WEBVTT - Rotation Out of Tech Is How To Make Money This Year: Nick Colas 0:00:00.800 --> 0:00:04.000 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney alongside 0:00:04.040 --> 0:00:06.920 my co host Matt Miller. Every business day we bring 0:00:06.960 --> 0:00:11.520 you interviews from CEOs, market pros, and Bloomberg experts, along 0:00:11.560 --> 0:00:15.560 with essential market moving news. Find the Bloomberg Markets podcast 0:00:15.560 --> 0:00:18.479 called Apple Podcasts or wherever you listen to podcasts, and 0:00:18.480 --> 0:00:23.800 at Bloomberg dot com slash podcast. We are going to 0:00:23.840 --> 0:00:26.400 get to a guest I've been looking forward to for 0:00:26.400 --> 0:00:28.680 a while. Nick Kolis, joins us co founder of Data 0:00:28.680 --> 0:00:31.440 Trek Research, and he was one of my favorite guests. 0:00:31.600 --> 0:00:34.960 Um when I used to anchor out of New York. Um, Nick, 0:00:35.040 --> 0:00:38.000 it's your notes that I really loved. I used to 0:00:38.080 --> 0:00:39.800 be on your mailing list. I feel like I got 0:00:39.880 --> 0:00:41.680 kicked off at some point along the way. I don't 0:00:41.680 --> 0:00:45.199 know that was perfect. Hype are there, Matt? You gotta be. 0:00:45.360 --> 0:00:49.080 The commissions have to be there. But but um, today 0:00:49.120 --> 0:00:51.080 you come to us with a note, with a with 0:00:51.120 --> 0:00:53.640 a survey. Really the results of your bubble survey. You 0:00:53.720 --> 0:00:57.520 had about four people, UM take the survey to tell you, 0:00:57.520 --> 0:01:00.319 you know, if they're seeing bubbles, what a bubble is, 0:01:00.640 --> 0:01:04.920 which bubbles are most concerning? What was your big takeaway Nick, 0:01:05.000 --> 0:01:08.000 from from the note from the survey. Sorry, yeah, well, 0:01:08.040 --> 0:01:10.080 first all, we'll definitely put you back on the press 0:01:10.120 --> 0:01:13.480 list for the product and apologize for for the for 0:01:13.520 --> 0:01:17.440 the omission um. The bottom line on this survey was 0:01:17.480 --> 0:01:20.320 really interesting because what we asked people. We asked people 0:01:20.360 --> 0:01:22.280 a couple of different directions and asked them where they 0:01:22.280 --> 0:01:26.120 see bubbles, And eighty five plus percent of people do 0:01:26.240 --> 0:01:28.759 see bubbles in the market. And these are professional investors, 0:01:28.840 --> 0:01:33.640 high network individuals, people who understand markets. Two see there's 0:01:33.640 --> 0:01:37.160 a bubble somewhere that by far the biggest one was bitcoin. 0:01:37.560 --> 0:01:41.080 They called out bitcoin by orders of magnitude more than 0:01:41.160 --> 0:01:43.399 any other thing. So two hundred and eighty votes for 0:01:43.440 --> 0:01:45.560 bitcoining and being in a bubble out of four hundred. 0:01:45.920 --> 0:01:50.320 The next next one up nine votes for US large caps, 0:01:50.360 --> 0:01:53.760 sixty four votes for US small caps. But so stocks, 0:01:53.800 --> 0:01:56.960 a little bit of bitcoin a lot. Hey, Nick, you 0:01:57.000 --> 0:01:58.440 know you and I've been in this business a long 0:01:58.480 --> 0:02:01.120 time and you kind of a similar history here in 0:02:01.200 --> 0:02:03.520 terms of time in the business. What do you make 0:02:03.520 --> 0:02:07.280 of SPACs, SPACs or something that we've seen in various 0:02:07.280 --> 0:02:10.600 forms over the years, But boy, have they just exploded 0:02:10.600 --> 0:02:14.119 onto the marketplace. They have exploded. And we did ask 0:02:14.160 --> 0:02:17.600 about SPACs and the survey and the majority of respondents 0:02:17.639 --> 0:02:21.640 did see SPACs is emblematic of a larger bubble in 0:02:22.360 --> 0:02:25.720 certain parts of tech. Look, underlying SPACs is a good 0:02:25.720 --> 0:02:28.600 fundamental thing, which is maybe the I P O process 0:02:28.680 --> 0:02:30.880 is a little bit broken and vcs have to find 0:02:30.880 --> 0:02:34.040 other ways to monetize their assets. Totally fair, but I 0:02:34.040 --> 0:02:37.600 think the enthusiasm O respects is way overdone