1 00:00:02,520 --> 00:00:13,360 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. Bloomberg Tech is live 2 00:00:13,400 --> 00:00:17,200 Speaker 1: from coast to coast with Caroline Hyde in New York 3 00:00:17,480 --> 00:00:19,440 Speaker 1: and ever though in sent Francisco. 4 00:00:23,880 --> 00:00:26,960 Speaker 2: This is Bloomberg Tech Live from Washington. Coming up, arm 5 00:00:27,000 --> 00:00:30,240 Speaker 2: announces plans to sell its own chips for the first time, 6 00:00:30,640 --> 00:00:32,879 Speaker 2: with Meta as the first major customer. 7 00:00:33,040 --> 00:00:36,680 Speaker 3: Plus space stocks on the move after reports that SpaceX 8 00:00:36,720 --> 00:00:39,840 Speaker 3: aims the file of prospect us for an IPO as soon. 9 00:00:39,720 --> 00:00:42,560 Speaker 2: As this week, and kind of Perkins makes its largest 10 00:00:42,680 --> 00:00:45,640 Speaker 2: raise ever three point five billion dollars. We'll discuss next 11 00:00:45,640 --> 00:00:47,080 Speaker 2: with partner Ilia. 12 00:00:46,800 --> 00:00:50,400 Speaker 3: Fishman, but first we check in on these public markets 13 00:00:50,560 --> 00:00:53,479 Speaker 3: and what volatility we have experienced today. We're at one 14 00:00:53,479 --> 00:00:55,760 Speaker 3: point two percent, let's call it on the nasat one hundred. 15 00:00:56,440 --> 00:00:59,120 Speaker 3: Video on the lead got many of the real tech 16 00:00:59,200 --> 00:01:03,080 Speaker 3: and growth named surging on hope that c SPA talks 17 00:01:03,120 --> 00:01:06,119 Speaker 3: can start between Iran and the United States, even though 18 00:01:06,120 --> 00:01:08,679 Speaker 3: in Ran pushes back on that. Great crude down three 19 00:01:08,720 --> 00:01:10,800 Speaker 3: point eight percent and we're still above one hundred dollars, 20 00:01:10,840 --> 00:01:13,520 Speaker 3: But this topic front and center at this year's Hill 21 00:01:13,560 --> 00:01:16,520 Speaker 3: and Valley Forum and Blomberg Senior Tech Editor Mike Sheppard 22 00:01:16,920 --> 00:01:19,720 Speaker 3: I'm pleased to say has the latest for US. Look, 23 00:01:20,280 --> 00:01:24,039 Speaker 3: there seems to be caution necessary because Iran's saying, no, thanks, 24 00:01:24,040 --> 00:01:25,959 Speaker 3: you don't want your fifteen point piece plan. We've actually 25 00:01:26,000 --> 00:01:28,680 Speaker 3: got five of our own. But the market is still optimistic. 26 00:01:28,959 --> 00:01:31,800 Speaker 4: Well, there is at least some sign of engagement, at 27 00:01:31,880 --> 00:01:35,400 Speaker 4: least through intermediaries. The US had sent its fifteen point 28 00:01:35,520 --> 00:01:39,440 Speaker 4: plan through Pakistan. It was promptly rejected, and it contains 29 00:01:39,480 --> 00:01:43,040 Speaker 4: some of the familiar provisions, limits on Iran's missile program 30 00:01:43,080 --> 00:01:46,600 Speaker 4: or rollback of its nuclear efforts, and then also international 31 00:01:46,640 --> 00:01:50,080 Speaker 4: guarantees for access through the Strait of Moves. And now 32 00:01:50,080 --> 00:01:52,800 Speaker 4: we have seen tay Ran respond with its own five 33 00:01:52,920 --> 00:01:56,920 Speaker 4: point plan or its conditions if you will. That include 34 00:01:57,000 --> 00:02:01,640 Speaker 4: actually halt hostilities, a demand for reparations from the devastating 35 00:02:01,680 --> 00:02:05,520 Speaker 4: assault by the US and Israel, honored cities and critical facilities, 36 00:02:05,760 --> 00:02:13,000 Speaker 4: but also very important sovereignty recognize internationally over the strait 37 00:02:13,000 --> 00:02:16,560 Speaker 4: of horror moves. So that is emerging as a sticking point, 38 00:02:16,720 --> 00:02:20,480 Speaker 4: and that's actually something we heard discussed during the proceedings 39 00:02:20,560 --> 00:02:24,239 Speaker 4: yesterday at Hill and Valley. During your interview with Pounteer's 40 00:02:24,440 --> 00:02:28,120 Speaker 4: Chief Technology office. He brought up the importance of the 41 00:02:28,160 --> 00:02:32,320 Speaker 4: Strait as an access for critical materials that are needed global. 42 00:02:32,480 --> 00:02:34,680 Speaker 2: Right, But then that's why you see markets seeing what 43 00:02:34,680 --> 00:02:37,240 Speaker 2: they are right, Technology stocks up, oil a little lower. 44 00:02:37,320 --> 00:02:40,600 Speaker 2: Even when those headlines from Iranian state TV hit pushing 45 00:02:40,680 --> 00:02:44,040 Speaker 2: back on the states of affairs with negotiations apart from 46 00:02:44,040 --> 00:02:47,400 Speaker 2: an algo move, status quo resumed. Let's go to that 47 00:02:47,400 --> 00:02:51,320 Speaker 2: conversation with Sean Sankar. We talked about where the conflict 48 00:02:51,320 --> 00:02:54,280 Speaker 2: in Eras sits in the history of war frankly, and 49 00:02:54,320 --> 00:02:55,799 Speaker 2: the role that technology has played. 50 00:02:56,000 --> 00:02:56,560 Speaker 5: Listen to this. 51 00:02:57,760 --> 00:03:00,360 Speaker 6: The current operations aren't going, but I think people will 52 00:03:00,360 --> 00:03:03,120 Speaker 6: reflect back and say, this is the first large scale 53 00:03:03,160 --> 00:03:08,520 Speaker 6: combat operation that was really driven enhanced, made substantially more 54 00:03:08,520 --> 00:03:10,040 Speaker 6: productive with technology with. 55 00:03:10,040 --> 00:03:17,560 Speaker 2: AI, the first AI driven war pollunteer name little higher today. 56 00:03:17,840 --> 00:03:19,639 Speaker 5: What else do we take from that? 57 00:03:19,720 --> 00:03:23,360 Speaker 4: Pallunteer is really front and center in this question of 58 00:03:23,440 --> 00:03:27,800 Speaker 4: AI's role in warfare because it is their Maven system 59 00:03:27,919 --> 00:03:31,359 Speaker 4: that is being used as the mission control for a 60 00:03:31,400 --> 00:03:35,760 Speaker 4: lot of the US combat operations, and it has really 61 00:03:36,040 --> 00:03:39,440 Speaker 4: accelerated in the view of combat commanders, the way that 62 00:03:39,520 --> 00:03:45,280 Speaker 4: they process enormous amounts of incoming information and on the battlefield, 63 00:03:45,320 --> 00:03:48,360 Speaker 4: and when you think back to prior conflicts in the region, 64 00:03:49,480 --> 00:03:51,920 Speaker 4: the current one is so vastly different. And it is 65 00:03:51,960 --> 00:03:54,440 Speaker 4: simply because of the enormous amounts of data that they 66 00:03:54,480 --> 00:03:58,640 Speaker 4: now have coming in from satellites and other surveillance equipment 67 00:03:58,760 --> 00:04:02,080 Speaker 4: scattered around the region. Commanders have to assess, but they 68 00:04:02,120 --> 00:04:05,400 Speaker 4: simply don't have the personnel all in one place at 69 00:04:05,360 --> 00:04:08,280 Speaker 4: a time. They really do need that machine learning and 70 00:04:08,400 --> 00:04:12,640 Speaker 4: artificial intelligence capability to be able to sort through all 71 00:04:12,680 --> 00:04:15,360 Speaker 4: of that. I think another critical point that also came 72 00:04:15,440 --> 00:04:18,719 Speaker 4: up in the conversation, not only would Schiam during your interview, 73 00:04:18,760 --> 00:04:22,320 Speaker 4: but during his remarks in the panel yesterday, was just 74 00:04:22,400 --> 00:04:26,599 Speaker 4: the need to accelerate US procurement and make it more 75 00:04:26,640 --> 00:04:30,000 Speaker 4: agile so that the US government and its allies can 76 00:04:30,160 --> 00:04:35,800 Speaker 4: develop for the battlefield more quickly. These drones, for instance, 77 00:04:35,880 --> 00:04:39,080 Speaker 4: the low cost drones, but other technology that could be 78 00:04:39,200 --> 00:04:43,279 Speaker 4: brought to bear very quickly against an adversary. And he 79 00:04:43,360 --> 00:04:46,200 Speaker 4: looked back to World War Two when there were more 80 00:04:46,240 --> 00:04:50,400 Speaker 4: than one hundred different airframes developed by industry by the 81 00:04:50,520 --> 00:04:53,240 Speaker 4: US industrial base, only a handful to improved critical but 82 00:04:53,279 --> 00:04:55,320 Speaker 4: he made the point that look, we have to be 83 00:04:55,400 --> 00:04:57,680 Speaker 4: trying harder and really spreading. 84 00:04:57,320 --> 00:05:00,200 Speaker 2: A lot of this pull towards ending the w in 85 00:05:00,240 --> 00:05:03,279 Speaker 2: Iran is what's pushing technology shares higher this morning. Blue 86 00:05:03,279 --> 00:05:05,360 Speaker 2: Mist Mike Sheppard, thank you very much. From Defense Tech 87 00:05:05,839 --> 00:05:11,159 Speaker 2: to space some stocks moving off on news around SpaceX's IPO, Echo, Star, 88 00:05:11,279 --> 00:05:14,920 Speaker 2: Rocket Lab, Ast Space Mobile, many others. All rallying is 89 00:05:14,960 --> 00:05:18,160 Speaker 2: the information reports that SpaceX aims to fire our perspectus 90 00:05:18,160 --> 00:05:20,719 Speaker 2: for an IPO as soon as this week. That follows 91 00:05:20,720 --> 00:05:23,839 Speaker 2: a previous Bloomberg report that SpaceX was paying to list 92 00:05:24,440 --> 00:05:26,520 Speaker 2: this month or file the documents at the end of 93 00:05:26,560 --> 00:05:27,880 Speaker 2: this month, which, by the way, if you look at 94 00:05:27,880 --> 00:05:28,840 Speaker 2: your calendar. 95 00:05:28,839 --> 00:05:29,599 Speaker 5: Is fast approaching. 96 00:05:29,640 --> 00:05:33,680 Speaker 2: Let's get out to Bloombos, Kyle Porter, We've been over this. 97 00:05:33,680 --> 00:05:36,320 Speaker 2: This is likely to be the biggest IPO. 98 00:05:36,480 --> 00:05:37,159 Speaker 5: Of all time. 99 00:05:37,440 --> 00:05:43,279 Speaker 2: I've either on a dollar raised perspective or on evaluation perspective. 