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Speaker 1: From Marhart.

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Speaker 2: We're Innovation, Money and Power Collie in Silicon Valley, NBN.

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Speaker 3: This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.

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Speaker 4: I'm Caroline Heyde of Bloomberg's world headquarters in New York,

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Speaker 4: and I'm an adler in San Francisco.

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Speaker 5: This is Bloomberg Technology coming up.

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Speaker 4: Amd rallies on AI optimism, as the company says it's

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Speaker 4: artificial intelligence chip will generate billions next year.

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Speaker 3: Plus, the UK Summit on AI Safety is underway in

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Speaker 3: London with attendees including Kamala Harris and Elon Musk. Will

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Speaker 3: bring you the big takeaways and interviews from the event, and.

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Speaker 4: We'll push you ahead to the Federal Reserve rate decision

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Speaker 4: due out later this afternoon and look at the central

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Speaker 4: banks impact on you guess, the AI startups. But first

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Speaker 4: let's check in on these markets, because well, we do

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Speaker 4: have some movement ahead of the all important decision, but

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Speaker 4: many are thinking, yes, rate's going to stay at that

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Speaker 4: twenty two year high for yet another month. We're seeing

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Speaker 4: the NASTAC up some seven tens of percent. Maybe it's

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Speaker 4: actually some of the economic data, Ed that's weighing on. Well,

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Speaker 4: the bad news being good news once more, if we're

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Speaker 4: seeing some of those factory orders coming in worse than expected,

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Speaker 4: if we're seeing jobless claims actually just ticking up more, indeed,

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Speaker 4: job openings starting to open up a little bit, maybe

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Speaker 4: this is something that we're trying to get, this mixed

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Speaker 4: picture of where the economy is really going. Whatever the case,

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Speaker 4: we're seeing some buoyancy in tech. We're seeing some boyancy

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Speaker 4: in the bomb market, yields falling that of course as

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Speaker 4: we get a hint that actually will see a slowing

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Speaker 4: of pace of growth in the amount of bonds that

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Speaker 4: will be issued on the long dated end by the

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Speaker 4: US Treasury, so lack of supply means yiels fall down.

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Speaker 4: We're seeing the VIX indexs just lower a little bit.

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Speaker 4: There's some calming over, of course, still concerns over geopolitics.

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Speaker 4: Move on to what's happening in the world the crypto though,

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Speaker 4: because on the day, even as VIX pulls back, options

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Speaker 4: protection maybe lower a bit. Even though we heard the

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Speaker 4: Apple maybe ticking up a little bit ahead of its earnings,

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Speaker 4: we're looking at crypto just on the downside by about

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Speaker 4: a percentage point. This as we see the dollar treading

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Speaker 4: water at thirty four thousand the end.

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Speaker 5: What are you watching on the micraft AMD?

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Speaker 3: This is the big technology story of the day, at

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Speaker 3: least from a market mover perspective. We're up always eight percent,

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Speaker 3: on track for the biggest jump since May. The story

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Speaker 3: the MII three hundred. AMD's AI accelerator on track to

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Speaker 3: start production and shipments in the final three months of

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Speaker 3: the year. Four hundred million dollars of revenue in the

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Speaker 3: current period coming from its AI accelerator two billion dollars

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Speaker 3: of revenue the company season four year twenty four, and

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Speaker 3: AMD is saying this will be the fastest of its

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Speaker 3: products to ever hit one billion dollars of revenue. This

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Speaker 3: is the direct competitor to Nvidia's h one hundred. We're

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Speaker 3: talking about a GPU that ships is an assemble component

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Speaker 3: for hyperscalers, data centers, and large AI startups to train

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Speaker 3: LM's large language models and foundation models. And that's despite

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Speaker 3: giving its current period forecast five point eight billion to

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Speaker 3: six point four billion dollars, the midpoint of that range

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Speaker 3: was below Street Can census. The concern for them separately

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Speaker 3: is a slow down in gaming CHIT sales, but AI

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Speaker 3: to the rescue and It's funny because the stock fell

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Speaker 3: in after hours during the earning school, it was week

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Speaker 3: during pre market trading, and it's gone off like a

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Speaker 3: rocket during the main session this Wednesday in Certaly.

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Speaker 4: Has let's stelve into someone who's perhaps benefiting from the rocket.

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Speaker 4: Evana de Leskas, with our CIO of Spear invested AMD

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Speaker 4: a key holding. I'm interested in how you balance out

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Speaker 4: that narrative that there is weakness, particularly in Europe when

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Speaker 4: you're coming to desire to get into industrial chips. There

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Speaker 4: is worry about China, but AI is still the bright spot.

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Speaker 6: That's right, Caroline. So we see AI as a pretty

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Speaker 6: big opportunity. And it's not just on the GPU side

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Speaker 6: for AMD, it's across the board data center spending. So

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Speaker 6: we believe they're going to benefit from this YouTube the Milano,

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Speaker 6: but also from their CPUs as well, like the Berghama

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Speaker 6: and Gene And that was really the big surprise this quarter.

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Speaker 6: Investors had expected that AMD's guidance was very aggressive for

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Speaker 6: the second half of this year, but they were able

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Speaker 6: to deliver and guide to still fifty percent growth for

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Speaker 6: the data center segment overall.

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Speaker 4: Now thinking more about a two billion run right by

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Speaker 4: the end of it. I'm interested as to whether you

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Speaker 4: think these two players and Video and AMD are going

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Speaker 4: to be the ones that take all. Whether the market

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Speaker 4: is going to be so large that vast the time

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Speaker 4: of one hundred and fifty billion or so that we

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Speaker 4: can still see entrance taking market share.

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Speaker 6: So we do see new entrants coming in. However, AMD

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Speaker 6: and in Nvidia have the early start, so they're going

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Speaker 6: to be able to capture significant part of the market share.

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Speaker 6: We're going to see some of the cloud vendors develop

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Speaker 6: their own solutions as well, so we see them benefiting

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Speaker 6: from this trend. Amazon has some new products that they're introducing,

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Speaker 6: but in Nvidia NAMD will be able to capture a

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Speaker 6: big part of market share as their first movers in

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Speaker 6: this market.

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Speaker 3: If our AMD shares are up eight percent, as I said,

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Speaker 3: on track for the biggest jump since May, and a

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Speaker 3: lot of the cell side talking about the Mi three

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Speaker 3: hundred being the.

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Speaker 5: Catalyst for the stock.

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Speaker 3: Right, your ETF includes both AMD and Nvidia. The Mi

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Speaker 3: three hundred is a direct competitor to the H one hundred,

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Speaker 3: which is already out there in the real world in volume.

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Speaker 5: So how do you play this?

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Speaker 3: How do you consider the composition of the ETF going forward.

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Speaker 6: So we see data center as a trillion dollar market

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Speaker 6: that is going to need upgrading, right, so we see

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Speaker 6: opportunities for multiple players. The shares of Nvidia have styled

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Speaker 6: out recently due to China concerns and also people just

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Speaker 6: being cautious on the AI being hype versus reality. But

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Speaker 6: we do believe that we are going to see significant investments,

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Speaker 6: and we do think that these companies are going to

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Speaker 6: be able to compound at over fifty percent GIGER over

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Speaker 6: the next few years.

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Speaker 3: The story of Nvidia over the course of twenty twenty

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Speaker 3: three is a stock up almost one hundred and ninety percent,

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Speaker 3: So you expect AMD's stock to track like Nvidia story

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Speaker 3: did with the h one hundred if they can prove

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Speaker 3: that they can scale up mi I three hundred in

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Speaker 3: the same way that Nvidia did.

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Speaker 6: Well in Nvidia really got oversold at some point in

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Speaker 6: the cycle, so a lot of what you're seeing here

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Speaker 6: in terms of the move is from really depressed levels.

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Speaker 6: So we do see similar upsite from here for both

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Speaker 6: in Nvidia in and AMD.

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Speaker 4: I mean, what's really interesting is, of course you set

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Speaker 4: up and launched sprx in large part to find the

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Speaker 4: undervalued areas of particularly B to B industrial use of tech.

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Speaker 4: Talk to us from a macro perspective geographically, where you

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Speaker 4: are worried about because there was serious signs of some

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Speaker 4: European slowdown is not going to be long lasting. Do

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Speaker 4: we think that that can be offset by the satiable

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Speaker 4: demand for artificial intelligence?

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Speaker 6: Yeah, well, Caroline. Interestingly, technology is going to be one

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Speaker 6: of the least sensitive to the economy sectors. So while

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Speaker 6: you're going to see some movement like, for example, in

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Speaker 6: consumer technology, we see some downside in autos. We're seeing

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Speaker 6: a lot of negative data points on the EV side.

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Speaker 6: We saw similar impact on semiconductor companies that sell to autos.

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Speaker 6: So we believe that consumer is going to be where

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Speaker 6: the downside is going to be in the near term

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Speaker 6: here driven by the economy and really high interest rates.