because they 0:02:37.639 --> 0:02:42.440 so often linked to electric vehicles, autonomous vehicles, things like that. 0:02:42.440 --> 0:02:44.760 That gets people all juiced up, and it does create 0:02:44.760 --> 0:02:46.440 a bit of a bubble in that segment of the 0:02:46.440 --> 0:02:51.639 equity market for sure. I I don't suppose anyone mentioned 0:02:51.760 --> 0:02:54.280 n f t s. Did you see that? Uh, Nick, 0:02:54.320 --> 0:02:57.520 people are paying hundreds of thousands of dollars to buy 0:02:57.720 --> 0:03:01.480 NBA moments, which are just actually video clips connected to 0:03:01.560 --> 0:03:05.840 a digital token that you don't even really own. Yeah. 0:03:06.000 --> 0:03:07.800 I I did a piece on n f t S 0:03:07.840 --> 0:03:10.400 for a client's last night. It really is like, it 0:03:10.440 --> 0:03:11.680 reminds me a lot of I don't know, if you 0:03:11.720 --> 0:03:15.359 were crypto kiddies, the Etherium product back in twenty It's 0:03:15.400 --> 0:03:18.799 the same company, dude, It's the same company, Dapper Entertainment 0:03:18.840 --> 0:03:21.480 started the kiddies, and then the NBA hired them to 0:03:21.600 --> 0:03:25.320 do these moments on top shot. You know, God bless them. 0:03:25.320 --> 0:03:26.960 They figured out a way to pull some money out 0:03:26.960 --> 0:03:29.520 of this system, which is which is great. I just thought, 0:03:29.560 --> 0:03:32.120 like a Matt, you're a car guy. What if GM 0:03:32.160 --> 0:03:36.320 were you to sell um fifteen second clips of the 0:03:36.360 --> 0:03:39.000 first Corvette launch at the Waldorf in New York and 0:03:39.120 --> 0:03:42.640 nineteen fifty three, well exactly, or for the Mustang when 0:03:42.680 --> 0:03:45.200 they unveiled it on the Empire State. This is the idea, 0:03:45.280 --> 0:03:48.120 and they could do that. And the idea would be 0:03:48.200 --> 0:03:51.600 that you got the only you know, authentic version, but 0:03:51.680 --> 0:03:55.240 anyone else can just get the clip on YouTube. Right. 0:03:55.280 --> 0:03:58.040 But the Corvette guy, the Mustang guy, he's going to 0:03:58.120 --> 0:04:00.600 want the original because he just spent three hundred grants 0:04:00.600 --> 0:04:03.040 for his original fifty three that he's gonna want to 0:04:03.040 --> 0:04:05.560 spend a hundred grand for the original video clip. This. 0:04:05.720 --> 0:04:07.320 I gotta rip up this grip for a second. Here. 0:04:07.520 --> 0:04:10.480 We can do that in my Tom Keene, are you 0:04:10.680 --> 0:04:14.200 a bigger fan of the C one Corvette? A great 0:04:14.240 --> 0:04:17.680 example was in the movie Less than Zero or of 0:04:17.720 --> 0:04:22.360 the C two, the split window is the one I love? Which, Nick, 0:04:22.480 --> 0:04:24.440 which you think is? Or do you like one of 0:04:24.440 --> 0:04:28.839 the newer ones? Look, I love the latest one flat out. 0:04:29.320 --> 0:04:32.360 I think that's unbelievable. That's a great concept, and I'm 0:04:32.440 --> 0:04:35.120 so glad they finally moved to mid engine. Other than that, 0:04:35.160 --> 0:04:36.719 you've got to go back to the original. You gotta 0:04:36.760 --> 0:04:39.160 go back to the source water goes back to Lake Victoria, 0:04:39.279 --> 0:04:42.160 the whole thing, and it's the c one, all right. 0:04:42.200 --> 0:04:44.919 So we're talking about expensive cars here, we're talking about 0:04:45.120 --> 0:04:48.320 rare cars. So, Nick, when a client asked you to 0:04:48.400 --> 0:04:50.760 write up a note and do some research on these 0:04:50.880 --> 0:04:56.280 NBA clips, I mean, what does that tell you? Well, 0:04:56.320 --> 0:04:58.479 it tells me that there's a lot of attention and 0:04:58.560 --> 0:05:00.320 there are Look, I mean, this is one of those 0:05:00.320 --> 0:05:02.159 things where you can make a lot of money very 0:05:02.240 --> 0:05:04.359 quickly if you happen to be in the right space, 0:05:04.400 --> 0:05:06.560 if you're in the art gallery space, if you're in 0:05:06.640 --> 0:05:09.599 the creative space. There's a shot here, and there's some 0:05:09.720 --> 0:05:13.039 heavy money behind the centrition. Horowitz wrote up a large 0:05:13.120 --> 0:05:15.839 blog entry on this very thing, and if you listen 0:05:15.920 --> 0:05:18.520 to Market and Ben's um Clubhouse chat a couple of 0:05:18.520 --> 0:05:21.799 weeks ago, it very clearly fits into a much larger 0:05:21.839 --> 0:05:25.040 scheme of a decentralized Internet, which is like their big thing. 