100 00:05:43,920 --> 00:05:45,160 Speaker 5: Let's talk about the latest car. 101 00:05:46,560 --> 00:05:50,360 Speaker 7: Indeed, the more recent reporting suggests that they are on 102 00:05:50,520 --> 00:05:54,599 Speaker 7: target for a June IPO, which, as you correctly point out, 103 00:05:54,600 --> 00:05:57,680 Speaker 7: would be the largest IPO by both evaluation and by 104 00:05:57,720 --> 00:06:00,600 Speaker 7: amount of capital raised. The current record was held by 105 00:06:00,600 --> 00:06:03,479 Speaker 7: Sadi Arabia as a RAMCO there raise around twenty nine 106 00:06:03,560 --> 00:06:07,520 Speaker 7: billion dollars. This would be according to recent reports, at 107 00:06:07,600 --> 00:06:10,400 Speaker 7: least double that. So you've got to look at a 108 00:06:10,480 --> 00:06:13,479 Speaker 7: huge range of institutional and retail mix to get this 109 00:06:13,520 --> 00:06:14,560 Speaker 7: sort of an IPO done. 110 00:06:16,120 --> 00:06:19,599 Speaker 3: And real demand at a time of real market volatility 111 00:06:19,920 --> 00:06:22,520 Speaker 3: and big deals being done. That is that still all 112 00:06:22,520 --> 00:06:25,719 Speaker 3: buttoned up? Of course, it was only recently that SpaceX 113 00:06:25,720 --> 00:06:26,640 Speaker 3: consumed Xai. 114 00:06:28,200 --> 00:06:31,080 Speaker 7: Indeed, it wasn't only very recently, and you know that's 115 00:06:31,080 --> 00:06:33,040 Speaker 7: a business that has a huge cash burn attached to it, 116 00:06:33,080 --> 00:06:35,839 Speaker 7: but it doesn't seem to have entered any enthusiasm for 117 00:06:35,880 --> 00:06:39,760 Speaker 7: this IPO. You've really got a situation where institutions are 118 00:06:39,760 --> 00:06:44,120 Speaker 7: looking at SpaceX as a monopoly and the retail component 119 00:06:44,160 --> 00:06:47,320 Speaker 7: are looking at it. As you know, master Eland strikes again. 120 00:06:47,360 --> 00:06:48,600 Speaker 7: Of course they're going to want to get into this. 121 00:06:48,640 --> 00:06:51,040 Speaker 7: He's made spectacular returns for his investors over the past 122 00:06:51,040 --> 00:06:51,920 Speaker 7: twenty years. 123 00:06:52,839 --> 00:06:55,520 Speaker 2: We are we're just showing a chart Kyle that that 124 00:06:55,720 --> 00:06:58,960 Speaker 2: is the kind of anticipated IPOs and the valuation of 125 00:06:59,000 --> 00:07:01,919 Speaker 2: SpaceX like one point seven five trillion. It's worth reminding 126 00:07:02,200 --> 00:07:07,279 Speaker 2: the audience that post merger SPACEXXAI, that private market transaction 127 00:07:07,920 --> 00:07:10,280 Speaker 2: value the company, the combine entity at one point two 128 00:07:10,280 --> 00:07:11,080 Speaker 2: to five trillion. 129 00:07:12,360 --> 00:07:13,520 Speaker 5: This is big. 130 00:07:13,720 --> 00:07:15,840 Speaker 2: There's a lot at stake here, right, Like, there's a 131 00:07:15,920 --> 00:07:19,280 Speaker 2: reason that all of these space and SpaceX adjacent stocks 132 00:07:19,520 --> 00:07:22,440 Speaker 2: are pushing higher. This is one that the world wants 133 00:07:22,480 --> 00:07:24,400 Speaker 2: to get in on, and there are a long list 134 00:07:24,400 --> 00:07:27,360 Speaker 2: of krem de la creme investors that are already on. 135 00:07:27,320 --> 00:07:27,960 Speaker 5: The cap table. 136 00:07:28,120 --> 00:07:30,440 Speaker 2: Just go over the basics of what we know of 137 00:07:30,520 --> 00:07:32,880 Speaker 2: the existing backing the SpaceX act. 138 00:07:33,680 --> 00:07:37,880 Speaker 7: I mean, the existing backing includes people blue chip funds 139 00:07:37,920 --> 00:07:42,800 Speaker 7: like the like the Fidelity. You have dedicated space infrastructure 140 00:07:42,960 --> 00:07:47,120 Speaker 7: or telecom infrastructure like Ecostar is in the Google is in. 141 00:07:47,160 --> 00:07:51,160 Speaker 7: The Bank of America is in there. Given the amount 142 00:07:51,160 --> 00:07:54,240 Speaker 7: of fundraising that's happened and how long SpaceX has been public, 143 00:07:54,280 --> 00:07:56,280 Speaker 7: there's been a very private sorry, there's been a very 144 00:07:56,320 --> 00:07:58,280 Speaker 7: long tail of people who've wanted to get into this, 145 00:07:58,600 --> 00:08:01,280 Speaker 7: and that's going to reils real questions of how they 146 00:08:01,280 --> 00:08:04,840 Speaker 7: go get out of hits. Typically, an IPO doesn't allow 147 00:08:04,960 --> 00:08:09,400 Speaker 7: much in the way of individual investors to sell their shares. 148 00:08:09,640 --> 00:08:12,120 Speaker 7: Given how long some of these people have pin locked up, 149 00:08:12,320 --> 00:08:13,640 Speaker 7: there may be more of a push to do that 150 00:08:13,680 --> 00:08:15,880 Speaker 7: sooner than the typical twelve month local period. 151 00:08:17,600 --> 00:08:19,040 Speaker 3: It is going to be one for the record books 152 00:08:19,080 --> 00:08:22,360 Speaker 3: for most Kyle Porter, we so appreciate your reporting on it. Look, 153 00:08:22,760 --> 00:08:25,440 Speaker 3: let's go to a publicly traded name already that has 154 00:08:25,440 --> 00:08:28,560 Speaker 3: some big moves today. We're watching ARM. That's after the 155 00:08:28,600 --> 00:08:31,120 Speaker 3: company announced plans to sell its own chips for the 156 00:08:31,160 --> 00:08:33,800 Speaker 3: first time, not just design them, not just licensing technology. 157 00:08:33,880 --> 00:08:36,880 Speaker 3: URM CEO Rene has sat down at Bloomberg Tech Europe's 158 00:08:36,920 --> 00:08:37,760 Speaker 3: Tom McKenzie. 159 00:08:39,280 --> 00:08:41,280 Speaker 8: It is a very big day for ARM. There's no 160 00:08:41,360 --> 00:08:44,600 Speaker 8: doubt about that. We've been an IP provider since we started. 161 00:08:45,280 --> 00:08:47,760 Speaker 8: We started selling combut subsystems a few years ago, which 162 00:08:47,880 --> 00:08:49,720 Speaker 8: was sort of the next step but it's not a 163 00:08:49,720 --> 00:08:53,400 Speaker 8: physical thing. But as we grew into the CSS business, 164 00:08:53,800 --> 00:08:55,760 Speaker 8: we had customers that kept asking for more and more 165 00:08:55,800 --> 00:08:59,320 Speaker 8: and more, and here we are today with ARMS first 166 00:09:00,080 --> 00:09:04,760 Speaker 8: priorate Armagi CPU, which Meta is our lead partner for 167 00:09:05,400 --> 00:09:07,360 Speaker 8: and Meta asked us to do it with them, so 168 00:09:07,520 --> 00:09:08,120 Speaker 8: we did. 169 00:09:08,480 --> 00:09:11,320 Speaker 9: Talk to them about Meta and the partnership. Then one 170 00:09:11,400 --> 00:09:14,320 Speaker 9: of your customers, open Ai, also also a customer. What 171 00:09:14,320 --> 00:09:16,920 Speaker 9: are the commitments from Meta from open Ai to take 172 00:09:16,960 --> 00:09:18,880 Speaker 9: this chip on board? When do you start shipping? 173 00:09:19,559 --> 00:09:22,360 Speaker 8: So as Mohammad said, it's available now and we'll start 174 00:09:22,400 --> 00:09:24,960 Speaker 8: shipping at the end of this year. We're not saying 175 00:09:24,960 --> 00:09:29,160 Speaker 8: anything publicly about the volumes associated with it, but they 176 00:09:29,160 --> 00:09:32,720 Speaker 8: are material enough that we have to start talking about 177 00:09:32,720 --> 00:09:34,560 Speaker 8: the product because it's going to start showing up on 178 00:09:34,640 --> 00:09:35,880 Speaker 8: our revenue this year. 179 00:09:36,360 --> 00:09:38,640 Speaker 9: The revenue starts showing up this year, and in your 180 00:09:38,640 --> 00:09:42,280 Speaker 9: presentation earlier here in San Francisco, you talked about potentially 181 00:09:42,360 --> 00:09:45,280 Speaker 9: just this one revenue stream, just this one part of 182 00:09:45,280 --> 00:09:48,120 Speaker 9: the business potentially one hundred billion dollars by twenty thirty. 183 00:09:49,040 --> 00:09:51,000 Speaker 9: Talk us through how you get to that one hundred 184 00:09:51,040 --> 00:09:51,760 Speaker 9: billion dollars. 185 00:09:52,000 --> 00:09:54,760 Speaker 8: So we're looking here then, Tom at the general purpose 186 00:09:54,800 --> 00:09:58,640 Speaker 8: CPU CHAM, which today in twenty twenty six is about 187 00:09:58,640 --> 00:10:02,880 Speaker 8: sixty billion dollars seventy dollars depending on your your maths. 188 00:10:03,960 --> 00:10:07,240 Speaker 8: I talked about agenta AI driving a four XCPU workload 189 00:10:07,760 --> 00:10:11,400 Speaker 8: even today. So sixty billion dollars going to one hundred 190 00:10:11,400 --> 00:10:12,960 Speaker 8: billion dollars by the end of the decade. In terms 191 00:10:12,960 --> 00:10:15,800 Speaker 8: of market opportunity, it's not really that much of a stretch. 192 00:10:17,840 --> 00:10:21,240 Speaker 2: I'm CEO Renee Has there speaking with Bloomberg's Tom McKenzie. 193 00:10:21,240 --> 00:10:23,840 Speaker 2: Now coming up on the program a conversation with Congressman 194 00:10:23,920 --> 00:10:27,680 Speaker 2: Suhas to Bremenian of Virginia on the future of AI 195 00:10:27,840 --> 00:10:28,640 Speaker 2: data centers. 196 00:10:29,040 --> 00:10:31,040 Speaker 5: That's next, This is Bloomberg Tech. 197 00:10:35,360 --> 00:10:37,720 Speaker 3: Apple, Well, let's set to unveil a new standalone SyRI 198 00:10:37,800 --> 00:10:41,959 Speaker 3: app featuring a redesigned interface and an ask Siri capability 199 00:10:42,160 --> 00:10:44,959 Speaker 3: that works across its software ecosystem. Now that's according to sources. 200 00:10:45,240 --> 00:10:48,600 Speaker 3: The app is expected to debut this year's WWDC in June. 201 00:10:48,640 --> 00:10:51,120 Speaker 3: For more, Bloomberg's Apple and Consumer Tech editor, It's Mark 202 00:10:51,120 --> 00:10:53,400 Speaker 3: German joins us with the breaking news that you brought 203 00:10:53,440 --> 00:10:56,280 Speaker 3: and I think for many it will be a finally 204 00:10:56,520 --> 00:10:58,360 Speaker 3: feeling if this happens. 205 00:11:00,200 --> 00:11:00,600 Speaker 10: Finally. 206 00:11:00,640 --> 00:11:05,400 Speaker 11: Indeed, Apple is revamping Siri for iOS twenty seven, macOS 207 00:11:05,440 --> 00:11:09,600 Speaker 11: twenty seven, and iPad os twenty seven, launching in September. 208 00:11:10,440 --> 00:11:12,720 Speaker 11: This is going to be quite significant. This is going 209 00:11:12,760 --> 00:11:15,760 Speaker 11: to include a serie app. It's going to include many 210 00:11:15,800 --> 00:11:19,800 Speaker 11: of the features that originally we're supposed to launch last year, 211 00:11:20,480 --> 00:11:23,120 Speaker 11: Personal context, so being able to tap into your personal 212 00:11:23,200 --> 00:11:26,120 Speaker 11: data and on your screen to fulfilled queries. The idea 213 00:11:26,240 --> 00:11:29,080 Speaker 11: is to transform Siri from just a voice assistant to 214 00:11:29,160 --> 00:11:31,480 Speaker 11: an AI agent that you can use sort of like 215 00:11:31,559 --> 00:11:34,319 Speaker 11: a copilot throughout your day to help you get things 216 00:11:34,360 --> 00:11:37,240 Speaker 11: done and to solve queries. So this is a really 217 00:11:37,240 --> 00:11:40,000 Speaker 11: big deal for Apple, and the hope internally and the 218 00:11:40,040 --> 00:11:41,880 Speaker 11: belief internally is they'll be able to pull it off 219 00:11:41,920 --> 00:11:43,360 Speaker 11: in time for the iPhone eighteen pro. 220 00:11:44,920 --> 00:11:47,200 Speaker 2: The other story that you broke is Amazon has been 221 00:11:47,200 --> 00:11:49,640 Speaker 2: pretty active in m and A on the field of robotics. 