Speaker 1: We're from Mahart where innovation, money and power Collie in
Speaker 1: Silicon Vallet NBN. This is Bloomberg Technology with Caroline Hyde
Speaker 1: and Ed Ludlow.
Speaker 2: I met Ludlow in San Francisco. Caroline hyders off today.
Speaker 2: This is Bloomberg Technology coming up on the program. Tesla's
Speaker 2: shock change of CFO Zat Kirkhorn has stepped down after
Speaker 2: thirteen years at the ev maker. Meanwhile, Elon Musk's health
Speaker 2: is in focus as talk of a Zuckerberg cage fight
Speaker 2: heats up, and plugging a forty eight billions on a
Speaker 2: black hole artificial intelligence could fuel a rebound at SoftBank,
Speaker 2: as the Japanese conglomerates Vision Fund seeks to snap five
Speaker 2: quarters of losses, and we go live to Lisbon as
Speaker 2: a key leader responds to Portugal's probe into a European
Speaker 2: telecoms giant artis the name we are watching so closely.
Speaker 2: The surprise story this Monday that we all woke up to.
Speaker 2: Zach kirkchn stepped down August fourth as Tesla's CFO. He's
Speaker 2: been at the company thirteen years. He became CFO early
Speaker 2: twenty nineteen. He is a big factor behind the profit
Speaker 2: at Tesla some of the key capital raises they've done.
Speaker 2: The chief accounting officer is going to transition into the
Speaker 2: CFO role. Kirk CON's going to stay till the end
Speaker 2: of the year to oversee that transition. Pierre Faragu of
Speaker 2: New Street Research currently has a buy rating on Tesla
Speaker 2: and joins us to discuss. Pierre your reaction to Zach
Speaker 2: stepping down.
Speaker 3: Well, very solfishly and as an analystcovering Deskla, I'm very
Speaker 3: disappointed because Zach was like an exceptionally held through CFO
Speaker 3: four analyst, always very very impressive in his ability to
Speaker 3: provide like a big picture and drill into very specific
Speaker 3: numbers he could give to give a good sound of
Speaker 3: what was happening. So the sense of control and understanding
Speaker 3: of how like the big Tesla machine works at at
Speaker 3: Tesla was impressive and I'm definitely going to miss it.
Speaker 3: It's also definitely a surprise. I was not expecting him
Speaker 3: to live. He's very young now, as you said, thirteen
Speaker 3: years as STEPSLA, four years as a CFO, still very young.
Speaker 3: You know, a lot, a lot of things he can
Speaker 3: do with his life, and quite a good, you know,
Speaker 3: amount of money in his on his bank account because
Speaker 3: of course, being the CFO of Tesla and going through
Speaker 3: such like an exceptionist strong stock performance means Zach already
Speaker 3: got paid very well for his time as TESTLIGHTE reminds me,
Speaker 3: you know, when their own left Tesla, it was the
Speaker 3: same thing. Tesla is the company that attracts talents the best.
Speaker 4: In the world.
Speaker 3: Remember there is three million applications a year. It's also
Speaker 3: the company that has the most difficulties to retain them
Speaker 3: in the long run, because that's the company that is
Speaker 3: making talents very rich rapidly at the same time.
Speaker 5: So yes, I think part of the model.
Speaker 2: So Tesla's name Vibab Teenager as the next CFO. He's
Speaker 2: been the chief accounting officer. Do you know anything about him?
Speaker 3: No, I don't have the chance to meet him personally.
Speaker 3: You know that Tesla is very very protective with the
Speaker 3: time of their executive So I had the opportunity to
Speaker 3: speak to Zach regularly, not so much to Vibav. You know,
Speaker 3: he's basically coming from the ranks of Tesla. I'm very
Speaker 3: very confident he will he will do a great job,
Speaker 3: and I hope I will forget very soon. My regrets
Speaker 3: of seeing Zach living and I'm sure ABAVS will be
Speaker 3: very helpful with an artists as well.