0:05:25.480 --> 0:05:27.120 So what I try to do for clients is just 0:05:27.160 --> 0:05:29.359 first of all, say like, yeah, this is coming and 0:05:29.400 --> 0:05:31.359 if you happen to be in on this early, you 0:05:31.400 --> 0:05:33.400 can make some money doing and no doubt about people 0:05:33.400 --> 0:05:35.800 are doing it right now, and there's some ten gentle 0:05:35.839 --> 0:05:38.360 things that big companies can do, but more than anything, 0:05:38.440 --> 0:05:42.559 just contextualize it as the Silicon Valley is very strong 0:05:42.600 --> 0:05:44.280 attempt and this will be going for the next ten 0:05:44.360 --> 0:05:47.560 years to decentralize the net and get away from one 0:05:47.640 --> 0:05:51.280 aws one Apple app store and try to figure out 0:05:51.320 --> 0:05:53.520 how to end run all the big tech giants. That's 0:05:53.520 --> 0:05:56.039 what the Silicon Valley and the vcs are trying to do. 0:05:57.160 --> 0:06:00.200 So you used to be a banker to doing the 0:06:00.279 --> 0:06:02.320 same kind of things that well Paul was doing it 0:06:02.400 --> 0:06:05.720 for for media um and telecoms right and you were 0:06:05.800 --> 0:06:11.440 doing mostly the auto industry nick um equity offerings, advising 0:06:11.440 --> 0:06:14.800 on M and A, etcetera. When and that going into 0:06:14.920 --> 0:06:18.920 the Internet bubble. Do you see any similarities between what 0:06:18.920 --> 0:06:22.080 we're looking at now and then or is the are 0:06:22.120 --> 0:06:26.240 the time periods just too different to compare. No, there 0:06:26.240 --> 0:06:29.800 are similarities at the very highest level. And the similarity 0:06:29.839 --> 0:06:33.960 is the pandemic gave tech a huge boost, and they 0:06:34.080 --> 0:06:37.560 both in stocks and in usage just societal usage, the 0:06:37.600 --> 0:06:41.200 same way Internet one oh from seven to two thousand 0:06:41.440 --> 0:06:44.120 did it for the first front of technology. And now 0:06:44.160 --> 0:06:47.279 we're beginning to see the rotation, which is very much 0:06:47.320 --> 0:06:49.120 like what it was in two thousand and one when 0:06:49.200 --> 0:06:52.200 dot Com began to blow up. I remember looking at Vistia, 0:06:52.240 --> 0:06:54.800 I'm looking at Forward, looking at GM and thinking why 0:06:54.839 --> 0:06:57.479 are these stocks up so much even though we're clearly 0:06:57.480 --> 0:06:59.640 at the end of the cycle. It was just money 0:06:59.760 --> 0:07:02.720 lead being tech and having to go somewhere else, and 0:07:02.760 --> 0:07:05.080 that's what was happening, and that's what's happening again now. 0:07:05.440 --> 0:07:07.160 But you look like the good Year chart for the 0:07:07.240 --> 0:07:10.120 last couple of weeks. They're buying Cooper Tire finally, which 0:07:10.160 --> 0:07:13.720 is awesome, but man, that thing was just dead for 0:07:14.160 --> 0:07:16.840 months and now it's coming back to life. Forward the 0:07:16.920 --> 0:07:19.080 same way. So I think what you're seeing is money 0:07:19.160 --> 0:07:21.960 rotating out of tech and back into the two older companies. 0:07:22.200 --> 0:07:24.160 And if you're just looking at independently, you think, what 0:07:24.440 --> 0:07:26.400 is going on here? And that's what's going on. Money 0:07:26.440 --> 0:07:29.160 is leaving tech and going into basic industry encyclicals, and 0:07:29.200 --> 0:07:30.760 we think that's going to continue. That's going to make 0:07:30.800 --> 0:07:33.680 money this year. Hey, Nick, thanks for joining us. We 0:07:33.720 --> 0:07:36.600 always appreciate getting your thoughts and your insight. Uh. We're 0:07:36.600 --> 0:07:38.400 always afford to chatting with you and Nick call Us. 0:07:38.560 --> 