222 00:11:49,800 --> 00:11:50,520 Speaker 5: What do we need to know? 223 00:11:52,360 --> 00:11:55,640 Speaker 11: Amazon is acquiring a company called Fauna Robotics, which makes 224 00:11:55,720 --> 00:11:59,240 Speaker 11: this adorable I should say humanoid robot. 225 00:11:59,360 --> 00:12:00,960 Speaker 12: It's about three and a half feet tall. 226 00:12:01,720 --> 00:12:04,480 Speaker 11: It could dance, it could hold hands, it could respond 227 00:12:04,679 --> 00:12:09,240 Speaker 11: to being called out by name, it could pick things up, 228 00:12:10,040 --> 00:12:12,560 Speaker 11: it could take things from the kitchen and bring it 229 00:12:12,600 --> 00:12:12,920 Speaker 11: to you. 230 00:12:13,559 --> 00:12:14,360 Speaker 5: This is a big deal. 231 00:12:14,600 --> 00:12:17,320 Speaker 11: And what's really clear here from what I'm hearing, is 232 00:12:17,320 --> 00:12:20,200 Speaker 11: that this is not meant for deliveries or for manufacturing 233 00:12:20,559 --> 00:12:24,200 Speaker 11: or anything within their fulfillment centers or operations. The idea 234 00:12:24,280 --> 00:12:26,959 Speaker 11: here is to learn about humanoid robots and to get 235 00:12:27,000 --> 00:12:30,080 Speaker 11: the technology and the right people to potentially build a 236 00:12:30,120 --> 00:12:33,680 Speaker 11: consumer grade humanoid robot. So they'd be obviously going to 237 00:12:33,679 --> 00:12:37,920 Speaker 11: toe to toe here with companies like Tesla Boston Dynamics 238 00:12:38,240 --> 00:12:39,559 Speaker 11: figure you name. 239 00:12:39,400 --> 00:12:43,199 Speaker 5: It right, mark it down eleven twelve. 240 00:12:44,080 --> 00:12:46,680 Speaker 2: On March twenty fifth, Bloombo's mark gum and use the 241 00:12:46,679 --> 00:12:49,880 Speaker 2: word adorable, Thank you very much. Now Here in Washington, 242 00:12:49,920 --> 00:12:53,360 Speaker 2: the Trump administration says it's working to cut red tape 243 00:12:53,400 --> 00:12:56,320 Speaker 2: around AI in the buildout of critical infrastructure, but that 244 00:12:56,360 --> 00:12:59,760 Speaker 2: push is facing fresh resistance on Capitol Hill. Senator Bernie 245 00:12:59,760 --> 00:13:04,079 Speaker 2: sand In Congresswomen Alexandria Cassio Cortez A set to introduce 246 00:13:04,160 --> 00:13:08,199 Speaker 2: legislation that would impose a moratorium on new AI data 247 00:13:08,240 --> 00:13:11,120 Speaker 2: centers until stronger safeguards are in place. 248 00:13:11,160 --> 00:13:13,199 Speaker 5: That debate is especially. 249 00:13:12,840 --> 00:13:16,320 Speaker 2: Relevant in Virginia, home to one of the largest concentrations 250 00:13:16,600 --> 00:13:19,880 Speaker 2: of data centers in this country. Joining us now as 251 00:13:19,960 --> 00:13:25,400 Speaker 2: Representative suehas Supermney in Democrat from Virginia. Your reaction, I 252 00:13:25,440 --> 00:13:28,280 Speaker 2: supposed to that initiative and we can then talk about 253 00:13:28,280 --> 00:13:31,079 Speaker 2: the scale of footprint of data centers in your state. 254 00:13:31,640 --> 00:13:34,080 Speaker 13: Yeah, it's important to understand where it's coming from. I 255 00:13:34,120 --> 00:13:37,200 Speaker 13: don't support a full data center moratorium at all, but 256 00:13:37,280 --> 00:13:40,640 Speaker 13: I do think there's a lot of frustration in communities 257 00:13:40,720 --> 00:13:43,599 Speaker 13: like mine when it comes to data center steamrolling. Communities 258 00:13:43,920 --> 00:13:46,920 Speaker 13: and having citing issues where they can create power problems 259 00:13:46,960 --> 00:13:49,280 Speaker 13: in those communities. And so if we did a comprehensive 260 00:13:49,360 --> 00:13:51,439 Speaker 13: look at where we should be citing data centers across 261 00:13:51,480 --> 00:13:53,600 Speaker 13: the country, what would be best for industry, will be 262 00:13:53,600 --> 00:13:56,720 Speaker 13: best for the communities. I think you would actually allay 263 00:13:56,760 --> 00:13:59,280 Speaker 13: a lot of the concerns that people who are supporting 264 00:13:59,360 --> 00:14:01,600 Speaker 13: data s emergenty have about these data centers. 265 00:14:01,960 --> 00:14:06,840 Speaker 2: You represent a region that you cannot understate the footprint 266 00:14:06,880 --> 00:14:11,040 Speaker 2: there seventy percent of the world's Internet traffic flowing through 267 00:14:11,480 --> 00:14:14,040 Speaker 2: servers inside what are essentially tin cans. 268 00:14:14,120 --> 00:14:16,000 Speaker 13: But if my district were a country, would be one 269 00:14:16,000 --> 00:14:17,599 Speaker 13: of the top five countries in terms of number of 270 00:14:17,679 --> 00:14:19,960 Speaker 13: data centers and then amount of Internet running through it. 271 00:14:20,760 --> 00:14:25,600 Speaker 2: What therefore is your position and how you represent your constituents, 272 00:14:26,000 --> 00:14:29,560 Speaker 2: because there is a split right Nimby is one pocket. 273 00:14:30,000 --> 00:14:33,680 Speaker 2: There is job creation, there is economic value created from 274 00:14:33,680 --> 00:14:34,840 Speaker 2: the build out that we're seeing. 275 00:14:34,960 --> 00:14:36,840 Speaker 13: Well, the data centers don't create a lot of jobs, 276 00:14:36,880 --> 00:14:38,880 Speaker 13: but the local government likes it because they create a 277 00:14:38,920 --> 00:14:41,840 Speaker 13: lot of revenue for local government and state government. They 278 00:14:42,160 --> 00:14:44,280 Speaker 13: also don't have create a lot of jobs, which means 279 00:14:44,320 --> 00:14:47,320 Speaker 13: less traffic through those communities, less schools, you have to build, 280 00:14:47,400 --> 00:14:49,680 Speaker 13: less roads, you have to build so the local government 281 00:14:49,720 --> 00:14:51,560 Speaker 13: loves it, which is why they keep approving them. But 282 00:14:51,640 --> 00:14:54,480 Speaker 13: it's shortsighted because then you start to create energy problems. 283 00:14:54,560 --> 00:14:57,480 Speaker 13: You start to have to build energy infrastructure through communities 284 00:14:57,520 --> 00:15:00,000 Speaker 13: that weren't expecting it, didn't sign up, very lower home value, 285 00:15:00,320 --> 00:15:02,520 Speaker 13: and people get angry about it, and rightfully so it's 286 00:15:02,600 --> 00:15:05,440 Speaker 13: more than just a nimbiaism. I think people have legitimate concerns. 287 00:15:05,480 --> 00:15:07,400 Speaker 13: But we can do this as a country. We can 288 00:15:07,440 --> 00:15:08,960 Speaker 13: build out the data centers that we need to build 289 00:15:09,000 --> 00:15:11,200 Speaker 13: out in this country. We don't need to do a moratorium. 290 00:15:11,240 --> 00:15:12,600 Speaker 13: But we have to deal with the buy in of 291 00:15:12,640 --> 00:15:15,160 Speaker 13: communities across the country because I know there's communities that 292 00:15:15,200 --> 00:15:17,040 Speaker 13: want data centers that are coming to ours right now. 293 00:15:17,200 --> 00:15:19,480 Speaker 13: If we had all our data centers, you know, it 294 00:15:19,520 --> 00:15:21,400 Speaker 13: takes more power than the city of DC and we're 295 00:15:21,400 --> 00:15:23,480 Speaker 13: doubling the number of data centers, so we have too 296 00:15:23,480 --> 00:15:26,160 Speaker 13: many in one spot. That's a national security concern as well. 297 00:15:26,240 --> 00:15:28,400 Speaker 13: What we really need to do is just start spreading 298 00:15:28,400 --> 00:15:30,640 Speaker 13: out the data centers across the country and getting it 299 00:15:30,640 --> 00:15:32,360 Speaker 13: in place to where community buying is there. 300 00:15:33,320 --> 00:15:38,080 Speaker 3: How can we hear from communities simultaneously. Clearly we're hearing 301 00:15:38,160 --> 00:15:42,640 Speaker 3: from leadership of big tech. Look today, yet another technology council. 302 00:15:42,720 --> 00:15:44,680 Speaker 3: The President is creating one at the moment where we 303 00:15:44,760 --> 00:15:46,360 Speaker 3: understand Jensen hung is going to be part of it. 304 00:15:46,400 --> 00:15:48,280 Speaker 3: Mark Zuckerberg is going to be part of it. Larry Ellison. 305 00:15:48,480 --> 00:15:52,120 Speaker 3: People very committed to data center build out, to compute 306 00:15:52,120 --> 00:15:54,240 Speaker 3: build out. So how do you ensure that at the 307 00:15:54,320 --> 00:15:58,200 Speaker 3: same time the voices of constituents are heard about these 308 00:15:58,240 --> 00:16:01,800 Speaker 3: anxieties about jobs, about what's happening in terms of energy prices. 309 00:16:01,840 --> 00:16:03,680 Speaker 13: We need to give them a voice in Congress, at 310 00:16:03,720 --> 00:16:05,760 Speaker 13: the state level, at the local level, every level of 311 00:16:05,800 --> 00:16:08,360 Speaker 13: government needs to give their constituents a voice. And we 312 00:16:08,400 --> 00:16:10,600 Speaker 13: don't have to be adversarial all the time to tech. 313 00:16:10,720 --> 00:16:12,920 Speaker 13: We can work together and we can solve this together. 314 00:16:13,280 --> 00:16:15,680 Speaker 13: But certainly we have to make sure that constituents' voices 315 00:16:15,880 --> 00:16:18,080 Speaker 13: do a say, do have a seat in the table, 316 00:16:18,400 --> 00:16:21,160 Speaker 13: because otherwise there's going to be a huge backlash towards 317 00:16:21,400 --> 00:16:23,840 Speaker 13: data centers. You're starting to see it more prominently now. 318 00:16:23,880 --> 00:16:26,480 Speaker 13: Right now you've got members of Congress introducing these moratoriums. 319 00:16:26,520 --> 00:16:28,120 Speaker 13: You're going to see it even more prominently if they 320 00:16:28,160 --> 00:16:29,680 Speaker 13: continue to steam all these communities. 