.960 have touched it. And we have eighteen thousand customers all 0:09:07.000 --> 0:09:10.240 around the world, so we do about eighty million people 0:09:10.280 --> 0:09:12.600 a month will be interacting on our system with one 0:09:12.600 --> 0:09:16.079 of our eighteen thousand customers. WHA, So what's changed? I mean, 0:09:16.120 --> 0:09:18.120 you have a great you know, first of all, we've 0:09:18.160 --> 0:09:20.559 talked to you a couple of times throughout the pandemic 0:09:20.720 --> 0:09:22.320 and it's been great checking in with you because you 0:09:22.360 --> 0:09:24.080 do have a great vantage point. You work with a 0:09:24.080 --> 0:09:27.360 lot of different companies, different industries from that vantage point. 0:09:27.440 --> 0:09:29.640 We were just talking about. C e o s are 0:09:29.679 --> 0:09:34.280 not giving a lot of forecast longer term, so we're 0:09:34.280 --> 0:09:36.559 not quite sure what happens after maybe the pop in 0:09:36.600 --> 0:09:39.560 the second quarter and after that. What would you say 0:09:39.600 --> 0:09:43.080 about the economy today and maybe out through the end 0:09:43.080 --> 0:09:45.720 of the year. I mean, we're seeing like we have 0:09:46.200 --> 0:09:50.120 a lot of travel, hospitality customers and some of the 0:09:50.120 --> 0:09:53.960 biggest brands in the world from hotels to um you know, 0:09:54.040 --> 0:09:58.440 airlines and man like they they reduced their staff in 0:09:58.480 --> 0:10:01.199 some cases down to like nothing, and now they've had 0:10:01.200 --> 0:10:06.319 the overhire for the amount of demand we're seeing their retail, online, retail. 0:10:06.360 --> 0:10:09.800 We have some of the biggest home building companies in 0:10:09.840 --> 0:10:13.080 the world. We're seeing a lot of action. Their home 0:10:13.120 --> 0:10:16.320 improvement companies a lot of action there. So I think 0:10:16.320 --> 0:10:19.199 there are are are we're seeing basically across our customer 0:10:19.240 --> 0:10:21.360 base a lot of movements. So it feels like things 0:10:21.400 --> 0:10:23.320 are bouncing back now in our world a lot to 0:10:23.360 --> 0:10:26.000 shift into digital. So I think those brands that are 0:10:26.000 --> 0:10:29.760 really being digitally forward and aggressive and really changing how 0:10:29.760 --> 0:10:32.400 they were doing business during COVID are gonna sort of 0:10:32.440 --> 0:10:35.680 they're gonna they're gonna really get the real bang out 0:10:35.679 --> 0:10:38.320 of as we come through this thing. So what does 0:10:38.360 --> 0:10:40.679 that look like on the other side in terms of 0:10:40.679 --> 0:10:43.559 how people interact with other people versus how they're interacting 0:10:43.559 --> 0:10:46.240 with bonds. What do companies that are reopening or that 0:10:46.280 --> 0:10:48.439 have reopened need to be prepared for the different way 0:10:48.440 --> 0:10:51.320 that consumers want to communicate. What do you see? I 0:10:51.320 --> 0:10:54.600 think it's really like the retail, it's been really interesting retail, 0:10:54.920 --> 0:10:58.240 Like obviously the retail physical locations got shut down. Now 0:10:58.280 --> 0:11:01.520 they're opening back up, but we're seeing such demands still 0:11:01.760 --> 0:11:05.840 in digital using messaging, allowing the consumer to have that 0:11:06.000 --> 0:11:08.600 personal experience, and that's what we need, Like we'd like 0:11:08.640 --> 0:11:12.000 to have conversations as people because it's how our brain works. 