Speaker 2: Pierre, You and I on this program Bloomberg Technology have
Speaker 2: used and talked about the term key man risk, and
Speaker 2: the thing that we talk about in the context of
Speaker 2: Zach was that he was one of just a handful
Speaker 2: of stated executive officers. Right, you have Drew Baglino leading
Speaker 2: the power in a battery business. Tom ju is now
Speaker 2: coming over from China. But does the key man risk
Speaker 2: conversation now get amplified because Zach, who's been such a
Speaker 2: stable force, is now gone.
Speaker 5: It's a very good question.
Speaker 3: So key mander is, yes, you can't ignore that the
Speaker 3: CFO leaves the company the stock comes down. You can't
Speaker 3: like that makes complete sense. There is like an oportunity
Speaker 3: risk reflected in a move like that. You never know
Speaker 3: exactly what's behind behind it. Then yes, a CFO, and
Speaker 3: especially a CFO with the talent of Zak, is a
Speaker 3: key man in an organization like that. Now, if you
Speaker 3: take a step back and look at how he learned,
Speaker 3: most likes to manage the multiple businesses he has. He
Speaker 3: likes to be directly speaking to very technical people, so
Speaker 3: people like Drew typically then he likes to have a
Speaker 3: type of either a CFO or a chief operating officer
Speaker 3: who is in charge of running the shop. And that's
Speaker 3: a model of SpaceX. That's the model more or less
Speaker 3: of Tesla with like the no real CEO, but like
Speaker 3: Zach and potentially term running the business from a financial
Speaker 3: and commercial, financial and operational and commercial perspective. And so
Speaker 3: that model, once again is extremely resilient as long as
Speaker 3: you have this capability of harnessing talents and bringing them
Speaker 3: up the pyramid. And look at someone like Tom, like
Speaker 3: the trajectory in China Tesla very similar to the trajectory
Speaker 3: of that in the finance department, Like these people came
Speaker 3: in very highly selected by Tesla and amongst all these
Speaker 3: very high high quality talents Tesla has, Tesla is extremely
Speaker 3: good at promoting very very fast, very young talents. So
Speaker 3: as long as that machine is there. As an analyst
Speaker 3: looking at the stock, looking at the long term, even
Speaker 3: the medium term, I feel that the key man risk
Speaker 3: is what it is. We'll see, you know, in the
Speaker 3: next few months, Skipper of you know, they's anything more
Speaker 3: to know about the situation. But I feel a relatively
Speaker 3: confident we shouldn't meet excessively.
Speaker 5: PF fair agree. New Street Research.
Speaker 2: Always grateful for your time and your reaction to what
Speaker 2: was a surprise piece of news this morning.
Speaker 5: Thank you.
Speaker 2: Let's stick with Musk over the weekend. Elon posted on
Speaker 2: x formerly known as Twitter, that he's going to have
Speaker 2: an MRI of his neck and upper back and he's
Speaker 2: going to find out whether or not he'll need surgery. This,
Speaker 2: of course, ahead of a proposed cage fight with Meta's
Speaker 2: co founder Mark Zuckerberg joined me out of DC. Bloomberg's
Speaker 2: Jackie Davlos. You and I have been through all of
Speaker 2: the posts, all of the timelines, all of the ideas.
Speaker 2: What do we know is the latest about this proposed
Speaker 2: cage fight.
Speaker 6: Well, and we know that cage fight is still up
Speaker 6: in the air, so our eager audience out there shouldn't
Speaker 6: put their beds in just yet. But what we do
Speaker 6: know is that Elon must sort of put the kebash
Speaker 6: on what's seemed to be an advancement in a proposed
Speaker 6: match between the two tech billionaires because of his injury
Speaker 6: to his upper neck and to his neck and upper back.
Speaker 6: Now it seemed to be escalating earlier in the day,
Speaker 6: because when Elon Musk first posted that Sunday that the
Speaker 6: batch should be live stream on next and that these
Speaker 6: proceeds would be going to charity, Mark Zuckerberg actually responded
Speaker 6: to that and said, hey, look, I suggested that we
Speaker 6: have this on August twenty six. Haven't heard back, and
Speaker 6: so a physical match may not be playing out, but
Speaker 6: they're certainly throwing punches at each other on their respective
Speaker 6: platforms already.