0:07:42.360 Co founder Data Trek Research. Matt Nicks is one of 0:07:42.360 --> 0:07:44.520 the smartest folks. We talked to boy every time we 0:07:44.560 --> 0:07:47.680 have them on. I learned a lot. And he's got taste. Yeah. 0:07:48.760 --> 0:07:50.920 Now I will disagree with him on that. I like 0:07:51.040 --> 0:07:54.840 to see two Corvette better, but I can admit that 0:07:54.960 --> 0:07:57.000 I don't have the greatest taste when it comes to 0:07:57.120 --> 0:08:00.160 these things. I know that Nick and I both air 0:08:00.200 --> 0:08:02.880 love for Ducati's and he has one of them, um 0:08:02.920 --> 0:08:06.640 coveted UH sport Classics or he has the GT version 0:08:06.640 --> 0:08:10.160 which they don't make anymore. So he's got the car 0:08:10.240 --> 0:08:12.080 thing and that that's great. And you've got the less 0:08:12.080 --> 0:08:14.080 than zero reference in there, which I totally got and 0:08:14.200 --> 0:08:18.760 untillly down with. That's good for that. The spacks are 0:08:18.760 --> 0:08:21.240 coming fast and furious. Dave Wilson, he brings us up 0:08:21.240 --> 0:08:23.880 at Data on a daily basis on the new spacks, 0:08:23.880 --> 0:08:27.800 and they're coming from a wide variety of backers and 0:08:27.880 --> 0:08:31.000 focusing on a wide variety of industries. It's kind of 0:08:31.040 --> 0:08:33.679 the new I p O, if you will, of recent months. 0:08:33.880 --> 0:08:37.360 David Dwalt, he's the founder of a spack called night 0:08:37.440 --> 0:08:40.079 a Dragon. He was also the former CEO of fire 0:08:40.160 --> 0:08:43.960 Eye and McAfee. Uh, they are spack supposed to start 0:08:43.960 --> 0:08:46.840 trading on the nastack today day. Thanks so much for 0:08:47.200 --> 0:08:51.040 joining us. We appreciate it. Talk to us about Night Dragon. 0:08:51.120 --> 0:08:54.200 What's the strategy here? Yeah, thank you, thank you for 0:08:54.240 --> 0:08:57.200 having me. Yeah. So, you know, when I was CEO 0:08:57.240 --> 0:09:00.640 of McAfee, ironically, there was a famous cybers cruity tech 0:09:00.800 --> 0:09:05.480 called night Dragon, and my researchers then sort of said, hey, 0:09:05.559 --> 0:09:09.640 here's uh, here's one of those seminal moments in cyber security, 0:09:09.720 --> 0:09:12.320 and they named it night Dragon. But I always said, 0:09:12.360 --> 0:09:14.520 if I ever built my own thing, it would be 0:09:14.559 --> 0:09:17.520 called that. But hey, listen, night Dragons the whole platform. 0:09:17.679 --> 0:09:21.200 We've been working hard as a team the last few years. Um, 0:09:21.240 --> 0:09:26.000 you know, funding investing into cyber companies from incubators to 0:09:26.080 --> 0:09:30.960 early stage to now late stage kinds of companies. Um, 0:09:30.960 --> 0:09:33.720 really the spack here, which is a you know, a 0:09:33.800 --> 0:09:37.760 new type of product called the scale and get into that. 0:09:38.280 --> 0:09:41.319 But really we wanted to help create companies are really 0:09:41.360 --> 0:09:44.760 efficient way to go public and these would be top 0:09:44.800 --> 0:09:48.800 tier cyber safety type companies that we know well as 0:09:48.840 --> 0:09:51.760 a team and we've known as you know, public company 0:09:51.800 --> 0:09:55.880 executives and help them get to a high potential for 0:09:56.080 --> 0:10:00.640 shareholder value. Dave um Night Dragon is an awesome name, 0:10:01.160 --> 0:10:04.560 first of all, and you also have served as CEO 0:10:04.600 --> 0:10:07.200 of a number of other companies, including Fire. I that 0:10:07.320 --> 0:10:12.480 name totally rules um McAfee isn't nearly as cool. I 0:10:12.520 --> 0:10:15.280 would have changed that, But the point is you've got 0:10:15.320 --> 0:10:18.599 a ton of experience in this industry. And it was 0:10:18.640 --> 0:10:21.960 pointed out to me earlier that SPACs maybe just a 0:10:22.000 --> 0:10:24.880 way for people who don't have you know, ten million 0:10:24.920 --> 0:10:28.800 dollars to throw at um BC partners to get into 0:10:28.880 --> 0:10:33.679 private equity. Do you think that's along the right lines? Well, 