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Speaker 6: So those areas of the economy are going to be

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Speaker 6: more sensitive and that's what we are avoiding. However, enterprise

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Speaker 6: just went through a down cycle in spending. Companies already

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Speaker 6: cut their budgets to a pretty low level, so we

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Speaker 6: see those comps being pretty favorable position going into twenty

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Speaker 6: twenty four. So areas like cloud data infrastructure, cybersecurity. We

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Speaker 6: think those are going to be good areas to be

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Speaker 6: into it next year.

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Speaker 3: Ivan, I always wanted to ask you how much you

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Speaker 3: nerd out, how deep you go on the details on

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Speaker 3: a product like this. Right, we're going to look at

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Speaker 3: some pictures of the Mi three hundred. You know, a

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Speaker 3: lot of the work in the market this morning is

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Speaker 3: based on what Lisa Sue had to say. Do you

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Speaker 3: go through the specs of these semikinduct and go with

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Speaker 3: your own conviction call based on deep research or do

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Speaker 3: you just go based on the commentary of executives.

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Speaker 6: So we do very fundamental deep research, and what where

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Speaker 6: we differentiate ourselves is that we read data across the

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Speaker 6: value chain. So we're going to be talking to companies

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Speaker 6: like Microsoft that are going to be partnering with companies

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Speaker 6: like Nvidia. We're talking to smaller cap companies that sell

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Speaker 6: liquid cooling to the data center segment, that are selling

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Speaker 6: casings to the data center segment. So we gather these

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Speaker 6: data points from multiple sources and that gives us confidence

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Speaker 6: in where the data center spending cycle is going. So

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Speaker 6: it really is not about just following what management is saying.

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Speaker 6: Is really trying to understand how they're positioned in the

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Speaker 6: ecosystem by getting data points from the supply chain.

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Speaker 4: Even doing that sort of deep research touts shore cet development.

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Speaker 4: Millennium Global companies with global perspectives give us the global

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Speaker 4: take on how much MPD is going to be exposed

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Speaker 4: to China and the continues when it comes to top

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Speaker 4: in technology, Well.

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Speaker 6: China is going to be a big risk to both

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Speaker 6: AMD and Nvidia, and we're going to see how the geopolitics.

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Speaker 6: We don't necessarily make geopolitical calls, so we're going to

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Speaker 6: see how that evolves over the next few years. But

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Speaker 6: it's a pretty large market and both the AM and

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Speaker 6: VDIA are very well positioned there because they're really the

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Speaker 6: only game in town. And the consumer side in China

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Speaker 6: of enterprise companies is pretty large and there are pretty

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Speaker 6: big consumers of this product. So if they're shut down

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Speaker 6: from this market, we do see the upside going maybe

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Speaker 6: five years out being really cupped and we see earning

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Speaker 6: stalling out then. But for the next three years, we

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Speaker 6: do see strong demand just from US domestic hyperscalers and enterprises.

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Speaker 6: We've not really seen enterprises participate in this cycle yet,

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Speaker 6: so we do see pretty significant near terms upset in

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Speaker 6: the next two to three years.

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Speaker 3: Vana de la Lasco Beer invest great to catch up

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Speaker 3: with you, and thank you for that technical expertise as well.

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Speaker 5: We appreciate it.

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Speaker 4: The UK Summit on AI Safety is underway, and earlier

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Speaker 4: on Bloomberg caught up with the CEO of Google's Deep

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Speaker 4: Mind about the future benefits of artificial intelligence to stick

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Speaker 4: a listen.

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Speaker 7: I think the message that we bring is one of

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Speaker 7: cautious optimism. Obviously, we're working on this technology because we

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Speaker 7: think it'll be one of the most beneficial technologies to

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Speaker 7: society ever. But it does come with attending risks, as

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Speaker 7: all transformative technologies do, and I think we need to

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Speaker 7: take those seriously, ranging from the near term risk to

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Speaker 7: the longer term technological risks, and I think we need

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Speaker 7: to start an international dialogue about that now. So it's

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Speaker 7: fantastic to see this happening in the summit, and.

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Speaker 8: There is divergence from policymakers, but there's also divergence and

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Speaker 8: quite passionate splits within your own community.

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Speaker 5: You're very aware of this.

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Speaker 8: The head of AI at Meta Anderkut saying name checking

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Speaker 8: in saying you're them hungering, there's maybe regulatory capture.

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Speaker 5: Going on here.

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Speaker 8: Your response to that critique, because ya, look isn't alone.

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Speaker 8: There are others who say, quote unquote, that is preposterous

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Speaker 8: to talk about some of these existential risks fearmongering. Is

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Speaker 8: that what you're doing, Dennis, though, of course not.

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Speaker 7: And there's equal luminaries on the other side of the

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Speaker 7: camp as well, including some of Yan's fellow Cheering Award winners,

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Speaker 7: And we've all known each other for a long time

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Speaker 7: actually for the academic community, and as far as sort

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Speaker 7: of regulatory capture and other things, I think that's pretty preposterous.

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Speaker 7: We've been myself and Shane Leger, one of my other

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Speaker 7: co founders of d Mine, have been talking about AI

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Speaker 7: safety since we were post docs and academics in two

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Speaker 7: thousand and nine, so before we'd even started our companies.

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Speaker 7: So I think it's comes from a genuine, actually uncertainty

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Speaker 7: around where the technology can go. It's more enormously powerful,

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Speaker 7: we know, and that's why we all work our whole

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Speaker 7: lives on it, all of us. We think it can

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Speaker 7: being incredible benefits to science and medicine and climate and

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Speaker 7: environment and can actually help us and help society face

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Speaker 7: of our greatest challenges and solve some of those challenges.

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Speaker 7: But you know, in terms of where the technology is

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Speaker 7: going to go and the capabilities that will have, there's

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Speaker 7: a lot of uncertainty around that, and I think it's good.

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Speaker 7: There's disagreement and even amongst the academic fraternity, and that

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Speaker 7: just shows you that's why we have to proceed with

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Speaker 7: cautious optimism. You know, we want to make sure we

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Speaker 7: get the benefits of the innovation and the promise that

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Speaker 7: the technology clearly holds. But we've got to be doing

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Speaker 7: a responsible way, I would say, using a scientific method,

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Speaker 7: trying to have as much foresight on the technology as possible,

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Speaker 7: so we predict ahead of time what the unintended consequences

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Speaker 7: might be.

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Speaker 8: I guess for some it's the emphasis, and the Deputy

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Speaker 8: Prime Minister himself, speaking to us earlier, said this is

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Speaker 8: very much the summit focused on frontier technology, so the

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Speaker 8: next models, the deep mind and others may be going

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Speaker 8: out with the next twelve months or so. Others would say, look,

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Speaker 8: we need to focus on the more prosaic risks of

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Speaker 8: the here and now, the misinformation.

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Speaker 1: Data security.

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Speaker 8: Those issues are not being given enough weight with the

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Speaker 8: critics would say.

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Speaker 7: Yeah, I don't agree with that. I mean I think

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Speaker 7: that that Actually, even in the summit, there's many sessions

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Speaker 7: on the near term Rizz and all of us in

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Speaker 7: the frontier labs are also thinking a lot about near

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Speaker 7: term harms and how to mitigate those.

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Speaker 3: Demss Hassi bis CEO of Google Deep Mind there. Bloomberg's

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Speaker 3: Tom McKenzie joins us now from the ground at the

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Speaker 3: AI summit, of course, conducted that conversation. It's kind of

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Speaker 3: like a who's who in the world of AI. Elon

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Speaker 3: Musk is there, right, Tom. But from a political perspective,

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Speaker 3: the world's leaders have not turned up. So how much

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Speaker 3: is Richie Schunach leaning in on Elon Musk of all

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Speaker 3: people being there?

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Speaker 8: Well, Elon Musk, certainly. Look a lot of your friends

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Speaker 8: and Caroline are on the ground today. Sam Moltman's here,

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Speaker 8: of course, have opened AI. Elon Musk is here, Eric

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Speaker 8: Schmidt is here. You have deep minds, demsocivists, of course,

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Speaker 8: so they already have bought the power lists in terms

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Speaker 8: of those driving the innovation within technology. But you're right, Look,

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Speaker 8: there's on the edges maybe a little bit of disappointment

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Speaker 8: that you don't have the French president here, that you

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Speaker 8: don't have the German chancellor, but I will suppress this.

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Speaker 8: The UK government, they say, look, we're actually pretty relaxed.

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Speaker 8: You've got vonder lyon the European Commissioned President, You've got

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Speaker 8: the Vice President of the United States kind of house

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Speaker 8: is here, You've got the Japanese representation, you've got Chinese representation.

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Speaker 8: So they would say, look, the leaders are here, and

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Speaker 8: crucially those executives are here in al must certainly helps

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Speaker 8: the UK and it's kind of pr efforts, certainly, And

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Speaker 8: what they have mons achieve is sign off on this

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Speaker 8: communic A twenty eight different nations. And that's no mean

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Speaker 8: feet right, getting China on board with the US, with

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Speaker 8: the UK on signing off on the need to protect

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Speaker 8: against what they describe as these catastrophic risks.