0:11:12.040 --> 0:11:14.440 We want to ask questions about products and we need that. 0:11:15.000 --> 0:11:17.440 So being able to provide that, especially in the retail area, 0:11:17.480 --> 0:11:21.240 I don't think it's about going back to stores. It's about, yes, 0:11:21.280 --> 0:11:23.600 the stores will be there. But I can tell you 0:11:23.679 --> 0:11:26.200 these retailers were working with like this big jewelry company, 0:11:26.240 --> 0:11:28.920 like they have three thousand stores in the US, the 0:11:28.960 --> 0:11:32.520 amount of money they've they've created an opportunity digitally now 0:11:32.800 --> 0:11:34.800 where they didn't think they could sell like this, sell 0:11:34.840 --> 0:11:38.160 a diamond necklace or diamond ring, and they're able to 0:11:38.200 --> 0:11:40.679 do it. That's what they're really starting to see is that, oh, yeah, 0:11:40.679 --> 0:11:42.640 we should have done this a long time ago. This 0:11:42.720 --> 0:11:44.280 is our future. We don't have to just rely on 0:11:44.360 --> 0:11:46.640 people walking in our stores. You and I talked about this, 0:11:46.679 --> 0:11:49.160 I think before. It was somebody during the pandemic that 0:11:49.200 --> 0:11:51.360 we talked with. It was kind of high end watches 0:11:51.400 --> 0:11:54.600 and they were doing virtual meetings with consumers to show 0:11:54.640 --> 0:11:57.920 them stuff, you know, and shot that way and personally 0:11:57.960 --> 0:12:01.640 these converse conversational bots. I kind of enjoyed. It engages 0:12:01.679 --> 0:12:05.160 me and I feel like I actually have some personal experience. Rob, Yeah, 0:12:05.200 --> 0:12:07.240 and that's that's what it is. Like the version one 0:12:07.240 --> 0:12:09.120 of the bots a couple of years ago, we're pretty bad. 0:12:09.160 --> 0:12:12.240 But our platform and what we're able to do with it, 0:12:12.320 --> 0:12:13.920 and it's just the way we built the platform and 0:12:13.960 --> 0:12:16.600 the way we have the data and the way our 0:12:16.640 --> 0:12:19.880 customers can build their bods like Pepper this this bot 0:12:20.000 --> 0:12:23.520 for Chipalti. It's it's like you basically you talk to 0:12:23.559 --> 0:12:25.199 it and you have this relationships and you build a 0:12:25.240 --> 0:12:28.040 burrito and and it's cool. It's like it's not just 0:12:28.120 --> 0:12:30.800 like give us your burrito order, Press one, Press twility, 0:12:30.920 --> 0:12:34.360 like you converse with this, like there's a personality and 0:12:34.360 --> 0:12:36.880 as personality. And that's the cool thing is that the 0:12:36.920 --> 0:12:38.920 websites are all sort of the same when you think 0:12:38.960 --> 0:12:41.800 about them, top navigation a bunch of texts and pictures. 0:12:42.280 --> 0:12:44.960 Every brand now can create a different type of think 0:12:45.000 --> 0:12:47.000 about it, like it's almost like they put a live human. 0:12:47.080 --> 0:12:49.960 They it's automated, but they create a personality for it. 0:12:50.160 --> 0:12:54.079 That was Roblicasio, founder, chairman and CEO of Live person listen, 0:12:54.120 --> 0:12:57.120 I think about, you know, what I have done over 0:12:57.160 --> 0:12:59.160 the last twelve thirteen months. And when I go online, 0:12:59.200 --> 0:13:01.600 it's not just about looking at a website, picking things 0:13:01.640 --> 0:13:04.280 and just filling out the order form. Essentially. There are 0:13:04.320 --> 0:13:05.960 times I have questions. I did it with a paint 0:13:06.000 --> 0:13:08.320 company and I started talking with somebody. I did it 0:13:08.360 --> 0:13:11.440 with framing, somebody actually had an ongoing conversation. And I 0:13:11.480 --> 0:13:14.000 have to say, as a consumer, I really like it 0:13:14.000 --> 0:13:16.000 because I get my questions answered right away. I do 0:13:16.040 --> 0:13:18.520 think it's something that has become as as the technology 0:13:18.559 --> 0:13:22.520 has gotten better, it's become increasingly acceptable to consumers because 0:13:22.520 --> 0:13:25.200 there is that fine line between what actually works and 0:13:25.600 --> 0:13:28.240 what makes a consumer more frustrated if they can't get 0:13:28.240 --> 0:13:29.720 the answer to what they're looking for. And I have 0:13:29.720 --> 0:13:31.040 to stay every once in a while, though, there's a 0:13:31.040 --> 0:13:33.000 bot that it's like, you can tell it's like standard questions. 