0:10:33.679 --> 0:10:36.920 it certainly is one route, especially if we start to 0:10:36.920 --> 0:10:40.520 see the evolution that Spinning Eagle had, which is a 0:10:40.600 --> 0:10:46.200 spack platform, you know, a super spact platform there. There's 0:10:46.280 --> 0:10:49.480 there's new sec rulings coming out that you could do 0:10:49.679 --> 0:10:53.640 a multitude of SPACs in one vehicle, and you could 0:10:53.679 --> 0:10:55.720 have two, three, or four or five of them, and 0:10:55.800 --> 0:10:58.080 you could have small, medium, in large type companies, you 0:10:58.679 --> 0:11:03.200 d a into the back product. And so this is 0:11:03.200 --> 0:11:05.200 here to stay. I mean there's no doubt about I mean, 0:11:05.240 --> 0:11:10.120 deal certainty, deal closure. You know, management afloat, managing short positions, 0:11:10.240 --> 0:11:14.280 you know, adding management teams into the board and advisors, 0:11:14.640 --> 0:11:19.200 you know, doing this with quality investors, quality leadership, and 0:11:19.360 --> 0:11:22.080 it looks like it's the right way to go, especially 0:11:22.520 --> 0:11:25.440 especially if you have foreign national companies trying to come 0:11:25.480 --> 0:11:28.600 into the US as well, and they want to use 0:11:28.840 --> 0:11:31.880 the listings and the investments as a way of gaining 0:11:31.920 --> 0:11:37.520 scipious approval or government US access, getting more open markets 0:11:37.600 --> 0:11:41.800 to especially in national security and cyber world. You know, 0:11:41.880 --> 0:11:45.400 these companies are often founded in Israel now or you know, 0:11:45.480 --> 0:11:48.640 other parts of the world. In fact, you alluded to Firear. 0:11:48.880 --> 0:11:52.160 That company was founded in Pakistan and you know we 0:11:52.240 --> 0:11:54.320 brought it to the United States and helped vet it. 0:11:55.040 --> 0:11:58.760 My other company for Scout, was founded in Israel. So 0:11:58.840 --> 0:12:02.040 you know, being able to be world class technology to 0:12:02.160 --> 0:12:05.000 the world stage is a little what this operating team 0:12:05.000 --> 0:12:07.559 has been good at and so we have a lot 0:12:07.559 --> 0:12:10.280 of different targets in mind, a lot of different opportunities, 0:12:10.320 --> 0:12:13.199 and uh, we think night dragons are really nice. Please 0:12:13.240 --> 0:12:15.000 tell us on here to do it. Please tell us 0:12:15.040 --> 0:12:17.079 before you make the offer so we can front run them. 0:12:19.200 --> 0:12:25.280 I'll try. What type of companies are technologies are you 0:12:25.320 --> 0:12:28.920 guys gonna be focused on initially? Yeah, so you know 0:12:29.000 --> 0:12:31.719 our market segment, what we what we all know here 0:12:31.840 --> 0:12:34.000 is a collective team, you know, a hundred and fifty 0:12:34.080 --> 0:12:37.640 years of collective experience by this team. But we're focused 0:12:37.640 --> 0:12:40.679 on cyber safety, security and privacy. I always like to 0:12:40.720 --> 0:12:44.360 say security from silicon to satellite. But the idea here 0:12:44.480 --> 0:12:49.760 is companies that really are in important threat areas. And 0:12:49.920 --> 0:12:51.800 let me just explain for a second. You know where 0:12:51.800 --> 0:12:57.600 do we see attackers really driving uh, you know, successful breaches. 0:12:58.160 --> 0:13:00.880 What we trying to do is build commercial defense to 0:13:00.960 --> 0:13:06.000 meet that threat. And we've identified ten different sectors that 0:13:06.200 --> 0:13:10.600 have multi billion dollar total addressable markets that we would 0:13:10.600 --> 0:13:14.520 like to target um our work towards. And they can 0:13:14.559 --> 0:13:19.559 be everything from satellite leo's with lower orbit satellites and 0:13:19.679 --> 0:13:23.040 now connecting everything from your watch to your car to airplanes, 0:13:23.120 --> 0:13:26.079 light shair safety, security, for Delta Airlines are aircraft are 0:13:26.080 --> 0:13:29.520 now connecting up in the ways and the security there 0:13:29.920 --> 0:13:32.360 you know, needs to improve a