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Speaker 4: Yeah, and there was much made of China being part

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Speaker 4: of this conversation, but it needs to be a global agreement,

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Speaker 4: a global narrative. If we're going to have guardrails here, Tom,

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Speaker 4: what do you expect to actually be coming out in

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Speaker 4: terms of hard regulatory policy? Already We've been hearing from

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Speaker 4: the US already enacting in executive order for example.

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Speaker 8: Yeah, so you've you've got the Communica, which is a

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Speaker 8: consent census around protecting against some of these risks.

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Speaker 5: But that's all it is. It's a consensus.

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Speaker 8: There's no regulatory concrete action that comes on the back

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Speaker 8: of this. They'll be hoping that that follows. In six

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Speaker 8: months time, South Korea will host their summit, then six

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Speaker 8: months after that it'll be France. But look, you're absolutely right.

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Speaker 8: There is a divergent picture when it comes to the

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Speaker 8: regulatory response, whether that is the euai AT that they

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Speaker 8: hope to put into lawn next year, or the executive

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Speaker 8: action of the US or China's own regulatory regime. And

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Speaker 8: it's interesting because you speak to certain people like Demis,

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Speaker 8: but also Inflection CEO as well, the Inflection AIICO saying, look,

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Speaker 8: we need to have kind of a global oversight body

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Speaker 8: and others push back on that. We spoke to the

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Speaker 8: Senior Vice President and IBM said, that's just not going

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Speaker 8: to happen. You're not going to be able to get

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Speaker 8: that global consensus. You need to work through the agencies

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Speaker 8: that already exist. So look, there are divisions in terms

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Speaker 8: of that regulatory framework. How it works the implementation, but

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Speaker 8: there are also divisions amongst executives themselves, take executives in

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Speaker 8: terms of how you define risks and how you define

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Speaker 8: the regulations that are needed to contain some of them.

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Speaker 9: RIK.

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Speaker 8: So the gap is huge at a time of course,

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Speaker 8: when we know the innovation is coming through at a

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Speaker 8: very rapid pace, whole load.

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Speaker 4: Of so much true to be done. There's a couple

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Speaker 4: of more days. Of course, it's today, it is tomorrow,

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Speaker 4: and of course it's all important. X discussion going on

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Speaker 4: between Enol Musk and Mishi Sunac after the event. Tom

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Speaker 4: McKenzie on the ground for us over there in buckingham Shaw.

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Speaker 4: We thank him very much for it. Meanwhile, coming up funding,

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Speaker 4: an AI scientist, former Google CEO actually is in the

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Speaker 4: UK at the moment. He's also been lending a hand

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Speaker 4: to a nonprofit with ambitious plans to build an aisystem

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Speaker 4: capable of scientific research. We have more on that next.

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Speaker 5: Ed, what's you got?

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Speaker 3: Yeah, just a real quick look at shares of Wayfair,

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Speaker 3: another one that had been lower and then suddenly book

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Speaker 3: Off it goes higher, up five percent, and lists really

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Speaker 3: impressed with the profitability in the e commerce context. In

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Speaker 3: the fintech context, with this stock up five point four percent.

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Speaker 3: This has been bog technology. Here's talking tech first Up.

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Speaker 3: We Work shares slumping by as much as fifty percent

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Speaker 3: today after a Wall Street Journal report about its plans

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Speaker 3: to file for bankruptcy. A spokesperson for the company said

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Speaker 3: it would quote not comment on speculation and interest. Internet

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Speaker 3: companies in Southeast Asia, like seeing Grabber, facing their slowest

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Speaker 3: growth in years. Researchers say online spending is expected to

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Speaker 3: rise by eleven percent this year, but down from twenty

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Speaker 3: percent a year earlier, in its lowest rate going back

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Speaker 3: to twenty seventeen. This comes as consumers in the region

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Speaker 3: pull back on their spending. Plus, new emails shown in

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Speaker 3: the DOJ lawsuit against Google are shedding new light about

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Speaker 3: the blurry line between search and advertising. In twenty nineteen,

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Speaker 3: the former head of Google Search raised concerns that his

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Speaker 3: team was quote getting too involved with ads. After Google

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Speaker 3: internally declared a code yellow amid revenue concern, speculators world

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Speaker 3: that its search team has sometimes been pulled into the

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Speaker 3: advertising side of the business. Google has pushed back on

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Speaker 3: that very IDEA.

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Speaker 4: Caroline Now, speaking of Google, the former CEO of that

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Speaker 4: business Searchmith, but he's mentioned further into the non profit

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Speaker 4: space by lending his funds his expertise to an AIPAD

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Speaker 4: research initiative called Future House, who mergs Jacki Davilas joins

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Speaker 4: us in Washington with a great story all about Basically,

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Speaker 4: they're assuming that the scientific process in and of itself

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Speaker 4: needs to be accelerated by AI, not just the actual

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Speaker 4: finding of scientific breakthroughs, that's very Caroline.

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Speaker 10: What Future House really wants to do here is not

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Speaker 10: just advanced breakthroughs like the alpha fold protein folding breakthrough

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Speaker 10: that we saw in the last couple of years that

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Speaker 10: really cracked open AI's potential in science. What Future House

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Speaker 10: wants to do is actually advanced the process itself. Now,

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Speaker 10: a lot of us kind of have to go back

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Speaker 10: to that high school, you know, laboratory where we were

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Speaker 10: learning about how to create a hyphe doing the research,

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Speaker 10: and then ultimately testing that. But there's a lot of

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Speaker 10: bottlenecks here that Future House says they can solve, starting

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Speaker 10: with the ability to make new hypotheses at a greater

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Speaker 10: scale and much faster, perhaps more accurate than humans can.

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Speaker 10: And the way they want to do that is with

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Speaker 10: this AI scientist, So they plan to kind of build

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Speaker 10: their own AI system that can ingest thousands and thousands

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Speaker 10: of papers at a much bigger scale than a human

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Speaker 10: scientist can, and eventually start to semi autonomously come up

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Speaker 10: with hypotheses of its own.

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Speaker 3: What's interesting about this story is there are loads of

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Speaker 3: startups and big companies working on applying AI and the

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Speaker 3: sciences by technology farmer drug discovery. This is a non

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Speaker 3: profit and it's focused in academia. Tell us who the

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Speaker 3: people are behind Future House.

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Speaker 10: Jackie that was by design ed Now, of course, Eric

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Speaker 10: Schmidt is by far the largest backer here. The organization

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Speaker 10: plans to have is backing for at least the first

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Speaker 10: five years. It expects to spend about twenty million dollars

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Speaker 10: in the next her up until next and a lot

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Speaker 10: of that funding is going to go to talent and

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Speaker 10: building what's called a wet laboratory, much like what we

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Speaker 10: would see in an academic institution or even some of

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Speaker 10: these industry led research labs. But the reason it's a

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Speaker 10: nonprofit is because it doesn't want to have the pressure

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Speaker 10: to make money or pump out products, and so that's

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Speaker 10: where you have Eric Schmidt saying he wants the incentives

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Speaker 10: really aligned to advance the research itself, not having its

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Speaker 10: attention diverted by you know, other priorities that perhaps might

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Speaker 10: come from investors or the market itself.

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Speaker 5: All Right, thanks to Bloombox. Jackie Dablos out in DC.

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Speaker 4: Then welcome back to blom meg Technology.

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Speaker 3: I'm Caroline Heard in New York and I'm ed Ludlow

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Speaker 3: in San Francisco. A quick check in on European markets.

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Speaker 3: The equities market in Europe has just closed.

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Speaker 5: The stock six.

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Speaker 3: Hundred Europe, which is kind of this continent wide gauge

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Speaker 3: of equities up for a third straight day seven ten

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Speaker 3: to one percent. A lot of the trading that's going

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Speaker 3: on in Europe, or did go on in Europe throughout

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Speaker 3: Wednesday session was kind of ahead of the Fed, a

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Speaker 3: drum beat to and treading water towards this afternoon's FED decision,

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Speaker 3: because of course Fed and rates policy has an impact

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Speaker 3: on the global economy. But there was also some pulled

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Speaker 3: back in some of the sort of benchmark European yields.

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Speaker 3: We're looking at the German ten year burned two point

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Speaker 3: seventy five percent on its yield, and euro dollar slipping

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Speaker 3: for a euro against the dollar for a second straight day.

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Speaker 5: Remember for one week only.

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Speaker 3: We're checking in on these European markets because of the

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Speaker 3: time difference and how exciting it is, Caroline, and.

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Speaker 4: Indeed it is all kind of dictated by US macro policy.

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Speaker 4: Let's dig in on what's happening in the US markets

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Speaker 4: right now. We are up wells seven tenser percent, let's

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Speaker 4: call it on the Nastak one hundred. Interesting desire to

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Speaker 4: be getting into technology names on a day where perhaps

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Speaker 4: we had some mixed data coming out from the US.