321 00:16:29,800 --> 00:16:32,440 Speaker 3: We have the NSCALE CEO on to start this week, 322 00:16:32,480 --> 00:16:34,320 Speaker 3: which already feels a very long time. Agover is on 323 00:16:34,400 --> 00:16:37,080 Speaker 3: Monday talking about how they're thinking vertical integration and they're 324 00:16:37,080 --> 00:16:40,160 Speaker 3: bringing electricity and infrastructure to the bear. We had Cruso, 325 00:16:40,240 --> 00:16:43,560 Speaker 3: the CEO on earlier yesterday talking about how they're also 326 00:16:43,640 --> 00:16:47,280 Speaker 3: thinking about infrastructure and building it out. Are there innovative 327 00:16:47,320 --> 00:16:50,240 Speaker 3: ways in which you can sil have data centers being 328 00:16:50,240 --> 00:16:53,080 Speaker 3: built near you without sunning a price push, without a 329 00:16:53,160 --> 00:16:56,280 Speaker 3: national security risk, without any detriment to your property prices. 330 00:16:57,360 --> 00:16:57,880 Speaker 5: Yes, and no. 331 00:16:58,160 --> 00:17:00,800 Speaker 13: I'd like to see exactly what they mean that because 332 00:17:01,240 --> 00:17:04,320 Speaker 13: you know, a lot of times people talk about SMRs 333 00:17:04,320 --> 00:17:07,919 Speaker 13: small nuclear reactors. Essentially you need three or four of 334 00:17:07,920 --> 00:17:10,480 Speaker 13: them for each data center, and who wants those nuclear 335 00:17:10,520 --> 00:17:13,360 Speaker 13: reactors next to their homes for instance, and sales. 336 00:17:13,119 --> 00:17:15,320 Speaker 3: Using gas provisions like you. 337 00:17:15,720 --> 00:17:17,280 Speaker 5: I think, I don't know how innovative that is. 338 00:17:17,320 --> 00:17:19,879 Speaker 2: When it comes down to congressmen, you know, on the 339 00:17:19,920 --> 00:17:22,440 Speaker 2: industry side, they would argue they take on the capital 340 00:17:22,480 --> 00:17:26,240 Speaker 2: burden of grid modernization, they buy electricity in bulk, and 341 00:17:26,320 --> 00:17:30,320 Speaker 2: that they would argue there's a deflationary impact for everyday 342 00:17:30,359 --> 00:17:34,760 Speaker 2: people's energy prices. There's also a lot of Bloomberg reporting 343 00:17:34,840 --> 00:17:37,280 Speaker 2: and investigation that shows in zip codes where there's a 344 00:17:37,320 --> 00:17:41,359 Speaker 2: high concentration of data center electricity prices have gone up 345 00:17:41,359 --> 00:17:42,000 Speaker 2: and energy. 346 00:17:41,760 --> 00:17:44,200 Speaker 5: Prices have gone up. What do you see the real 347 00:17:44,359 --> 00:17:45,560 Speaker 5: on the ground view. 348 00:17:45,920 --> 00:17:49,360 Speaker 13: My home in Ashburn, Virginia, our electricity prices have gone up, 349 00:17:49,400 --> 00:17:52,440 Speaker 13: and it's because we had to pay for that infrastructure. 350 00:17:52,560 --> 00:17:54,760 Speaker 13: They're not taking that costs into accounts. So, yes, you 351 00:17:54,800 --> 00:17:59,280 Speaker 13: bring more energy infrastructure long term lower costs, but when 352 00:17:59,280 --> 00:18:01,600 Speaker 13: we have to pay front for that energy infrastructure, it 353 00:18:01,680 --> 00:18:03,080 Speaker 13: raises our utility prices. 354 00:18:03,240 --> 00:18:04,200 Speaker 5: So that needs to change. 355 00:18:04,240 --> 00:18:06,600 Speaker 13: When you to make sure that communities aren't subsidizing the 356 00:18:06,680 --> 00:18:08,800 Speaker 13: data center's energies. And again we can do is a 357 00:18:08,840 --> 00:18:12,119 Speaker 13: lot of companies are actually volunteering to do this to 358 00:18:12,119 --> 00:18:13,879 Speaker 13: be able to pay for their own energy infrastructure. I 359 00:18:13,960 --> 00:18:16,080 Speaker 13: like that idea. That's going to help a lot, and 360 00:18:16,119 --> 00:18:17,400 Speaker 13: that's the type of thing we need to be doing 361 00:18:17,400 --> 00:18:18,800 Speaker 13: when it comes to getting community buyering. 362 00:18:19,280 --> 00:18:22,680 Speaker 2: What is your view of your constituents and the American 363 00:18:22,760 --> 00:18:26,199 Speaker 2: people's relationship with AI. I think Caroline and I have 364 00:18:26,240 --> 00:18:28,760 Speaker 2: had a lot of conversations in the last twenty four 365 00:18:28,800 --> 00:18:32,199 Speaker 2: hours where AI doesn't have very much good PR at 366 00:18:32,200 --> 00:18:35,600 Speaker 2: the moment with every day Americans. One thing that Sean Sankar, 367 00:18:35,640 --> 00:18:37,959 Speaker 2: he's the CTO at Palenteer, put to us is that, 368 00:18:38,000 --> 00:18:41,040 Speaker 2: you know, there's a distinction between what is AI slop 369 00:18:41,160 --> 00:18:43,679 Speaker 2: what people see in their social media feeds, and how 370 00:18:43,720 --> 00:18:46,239 Speaker 2: they actually might benefit from it in their working and 371 00:18:46,280 --> 00:18:47,160 Speaker 2: at home lives. 372 00:18:47,720 --> 00:18:49,639 Speaker 13: You know, I worked at the White House as a 373 00:18:49,640 --> 00:18:53,240 Speaker 13: tech advisor ten years ago. AI was exciting to people. 374 00:18:53,359 --> 00:18:55,080 Speaker 13: They couldn't wait to use it, they couldn't wait to 375 00:18:55,119 --> 00:18:58,640 Speaker 13: adopt it. But they've seen the job displacement. It's hard 376 00:18:58,680 --> 00:19:01,880 Speaker 13: to love AI when companies are putting out announcements saying 377 00:19:02,080 --> 00:19:05,320 Speaker 13: because of AI or laying off jobs, congratulations to us. Right, 378 00:19:05,520 --> 00:19:07,040 Speaker 13: people don't like to hear that. They don't like to 379 00:19:07,119 --> 00:19:09,240 Speaker 13: hear about data centers coming to their community and making 380 00:19:09,280 --> 00:19:12,280 Speaker 13: them pay for the energy costs and energy infrastructure. So 381 00:19:12,400 --> 00:19:14,760 Speaker 13: AI has a PR problem, but they've earned it because 382 00:19:14,760 --> 00:19:17,960 Speaker 13: of the way they talked to communities about AI. And 383 00:19:18,000 --> 00:19:20,600 Speaker 13: so what we need to do is we're collaborative with government. 384 00:19:20,640 --> 00:19:22,639 Speaker 13: I think Congress needs to get more involved than it 385 00:19:22,680 --> 00:19:25,280 Speaker 13: has already when it comes to safety and national security 386 00:19:25,720 --> 00:19:26,760 Speaker 13: and communities. 387 00:19:27,359 --> 00:19:30,600 Speaker 3: Representative sus sobre Money, I'm Democrat of Virginia. It's a 388 00:19:30,640 --> 00:19:33,199 Speaker 3: wonderful to have time with you today. Thank you very much. Indeed, 389 00:19:33,640 --> 00:19:36,959 Speaker 3: now coming up Striker still reeling from a March eleventh, 390 00:19:36,960 --> 00:19:39,960 Speaker 3: I ran link cyber attack that stalled global operations, will 391 00:19:39,960 --> 00:19:42,480 Speaker 3: discuss the cyber landscape amid the continuing war in Iran. 392 00:19:42,520 --> 00:19:54,080 Speaker 3: That's next, this will be their attack, Striker. Well, it 393 00:19:54,119 --> 00:19:57,200 Speaker 3: says a March eleventh cyber attack that stalled global operations 394 00:19:57,280 --> 00:20:00,960 Speaker 3: is lightly contained, but disruptions persist ten days after the event. 395 00:20:01,200 --> 00:20:03,760 Speaker 3: That's according to the EIGHTK filing from the company just yesterday. 396 00:20:03,920 --> 00:20:07,960 Speaker 3: Blumberg cyber Editorestone joins us with more what is keeping 397 00:20:08,000 --> 00:20:10,800 Speaker 3: it so long from being able to really ascertain operations? 398 00:20:10,840 --> 00:20:16,200 Speaker 14: Again, this is a really complicated, intense, complex attack carried 399 00:20:16,240 --> 00:20:19,359 Speaker 14: out excuse me, by a nation state against the company 400 00:20:19,359 --> 00:20:21,600 Speaker 14: that just wasn't expecting this kind of thing. You know, 401 00:20:21,680 --> 00:20:25,440 Speaker 14: these hackers exploited in old vulnerability to get in. They 402 00:20:25,480 --> 00:20:28,920 Speaker 14: somehow had access to you know, pretty deep confines within 403 00:20:29,040 --> 00:20:32,600 Speaker 14: the in the corporate systems, and then they wiped data 404 00:20:32,640 --> 00:20:35,359 Speaker 14: from their kind of perch in there. So it just 405 00:20:35,359 --> 00:20:37,480 Speaker 14: takes a lot of investigation, It takes a lot of cleanup. 406 00:20:39,320 --> 00:20:39,520 Speaker 1: You know. 407 00:20:39,560 --> 00:20:41,760 Speaker 2: We started this segment talking about how you know, ten 408 00:20:41,840 --> 00:20:45,560 Speaker 2: days after the initial attack, this is still causing an issue. 409 00:20:45,760 --> 00:20:47,320 Speaker 5: We've also sought a lot on the show. 410 00:20:47,160 --> 00:20:52,000 Speaker 2: This past week with experts in the industry about the 411 00:20:52,080 --> 00:20:58,480 Speaker 2: sophistication and competence of Iran's cyber threat. Right where does 412 00:20:58,520 --> 00:21:01,080 Speaker 2: this rank, Jeff in sort of historic attacks at the 413 00:21:01,160 --> 00:21:04,160 Speaker 2: nation state level against the United States of America. 414 00:21:04,760 --> 00:21:09,600 Speaker 14: This is not the kind of threat that national security 415 00:21:09,600 --> 00:21:11,800 Speaker 14: officials have warned about from the likes of a Russia 416 00:21:11,920 --> 00:21:15,320 Speaker 14: or China. Iran is a little more specialized. They are 417 00:21:15,320 --> 00:21:18,240 Speaker 14: a little more opportunistic. What they do is they try 418 00:21:18,240 --> 00:21:23,280 Speaker 14: to inflict pain and project power in any way they can. 419 00:21:23,359 --> 00:21:26,919 Speaker 14: So they saw an opportunity here to go against the 420 00:21:27,040 --> 00:21:29,840 Speaker 14: US healthcare sector, right and cause some economic pain for 421 00:21:29,880 --> 00:21:30,440 Speaker 14: this company. 422 00:21:30,640 --> 00:21:32,119 Speaker 15: They've disrupted some surgeries. 423 00:21:32,160 --> 00:21:35,280 Speaker 14: We know that some facilities around the country have pushed 424 00:21:35,320 --> 00:21:37,960 Speaker 14: back procedures as a result of this. It is not 425 00:21:38,200 --> 00:21:42,000 Speaker 14: the level of a big kind of blackout or electrical 426 00:21:42,000 --> 00:21:43,160 Speaker 14: failure like you see in the. 427 00:21:43,080 --> 00:21:45,480 Speaker 5: Movies, Jeff. 428 00:21:45,920 --> 00:21:49,840 Speaker 3: We are seeing hopes maybe dash for many but hopes 429 00:21:49,880 --> 00:21:52,000 Speaker 3: that maybe there's a de escalation in the current conflict 430 00:21:52,000 --> 00:21:56,720 Speaker 3: with Iran. But are you feeling that the ongoing conflict 431 00:21:56,720 --> 00:21:59,560 Speaker 3: from a cyber perspective is still happening. What are companies 432 00:21:59,600 --> 00:22:01,320 Speaker 3: currently need it being affected by? 433 00:22:01,400 --> 00:22:04,680 Speaker 14: Briefly, we know that the companies have to have the 434 00:22:04,720 --> 00:22:07,439 Speaker 14: defenses up against things like phishing attacks. I don't expect 435 00:22:07,440 --> 00:22:11,760 Speaker 14: there to subside US national security officials. European officials have said, 436 00:22:12,640 --> 00:22:16,560 Speaker 14: don't rest on this because this is a reliable means 437 00:22:16,600 --> 00:22:20,280 Speaker 14: for Aran to try to even the playing field. 