0:13:33.000 --> 0:13:35.440 You're like, no, that's not what I want, that's not 0:13:35.559 --> 0:13:38.720 what I'm asking, all right. Still ahead on Bloomberg Business Week, 0:13:38.800 --> 0:13:42.320 Ruin and Recovery in the video game industry. Bloomberg's Jason 0:13:42.400 --> 0:13:45.720 Schreyer on his book Press Reset, all about how our 0:13:45.760 --> 0:13:48.600 series of renowned studios fell apart. This is someone who 0:13:48.640 --> 0:13:51.320 knows the video game industry inside and it's a second 0:13:51.360 --> 0:13:54.240 book on the industry. Yeah, and it is a fantastic read. 0:13:54.360 --> 0:13:56.920 Also up next the Shop from Home. Boom is here 0:13:56.960 --> 0:13:59.800 to stay, but now people are buying clothing and accessories 0:13:59.800 --> 0:14:03.440 for going out. Retail veteran Julie Bornstein on consumer spending 0:14:03.440 --> 0:14:06.360 patterns and the one year anniversary of her shopping app, 0:14:06.520 --> 0:14:09.240 the yes, are you shopping more? I am shopping a 0:14:09.280 --> 0:14:11.560 little more, a little differently. Yeah, I mean I don't 0:14:11.559 --> 0:14:14.360 shop much in general. Okay, okay, cat talk to your wife, 0:14:14.520 --> 0:14:17.240 Yes you can, all right, that's coming up. This is 0:14:17.240 --> 0:14:24.960 Bloomberg Broadcasting from the financial capital of the world, Bloomberg 0:14:25.000 --> 0:14:28.520 eleven Frio in New York to Washington, d C. Bloomberg 0:14:29.480 --> 0:14:32.720 to Boston, Bloomberg one O six one to San Francisco, 0:14:32.760 --> 0:14:36.240 Bloomberg nine six to the country Sirius XM CHADO one 0:14:36.320 --> 0:14:39.240 nine team, and around the globe the Bloomberg Business app 0:14:39.360 --> 0:14:43.720 and Bloomberg Radio dot Com. This is Bloomberg Business Week. 0:14:44.720 --> 0:14:46.520 We mentioned we had a couple of interviews when it 0:14:46.520 --> 0:14:48.800 comes to consumer spending. This is our second one and 0:14:48.960 --> 0:14:50.880 this next guest has a front row seat when it 0:14:50.920 --> 0:14:54.400 comes to consumer spending in retail. We're talking about Julie Bornstein. 0:14:54.640 --> 0:14:56.800 She's founder and CEO of the shopping app The Yes, 0:14:56.880 --> 0:15:01.120 which she launched him one year ago. Talk about timing, Yeah, 0:15:01.160 --> 0:15:02.920 and she knows a thing or two about retail. She's 0:15:02.960 --> 0:15:05.600 a former chief operating officer of stitch Fixed, former chief 0:15:05.680 --> 0:15:09.920 digital officer at Sephora, executive responsibilities at Urban Outfitters in 0:15:10.000 --> 0:15:12.840 Nordstrom as well, and now she's steering a company that 0:15:12.920 --> 0:15:16.320 she launched during the pandemic towards a more normalized retail climate. 0:15:16.680 --> 0:15:18.480 So here's what people are spending their money on. When 0:15:18.480 --> 0:15:21.440 it comes to fashion, we definitely are starting to see 0:15:21.560 --> 0:15:24.680 sort of a turn in pattern. Um. I would say. 0:15:24.680 --> 0:15:28.000 In the beginning of our launch last May, which was 0:15:28.040 --> 0:15:30.160 a crazy time to try and launch a fashion business, 0:15:30.440 --> 0:15:34.760 we were primarily selling casual clothes Zoom tops was a 0:15:34.760 --> 0:15:39.640 big category, and leggings and comfortable clothing, um. And it 0:15:39.680 --> 0:15:42.880 was interesting because we definitely saw, with the world really 0:15:42.880 --> 0:15:46.600 focusing on online shopping, an appetite for consumers to try 0:15:46.640 --> 0:15:49.120 out new apps. You know, I think as everyone started 0:15:49.440 --> 0:15:53.000 doing grocery shopping on instat cart and other ways of 0:15:53.120 --> 0:15:55.000 sort of going through life. We saw a lot of 0:15:55.000 --> 0:15:59.320 people downloading our app called the Yes and UM, you know, 0:15:59.360 --> 0:16:02.840 I would say both playing around and uh sort of 0:16:02.880 --> 0:16:04.600 thinking about what they want to buy in the future 0:16:04.720 --> 0:16:08.360 and then buying pretty