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Speaker 4: I mean, overall, we're trying to be reading the tea

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Speaker 4: leaves of what's been disclosed. When it comes to job openings,

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Speaker 4: actually climbing, the US factory gauge slumping. Nevertheless, some movement

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Speaker 4: towards some of the tech names Bitcoin. On the downside,

437
00:21:58,680 --> 00:22:01,760
Speaker 4: the dollar stays flat, but we do remain at about

438
00:22:01,760 --> 00:22:04,520
Speaker 4: thirty four thousand elevated level US tending yield though. This

439
00:22:04,560 --> 00:22:07,880
Speaker 4: is what to watch while markets rallying twelve basis points

440
00:22:07,920 --> 00:22:10,119
Speaker 4: to the downside. This is the Treasury said it will

441
00:22:10,119 --> 00:22:12,600
Speaker 4: sell one hundred and twelve billion dollars in longer term securities,

442
00:22:12,680 --> 00:22:15,560
Speaker 4: actually sort of slowing that growth of issuance. But notably,

443
00:22:15,560 --> 00:22:17,320
Speaker 4: we are thinking that the Federal Reserve is going to

444
00:22:17,320 --> 00:22:20,000
Speaker 4: be holding those interest rates steady and a twenty two

445
00:22:20,240 --> 00:22:23,240
Speaker 4: year high. Of course in their meeting today, maybe they

446
00:22:23,280 --> 00:22:25,959
Speaker 4: could hike later in the year. What does that policy

447
00:22:26,040 --> 00:22:28,520
Speaker 4: mean for sort of hearts and minds in terms of

448
00:22:28,600 --> 00:22:31,399
Speaker 4: allocating capital, tools, technology names in private sector and the

449
00:22:31,400 --> 00:22:34,360
Speaker 4: public sector. We want to discuss the FED conversation. It's implication,

450
00:22:34,480 --> 00:22:36,560
Speaker 4: but again for AI investors and how should they be

451
00:22:36,640 --> 00:22:39,240
Speaker 4: thinking about monetary policy. And pleased to say, Joe Chow's

452
00:22:39,280 --> 00:22:41,040
Speaker 4: with us. He's the co founder and managing partner over

453
00:22:41,040 --> 00:22:43,879
Speaker 4: at Millennia Capital, and someone who worked with the FED

454
00:22:44,320 --> 00:22:47,760
Speaker 4: knows how to think about the implications of valuations of companies.

455
00:22:48,119 --> 00:22:50,560
Speaker 4: And you actually think, look, this AI, some call it

456
00:22:50,600 --> 00:22:52,520
Speaker 4: a mini bubble, is not a bubble if you're looking

457
00:22:52,520 --> 00:22:54,400
Speaker 4: at where interest rates ultimately.

458
00:22:53,920 --> 00:22:57,720
Speaker 11: Are exactly and in our view the AI super second

459
00:22:57,760 --> 00:23:00,439
Speaker 11: which just starting this year, this is year one, and

460
00:23:00,520 --> 00:23:02,680
Speaker 11: that the bubble is not going to peak or burst

461
00:23:02,720 --> 00:23:04,600
Speaker 11: for like the ten years in Nerview. There's a couple

462
00:23:04,600 --> 00:23:07,080
Speaker 11: of reasons for why. If you look at historical tech

463
00:23:07,080 --> 00:23:09,400
Speaker 11: bubbles like the crypto we had ten to twelve years

464
00:23:09,440 --> 00:23:12,080
Speaker 11: of loose monster policy, and in two thousand and one

465
00:23:12,119 --> 00:23:14,640
Speaker 11: when the dotcom bubble burst it we had ten years

466
00:23:14,640 --> 00:23:18,320
Speaker 11: of fiscal policy fiscal surplus. So usually these tech bubbles,

467
00:23:18,359 --> 00:23:20,840
Speaker 11: InnoVision bubbles tend to form when you have one of

468
00:23:20,840 --> 00:23:26,760
Speaker 11: these following conditions. Loose Mountter policy, strong markets. We're strong economy,

469
00:23:26,840 --> 00:23:29,880
Speaker 11: and in twenty twenty three we have anything but that

470
00:23:30,040 --> 00:23:33,240
Speaker 11: we have time Mountter policy. With QT we have a

471
00:23:33,320 --> 00:23:36,040
Speaker 11: very difficult market. And my point is, if AI has

472
00:23:36,119 --> 00:23:40,400
Speaker 11: been this bigger important, then imagine when the FEN normalizes

473
00:23:40,560 --> 00:23:44,199
Speaker 11: and when the markets kind of resume, then that how

474
00:23:44,240 --> 00:23:45,639
Speaker 11: big AA bubble could become.

475
00:23:46,320 --> 00:23:48,720
Speaker 4: I'm interested. You're obviously backing some of the key names

476
00:23:48,720 --> 00:23:50,399
Speaker 4: that we talked a lot about on the show, the

477
00:23:50,440 --> 00:23:53,200
Speaker 4: coheres of this world, the stability AIS, and there's some

478
00:23:53,240 --> 00:23:55,639
Speaker 4: management concerns with that business. I'm interesting now one a

479
00:23:55,720 --> 00:23:58,520
Speaker 4: day where we see Olive AI, for example, once worth

480
00:23:58,760 --> 00:24:01,040
Speaker 4: four billion dollars valuation in twenty twenty one when it

481
00:24:01,119 --> 00:24:03,760
Speaker 4: last raised some funds and now it basically sales off

482
00:24:03,800 --> 00:24:06,119
Speaker 4: folts of the business and has to fold. What is

483
00:24:06,119 --> 00:24:09,040
Speaker 4: this distinguishing factor between companies that can't make it through

484
00:24:09,440 --> 00:24:10,440
Speaker 4: and companies that can.

485
00:24:11,040 --> 00:24:13,280
Speaker 11: Yeah, So you know, I've been having these conversations with

486
00:24:13,320 --> 00:24:15,800
Speaker 11: a lot of investors and founders. So basically I've been

487
00:24:15,840 --> 00:24:19,440
Speaker 11: asked what is AI, and I said, AI is software squared.

488
00:24:19,880 --> 00:24:23,440
Speaker 11: Think about how big impact internet and software have had

489
00:24:23,440 --> 00:24:26,159
Speaker 11: on our lives, business and consumer lives as can be

490
00:24:26,440 --> 00:24:28,879
Speaker 11: much much bigger. So by the same token you can

491
00:24:29,080 --> 00:24:31,480
Speaker 11: you can you can value a software company on a

492
00:24:31,600 --> 00:24:35,000
Speaker 11: price to revenue, on a price to growth profit e

493
00:24:35,040 --> 00:24:37,360
Speaker 11: bit of free cash to LTV CACT and all these

494
00:24:37,359 --> 00:24:40,359
Speaker 11: operating metrics. You would value an AI company by the

495
00:24:40,359 --> 00:24:43,119
Speaker 11: same token, and you would value kind of like the

496
00:24:43,160 --> 00:24:45,960
Speaker 11: company based on long term DCF and so yes, some

497
00:24:46,000 --> 00:24:49,560
Speaker 11: of these AI companies are overvalued, but that's because they're

498
00:24:49,600 --> 00:24:52,639
Speaker 11: growing fast, so the growth rate price the earnings earnings

499
00:24:52,680 --> 00:24:56,920
Speaker 11: growth or revene growth is justified, or because the total

500
00:24:56,960 --> 00:24:59,880
Speaker 11: addressing market is big, or there's such a strong mode.

501
00:25:00,160 --> 00:25:02,000
Speaker 11: So some of the companies that you know are not

502
00:25:02,160 --> 00:25:05,320
Speaker 11: sustainable may not exemplify one of those our characteristics.

503
00:25:05,440 --> 00:25:07,879
Speaker 3: Joe, Caroline and I were reflecting this morning on a

504
00:25:07,960 --> 00:25:10,119
Speaker 3: conversation we kind of had throughout the year, but it

505
00:25:10,240 --> 00:25:14,680
Speaker 3: started within a COSTLA that ninety percent of these new startups.

506
00:25:14,720 --> 00:25:16,760
Speaker 3: In other words, ones that were founded this year in

507
00:25:16,800 --> 00:25:20,199
Speaker 3: the AI domain won't survive. But I kind of like

508
00:25:21,040 --> 00:25:23,879
Speaker 3: it's a conversation that I've always had covering bench capital. Right,

509
00:25:23,920 --> 00:25:26,680
Speaker 3: you look at your portfolio, aren't ninety percent of they're

510
00:25:26,680 --> 00:25:27,840
Speaker 3: not going to make it anyway?