Speaker 2: You know, you and I cover technology, and the platforms
Speaker 2: are at the heart of this. You mentioned Zuckerberg's response
Speaker 2: threads being more reliable outside of the tech.
Speaker 5: What do we know about the training that's going on, Like,
Speaker 5: is this real, Jackie? Are they really gearing up for
Speaker 5: this fight?
Speaker 6: Well, you know, they've both been posting pictures of them training.
Speaker 6: We saw that post that Mark Zuckerberg had of him
Speaker 6: with this really heavy.
Speaker 5: Vest that he was.
Speaker 6: Bragging about how fast he could do this particular training session.
Speaker 6: I mean, they're really putting themselves out there in this
Speaker 6: way that you know, at least for Zuckerberg it's a
Speaker 6: little uncharacteristic of him.
Speaker 7: For Elon Musk not so much.
Speaker 6: But you know, at the end of the day, this
Speaker 6: isn't really about a cage match. I think what a
Speaker 6: lot of tech watchers out there realize is that the
Speaker 6: competition between the two really has intensified because of this
Speaker 6: tit for tat about the social platforms themselves, and so
Speaker 6: I think this is a culmination, probably a much more
Speaker 6: entertaining one that we normally see play out, but certainly
Speaker 6: one that's still a little.
Speaker 8: Bit up in the air.
Speaker 2: Ben Bos, Jackie Davlos, everything about the oxygen out of DC.
Speaker 5: Thank you very much.
Speaker 2: Now, look, we spent the last couple of weeks talking
Speaker 2: about the rebranding of Twitter two X. But what does
Speaker 2: Martin Grassa, the co designer a Twitter's original iconic bluebird logo,
Speaker 2: have to say about the change?
Speaker 5: Have a listen to this.
Speaker 9: I think with the letter form itself, it's a tough
Speaker 9: solve that they have to come up with because it's
Speaker 9: angular and sharp, it has an aggressive construction, and so
Speaker 9: I think the challenge that they'll have is how to
Speaker 9: define what X means, how to make it feel welcoming
Speaker 9: and approachable in its own way. And it's an incredible
Speaker 9: opportunity to have a single letter domain. I think there
Speaker 9: is only a few of them in the world. And
Speaker 9: they really get a chance to sort of say the
Speaker 9: final letter in the alphabet the same way you know
Speaker 9: people think about the bird today. I think, you know,
Speaker 9: ten years ago, there wasn't this emotional attachment to the
Speaker 9: bird that we see as it starts.
Speaker 2: To you know, pull away and change the X coming
Speaker 2: out here on Bloomberg Technology, check it.
Speaker 5: Look at zoom shares.
Speaker 2: We've been talking and asking is this the end of
Speaker 2: the remote work era? When the darling of the remote
Speaker 2: work era says to its staff, time to come back
Speaker 2: to the office. It's time to have a conversation that next.
Speaker 5: This is Bloomberg.
Speaker 2: Another piece of news that we're tracking here on Bloombow Technology,
Speaker 2: PayPal is launching a stable coin, the latest crypto payments push.
Speaker 2: What's so interesting about this It's the first by a
Speaker 2: large financial company and is significant joining us now who
Speaker 2: else Bloomberg Shnali Bassekale paypaler is like the og name
Speaker 2: in payments and then you follow in the modern era
Speaker 2: discussion around crypto. I'm not so surprised by this, but
Speaker 2: it is a significant piece of news.
Speaker 7: Oh.