438 00:22:21,560 --> 00:22:23,880 Speaker 2: Both Jeff Stone with the reporting, thank you very much. 439 00:22:23,960 --> 00:22:26,600 Speaker 2: Like coming up from the show, we speak with Rachel Hoff, 440 00:22:26,720 --> 00:22:30,800 Speaker 2: policy director at the Ronald Reagan Institute, on key takeaways 441 00:22:30,800 --> 00:22:32,399 Speaker 2: from the Hill and Valley Forum where we were yesterday, 442 00:22:32,440 --> 00:22:35,840 Speaker 2: but also the growing prominence of the defense tech sector 443 00:22:36,160 --> 00:22:40,520 Speaker 2: and its relationship with the administration and government here in Washington, 444 00:22:40,600 --> 00:22:42,960 Speaker 2: d C. It is halftime in the program. This is 445 00:22:42,960 --> 00:22:56,320 Speaker 2: Bloomberg Tech. Welcome back to Bloomberg Tech. This is what 446 00:22:56,359 --> 00:22:59,919 Speaker 2: financial markets look like. Technology stocks in particular, pushing higher, 447 00:23:00,480 --> 00:23:04,639 Speaker 2: oil coming down a little bit. The market is weighing 448 00:23:04,720 --> 00:23:08,600 Speaker 2: up the prospects of a ceasefire of a plan towards 449 00:23:08,720 --> 00:23:12,040 Speaker 2: peace in the context of the war in Iran, America 450 00:23:12,040 --> 00:23:13,560 Speaker 2: has put out some proposals. 451 00:23:14,000 --> 00:23:15,680 Speaker 5: What we've seen throughout the morning. 452 00:23:15,560 --> 00:23:20,160 Speaker 2: Is lines principally via Iran state television pushing back actually 453 00:23:20,720 --> 00:23:23,720 Speaker 2: on their interest in engaging with US. But at least 454 00:23:23,720 --> 00:23:26,399 Speaker 2: in the technology sector, we haven't seen then as that 455 00:23:26,440 --> 00:23:29,200 Speaker 2: one hundred or the Philadelphia semi Conductor Index Change directory 456 00:23:29,240 --> 00:23:32,199 Speaker 2: you still see, Brent Krue that's the global benchmark for 457 00:23:32,240 --> 00:23:35,439 Speaker 2: oil hold above one hundred dollars a barrel, and a 458 00:23:35,440 --> 00:23:38,119 Speaker 2: lot of focus on supply chain, particularly the passage of 459 00:23:38,640 --> 00:23:40,560 Speaker 2: ships through the Strait of Horror moves in the context 460 00:23:40,600 --> 00:23:43,280 Speaker 2: of energy, but other things as well. That's what we've 461 00:23:43,280 --> 00:23:44,800 Speaker 2: been talking about for twenty four US straight. 462 00:23:44,920 --> 00:23:48,320 Speaker 3: It is because we've been talking about how technology intertwines 463 00:23:48,320 --> 00:23:51,080 Speaker 3: with defense and how are all aligns. Here in Washington, 464 00:23:51,080 --> 00:23:52,800 Speaker 3: we were at the Hill and Valley Forum n and it 465 00:23:52,840 --> 00:23:55,840 Speaker 3: held a spotlight really on defense tech in the age 466 00:23:55,840 --> 00:23:59,760 Speaker 3: of AI. But SIB data shows just how early that's 467 00:23:59,760 --> 00:24:03,200 Speaker 3: shit still is. While Pentagon spending on defense tech has 468 00:24:03,240 --> 00:24:05,560 Speaker 3: more than doubled from out one point eight billion in 469 00:24:05,600 --> 00:24:07,600 Speaker 3: fiscal year twenty twenty three to four point three billion 470 00:24:07,600 --> 00:24:09,840 Speaker 3: for fiscal year twenty twenty five. It still makes up 471 00:24:10,000 --> 00:24:13,280 Speaker 3: get this, less than one percent of total contract dollars. 472 00:24:13,480 --> 00:24:15,800 Speaker 3: He discuss more on this. It's Rachel Hoffe, policy director 473 00:24:15,800 --> 00:24:18,520 Speaker 3: that Ronald Reagan Institute which issued the report, and it's 474 00:24:18,640 --> 00:24:23,080 Speaker 3: stark warnings. Basically, you not only highlight how little in 475 00:24:23,119 --> 00:24:25,240 Speaker 3: the grand scheme of things money is going to defense 476 00:24:25,280 --> 00:24:27,040 Speaker 3: tech for all the amount that we talk about it, 477 00:24:27,200 --> 00:24:28,960 Speaker 3: but you also try and outline ways in which it 478 00:24:28,960 --> 00:24:31,800 Speaker 3: could be adopted faster. First and foremost, why do we 479 00:24:31,880 --> 00:24:34,200 Speaker 3: get so much excitement about defense tech? Why is the 480 00:24:34,280 --> 00:24:37,320 Speaker 3: VC community pouring in money when the end client isn't 481 00:24:37,359 --> 00:24:38,560 Speaker 3: putting money in as much. 482 00:24:38,880 --> 00:24:40,600 Speaker 16: Well, it's a great question, and I think you've got 483 00:24:40,640 --> 00:24:42,439 Speaker 16: to look at, you know, not just the end client, 484 00:24:42,480 --> 00:24:45,159 Speaker 16: but the threat environment the world that you were just 485 00:24:45,240 --> 00:24:49,360 Speaker 16: speaking about in which that client is operating, And simply. 486 00:24:49,040 --> 00:24:50,480 Speaker 10: Put, it's a dangerous world. 487 00:24:50,520 --> 00:24:53,560 Speaker 16: It's getting more complex and complicated as we see tension 488 00:24:53,600 --> 00:24:56,959 Speaker 16: on the rises, we see conflicts erupting in different corners 489 00:24:57,000 --> 00:24:59,960 Speaker 16: of the world, and that means that protecting American national 490 00:25:00,080 --> 00:25:03,439 Speaker 16: security is good business and it's important business. And so 491 00:25:03,600 --> 00:25:07,400 Speaker 16: we're seeing those private dollars flow those that private capital 492 00:25:07,440 --> 00:25:10,320 Speaker 16: from the venture capital community, But those investors are going 493 00:25:10,359 --> 00:25:12,480 Speaker 16: to need to see the public dollars line up in 494 00:25:12,560 --> 00:25:15,280 Speaker 16: terms of Pentagon spending if it's going to continue and 495 00:25:15,280 --> 00:25:16,960 Speaker 16: if they're going to continue to take that risk. 496 00:25:17,600 --> 00:25:20,640 Speaker 3: The reporting that ED and team and women continue doing, 497 00:25:20,760 --> 00:25:24,080 Speaker 3: ANDRIL now looking at an overall market cap of sixty 498 00:25:24,119 --> 00:25:26,920 Speaker 3: one billion dollars, raising another four billion dollars, and yet 499 00:25:27,000 --> 00:25:29,040 Speaker 3: we're just talking that less than that is how much 500 00:25:29,080 --> 00:25:31,520 Speaker 3: has been directed to all's defense tech from the Pentacon. 501 00:25:31,840 --> 00:25:35,880 Speaker 3: What your policy prescriptives to get the government even more 502 00:25:35,920 --> 00:25:37,560 Speaker 3: comfortable with aligning that money. 503 00:25:38,240 --> 00:25:39,680 Speaker 16: There's a lot of work that we've done at the 504 00:25:39,680 --> 00:25:42,920 Speaker 16: Reagan Institute with regard to this national security innovation based 505 00:25:43,000 --> 00:25:47,879 Speaker 16: kind of thinking about how public investments, but public policy 506 00:25:48,640 --> 00:25:52,119 Speaker 16: can help tackle this problem that we're seeing the private 507 00:25:52,160 --> 00:25:54,679 Speaker 16: sector stand up to solve. Right now, they're operating at 508 00:25:54,680 --> 00:25:57,000 Speaker 16: two different speeds. Where the private sectors in the lead 509 00:25:57,040 --> 00:25:59,960 Speaker 16: were really seeing innovation, we're seeing progress and the guy 510 00:26:00,359 --> 00:26:01,400 Speaker 16: is struggling to keep up. 511 00:26:01,600 --> 00:26:02,359 Speaker 10: It's improving. 512 00:26:02,520 --> 00:26:05,240 Speaker 16: You mentioned at the top defense tech spending has doubled. 513 00:26:05,280 --> 00:26:08,280 Speaker 16: That's great, and yet it's still less than one percent 514 00:26:08,320 --> 00:26:11,680 Speaker 16: and so I think continuing to improve the demand signal 515 00:26:12,040 --> 00:26:15,600 Speaker 16: that government and that's not just the Pentagon, that's also Congress, 516 00:26:16,200 --> 00:26:18,840 Speaker 16: political leaders at the White House level and beyond are 517 00:26:18,960 --> 00:26:22,880 Speaker 16: sending two private sector partners, the clarity with which they're 518 00:26:22,880 --> 00:26:27,199 Speaker 16: communicating their policy priorities, their technology priorities, and then the 519 00:26:27,280 --> 00:26:29,760 Speaker 16: spending to back up those acquisition pathways. 520 00:26:29,840 --> 00:26:32,160 Speaker 2: I want to define what that spending is. What we've 521 00:26:32,160 --> 00:26:35,399 Speaker 2: looked at on the show. Historically RACHEL is unclassified or 522 00:26:35,440 --> 00:26:40,280 Speaker 2: declassified missile spending, and to ham A home the point 523 00:26:40,359 --> 00:26:43,239 Speaker 2: largely it goes to Lockheed Martin and others of that 524 00:26:43,320 --> 00:26:46,360 Speaker 2: legacy Prime ilk. The question I suppose that this juncture 525 00:26:46,400 --> 00:26:49,159 Speaker 2: is does what's happened with the war in Iran change 526 00:26:49,240 --> 00:26:52,080 Speaker 2: that you know, we've done a lot of covering the 527 00:26:52,160 --> 00:26:58,560 Speaker 2: use of drones, lower costs, autonomous technology. The question for 528 00:26:58,680 --> 00:27:00,760 Speaker 2: your report is jectory different. 529 00:27:00,760 --> 00:27:04,480 Speaker 16: Now it's becoming different, it is changing. I think what 530 00:27:04,520 --> 00:27:07,320 Speaker 16: we're seeing with the conflict in Iran and Operation Epic 531 00:27:07,359 --> 00:27:09,240 Speaker 16: Fury is really driving. 532 00:27:08,920 --> 00:27:11,360 Speaker 10: Home the point that defense. 533 00:27:11,080 --> 00:27:13,800 Speaker 16: Tech matters, that these low cost systems are going to 534 00:27:13,840 --> 00:27:17,399 Speaker 16: be an important part of ensuring America's national security. But 535 00:27:17,520 --> 00:27:20,440 Speaker 16: the fact remains that most of the platforms, the weapon 536 00:27:20,480 --> 00:27:23,399 Speaker 16: systems and platforms that we've used in Operation Epic Fury 537 00:27:23,920 --> 00:27:27,440 Speaker 16: are from the Reagan administration or before forty sixty eight, 538 00:27:27,440 --> 00:27:30,800 Speaker 16: eight year old systems, and those are important platforms. Right. 