511
00:25:29,200 --> 00:25:31,800
Speaker 11: That's the power leventry capital is not every company is

512
00:25:31,840 --> 00:25:33,760
Speaker 11: going to make it. But when I take a step

513
00:25:33,760 --> 00:25:35,960
Speaker 11: back and I work at the ecosystem, you know, I'm

514
00:25:36,000 --> 00:25:39,840
Speaker 11: really really excited about this juncture where AI has really

515
00:25:39,880 --> 00:25:42,960
Speaker 11: introduced a lot of life back back into the ecosystem,

516
00:25:43,080 --> 00:25:45,560
Speaker 11: where AI has created this whole new green field in

517
00:25:45,560 --> 00:25:48,360
Speaker 11: which many new companies will be born and there will

518
00:25:48,359 --> 00:25:51,480
Speaker 11: be many useful applications LBW built in cancer research, in

519
00:25:51,520 --> 00:25:55,639
Speaker 11: healthcare services and et cetera. And so not every company

520
00:25:55,680 --> 00:25:57,439
Speaker 11: is going to make it where the ones. But you know,

521
00:25:57,640 --> 00:25:59,919
Speaker 11: I compare this twenty twenty three moments. It's sort of

522
00:26:00,000 --> 00:26:02,600
Speaker 11: where we were in twenty ten for the cloud, and

523
00:26:02,640 --> 00:26:04,600
Speaker 11: twenty ten was when we were coming out of the GFC,

524
00:26:04,680 --> 00:26:07,119
Speaker 11: when markets were recovering, and maybe the.

525
00:26:07,119 --> 00:26:07,920
Speaker 5: Two thousand and two moment.

526
00:26:07,960 --> 00:26:11,080
Speaker 11: And so the companies that do that will stay, that

527
00:26:11,119 --> 00:26:13,640
Speaker 11: will survive this sort of kind of wash out our

528
00:26:13,720 --> 00:26:16,320
Speaker 11: poise to stay and you're seeing some of the most

529
00:26:16,359 --> 00:26:19,080
Speaker 11: impressive growth numbers from open AI, from n RAPPID, from cohere,

530
00:26:19,480 --> 00:26:22,119
Speaker 11: and we're really confident to say that the aida markets

531
00:26:22,119 --> 00:26:24,119
Speaker 11: are to stay and that it's going to have a

532
00:26:24,200 --> 00:26:26,280
Speaker 11: huge impact on our business consumer lives.

533
00:26:26,960 --> 00:26:28,960
Speaker 3: There's been a debate this week about what's going to

534
00:26:28,960 --> 00:26:32,439
Speaker 3: be bigger for global financial markets, the FED this afternoon

535
00:26:32,800 --> 00:26:35,440
Speaker 3: or Apple earnings on Thursday evening.

536
00:26:36,480 --> 00:26:37,600
Speaker 5: Let's stick with the FED.

537
00:26:38,240 --> 00:26:40,720
Speaker 3: If you are a venture capitalist or you're a long

538
00:26:40,840 --> 00:26:45,120
Speaker 3: term private investor, why do you care about monetary policy?

539
00:26:45,240 --> 00:26:48,320
Speaker 3: Why do you track rates in the direction to travel

540
00:26:48,359 --> 00:26:48,879
Speaker 3: for rates?

541
00:26:49,320 --> 00:26:52,479
Speaker 11: Well, there's two things. One is venture capital assets are

542
00:26:52,520 --> 00:26:54,679
Speaker 11: just equities and that's no different than public equities. It's

543
00:26:54,720 --> 00:26:57,639
Speaker 11: just that public equities trade, you know, move every mill second,

544
00:26:57,640 --> 00:27:00,119
Speaker 11: but venture capital ascess don't move. But if you're you

545
00:27:00,200 --> 00:27:03,120
Speaker 11: see you need to understand where rates are, where discount

546
00:27:03,200 --> 00:27:06,239
Speaker 11: rates are going, and what the exit markets will look like.

547
00:27:06,400 --> 00:27:09,960
Speaker 11: And that's going to impact sort of evaluations your portfolio.

548
00:27:10,359 --> 00:27:13,920
Speaker 11: And the secondly is is you know, let me say

549
00:27:13,920 --> 00:27:16,280
Speaker 11: this now that the FED is done, where you're done

550
00:27:16,480 --> 00:27:18,439
Speaker 11: and you know in my view, the only direction the

551
00:27:18,480 --> 00:27:20,560
Speaker 11: federal funds rate is going to go absent any sort

552
00:27:20,560 --> 00:27:23,440
Speaker 11: of blackswan events in the next few years is downwards.

553
00:27:23,480 --> 00:27:25,199
Speaker 11: You know, when now we're at five point five and

554
00:27:25,200 --> 00:27:28,000
Speaker 11: a little bit higher, you know, absent you know, blackswan events,

555
00:27:28,040 --> 00:27:29,680
Speaker 11: the federal funds rate will kind of go down from

556
00:27:29,720 --> 00:27:31,400
Speaker 11: five to five and a half, maybe three to four percent,

557
00:27:31,440 --> 00:27:34,399
Speaker 11: maybe maybe two percent, And so we're discount rates to

558
00:27:34,760 --> 00:27:38,320
Speaker 11: kind of compress by twenty pips points twenty pips. That's

559
00:27:38,359 --> 00:27:42,240
Speaker 11: going to leave to equity valuation expansion, and that's going

560
00:27:42,240 --> 00:27:45,560
Speaker 11: to be a healthy movement for the public markets in

561
00:27:45,560 --> 00:27:48,440
Speaker 11: tech and private markets and comparables. So you know, that's

562
00:27:48,440 --> 00:27:50,360
Speaker 11: why we're really decided about this juncture is the FA's

563
00:27:50,359 --> 00:27:53,520
Speaker 11: almost done, we're starting a new business cycle, and AI

564
00:27:53,600 --> 00:27:56,119
Speaker 11: is really introduced a lot of new activities in the market,

565
00:27:56,800 --> 00:27:58,719
Speaker 11: and so this may be actually want to be one

566
00:27:58,720 --> 00:27:59,920
Speaker 11: of the best comet to invest in AI.

567
00:28:00,119 --> 00:28:02,560
Speaker 3: That is an answer that I think Caroline addresses a

568
00:28:02,600 --> 00:28:04,960
Speaker 3: lot of the questions that are global technology. Audience has

569
00:28:05,000 --> 00:28:07,680
Speaker 3: Joe Chow and Leniar Capital. Great to ab back on

570
00:28:07,720 --> 00:28:10,320
Speaker 3: Bloomberg Technology. Thank you coming up here on the show

571
00:28:10,320 --> 00:28:13,760
Speaker 3: will continue the conversation on AI and talk regulation and

572
00:28:13,880 --> 00:28:16,720
Speaker 3: investment in the space. That's the next conversation, Caro.

573
00:28:16,960 --> 00:28:19,480
Speaker 4: Meanwhile, let's talk about desire to be spending money on

574
00:28:19,600 --> 00:28:23,080
Speaker 4: big deals. Some news crossing the wire that will endeavor.

575
00:28:23,359 --> 00:28:25,840
Speaker 4: You know, the company of talent agency and behind an

576
00:28:25,880 --> 00:28:28,520
Speaker 4: ultimate fighting champion as well, but a private equity firm,

577
00:28:28,560 --> 00:28:30,320
Speaker 4: silver Lake, is turning to its closest partner in the

578
00:28:30,320 --> 00:28:32,680
Speaker 4: Middle East to back one of its own largest ever

579
00:28:32,800 --> 00:28:35,480
Speaker 4: buyout deal proposals. The pfirm is and talks to team

580
00:28:35,600 --> 00:28:38,719
Speaker 4: with Abu Dab's well Fun Mumbadulla in a potential takeover

581
00:28:38,760 --> 00:28:40,760
Speaker 4: of Endeavor. Just check out the shares popping two and

582
00:28:40,800 --> 00:28:43,280
Speaker 4: a half percent Endeavor so far. Not commenting this is

583
00:28:43,320 --> 00:29:01,920
Speaker 4: bloombog technology Now. Business officials told a Senate panel on

584
00:29:02,080 --> 00:29:05,040
Speaker 4: artificial intelligence that Congress must take a more active role

585
00:29:05,080 --> 00:29:07,600
Speaker 4: in regulating the use of AI, particularly in the workplace,

586
00:29:07,920 --> 00:29:10,080
Speaker 4: so more and how the technology is impacting the workforce.

587
00:29:10,120 --> 00:29:12,200
Speaker 4: That's just bring in Bloombergs to a Constancy's got a

588
00:29:12,200 --> 00:29:15,040
Speaker 4: great story reading on at the moment. The myriad of

589
00:29:15,400 --> 00:29:18,240
Speaker 4: state by state, region by region rules that are coming in.

590
00:29:18,280 --> 00:29:20,239
Speaker 4: I think of here in New York in particular, but

591
00:29:20,320 --> 00:29:22,800
Speaker 4: nothing from a federal level that's protecting the worker, right.