lot. So there's really 0:13:32.400 --> 0:13:36.439 amazing space economy, safety, security opportunities, but all the way 0:13:36.480 --> 0:13:42.520 down to identity management, cloud security areas, social network. If 0:13:42.559 --> 0:13:45.360 anybody you know watched the last you know, four years, 0:13:45.440 --> 0:13:49.920 we know manipulated information, false information, is you know here 0:13:49.960 --> 0:13:52.840 to stay? How do we fix that problem? We have 0:13:52.920 --> 0:13:56.120 some really cool companies that are Night Dragon portfolio already, 0:13:56.520 --> 0:13:58.840 as well as ones we know that can come and 0:13:58.920 --> 0:14:02.440 meet these sector areas and we can help take them 0:14:02.520 --> 0:14:06.880 to their full potential. We believe as a public company 0:14:07.440 --> 0:14:10.640 excellent Dave. Great to get some time with you. Fascinating stuff, Dave. 0:14:10.720 --> 0:14:13.960 D Walt there who used to run uh fire Eye 0:14:14.040 --> 0:14:17.600 McAfee document um now talking about his Night Dragons. Back 0:14:20.120 --> 0:14:23.520 at the beginning of this lockdown, I was drinking a 0:14:23.520 --> 0:14:26.480 lot of beer, and I was gaining weight, and I 0:14:26.560 --> 0:14:29.160 was kind of tired, and I thought, this is not 0:14:29.280 --> 0:14:31.400 a good idea. I've got to make a change in 0:14:31.440 --> 0:14:34.760 my life, so I started drinking wine instead. I want 0:14:34.760 --> 0:14:39.240 to bring in right now. Steven Ranickally, Global beverages strategist 0:14:39.320 --> 0:14:42.200 at Robbo Bank International to talk to us about the 0:14:42.240 --> 0:14:45.240 impact UM, maybe a little bit longer term than than 0:14:45.280 --> 0:14:50.200 what I've experienced of the lockdowns the pandemic on the 0:14:50.240 --> 0:14:53.400 wine industry. UM, Stephen, thanks so much for joining us. 0:14:53.400 --> 0:14:56.880 I'm assuming a lot of people are drinking more wine. 0:14:56.960 --> 0:15:00.720 Is that wrong? Well, you know that's first off, let 0:15:00.720 --> 0:15:02.800 me say, I think you made a great switch switching 0:15:02.880 --> 0:15:04.680 from beer to wine. That will make a lot of 0:15:05.000 --> 0:15:07.720 fines that I deal with very happy. But you know, 0:15:07.800 --> 0:15:09.800 I think overall, when you look at it, people didn't 0:15:09.840 --> 0:15:12.440 really drink much more. What you saw was a huge 0:15:12.480 --> 0:15:15.600 shift in channels, right, so people, you know, they were 0:15:16.160 --> 0:15:19.680 we know that restaurants were shut down, bars restaurants shut down, 0:15:20.280 --> 0:15:22.640 and you know, people were doing all their shopping at 0:15:22.800 --> 0:15:24.920 a grocery stores. So when you look at the numbers, 0:15:24.920 --> 0:15:27.320 the numbers that were put out oftentimes really just looked 0:15:27.320 --> 0:15:30.920 at grocery stores and you saw this huge jump in sales, 0:15:30.960 --> 0:15:33.920 and everyone thought, oh, everyone's you know, everyone's drinking a 0:15:33.920 --> 0:15:36.800 ton more. But really it was just compensating for the 0:15:36.840 --> 0:15:39.400 loss of sales and the on premise and that, you know. 0:15:39.480 --> 0:15:43.000 But what was really important behind that is certain segments 0:15:43.000 --> 0:15:45.280 of the wine sector were hit worse than others because 0:15:45.320 --> 0:15:48.960 of it. Steve talked to us about the financial health 0:15:49.240 --> 0:15:52.080 of the wine industry. I'm wondering if it's if it's 0:15:52.120 --> 0:15:54.760 like other industries that we've seen there in this past year, 0:15:54.800 --> 0:15:58.000 where if you're a big company, good balance sheet, access 0:15:58.040 --> 0:16:02.200 to capital, you generally formed or fared better than maybe 0:16:02.240 --> 0:16:06.320 an independent player who maybe again doesn't have access to capital. 0:16:06.440 --> 0:16:08.520 Talk to us about the wine industry, how those players 0:16:08.520 --> 0:16:11.760 have fared. Yeah, I think I think what you've laid 0:16:11.800 --> 0:16:13.880 out as a as a pretty fair assessment, and I 0:16:13.880 --> 0:16:16.320 should say, you know, it's it's it's always a bit 0:16:16.360 --> 0:16:19.240 of a mixed bag. Even among some of the smaller players. 