539 00:27:30,880 --> 00:27:34,040 Speaker 16: Aircraft carriers moving into the region are an important part 540 00:27:34,080 --> 00:27:37,480 Speaker 16: of projecting American strength. But the fact that only one 541 00:27:37,560 --> 00:27:41,280 Speaker 16: weapon system, the Lucas drone, is being used in Operation 542 00:27:41,400 --> 00:27:44,720 Speaker 16: Epic Fury, that's been developed in the last fifteen years, 543 00:27:45,080 --> 00:27:48,280 Speaker 16: only one system in this operation that's less than fifteen 544 00:27:48,359 --> 00:27:50,840 Speaker 16: years old, really shows how we need to keep up 545 00:27:50,880 --> 00:27:52,879 Speaker 16: to meet those challenges that you're speaking to. 546 00:27:53,080 --> 00:27:55,600 Speaker 2: The word procurement comes up quite a lot when you're 547 00:27:55,600 --> 00:27:58,760 Speaker 2: at somewhere Light Hill and Valley Forum, and there's a 548 00:27:58,760 --> 00:28:01,000 Speaker 2: bit of an exasperation for industry. 549 00:28:00,600 --> 00:28:02,639 Speaker 5: About how that works. 550 00:28:02,720 --> 00:28:07,360 Speaker 2: PowerPoint presentations is something that they stress over. Is this 551 00:28:07,440 --> 00:28:13,080 Speaker 2: administration better than prior administrations and this Pentagon better than 552 00:28:13,160 --> 00:28:17,159 Speaker 2: prior toations of it at dealing with more nimble, smaller technology. 553 00:28:16,680 --> 00:28:18,600 Speaker 10: Companies well politics aside. 554 00:28:18,880 --> 00:28:21,119 Speaker 16: At the Reagan Institute, we've developed a report card to 555 00:28:21,119 --> 00:28:24,159 Speaker 16: look at exactly this, and we've seen improvements in some 556 00:28:24,320 --> 00:28:27,720 Speaker 16: grades that matter in this defense innovation ecosystem over time, 557 00:28:28,000 --> 00:28:30,080 Speaker 16: and we've seen some grades moving in the other direction, 558 00:28:30,200 --> 00:28:33,360 Speaker 16: but the biggest year on year jump that we've ever seen, 559 00:28:33,440 --> 00:28:37,080 Speaker 16: biggest improvement and grade is something we call customer clarity 560 00:28:37,080 --> 00:28:39,880 Speaker 16: that demands signal that the government's signaling. 561 00:28:39,480 --> 00:28:41,080 Speaker 10: To private sector partners. 562 00:28:41,280 --> 00:28:45,360 Speaker 16: And we see that not just through spending and acquisition pathways, 563 00:28:45,360 --> 00:28:48,080 Speaker 16: but some of the reforms that this administration has pursued, 564 00:28:48,360 --> 00:28:54,000 Speaker 16: the acquisition transformation strategy, streamlining technology priorities. They've said a 565 00:28:54,040 --> 00:28:57,560 Speaker 16: fewer number of technologies are important and then sent that 566 00:28:57,640 --> 00:29:00,440 Speaker 16: signal to private sector partners in terms of what the 567 00:29:00,480 --> 00:29:03,600 Speaker 16: administration wants to focus on, and from what we hear 568 00:29:04,000 --> 00:29:07,360 Speaker 16: from those private sector partners, that's helping helping them align 569 00:29:07,440 --> 00:29:08,720 Speaker 16: to national security priorities. 570 00:29:08,720 --> 00:29:10,240 Speaker 3: I want to talk about talent for a minute because 571 00:29:10,280 --> 00:29:12,840 Speaker 3: Chris power Hadrian joined us yesterday from the Henna Valley Forum, 572 00:29:12,880 --> 00:29:16,240 Speaker 3: and his point was talent is a real issue, and 573 00:29:16,280 --> 00:29:18,280 Speaker 3: that's why in many ways they've got this novel way 574 00:29:18,320 --> 00:29:21,640 Speaker 3: of training people up because there's a huge retirement block. 575 00:29:21,680 --> 00:29:24,200 Speaker 2: That's said the average age of working that industry is 576 00:29:24,240 --> 00:29:26,800 Speaker 2: sixty five, yeah, or something like that, and not everyone 577 00:29:26,840 --> 00:29:29,520 Speaker 2: works until the present generational thing in the school. 578 00:29:29,600 --> 00:29:32,760 Speaker 3: Sorry character, no, but what's so great about your national security? Basically, 579 00:29:32,760 --> 00:29:35,400 Speaker 3: an innovationion based port card is it reads like a 580 00:29:35,400 --> 00:29:41,000 Speaker 3: school report and you're saying talent based D plus in America? 581 00:29:41,520 --> 00:29:44,080 Speaker 3: What do we need more? Look, I said, as a 582 00:29:44,080 --> 00:29:45,840 Speaker 3: British person who luckily enough. 583 00:29:45,680 --> 00:29:47,920 Speaker 5: Works also a British person working in America. 584 00:29:48,000 --> 00:29:50,120 Speaker 3: Do we need more immigration? What is it that's needed 585 00:29:50,160 --> 00:29:51,440 Speaker 3: to boost the D plus? 586 00:29:51,640 --> 00:29:52,640 Speaker 10: It's all of the above. 587 00:29:52,680 --> 00:29:55,400 Speaker 16: We need to attract foreign born talent here to the 588 00:29:55,520 --> 00:29:57,840 Speaker 16: United States to work on some of our hardest problems, 589 00:29:57,840 --> 00:30:00,840 Speaker 16: with appropriate controls of course in place for an national security, 590 00:30:01,080 --> 00:30:04,560 Speaker 16: but we also have to be channeling our domestic talent 591 00:30:05,080 --> 00:30:09,720 Speaker 16: toward STEM careers, toward not just high skill but also 592 00:30:09,840 --> 00:30:13,600 Speaker 16: skilled trades. Companies like Hadrian are doing some very interesting 593 00:30:13,640 --> 00:30:16,680 Speaker 16: and innovative things in that regard, and also thinking about 594 00:30:16,720 --> 00:30:21,560 Speaker 16: how technology itself, AI and beyond can make our workforce 595 00:30:21,640 --> 00:30:24,520 Speaker 16: more productive, even in smaller numbers. 596 00:30:24,720 --> 00:30:26,240 Speaker 10: That it's not just about. 597 00:30:25,960 --> 00:30:28,680 Speaker 16: Maintaining the workforce of the past, but preparing for the 598 00:30:28,760 --> 00:30:31,120 Speaker 16: workforce of the future. And our low grade I think 599 00:30:31,160 --> 00:30:34,080 Speaker 16: in the talent and workforce domain shows that there's a 600 00:30:34,080 --> 00:30:37,479 Speaker 16: lot to be done both with private sector and public 601 00:30:37,520 --> 00:30:40,320 Speaker 16: sector collaboration here to really get that challenge. 602 00:30:40,520 --> 00:30:43,080 Speaker 2: Rachel Hoff, Ronald Reagan Institute. 603 00:30:43,120 --> 00:30:44,920 Speaker 5: It's great to have you on Bloomberg Tech. Thank you 604 00:30:45,000 --> 00:30:45,280 Speaker 5: very much. 605 00:30:45,360 --> 00:30:48,640 Speaker 2: Now coming up, fifty four year old VC firms Kinda 606 00:30:48,720 --> 00:30:53,280 Speaker 2: Perkins makes its largest rays ever three point five billion dollars. 607 00:30:53,320 --> 00:30:56,680 Speaker 2: Will discuss next with partner Ilia Fushman. 608 00:30:56,960 --> 00:30:57,880 Speaker 5: This is bloom Bag Tech. 609 00:31:06,560 --> 00:31:10,360 Speaker 3: Kleine Perkins, the half century old venture capital institution, has 610 00:31:10,440 --> 00:31:12,840 Speaker 3: raised three and a half billion dollars to make bets 611 00:31:12,840 --> 00:31:17,000 Speaker 3: on AI startups and current portfolio stars innovating cross autonomy, transportation, 612 00:31:17,080 --> 00:31:20,719 Speaker 3: professional services, and space for example. Kind Of Perkins partner 613 00:31:20,840 --> 00:31:23,520 Speaker 3: Elia Fishman, I'm pleased to say, joins us for more. 614 00:31:23,640 --> 00:31:26,600 Speaker 3: And look, you've got one billion dedicated to what is 615 00:31:26,600 --> 00:31:29,720 Speaker 3: your twenty second early stage fund. You then got to 616 00:31:29,800 --> 00:31:32,200 Speaker 3: and a half billion going in the growth areas. Just 617 00:31:32,320 --> 00:31:35,320 Speaker 3: tell us about what excites you, Why this amount of money? Why? 618 00:31:35,360 --> 00:31:35,640 Speaker 14: Now? 619 00:31:36,720 --> 00:31:39,720 Speaker 17: Well, we're really at the early innings of probably the 620 00:31:39,720 --> 00:31:43,120 Speaker 17: biggest transformation in technology that any of us have witnessed. 621 00:31:43,440 --> 00:31:46,960 Speaker 17: We see companies growing at big scale, faster than ever before. 622 00:31:47,600 --> 00:31:51,280 Speaker 17: We see AI penetrate all facets of our lives, Whether 623 00:31:51,320 --> 00:31:54,920 Speaker 17: it's on the consumer side with search media, we have 624 00:31:55,120 --> 00:31:57,920 Speaker 17: video models that are still on the come. And then 625 00:31:58,040 --> 00:32:00,880 Speaker 17: on the work side, we see companies all transform how 626 00:32:00,880 --> 00:32:04,360 Speaker 17: they operate, whether it's across legal and professional services with Harvey, 627 00:32:04,840 --> 00:32:10,640 Speaker 17: healthcare with open Evidence, transportation and autonomy with Weimo, and 628 00:32:10,680 --> 00:32:13,080 Speaker 17: we're still very much in the early innings of all 629 00:32:13,120 --> 00:32:16,400 Speaker 17: of this. If we look at how some of the 630 00:32:16,520 --> 00:32:20,040 Speaker 17: leading AI forward companies operate and we compare that to 631 00:32:20,120 --> 00:32:24,840 Speaker 17: the more traditional companies, the opportunity to penetrate the enterprise 632 00:32:25,000 --> 00:32:27,400 Speaker 17: with AI is just infinite from where we sit, and 633 00:32:27,440 --> 00:32:29,080 Speaker 17: that's reflected in the funds. 634 00:32:30,840 --> 00:32:33,280 Speaker 3: Where excites you the most. Is it putting the money 635 00:32:33,280 --> 00:32:35,960 Speaker 3: into fresh new startups that haven't even been designed now, 636 00:32:36,280 --> 00:32:39,280 Speaker 3: or is it backing say a star performer anthropic we 637 00:32:39,360 --> 00:32:42,560 Speaker 3: know is looking to be ipo ing. You've got standout 638 00:32:42,640 --> 00:32:46,200 Speaker 3: names like SpaceX on the books as well. But where 639 00:32:46,240 --> 00:32:48,800 Speaker 3: are you thinking about where you can follow on your capital? 