592
00:29:23,280 --> 00:29:27,000
Speaker 9: Right, So, and that's what these these folks from the

593
00:29:27,040 --> 00:29:29,920
Speaker 9: business community were really calling for, because if you have

594
00:29:30,040 --> 00:29:33,959
Speaker 9: this patchwork of local and state regulations, it can make

595
00:29:34,000 --> 00:29:38,280
Speaker 9: it really difficult for companies who are developing new technologies

596
00:29:38,360 --> 00:29:40,600
Speaker 9: to figure out how to how to even proceed. So

597
00:29:40,960 --> 00:29:44,480
Speaker 9: some some folks were calling for federal action on this,

598
00:29:44,640 --> 00:29:47,480
Speaker 9: on this in particular, looking at AI and hiring. I

599
00:29:47,480 --> 00:29:49,560
Speaker 9: think that's a big one. And as you mentioned, there's

600
00:29:49,560 --> 00:29:53,560
Speaker 9: a New York City law looking at bias in AI

601
00:29:54,480 --> 00:29:59,800
Speaker 9: software that you know, in order to regulate those sorts

602
00:29:59,840 --> 00:30:02,800
Speaker 9: of of programs being used for employment decisions.

603
00:30:02,960 --> 00:30:06,240
Speaker 4: Now there in comes the ongoing issue with regulation and

604
00:30:06,280 --> 00:30:09,240
Speaker 4: new technology, which is do you stifle innovation? How much

605
00:30:09,280 --> 00:30:11,640
Speaker 4: you're seeing this put in the push being discussed at

606
00:30:11,680 --> 00:30:12,600
Speaker 4: a Congress.

607
00:30:12,280 --> 00:30:14,680
Speaker 9: Level, Yeah, so that was a big part of the

608
00:30:14,720 --> 00:30:16,720
Speaker 9: conversation at the hearing yesterday.

609
00:30:17,360 --> 00:30:18,880
Speaker 6: And I think that.

610
00:30:18,800 --> 00:30:21,600
Speaker 9: There are you know, it's it's really tough for lawmakers

611
00:30:21,640 --> 00:30:23,680
Speaker 9: to figure out how to proceed here because I think

612
00:30:23,680 --> 00:30:27,239
Speaker 9: that there are, you know, arguments on both sides that

613
00:30:28,400 --> 00:30:31,120
Speaker 9: you know, on one side, folks say that you know,

614
00:30:31,240 --> 00:30:34,720
Speaker 9: AI has holds a lot of risk for workers and

615
00:30:34,960 --> 00:30:38,880
Speaker 9: may even result in displacement of people's jobs on a

616
00:30:38,960 --> 00:30:41,640
Speaker 9: large scale. And then on the other side, people say

617
00:30:41,800 --> 00:30:43,959
Speaker 9: that's really not going to happen. You know, we're going

618
00:30:44,000 --> 00:30:47,080
Speaker 9: to see people shifting into new jobs, We're going to

619
00:30:47,080 --> 00:30:51,080
Speaker 9: see people learning new skills, and so it's hard to

620
00:30:51,160 --> 00:30:54,840
Speaker 9: know for Congress at this point in particular, you know,

621
00:30:55,000 --> 00:30:57,960
Speaker 9: how exactly they should proceed, how tightly they should be

622
00:30:57,960 --> 00:31:01,360
Speaker 9: regulating versus letting that companies do their.

623
00:31:01,200 --> 00:31:04,400
Speaker 4: Own thing, the ongoing debate. Joe Constance is great to

624
00:31:04,400 --> 00:31:06,640
Speaker 4: have you, thank you very much indeed on that important story,

625
00:31:06,640 --> 00:31:08,400
Speaker 4: and it's something that's been discussed in the UK right

626
00:31:08,440 --> 00:31:08,840
Speaker 4: now as well.

627
00:31:08,880 --> 00:31:11,840
Speaker 3: In it is and that's the topic of discussion in

628
00:31:11,840 --> 00:31:14,880
Speaker 3: today's VC Spotlight. We're going to hone in on investing

629
00:31:14,880 --> 00:31:17,640
Speaker 3: in art official intelligence, but with the context that right

630
00:31:17,640 --> 00:31:20,160
Speaker 3: now in the United Kingdom there is an AI summit

631
00:31:20,240 --> 00:31:23,280
Speaker 3: underway joining us. James Wise, a partner at Borders and

632
00:31:23,400 --> 00:31:26,800
Speaker 3: Capital big presence in the UK and Europe. Ben what

633
00:31:26,920 --> 00:31:29,720
Speaker 3: does the summit like this actually mean, James, for the

634
00:31:29,800 --> 00:31:33,600
Speaker 3: ecosystem of startups working on AI in the UK. In particular,

635
00:31:33,880 --> 00:31:37,480
Speaker 3: is there any actually tangible action that will come in

636
00:31:37,520 --> 00:31:38,800
Speaker 3: supporting that industry.

637
00:31:38,960 --> 00:31:40,760
Speaker 1: Well, overall it's a very positive thing, right.

638
00:31:40,800 --> 00:31:43,520
Speaker 2: We want to see international collaboration, we want to see

639
00:31:43,600 --> 00:31:48,000
Speaker 2: regulation that's clear and forward thinking. But obviously our aperature

640
00:31:48,000 --> 00:31:50,560
Speaker 2: here is really how is this going to affect entrepreneurs

641
00:31:50,600 --> 00:31:53,000
Speaker 2: on a day to day basis coming into the market

642
00:31:53,040 --> 00:31:54,880
Speaker 2: and their ability to raise capital.

643
00:31:55,200 --> 00:31:57,520
Speaker 1: And what we're looking at is how will.

644
00:31:57,400 --> 00:32:00,640
Speaker 2: Regulation of models or access to the tools open source

645
00:32:00,680 --> 00:32:04,240
Speaker 2: solutions affect the desire of entrepreneurs to try innovating in

646
00:32:04,240 --> 00:32:07,360
Speaker 2: this space and the ability of investors to really make

647
00:32:07,360 --> 00:32:09,200
Speaker 2: a difference and help build big businesses.

648
00:32:09,200 --> 00:32:14,280
Speaker 3: Here, what this summit has done is literally put in

649
00:32:14,280 --> 00:32:17,440
Speaker 3: front of the camera the talent in the UK, you know,

650
00:32:17,920 --> 00:32:21,640
Speaker 3: deep mind being the obvious example. Are there any particular

651
00:32:21,680 --> 00:32:25,200
Speaker 3: advantages or strengths that you feel the UK has in

652
00:32:25,240 --> 00:32:27,960
Speaker 3: the field of artificial intelligence, be it academic or be

653
00:32:28,040 --> 00:32:29,040
Speaker 3: it the private sector.

654
00:32:30,200 --> 00:32:33,479
Speaker 2: Yeah, that we have a broad range of software successes right,

655
00:32:33,480 --> 00:32:37,240
Speaker 2: whether it's in fintech, or it's in detech or even

656
00:32:37,320 --> 00:32:39,920
Speaker 2: in the life sciences. And actually what we're seeing is

657
00:32:40,080 --> 00:32:44,520
Speaker 2: research and AI now proliferating through inter industrial applications and

658
00:32:44,560 --> 00:32:47,120
Speaker 2: being taken up by leading software businesses to make a

659
00:32:47,120 --> 00:32:47,640
Speaker 2: difference for.

660
00:32:47,680 --> 00:32:49,600
Speaker 1: Users and ultimately that's what matters.

661
00:32:49,880 --> 00:32:52,760
Speaker 2: Having people here is fantastic, but making sure that they

662
00:32:52,800 --> 00:32:54,480
Speaker 2: work on an international level is still.

663
00:32:54,280 --> 00:32:55,080
Speaker 1: Going to be important.

664
00:32:55,280 --> 00:32:57,320
Speaker 2: You know, the UK is a great market, but when

665
00:32:57,360 --> 00:32:59,720
Speaker 2: we invest in businesses here, we're not investing in UK

666
00:32:59,760 --> 00:33:02,080
Speaker 2: business to win in the UK. We want them to

667
00:33:02,080 --> 00:33:04,880
Speaker 2: be impactful on the global scale, and that's why having

668
00:33:04,920 --> 00:33:08,880
Speaker 2: something like the Global AI Safety Summit is incredibly beneficial.

669
00:33:09,160 --> 00:33:12,600
Speaker 4: It's interesting, of course, summary investments include Writer and we've

670
00:33:12,640 --> 00:33:16,600
Speaker 4: interviewed founder of that business who's permanently jetting across from

671
00:33:16,680 --> 00:33:20,480
Speaker 4: London to SF and back building a global AI business.

672
00:33:20,560 --> 00:33:23,000
Speaker 4: One of valuations like James in the UK, because we're

673
00:33:23,000 --> 00:33:25,080
Speaker 4: just talking about how they're pretty elevated here in the US.