practical clothes. Um. But we started 0:16:08.400 --> 0:16:12.080 to see um, some light at the end of the 0:16:12.120 --> 0:16:16.320 tunnel of the COVID pandemic in the thought that people 0:16:16.320 --> 0:16:20.480 are starting to buy for going out. So we're seeing 0:16:20.520 --> 0:16:25.280 some occasion categories like dresses and heels, UM, and some 0:16:25.400 --> 0:16:27.640 other interesting trends. How much are they buying and how 0:16:27.720 --> 0:16:29.880 much do you think has also been impacted as a 0:16:29.920 --> 0:16:31.960 result of the stimulus payments? How much has that given 0:16:32.000 --> 0:16:33.680 kind of maybe a boost to some of the business 0:16:34.200 --> 0:16:39.440 at the Yes. The Yes cells primarily branded um, you know, 0:16:39.520 --> 0:16:42.360 mid to hire price points, so we're probably a little 0:16:42.440 --> 0:16:44.400 less sensitive to the checks. But I think just the 0:16:44.720 --> 0:16:47.160 I mean, I think a combination of the stimulus checks 0:16:47.160 --> 0:16:51.120 and the fact that sort of consumer confidence is growing 0:16:51.240 --> 0:16:53.600 and people just are starting to think about going out 0:16:53.640 --> 0:16:56.440 again is very evident in we're seeing an increase in 0:16:56.520 --> 0:16:59.360 total sales and obviously a change of what people are 0:16:59.400 --> 0:17:03.600 buying well. And so how has kind of what you've 0:17:03.640 --> 0:17:07.040 seen Julie and maybe the last few months maybe changed 0:17:07.240 --> 0:17:12.600 your thoughts and thinking about the rest of the year. Um. 0:17:12.760 --> 0:17:15.320 You know, I think that the it's hard to predict 0:17:15.440 --> 0:17:19.080 how things will come back, UM, and I think it's 0:17:19.119 --> 0:17:24.159 gonna be, um, a slow, steady return, especially in fashion. 0:17:24.200 --> 0:17:27.800 If you kind of look at historical trends, you know, 0:17:27.840 --> 0:17:29.960 it takes a little while for things to come back. 0:17:30.200 --> 0:17:32.639 And it also, UM, I think there's sort of this 0:17:32.760 --> 0:17:35.760 combination of you have sort of this money that you 0:17:35.840 --> 0:17:39.520 haven't spent in this category, UM, so you're excited to 0:17:39.520 --> 0:17:41.560 spend it. And on the flip side, you haven't worn 0:17:41.600 --> 0:17:44.520 anything in your closet for the past year, um, And 0:17:44.600 --> 0:17:46.439 so you know, I think and then the things that 0:17:46.480 --> 0:17:48.840 you have bought you kind of want to burn because 0:17:48.840 --> 0:17:51.120 you've been wearing but you have gotten used to wearing 0:17:51.200 --> 0:17:53.439 comfortable things. So I think there are a number of 0:17:53.440 --> 0:17:55.879 interesting dynamics that play and we're seeing a little bit 0:17:55.920 --> 0:17:58.960 all of it play out. Um. Certainly in terms of 0:17:59.000 --> 0:18:00.320 some of the you know, if you look at the 0:18:00.320 --> 0:18:05.080 product categories that the fashion brands are making, they've added 0:18:05.080 --> 0:18:07.479 a lot of casual into their line and it seems 0:18:07.480 --> 0:18:11.000 as though they will keep that while also we'll start 0:18:11.040 --> 0:18:13.679 to see the return of more, you know, sort of 0:18:13.960 --> 0:18:17.360 clothing to go out in for occasions and ultimately for work, 0:18:17.359 --> 0:18:20.959 which I think will come back even later because return 0:18:21.000 --> 0:18:24.439 to office won't happen more at scale until the fall, right. 