640 00:32:49,880 --> 00:32:52,000 Speaker 17: So our model is pretty simple. We try to back 641 00:32:52,000 --> 00:32:54,440 Speaker 17: companies as early as possible out of our venture funds 642 00:32:54,520 --> 00:32:57,720 Speaker 17: and as they hit inflection, as they hit escape velocity, 643 00:32:57,800 --> 00:33:01,680 Speaker 17: to really concentrate and double down with our funds. Sometimes 644 00:33:02,080 --> 00:33:03,680 Speaker 17: we see things a little bit later, and so we 645 00:33:03,720 --> 00:33:05,840 Speaker 17: come in with a very high conviction, big check out 646 00:33:05,880 --> 00:33:07,600 Speaker 17: of our growth funds straight away. 647 00:33:07,640 --> 00:33:09,040 Speaker 15: But the really. 648 00:33:08,800 --> 00:33:11,080 Speaker 17: Exciting thing we're seeing in the market today is that 649 00:33:11,200 --> 00:33:15,000 Speaker 17: as companies hit really large scale, like in the case 650 00:33:15,040 --> 00:33:18,320 Speaker 17: of Anthropic, that we've really never seen before, the opportunity 651 00:33:18,360 --> 00:33:22,080 Speaker 17: to back these as they progress to escape velocity is 652 00:33:22,120 --> 00:33:24,320 Speaker 17: near infinite, and so that really is reflected in the 653 00:33:24,360 --> 00:33:27,520 Speaker 17: fund structure. So the venture fund we're looking for application 654 00:33:27,600 --> 00:33:32,640 Speaker 17: layer companies, we're looking for infrastructure companies, we're looking for autonomy, 655 00:33:32,680 --> 00:33:37,560 Speaker 17: and as models cheaper and more performant, the physical economy 656 00:33:37,600 --> 00:33:41,040 Speaker 17: becomes an opportunity. But as these companies then hit scale, 657 00:33:41,120 --> 00:33:45,680 Speaker 17: hit growth, we really concentrate with our growth funds. 658 00:33:45,840 --> 00:33:49,160 Speaker 2: We see extremes at both ends of the spectrum. 659 00:33:49,560 --> 00:33:50,720 Speaker 5: Wrote a few weeks ago. 660 00:33:50,720 --> 00:33:54,160 Speaker 2: About the seed round now being more like the coconut 661 00:33:54,280 --> 00:33:57,880 Speaker 2: round the avocado seed round, where you are putting huge 662 00:33:58,000 --> 00:34:01,760 Speaker 2: checks into a collective of a few individuals and you're 663 00:34:01,760 --> 00:34:06,120 Speaker 2: basically betting on their intellectual power. What are you seeing 664 00:34:06,160 --> 00:34:09,160 Speaker 2: in that early stage. I'm really interested you've dedicated those 665 00:34:09,200 --> 00:34:10,960 Speaker 2: funds to that part of the market. 666 00:34:12,040 --> 00:34:14,600 Speaker 17: Well, what we're really seeing is just the opportunity again 667 00:34:14,640 --> 00:34:19,680 Speaker 17: to transform industries with AI business models is again near infinite. 668 00:34:19,719 --> 00:34:21,760 Speaker 15: I mean, everything is really up for grabs. 669 00:34:22,680 --> 00:34:25,320 Speaker 17: We're kind of past what I would call the hype 670 00:34:25,400 --> 00:34:28,480 Speaker 17: buying part of the cycle where folks just wanted AI, 671 00:34:29,160 --> 00:34:32,360 Speaker 17: and we've seen companies like Harvey, for example, in market 672 00:34:32,520 --> 00:34:36,560 Speaker 17: with customers with data around engagement and growth and performance 673 00:34:36,920 --> 00:34:39,480 Speaker 17: to inform how we should think about these opportunities. At 674 00:34:39,520 --> 00:34:43,480 Speaker 17: the early stage, there is a novel case of structure 675 00:34:43,480 --> 00:34:45,840 Speaker 17: of companies where you have sort of the formation of 676 00:34:45,880 --> 00:34:49,160 Speaker 17: next generation labs, which could be the next inflection in 677 00:34:49,239 --> 00:34:52,799 Speaker 17: AI itself, and those are very interesting. But then you 678 00:34:52,880 --> 00:34:57,600 Speaker 17: have really runaway successes that are helping people do their 679 00:34:57,640 --> 00:35:01,200 Speaker 17: work better, that are helping consumers get answers around healthcare. 680 00:35:01,920 --> 00:35:04,520 Speaker 17: And so we try to balance our investing across all 681 00:35:04,560 --> 00:35:08,359 Speaker 17: of those because there is another frontier to be unlocked here, 682 00:35:09,080 --> 00:35:11,840 Speaker 17: and those are the model companies of the future. But 683 00:35:11,880 --> 00:35:14,400 Speaker 17: then you have the model companies of today like Anthropic, 684 00:35:14,800 --> 00:35:17,880 Speaker 17: which are growing faster at a scale that's never been 685 00:35:17,920 --> 00:35:21,799 Speaker 17: seen before, and I think that's still early in their trajectory. 686 00:35:22,520 --> 00:35:24,000 Speaker 5: At the other end of the spectrum. 687 00:35:24,080 --> 00:35:28,360 Speaker 2: Bloomberg also reporting today that SpaceX could seek to raise 688 00:35:28,920 --> 00:35:33,840 Speaker 2: seventy five billion dollars in an IPO confidential filing this week, 689 00:35:34,280 --> 00:35:37,840 Speaker 2: targeting Dune the evaluation one point seventy five trillion to 690 00:35:37,840 --> 00:35:43,040 Speaker 2: two trillion. Pine Perkins has participated in some price SpaceX rounds. 691 00:35:44,680 --> 00:35:46,960 Speaker 2: What's going to happen? How is that going to impact 692 00:35:46,960 --> 00:35:49,600 Speaker 2: the world? Space is a domain that you want to 693 00:35:49,640 --> 00:35:52,280 Speaker 2: go after in the new funds that you've raised. 694 00:35:53,440 --> 00:35:55,320 Speaker 15: I think we want to go after many domains. 695 00:35:55,320 --> 00:35:58,360 Speaker 17: Spaces is a really good example of bringing communication to 696 00:35:58,440 --> 00:36:01,480 Speaker 17: the world, and that's incredible kind of activity that lifts everything. 697 00:36:01,560 --> 00:36:04,600 Speaker 17: If you think about technology, right the Internet was the 698 00:36:04,600 --> 00:36:08,000 Speaker 17: big unlock and getting more of connectivity throughout the world 699 00:36:08,120 --> 00:36:10,879 Speaker 17: is important. But it's also a testament to the fact 700 00:36:10,880 --> 00:36:13,760 Speaker 17: that you now can build companies that are truly transformational 701 00:36:13,760 --> 00:36:16,160 Speaker 17: when it comes to both the physical world and the 702 00:36:16,200 --> 00:36:18,920 Speaker 17: digital world. And that's something that we will focus on 703 00:36:19,040 --> 00:36:21,920 Speaker 17: quite a bit. And that's autonomy. That's autonomy maybe in 704 00:36:21,960 --> 00:36:25,840 Speaker 17: the defense tech sector, that's also autonomy on the consumer side. 705 00:36:26,239 --> 00:36:28,680 Speaker 17: We have a position in Weimo as well, and so 706 00:36:28,760 --> 00:36:33,960 Speaker 17: we just see a really really large scale opportunity across everything. 707 00:36:35,400 --> 00:36:35,760 Speaker 5: Elliot. 708 00:36:36,600 --> 00:36:39,560 Speaker 3: According to people familiar I'm told that you managed to 709 00:36:39,640 --> 00:36:42,760 Speaker 3: raise this amount of money pretty fast and it was oversubscribed, 710 00:36:42,800 --> 00:36:46,680 Speaker 3: and I imagine LPs were excited because of the opportunity 711 00:36:46,880 --> 00:36:49,439 Speaker 3: and the delivery of liquidity, unlike a lot of other 712 00:36:49,480 --> 00:36:52,640 Speaker 3: funds you delivered. When it comes to the Figma IPO, 713 00:36:53,000 --> 00:36:57,200 Speaker 3: we saw the Windsurf acquisition. We might see enormous returns 714 00:36:57,239 --> 00:37:00,840 Speaker 3: if SpaceX and indeed Anthropic and maybe Data Bricks or 715 00:37:00,840 --> 00:37:04,200 Speaker 3: Away may do go public. Is that what locked in 716 00:37:04,200 --> 00:37:06,439 Speaker 3: the LP base? How do you think about the need 717 00:37:06,520 --> 00:37:08,520 Speaker 3: for the markets to open in twenty and twenty six. 718 00:37:09,440 --> 00:37:12,000 Speaker 17: We're very fortunate to have an incredibly supportive lpbase, so 719 00:37:12,040 --> 00:37:14,200 Speaker 17: we're very thankful for that, and ultimately it's all a 720 00:37:14,280 --> 00:37:16,759 Speaker 17: testament to the entrepreneurs that we back, because they're the 721 00:37:16,840 --> 00:37:19,560 Speaker 17: ones building these incredible companies. But if you look at 722 00:37:19,560 --> 00:37:21,359 Speaker 17: the public markets, and if you look at what's really 723 00:37:21,440 --> 00:37:24,719 Speaker 17: driving value, it's technology companies. And if you look at 724 00:37:24,719 --> 00:37:27,080 Speaker 17: the private markets, you know there's a public market MAG 725 00:37:27,160 --> 00:37:30,560 Speaker 17: seven and there's probably a future private market MAG seven 726 00:37:30,600 --> 00:37:33,920 Speaker 17: that's on the come. And that's really the interest that 727 00:37:33,960 --> 00:37:37,560 Speaker 17: we're seeing from limited partners because these companies are getting 728 00:37:37,600 --> 00:37:40,960 Speaker 17: to again revenue scales that we've never seen before, faster 729 00:37:41,160 --> 00:37:44,120 Speaker 17: and compounding at those scales faster than ever before. And 730 00:37:44,160 --> 00:37:47,480 Speaker 17: there's probably the next level of the future future max 731 00:37:47,520 --> 00:37:49,839 Speaker 17: seven and these could be the application companies like at 732 00:37:49,840 --> 00:37:53,200 Speaker 17: Harvey like and Open Evidence, which are then going to 733 00:37:53,239 --> 00:37:55,680 Speaker 17: be the next generation. It's really just a testament to 734 00:37:55,719 --> 00:37:58,560 Speaker 17: the fact that tech is driving pretty much most of 735 00:37:58,560 --> 00:38:02,359 Speaker 17: the value you see today. LP's recognize that and recognize that, 736 00:38:02,400 --> 00:38:04,680 Speaker 17: and we think that's the really big opportunity here. 737 00:38:05,920 --> 00:38:09,920 Speaker 3: And we've talked about this, but public market sentiment might 738 00:38:09,920 --> 00:38:14,800 Speaker 3: be an all time hyphotech. Public sentiment is not. Certainly 739 00:38:14,840 --> 00:38:17,479 Speaker 3: when it comes to AI. They're fearful, they're worried about jobs, 740 00:38:17,520 --> 00:38:21,200 Speaker 3: they're worried about energy prices. And from your portfolio companies, 741 00:38:21,480 --> 00:38:24,200 Speaker 3: are you trying to get across that the opportunity here 742 00:38:24,239 --> 00:38:27,280 Speaker 3: You talk about the infinite possibilities, but for many listening 743 00:38:27,320 --> 00:38:29,759 Speaker 3: at home, it feels like infinite worries and concerns. 