674
00:33:25,240 --> 00:33:27,880
Speaker 2: Yeah, well, look, the amount of money from venture investors

675
00:33:27,920 --> 00:33:30,479
Speaker 2: going into AI has grown significantly in the UK over

676
00:33:30,440 --> 00:33:32,840
Speaker 2: the last year. It's grown by about seventy percent. AI

677
00:33:32,880 --> 00:33:35,360
Speaker 2: has now just overtaken fintech this year in terms of

678
00:33:35,360 --> 00:33:38,320
Speaker 2: the main area that vcs are putting dollars, and obviously

679
00:33:38,360 --> 00:33:41,560
Speaker 2: that creates competition and it drives up valuations for early

680
00:33:41,560 --> 00:33:45,160
Speaker 2: stage investments. I think what's different about AI investing right

681
00:33:45,200 --> 00:33:49,120
Speaker 2: now versus some software valuations driven maybe a couple of

682
00:33:49,200 --> 00:33:52,240
Speaker 2: years ago, is that revenues are really following right There

683
00:33:52,280 --> 00:33:55,440
Speaker 2: is incredible demand both at the enterprise level and at

684
00:33:55,440 --> 00:33:58,440
Speaker 2: the consumer level for these new tools. Now we need

685
00:33:58,480 --> 00:34:01,200
Speaker 2: to make sure that demand convert into usage and that

686
00:34:01,320 --> 00:34:03,640
Speaker 2: people really get benefit out of it. But a lot

687
00:34:03,680 --> 00:34:06,480
Speaker 2: of the high valuations you're seeing are actually underpinned by

688
00:34:06,760 --> 00:34:08,080
Speaker 2: very fast growing revenues.

689
00:34:08,880 --> 00:34:11,839
Speaker 4: I put to you a question that we just had

690
00:34:11,880 --> 00:34:14,880
Speaker 4: a chat with Joe Chaw about, and there's one company,

691
00:34:14,920 --> 00:34:16,279
Speaker 4: for example. We're starting to get a view of these

692
00:34:16,320 --> 00:34:19,719
Speaker 4: companies actually failing now. We had Olive AI, one of

693
00:34:19,719 --> 00:34:22,040
Speaker 4: these companies that was worth four billion back in twenty

694
00:34:22,040 --> 00:34:23,680
Speaker 4: twenty one and is now selling off parts of the

695
00:34:23,680 --> 00:34:27,400
Speaker 4: business and basically unwinding. How do you discern a mote?

696
00:34:27,560 --> 00:34:29,719
Speaker 4: How do you decide which company is the one that's

697
00:34:29,760 --> 00:34:32,200
Speaker 4: going to be able to push through when a lot

698
00:34:32,239 --> 00:34:35,520
Speaker 4: of the firepowerin AI is costly and ends up being

699
00:34:35,560 --> 00:34:38,000
Speaker 4: owned by some of the big oligopolies. Shall we say?

700
00:34:38,320 --> 00:34:38,520
Speaker 5: Yeah?

701
00:34:38,520 --> 00:34:40,480
Speaker 1: And AI is an incredibly broad term, right.

702
00:34:40,520 --> 00:34:42,640
Speaker 2: What we've seen over the last year is an explosion

703
00:34:42,640 --> 00:34:45,600
Speaker 2: in the capabilities of generative AI, and in fact that's

704
00:34:45,640 --> 00:34:48,440
Speaker 2: completely ruined the business models of some businesses that were

705
00:34:48,440 --> 00:34:51,640
Speaker 2: building their own models at scale, and so there's going

706
00:34:51,719 --> 00:34:53,440
Speaker 2: to be disruption, there will be failures.

707
00:34:53,680 --> 00:34:53,840
Speaker 7: You know.

708
00:34:53,920 --> 00:34:55,880
Speaker 2: What we're looking for right now in a period of

709
00:34:56,040 --> 00:34:59,760
Speaker 2: very fast technical change and innovation are founders and product

710
00:34:59,760 --> 00:35:02,359
Speaker 2: team so who can adapt and deploy these new technologies

711
00:35:02,600 --> 00:35:05,040
Speaker 2: to find ways to really bring the value for the customers.

712
00:35:05,239 --> 00:35:07,360
Speaker 2: You know, I think you did a great summary earlier

713
00:35:07,360 --> 00:35:09,600
Speaker 2: of AMD's new earnings and forecasts.

714
00:35:09,600 --> 00:35:10,959
Speaker 1: We all know the storage.

715
00:35:10,760 --> 00:35:13,480
Speaker 2: VideA right now, a lot of the value is being

716
00:35:13,520 --> 00:35:16,200
Speaker 2: captured at that level, at the cloud level, with the

717
00:35:16,280 --> 00:35:18,160
Speaker 2: hyperscalers or with the chip producers.

718
00:35:18,400 --> 00:35:19,560
Speaker 1: What we're looking for is the.

719
00:35:19,480 --> 00:35:22,720
Speaker 2: Businesses who can navigate through this changing landscape and capture

720
00:35:22,800 --> 00:35:26,279
Speaker 2: value by providing services to people. James, you raise a

721
00:35:26,280 --> 00:35:28,680
Speaker 2: really good point because many of the founders at Caroline

722
00:35:28,719 --> 00:35:30,279
Speaker 2: and I speak to you, the first thing they think

723
00:35:30,320 --> 00:35:33,759
Speaker 2: about when they wake up literally is compute. It's expensive

724
00:35:33,800 --> 00:35:37,440
Speaker 2: and it's hard to secure. The UK startups have access

725
00:35:37,480 --> 00:35:38,360
Speaker 2: to that compute.

726
00:35:38,600 --> 00:35:39,880
Speaker 1: Yeah, it is a challenge.

727
00:35:39,920 --> 00:35:42,800
Speaker 2: You know, the UK locally has about a sixth or

728
00:35:42,920 --> 00:35:44,360
Speaker 2: sixth in the world in terms of the amount of

729
00:35:44,360 --> 00:35:47,120
Speaker 2: compute that has nationally well behind the US and China.

730
00:35:47,840 --> 00:35:50,680
Speaker 1: However, you know, we do have some local centers.

731
00:35:50,680 --> 00:35:53,160
Speaker 2: We've just announced in the UK funding for an exoscale

732
00:35:53,680 --> 00:35:56,800
Speaker 2: computing center as well, which will help, and international funds

733
00:35:56,800 --> 00:35:59,480
Speaker 2: like Bolderton have relationships with the likes of end VideA

734
00:35:59,520 --> 00:36:02,800
Speaker 2: and others so that we can provide access to cloud.

735
00:36:03,120 --> 00:36:06,360
Speaker 2: You know, this weekend in London we're providing access to

736
00:36:06,760 --> 00:36:09,160
Speaker 2: three hundred hackers. I think it's the biggest hackathon in

737
00:36:09,239 --> 00:36:15,720
Speaker 2: the agathon con Alert two tools for free of charge,

738
00:36:15,719 --> 00:36:17,920
Speaker 2: you know, subsidized byers and the providers to help them

739
00:36:17,960 --> 00:36:20,239
Speaker 2: start getting on the scale and learning how to use

740
00:36:20,280 --> 00:36:22,600
Speaker 2: these tools. And I think things like that, and things

741
00:36:22,640 --> 00:36:24,640
Speaker 2: like deals with en Video here in the UK means

742
00:36:24,680 --> 00:36:27,440
Speaker 2: that entrepreneurs here can compete and lead in the field.

743
00:36:27,719 --> 00:36:30,440
Speaker 3: Remember to invite us to your hackathons. James Wise of

744
00:36:30,520 --> 00:36:33,040
Speaker 3: Borders and Capital, thank you very much. Like coming out

745
00:36:33,040 --> 00:36:43,319
Speaker 3: there on the show. Meta set to be hit by

746
00:36:43,320 --> 00:36:46,400
Speaker 3: a privacy crackdown in the EU over its trove of

747
00:36:46,480 --> 00:36:49,800
Speaker 3: personal data that it uses to target users with ads.

748
00:36:49,840 --> 00:36:52,600
Speaker 5: Join us more. Our Big Tech editor Bloomberg.

749
00:36:52,200 --> 00:36:55,040
Speaker 3: Sarah Fryer, So, the mechanics of this are interesting and important.

750
00:36:55,560 --> 00:36:58,200
Speaker 3: What they're saying as you can't take the data from

751
00:36:58,239 --> 00:37:01,480
Speaker 3: your big platforms and use it in how you target

752
00:37:01,520 --> 00:37:02,680
Speaker 3: those users with ads.

753
00:37:03,200 --> 00:37:06,040
Speaker 12: Right, they're saying that the data collection at this scale

754
00:37:06,120 --> 00:37:10,000
Speaker 12: at which Meta has done it across Facebook, Instagram and

755
00:37:10,200 --> 00:37:14,040
Speaker 12: a Messenger is beyond what consumers have agreed.

756
00:37:13,640 --> 00:37:14,080
Speaker 5: To and.