0:16:19.240 --> 0:16:23.360 If you had a really strong brand, really clear identity 0:16:23.400 --> 0:16:26.200 in the market, you know, some of those players did 0:16:26.280 --> 0:16:29.200 really really well, didn't really miss a beat, but it 0:16:29.240 --> 0:16:31.160 was really on the whole. I would say it was, 0:16:31.600 --> 0:16:34.280 you know, larger wineries that have the national brands, that 0:16:34.320 --> 0:16:38.400 have good access to the supermarkets and the big retail accounts. 0:16:38.920 --> 0:16:41.920 Those players did did much better. They fared much better 0:16:41.960 --> 0:16:45.080 in than than a lot of the smaller players that 0:16:45.440 --> 0:16:48.120 you know lost not only you know, they lost out 0:16:48.160 --> 0:16:50.680 on sales and restaurants. But also, you know, a lot 0:16:50.680 --> 0:16:53.040 of the tasting room traffic, a lot of the the 0:16:53.160 --> 0:16:56.960 smaller guys depend on people traveling out to California, Oregon 0:16:57.120 --> 0:17:00.400 visiting the winery and you know, and generating no sales. 0:17:00.440 --> 0:17:02.720 So those guys got hit kind of, you know, on 0:17:02.720 --> 0:17:04.800 on both ends of that. So so when do you 0:17:04.880 --> 0:17:07.000 steve When are some of those wineries going to open 0:17:07.080 --> 0:17:09.440 up some of their tasting rooms just asking for a friend? 0:17:11.640 --> 0:17:15.520 You know, it's it's it's it's been touch and go. Uh, 0:17:15.600 --> 0:17:17.200 you know, we're all kind of waiting. I think we're 0:17:17.200 --> 0:17:19.880 all kind of looking at this and saying that by 0:17:19.960 --> 0:17:22.920 you know, hopefully by summer we're getting back to two 0:17:23.000 --> 0:17:28.040 more normalized activity. Uh, you know, restaurants opening up, tasting 0:17:28.119 --> 0:17:30.320 rooms and so forth, and so, you know, I think 0:17:31.840 --> 0:17:34.280 we'll start to get back to some level of normalcy. 0:17:34.400 --> 0:17:37.720 But it's gonna take time, you know, and especially on 0:17:37.760 --> 0:17:40.080 the restaurant side. You know, we've seen the numbers out 0:17:40.080 --> 0:17:43.159 of the National Restaurant Association. There are a number of 0:17:43.600 --> 0:17:46.400 you know, there's a large swath of those those independent 0:17:46.480 --> 0:17:48.760 restaurants that are not going to fully recover. They're not 0:17:48.800 --> 0:17:52.040 going to reopen right so that really kind of creates 0:17:52.119 --> 0:17:56.120 some challenges and winners and losers within within the wine industry. 0:17:56.200 --> 0:17:58.280 Some you know, some of these winders will be much 0:17:58.320 --> 0:18:01.840 more challenged than others. You know, I I would, It's interesting. 0:18:01.920 --> 0:18:04.679 I would normally if I wanted to, um, go on 0:18:04.680 --> 0:18:09.040 a wine tasting. My dad loves the Silver oak Um 0:18:09.200 --> 0:18:13.800 place out in in uh in Oakville, California, and so 0:18:13.840 --> 0:18:17.160 maybe we'd go out there. Um. But if we're stuck 0:18:17.160 --> 0:18:20.360 in lockdown in New York. My buddy Neil Grossman has 0:18:20.359 --> 0:18:23.240 a vineyard now up by Millbrook, and I wonder if 0:18:23.280 --> 0:18:28.159 more people are trying their local wineries, local vineyards just 0:18:28.200 --> 0:18:32.560 because they can't get to Napa Valley. Yeah. I think 0:18:32.560 --> 0:18:35.080 there's there's probably a fair amount of that, and there 0:18:35.080 --> 0:18:37.920 will be right it's there, We're you know, moving back 0:18:37.960 --> 0:18:40.480 to visiting wineries and so forth. It's going to be 0:18:40.560 --> 0:18:44.479 a process. You know, we see some consumers, even with 0:18:44.520 --> 0:18:47.080 a vaccine, much more reluctant to travel. So I think 0:18:47.080 --> 0:18:49.440 there's gonna be a little bit of that. But also, 0:18:49.520 --> 0:18:52.800 you know, one of the big winners in in has 0:18:52.840 --> 0:18:56.880 been e