744 00:38:30,920 --> 00:38:33,520 Speaker 17: Well, I think one by product, which will be pretty straightforward, 745 00:38:33,520 --> 00:38:35,400 Speaker 17: as quality of life will improve for everyone. Right, we 746 00:38:35,400 --> 00:38:38,240 Speaker 17: will have better access to information, better access to healthcare, 747 00:38:38,320 --> 00:38:44,319 Speaker 17: better access to services, better more performant world around us. 748 00:38:44,400 --> 00:38:46,320 Speaker 15: Really, I mean you think think they're aout WAYMO. 749 00:38:46,520 --> 00:38:51,200 Speaker 17: The ability to have very safe transportation on demand is incredible. 750 00:38:51,520 --> 00:38:54,520 Speaker 17: On the flip side, there is a very clear worry 751 00:38:54,640 --> 00:38:58,200 Speaker 17: because these changes are happening on a timescale that's faster 752 00:38:58,320 --> 00:38:59,040 Speaker 17: than ever before. 753 00:38:59,320 --> 00:39:01,200 Speaker 15: And one of the things we do think about quite. 754 00:39:01,080 --> 00:39:03,440 Speaker 17: A bit is how do we help folks upskill, how 755 00:39:03,480 --> 00:39:07,080 Speaker 17: do we help folks learn and transition into this world. 756 00:39:07,680 --> 00:39:09,880 Speaker 15: It's going to be a world of abundance. But what 757 00:39:10,000 --> 00:39:11,160 Speaker 15: we have to be thoughtful of is. 758 00:39:11,160 --> 00:39:13,520 Speaker 17: I think the industry is making sure that the abundance 759 00:39:13,600 --> 00:39:15,000 Speaker 17: is accessible and distributed. 760 00:39:16,520 --> 00:39:18,520 Speaker 2: Kleiner Perkins Partner earlier Fisher and great to have you 761 00:39:18,560 --> 00:39:19,319 Speaker 2: on Bloomberg Tech. 762 00:39:19,360 --> 00:39:20,319 Speaker 5: Thank you very much. 763 00:39:20,400 --> 00:39:23,080 Speaker 2: Now coming up on the program, open ai nears an 764 00:39:23,120 --> 00:39:26,440 Speaker 2: eight hundred and fifty billion dollar valuation, as it is 765 00:39:26,480 --> 00:39:28,880 Speaker 2: also close on a deal to raise ten billion dollars 766 00:39:28,920 --> 00:39:31,560 Speaker 2: more in its latest funding round. We have the details next, 767 00:39:31,880 --> 00:39:45,759 Speaker 2: This is Bloomberg Tech. Open Ai is nearing a deal 768 00:39:45,800 --> 00:39:49,000 Speaker 2: to raise about ten billion dollars from venture investors including 769 00:39:49,040 --> 00:39:53,640 Speaker 2: Andrews and Horowitz, Abudabi's MGX, and Microsoft. That's, according to sources, 770 00:39:53,640 --> 00:39:56,320 Speaker 2: that would bring its total hall from its latest funding 771 00:39:56,440 --> 00:39:59,960 Speaker 2: rounds to one hundred and twenty billion dollars, boosting its valuation, 772 00:40:00,080 --> 00:40:03,280 Speaker 2: and to eight hundred and fifty billion dollar bloemost shuring 773 00:40:03,280 --> 00:40:05,839 Speaker 2: Gafari is with us part of the team that broke 774 00:40:05,880 --> 00:40:09,040 Speaker 2: the story. Okay, so let's just be very clear about 775 00:40:09,040 --> 00:40:12,440 Speaker 2: what this is. It's basically an extension or expansion of 776 00:40:12,520 --> 00:40:14,040 Speaker 2: the round they were already doing. So they did one 777 00:40:14,120 --> 00:40:17,359 Speaker 2: hundred and ten billion dollars from corporates basically, and now 778 00:40:17,360 --> 00:40:19,720 Speaker 2: they're adding a little bit more. But it's the vcs 779 00:40:19,760 --> 00:40:21,239 Speaker 2: that are getting in. What else do we need to know? 780 00:40:22,800 --> 00:40:24,640 Speaker 12: That's right? So this is sort of the second part 781 00:40:24,640 --> 00:40:25,240 Speaker 12: of the round. 782 00:40:25,360 --> 00:40:27,640 Speaker 18: We're heading into the final close, you know, as soon 783 00:40:27,680 --> 00:40:29,440 Speaker 18: as the end of month, which could be next week, 784 00:40:29,840 --> 00:40:33,280 Speaker 18: and we're seeing some you know, big names traditional vcs 785 00:40:33,920 --> 00:40:38,400 Speaker 18: as well as other funds like a d shaw Co two. 786 00:40:39,000 --> 00:40:42,200 Speaker 18: And we are seeing one more company investor jump in 787 00:40:42,239 --> 00:40:45,480 Speaker 18: on this part of the round, which is Microsoft. 788 00:40:45,600 --> 00:40:49,719 Speaker 3: And that maybe raised a few eyebrows, surean because there's 789 00:40:49,760 --> 00:40:53,919 Speaker 3: been much questioning of that relationship. What does their participation 790 00:40:54,000 --> 00:40:55,120 Speaker 3: look like? What does it signal? 791 00:40:56,680 --> 00:40:59,080 Speaker 18: Yeah, I think there's been a lot written about open 792 00:40:59,120 --> 00:41:02,080 Speaker 18: AI and Microsoft ups and downs, of course, Microsoft being 793 00:41:02,080 --> 00:41:04,399 Speaker 18: the biggest sort of early corporate backer of open Ai, 794 00:41:04,520 --> 00:41:08,640 Speaker 18: critical to their expansion into this GPT era. However, in 795 00:41:08,680 --> 00:41:12,960 Speaker 18: recent times we've seen open ai diversify it's cloud you know, 796 00:41:13,000 --> 00:41:17,360 Speaker 18: it's compute based, diversify its corporate partner base, and so 797 00:41:17,440 --> 00:41:19,960 Speaker 18: I think this signifies a Microsoft still in open Ai 798 00:41:20,120 --> 00:41:21,880 Speaker 18: now how much and how deep? And are they the 799 00:41:22,040 --> 00:41:24,680 Speaker 18: kind of sole corporate partners in early days? No, but 800 00:41:24,800 --> 00:41:27,320 Speaker 18: we are seeing a continuation, at least on the funding 801 00:41:27,360 --> 00:41:29,120 Speaker 18: side here Swen. 802 00:41:29,200 --> 00:41:33,080 Speaker 2: Another big headline on open ai is it's discontinuing support 803 00:41:33,200 --> 00:41:36,200 Speaker 2: for Sora and winding down a deal that it had 804 00:41:36,200 --> 00:41:38,520 Speaker 2: with Disney. I remember when that deal hit. We broke 805 00:41:38,560 --> 00:41:40,880 Speaker 2: it on this show and made a pretty big deal 806 00:41:40,880 --> 00:41:44,640 Speaker 2: of it. Pardon the expression, why are they winding down Sora? 807 00:41:44,800 --> 00:41:48,120 Speaker 2: And why did Disney and that relationship fall apart? 808 00:41:50,080 --> 00:41:50,560 Speaker 5: That's right. 809 00:41:50,600 --> 00:41:52,520 Speaker 12: It was sort of an abrupt ending. 810 00:41:52,680 --> 00:41:55,120 Speaker 18: So if you remember, Sora launched an app not so 811 00:41:55,239 --> 00:41:57,600 Speaker 18: long ago, and it was sort of had a viral. 812 00:41:57,440 --> 00:41:59,000 Speaker 12: Beginning and was topping charts. 813 00:41:59,040 --> 00:42:03,719 Speaker 18: But as viral apps do sometimes, kind of user activity 814 00:42:03,760 --> 00:42:05,960 Speaker 18: on that app seemed to die down in recent months. 815 00:42:06,280 --> 00:42:10,440 Speaker 18: And remember that producing videos, especially ai videos. 816 00:42:10,040 --> 00:42:11,520 Speaker 12: It's an expensive business. 817 00:42:11,560 --> 00:42:14,759 Speaker 18: It can cost a lot more to produce even a 818 00:42:14,760 --> 00:42:17,600 Speaker 18: ten second video clip than it does, you know, a 819 00:42:17,640 --> 00:42:20,120 Speaker 18: paragraph of texts in a chatbot. So you have to 820 00:42:20,160 --> 00:42:23,160 Speaker 18: think about the cost benefit ratio for a company like 821 00:42:23,200 --> 00:42:26,920 Speaker 18: open ai when it's facing stiff competition from Anthropic on enterprise, 822 00:42:26,960 --> 00:42:30,080 Speaker 18: when it's facing stronger Google Gemini models. Is it the 823 00:42:30,120 --> 00:42:33,120 Speaker 18: right decision to go all in on video when there's 824 00:42:33,239 --> 00:42:35,120 Speaker 18: limited compute, limited resources. 825 00:42:35,440 --> 00:42:37,640 Speaker 12: I think is probably the question the company was thinking. 826 00:42:37,719 --> 00:42:41,360 Speaker 18: Now the dynamics with Disney, you know, we're it's I 827 00:42:41,360 --> 00:42:44,960 Speaker 18: think there's going to probably be more about this store. 828 00:42:44,960 --> 00:42:48,520 Speaker 18: We're going to look into exactly what happened there more. 829 00:42:48,560 --> 00:42:50,319 Speaker 12: But I think that you know, we're seeing this. 830 00:42:50,320 --> 00:42:55,640 Speaker 18: Pushback on video front from a major lab is very significant, and. 831 00:42:55,640 --> 00:42:58,160 Speaker 3: It really does seem part of this border strategy shift 832 00:42:58,200 --> 00:43:01,040 Speaker 3: honing in on on where to win that Fujisimo is 833 00:43:01,080 --> 00:43:04,320 Speaker 3: really bringing open ai as well. Blue Moost showing Gafari 834 00:43:04,719 --> 00:43:06,960 Speaker 3: great reporting as always, Thanks so much for bringing it 835 00:43:07,000 --> 00:43:08,640 Speaker 3: to us. And look, we've got to talk a little 836 00:43:08,680 --> 00:43:11,760 Speaker 3: bit more ed about what all this means for Disney, 837 00:43:12,040 --> 00:43:15,040 Speaker 3: because what a first week for Josh Tomara at the moment, 838 00:43:15,120 --> 00:43:17,239 Speaker 3: like the unraveling of the Story deal that many people 839 00:43:17,360 --> 00:43:19,160 Speaker 3: thought would be the next experience. We were going to 840 00:43:19,160 --> 00:43:21,919 Speaker 3: get Disney Plus and the like, and now also there's 841 00:43:21,960 --> 00:43:22,919 Speaker 3: issues with Epic Games. 842 00:43:23,000 --> 00:43:26,200 Speaker 2: So Josh Tomorrow became CEO last Wednesday the eighteenth at 843 00:43:26,280 --> 00:43:30,320 Speaker 2: the annual shareholder meeting. He's seven days in and Disney 844 00:43:30,800 --> 00:43:33,600 Speaker 2: put money into this open AI relationship. It was supposed 845 00:43:33,640 --> 00:43:35,960 Speaker 2: to yield things. They also have an investment in Epic 846 00:43:36,000 --> 00:43:39,080 Speaker 2: Games video game maker, a company that's doing big layoffs, 847 00:43:39,160 --> 00:43:42,280 Speaker 2: so hard start to that tenures. 848 00:43:42,440 --> 00:43:46,000 Speaker 3: Welcome to the role of CEO. It would feel like, well, 849 00:43:46,320 --> 00:43:49,200 Speaker 3: that does it for this extraordinary edition of Blue mag 850 00:43:49,239 --> 00:43:51,040 Speaker 3: Tech right here from the heart of Washington. 851 00:43:51,120 --> 00:43:54,080 Speaker 2: Yeah, lots to recap on tech and politics. Do it 852 00:43:54,080 --> 00:43:57,360 Speaker 2: on the podcast. You know where to find it online, Apple, Spotify, 853 00:43:57,440 --> 00:43:58,920 Speaker 2: and iHeart from Washington. 854 00:43:59,000 --> 00:44:00,520 Speaker 5: DC. S has been back