757
00:37:15,600 --> 00:37:18,479
Speaker 12: Takes away their choice. And so what Meta has done

758
00:37:18,520 --> 00:37:22,839
Speaker 12: is they've operated or they've released this free version, this

759
00:37:23,000 --> 00:37:27,560
Speaker 12: ad free version, thinking that that would satisfy regulators and say,

760
00:37:27,719 --> 00:37:30,240
Speaker 12: you know, we're giving users a choice here, they don't

761
00:37:30,280 --> 00:37:34,160
Speaker 12: have to have ads. It's a sort of calculated move

762
00:37:34,200 --> 00:37:36,600
Speaker 12: on metas part, but because people probably won't use that

763
00:37:36,640 --> 00:37:42,200
Speaker 12: one that said, regulators aren't sure that that necessarily satisfies them,

764
00:37:42,200 --> 00:37:46,000
Speaker 12: and Meta saying that, you know, they have had discussions

765
00:37:46,040 --> 00:37:49,040
Speaker 12: over the course of many months trying to get to

766
00:37:49,080 --> 00:37:51,560
Speaker 12: a place where they can still operate in Europe, but

767
00:37:52,120 --> 00:37:53,719
Speaker 12: it looks a little tenuous right.

768
00:37:53,640 --> 00:37:56,480
Speaker 4: Now, Meta saying this statement is so white, Sarah. They've

769
00:37:56,480 --> 00:37:58,040
Speaker 4: been aware of this plan for weeks and we were

770
00:37:58,040 --> 00:38:00,000
Speaker 4: already fully engaged with them to arrive at a statisfy

771
00:38:00,040 --> 00:38:04,400
Speaker 4: factory outcomfortable parties. But the band is unjustifiably ignores that careful,

772
00:38:04,520 --> 00:38:08,160
Speaker 4: robust regulatory process. So when next, Because this is really

773
00:38:08,200 --> 00:38:11,399
Speaker 4: stemming from Norway, right, they've already come down in this way.

774
00:38:11,400 --> 00:38:14,440
Speaker 4: They're already getting fines on a daily basis. How harsh

775
00:38:14,440 --> 00:38:15,040
Speaker 4: could this get?

776
00:38:16,320 --> 00:38:18,000
Speaker 12: I mean it could It could be something that we

777
00:38:18,040 --> 00:38:21,759
Speaker 12: see in all of Europe. We could see that this

778
00:38:21,880 --> 00:38:26,200
Speaker 12: ad free version gets maybe deeper scrutiny as to whether

779
00:38:26,280 --> 00:38:30,160
Speaker 12: it collects data. Still, I think, you know, users aren't

780
00:38:30,200 --> 00:38:32,960
Speaker 12: is concerned about whether they have ads or not compared

781
00:38:33,000 --> 00:38:36,640
Speaker 12: to how much data is taken from them. So so

782
00:38:36,760 --> 00:38:39,560
Speaker 12: I think that that's that's what will come to next.

783
00:38:39,960 --> 00:38:44,120
Speaker 12: Already Meta has pulled back from Europe. Remember that Threads,

784
00:38:44,280 --> 00:38:48,240
Speaker 12: the new Instagram platform, wasn't launched there, so they are

785
00:38:48,440 --> 00:38:51,600
Speaker 12: they are trying to be a little bit more cautious

786
00:38:51,640 --> 00:38:54,320
Speaker 12: in the region, and that's difficult for the company because

787
00:38:54,680 --> 00:38:57,800
Speaker 12: it is one of their more lucrative ad regions around

788
00:38:57,800 --> 00:38:58,200
Speaker 12: the world.

789
00:38:58,920 --> 00:39:01,520
Speaker 4: So far, great to break that down. We thank you

790
00:39:01,560 --> 00:39:05,560
Speaker 4: the ongoing focus of regulators on Meta. Meanwhile, let's talk

791
00:39:05,600 --> 00:39:07,360
Speaker 4: about regulation here in the US when it comes to

792
00:39:07,400 --> 00:39:09,759
Speaker 4: crypto and indeed, while a trial that's going on we

793
00:39:09,800 --> 00:39:11,840
Speaker 4: all know the Crypto Ford trial of FTX coming to

794
00:39:11,840 --> 00:39:15,080
Speaker 4: a close this week. After Sam mcmnfred finished testifying, prosecu

795
00:39:15,239 --> 00:39:18,160
Speaker 4: just make their final pitch to the jury promotion. Alibassek

796
00:39:18,360 --> 00:39:20,960
Speaker 4: is going to be back at the courthouse tomorrow and

797
00:39:21,040 --> 00:39:23,239
Speaker 4: people have been like getting there at one to two

798
00:39:23,280 --> 00:39:25,239
Speaker 4: in the morning. May seem to get into this courthouse.

799
00:39:25,800 --> 00:39:28,120
Speaker 4: What are we anticipating. How quickly could any sort of

800
00:39:28,200 --> 00:39:29,120
Speaker 4: judgment be made him?

801
00:39:29,680 --> 00:39:31,799
Speaker 13: Well, it could be as early as the end of

802
00:39:31,800 --> 00:39:34,320
Speaker 13: this week, it could go into next week in theory

803
00:39:34,360 --> 00:39:36,520
Speaker 13: here because the jury has to deliberate, but they are

804
00:39:36,600 --> 00:39:38,799
Speaker 13: looking to get to a conclusion. What you're going through

805
00:39:38,800 --> 00:39:40,840
Speaker 13: today is we have Sam mcmanfried who wrapped up his

806
00:39:40,880 --> 00:39:44,000
Speaker 13: own testimony just yesterday, and now today you're watching the

807
00:39:44,000 --> 00:39:47,959
Speaker 13: prosecution really come in with closing remarks using Sam Bankmanfried's

808
00:39:47,960 --> 00:39:50,840
Speaker 13: own testimony against him. So what they are now saying

809
00:39:51,239 --> 00:39:54,040
Speaker 13: is you saw him come in early to his own defense,

810
00:39:54,320 --> 00:39:57,520
Speaker 13: very clear worded, very clear headed, and a day later

811
00:39:57,560 --> 00:40:01,640
Speaker 13: you saw him walk into the prosecution stumble over many definitions,

812
00:40:01,640 --> 00:40:05,160
Speaker 13: stumbling over many things that the prosecution put right in

813
00:40:05,200 --> 00:40:09,000
Speaker 13: front of him, books articles as to what he had said,

814
00:40:09,160 --> 00:40:13,600
Speaker 13: and then watching him either not remember or deny what

815
00:40:13,719 --> 00:40:15,759
Speaker 13: has been written or said about him.

816
00:40:16,320 --> 00:40:20,880
Speaker 3: What was SBF's defense beyond basically saying I wasn't a

817
00:40:20,960 --> 00:40:21,840
Speaker 3: very good CEO.

818
00:40:23,400 --> 00:40:25,759
Speaker 13: Well, that's the main defense, isn't it. This idea that

819
00:40:25,800 --> 00:40:27,920
Speaker 13: they didn't have the right risk management in place. And

820
00:40:27,960 --> 00:40:30,400
Speaker 13: the idea here was not just that, you know, he

821
00:40:30,480 --> 00:40:32,279
Speaker 13: wasn't a very good CEO, but he was trying to

822
00:40:32,320 --> 00:40:36,800
Speaker 13: show that he wasn't actually there or responsible for certain

823
00:40:36,840 --> 00:40:40,160
Speaker 13: amounts of the decisions made over at Alameda while Caroline

824
00:40:40,160 --> 00:40:42,759
Speaker 13: Ellison was running it. That's the distance he tried to

825
00:40:42,800 --> 00:40:46,120
Speaker 13: create from himself, because remember, he's trying to convince a jury,

826
00:40:46,280 --> 00:40:48,800
Speaker 13: many of which were not aware of what had happened

827
00:40:48,800 --> 00:40:51,279
Speaker 13: the last year a couple of years at FTX. Were

828
00:40:51,320 --> 00:40:53,160
Speaker 13: not aware of many of the inner workings of the

829
00:40:53,200 --> 00:40:55,719
Speaker 13: crypto industry, and we're not aware of a lot of

830
00:40:56,080 --> 00:40:58,040
Speaker 13: you know, what was allowed and what was not allowed

831
00:40:58,080 --> 00:41:00,960
Speaker 13: in terms of margin loans, as he has said, Alameda

832
00:41:01,000 --> 00:41:03,839
Speaker 13: had taken from FTX. But the prosecution is coming down

833
00:41:03,920 --> 00:41:08,600
Speaker 13: hard and going against him in terms of the discrepancies

834
00:41:08,640 --> 00:41:11,800
Speaker 13: in how he had shown what had happened over in FTX.

835
00:41:12,280 --> 00:41:14,920
Speaker 4: Shanana Bess can be back at that courthouse in New York.

836
00:41:15,000 --> 00:41:17,200
Speaker 4: We thanka Meanwhile, that does it for this suggation of

837
00:41:17,200 --> 00:41:18,319
Speaker 4: BlueBag technology today.

838
00:41:19,280 --> 00:41:20,239
Speaker 5: Shout out podcasts.

839
00:41:20,239 --> 00:41:22,799
Speaker 3: Wherever you get your podcasts, we have it everywhere from

840
00:41:22,880 --> 00:41:24,000
Speaker 3: SF in New York City.

841
00:41:24,400 --> 00:41:26,080
Speaker 5: This is Bloomberg technology