commerce. Right, You've seen people shifting from from 0:18:56.960 --> 0:18:59.960 restaurant sales to buying online and you know they're fine 0:19:00.040 --> 0:19:02.520 ending their great wines and they can have those at home, 0:19:02.600 --> 0:19:05.480 and you know, so finding ways I think the challenge 0:19:05.520 --> 0:19:08.320 for the wine industry has been finding ways to connect 0:19:08.359 --> 0:19:12.199 with the consumer where they are. Hey, Steve, you know 0:19:12.400 --> 0:19:14.760 there's so many independent wineries out there. Are they going 0:19:14.800 --> 0:19:16.639 to be? Are we going to see some consolidation in 0:19:16.640 --> 0:19:19.680 this industry because maybe some of those smaller, weaker ones 0:19:19.720 --> 0:19:22.680 that are gonna be a little bit vulnerable here. Yeah, 0:19:22.720 --> 0:19:25.239 I think you know there's there we're certainly looking at 0:19:25.280 --> 0:19:29.160 and saying, you know, moving forward, we're seeing signs of consolidation. 0:19:29.280 --> 0:19:32.240 We put out a note, you know, a couple of 0:19:32.920 --> 0:19:34.719 last month that said, you know, when you look at 0:19:34.760 --> 0:19:37.200 some of the signs, were likely to see some consolidation. 0:19:37.640 --> 0:19:41.479 And we've already seen some really interesting moves. Um, you know, 0:19:41.560 --> 0:19:46.359 we're larger reasonably sized wineries either going uh you know 0:19:46.400 --> 0:19:49.160 the spack route. You saw the Vintage Wine Estates deal 0:19:49.280 --> 0:19:51.920 that was you know, that was a huge deal, seven 0:19:52.000 --> 0:19:54.560 hundred million dollar deal there you know, merged with us 0:19:54.640 --> 0:19:57.480 back and and you know we had them. We had 0:19:57.840 --> 0:20:01.280 the CEO, Pat Roney on on on our podcast and 0:20:01.320 --> 0:20:03.440 we kind of talked about some of what they were 0:20:03.480 --> 0:20:07.000 going through and and why this SPAC deal made sense. 0:20:07.040 --> 0:20:09.240 It was a really interesting move, right, this rise of 0:20:09.320 --> 0:20:12.919 spacts and how even that's playing in in the wine space. 0:20:12.960 --> 0:20:15.640 But even aside from that, you've had duck Horn announced 0:20:15.760 --> 0:20:18.639 uh an I p O. You've had Virgin Wines in 0:20:18.680 --> 0:20:21.600 the UK announce an i p O. And we've also 0:20:21.640 --> 0:20:23.560 seen kind of behind the scenes a lot of the 0:20:23.680 --> 0:20:28.159 larger wineries that have come through, you know and reasonably 0:20:28.160 --> 0:20:30.399 good condition, saying hey, maybe this is a good time 0:20:30.440 --> 0:20:32.879 for us to make some acquisitions. Right, So it's an 0:20:32.920 --> 0:20:35.080 interesting time in the wine industry with a lot of 0:20:35.960 --> 0:20:38.960 a lot of acquisitions and and uh yeah, I think 0:20:38.960 --> 0:20:41.800 we'll see more all right, Steve, thanks so much for 0:20:41.840 --> 0:20:44.359 joining us. We always appreciate a Steve Ranically of Global 0:20:44.760 --> 0:20:48.600 Beverages Strategist at Robbo Bank giving us the state of 0:20:48.840 --> 0:20:56.440 the global wine market. The pandemic has upended, has disrupted 0:20:56.560 --> 0:21:00.119 how we all work, or how many people work, with 0:21:00.280 --> 0:21:04.280 many people being forced to work from home, changing our calendars, 0:21:04.359 --> 0:21:07.560 changing our work days. Now, the question is, let's talk 0:21:07.600 --> 0:21:10.199 about that five day work day. Is that something that 0:21:10.240 --> 0:21:12.919 needs to be looked at. Let's turn to Stefan Nicola 0:21:13.160 --> 0:21:16.240 Bloomberg News in Berlin. Stuff and you've got a fascinating 0:21:16.240 --> 0:21:19.639 story here. The four day work week gains popularity. What 0:21:19.680 --> 0:21:24.840 do we know? Yeah, it is gaining popularity around the world. 0:21:25.480 --> 0:21:28.720 I talked with the CEO of a Berlin tech company 0:21:28.800 --> 0:21:32.720 and they had trials at four point five day work 0:21:32.720 --> 0:21:36.920 week after the pandemic really put a lot of stress 0:21:36.960 --> 0:21:39.840