0:18:24.520 --> 0:18:27.520 I mean, i'mwhere in heels, to be fair, I'm getting 0:18:27.600 --> 0:18:31.080 dressed up you so like you do get back and 0:18:31.119 --> 0:18:33.359 that's from you know, yoga pants and jeans and bare 0:18:33.359 --> 0:18:37.199 feet at home for eight nine months. Um Or is 0:18:37.240 --> 0:18:39.800 there anything you know, you're just talking about kind of 0:18:39.840 --> 0:18:42.680 how people are adapting some of their lines to include 0:18:42.760 --> 0:18:45.760 some of that you know, casual wear. But is there 0:18:45.960 --> 0:18:49.359 anything from the pandemic in terms of how we shopped 0:18:49.440 --> 0:18:52.160 or how we looked at the stuff we owned, how 0:18:52.200 --> 0:18:55.919 that stays with us post pandemic. Yeah. I mean I 0:18:55.960 --> 0:18:59.120 think two of the um sort of trends that I 0:18:59.160 --> 0:19:02.959 think stick is, you know, we saw a step function 0:19:03.080 --> 0:19:08.719 change in the amount of purchasing online and so you know, 0:19:08.760 --> 0:19:11.359 there have been sort of there's been a steady growth 0:19:11.400 --> 0:19:14.240 in online purchasing. I've been in online retail for twenty 0:19:14.320 --> 0:19:17.879 years and you know you've seen a very steady rise. Um. 0:19:17.920 --> 0:19:20.080 But I think we saw a step change function this 0:19:20.160 --> 0:19:24.119 year that will continue um, meaning that we've increased the 0:19:24.160 --> 0:19:27.040 trend and now we will sort of continue to grow 0:19:27.119 --> 0:19:29.600 off of that new trend. That was Julie Bornstein, founder 0:19:29.600 --> 0:19:31.680 and CEO of the shopping app The Yes. She was 0:19:31.720 --> 0:19:35.000 former chief operating officer of stitch Fixed, former chief digital 0:19:35.000 --> 0:19:38.199 officer as Aphora or did Urban Outfitters Nordstrom. You know 0:19:38.280 --> 0:19:40.560 someone who really, you know, has worked in retail for 0:19:40.600 --> 0:19:42.720 a long time see me ups and downs and understands 0:19:42.800 --> 0:19:45.160 kind of the evolution in how we're shopping throughout the pandemic. 0:19:45.160 --> 0:19:47.560 We've been hearing from executives and talking about this a lot. 0:19:47.600 --> 0:19:50.280 The acceleration of trends pretty amazing, Caroll. To see a 0:19:50.280 --> 0:19:53.800 company get five years worth of shopping trends compressed into one. 0:19:54.000 --> 0:19:55.840 That's that really stood out for me, just as a 0:19:55.880 --> 0:19:58.920 reminder of how much happened in the last year and 0:19:58.920 --> 0:20:00.359 and the impact it's going to have want all of 0:20:00.440 --> 0:20:02.920 us going forward. All Right, you're listening to Bloomberg Business 0:20:02.960 --> 0:20:04.840 Week coming up next, the rise and fall of some 0:20:04.960 --> 0:20:08.080 gaming heavyweights. We're talking about video games. Yeah, the dark 0:20:08.119 --> 0:20:10.720 side of the video game industry. We're bringing it to light. 0:20:11.000 --> 0:20:22.200 This is Bloomberg. You're listening to Bloomberg Business Week with 0:20:22.280 --> 0:20:26.879 Carol Messer and Bloomberg Quick Takes. Tim Stinovich from Bloomberg Radio. 0:20:28.119 --> 0:20:30.920 Do my reclose cover story Bloomberg Business Week from the summer. 0:20:31.000 --> 0:20:33.120 It was about the dark underbelly of a business built 0:20:33.160 --> 0:20:34.960 on fund Tim, this is a story about the video 0:20:34.960 --> 0:20:38.280 game industry. Bloomberg News technology writer Jason Schreyer joined us again, 0:20:38.400 --> 0:20:40.800 this time around talking about his new book, an excerpt 0:20:40.960 --> 0:20:43.240 of which was just in the magazine. I could not 0:20:43.280 --> 0:20:45.080 put this story down when I started reading, and Carol, 0:20:45.080 --> 0:20:46.800 I'm not a gamer, and the mark to me of 0:20:47.000 --> 0:20:49.960 good writing is bringing someone in who has no experience 0:20:49.960 --> 0:20:51.760 in something, and that's how I feel about gaming. I 0:20:51.840 --> 0:20:53.880 just could not stop reading this. I was enthralled. Well, 0:20:53.880 --> 0:20:55.399 this is the second book on the industry, and he 0:20:55.440 --> 0:20:57.560 really brought it down to the people in the industry 0:20:57.600 --> 0:21:00.240 and how the ups and downs can really imp packed 0:21:00.280 --> 0:21:02.879 them personally. The book is called Press, Reset, Ruin and 0:21:02.920 --> 0:21:05.520 Recovery in the Video Game Industry, and an unforgiving one 0:21:05.560 --> 0:21:08.080