Speaker 10: Absolutely, You and I talk about the PayPal mafia all
Speaker 10: the time. Everyone from elon Musk to Max Levchen, and
Speaker 10: so it's not surprising to see PayPal be the first
Speaker 10: really come out and make a stable coin announce They
Speaker 10: are also working with Paxos, which we know has been
Speaker 10: kind of a longer standing stable coin issuer and is
Speaker 10: regulated pretty heavily here in the United States, including with
Speaker 10: the New York Department of Financial Services. So if they
Speaker 10: are trying to get something off the ground, to do
Speaker 10: it in a way that is already regulated, well known
Speaker 10: by the regulators, it makes a lot of sense, especially
Speaker 10: because ed if you think about the way that stable
Speaker 10: coins are used kind of as an on ramp off ramp,
Speaker 10: and kind of also here on the eve of the
Speaker 10: House Financial Services Committee really trying to proceed with a
Speaker 10: new bill here for stable coin legislation. So a lot
Speaker 10: of movement on that front. Very unclear what the endgame is,
Speaker 10: but as we know, PayPal has four hundred and thirty
Speaker 10: million users here that are right for the taking. When
Speaker 10: you think about the movement over to digital payments.
Speaker 2: So the basics of stable coins a cryptotoken that's pegged
Speaker 2: to a real asset like the dollar, the US dollar,
Speaker 2: is that the case with PayPal stable coin? What are
Speaker 2: the specifics of it.
Speaker 10: Yeah, it's fully backed by US dollar deposits, treasuries, cash equivalents.
Speaker 10: I think it will be interesting to see how that
Speaker 10: works over time and who else they work with. I
Speaker 10: think about what STA Circle has done, for example, and
Speaker 10: Circle also has used Blackrock to manage that kind of
Speaker 10: treasury of cash and cash equivalents. As we've seen over time,
Speaker 10: that has been a very interesting thing to even look
Speaker 10: under the hood. Because initially they had kept money at
Speaker 10: Silicon Valley Banks soil Coon Valley Bank hat failed. They
Speaker 10: worked more with Blackrock to figure out how to move
Speaker 10: some of that money. So to the point that you're
Speaker 10: making the linkages here to the US financial system will
Speaker 10: be interesting to keep an eye on continuously and again
Speaker 10: the partners.
Speaker 7: That they have.
Speaker 10: The other reason I think about Circle so heavily is
Speaker 10: because of the way that coinbase, for example, uses Circle
Speaker 10: and USDC to really manage their kind of cash holdings
Speaker 10: here as almost a proxy, given that it's backed so
Speaker 10: much by very stable liquid US dollars and treasuries. The
Speaker 10: expansion of how PayPal works with the existing crypto ecosystem
Speaker 10: in that way, how much can you use PayPal stable
Speaker 10: given that it is back kind of just by treasuries
Speaker 10: and cash. Will more companies like a coin base feel
Speaker 10: comfort in doing that and work with PayPal in the
Speaker 10: future at a greater scale is a pivotal question.
Speaker 2: Well, quickly, we just showed a fantastic chart, mister director.
Speaker 2: Bring it back up up there you go. You look
Speaker 2: at the market for stable coin. It is clearly dominated
Speaker 2: by one name, Shanale. Very quickly break down the market
Speaker 2: for US.
Speaker 10: Yeah, very clearly. Tether is a big part of the
Speaker 10: stable coin market. And I think you have to look
Speaker 10: at this ed because twenty one percent is USDC as well.
Speaker 10: How much are people using stable coins inside of the
Speaker 10: United States versus outside of the United States. PayPal is
Speaker 10: still a US domiciled company and so there is a
Speaker 10: rational for them to be working with past paxos. We've
Speaker 10: seen issues with other stable coins through paxos, like Finance
Speaker 10: and so but paxos again has been a very trusted
Speaker 10: issue in the United States, with a lot of US adoption, in.
Speaker 2: Particular Bloomberg Shnali bassec all things crypto out of New York.
Speaker 2: All right, So the push to get tech workers back
Speaker 2: in the office continues. This time the back to office
Speaker 2: announcement coming from the darling of the work from home
Speaker 2: era Zoom to discuss Thingboks Brady Ford here with us.
Speaker 5: This was one I did not see coming. What is
Speaker 5: Zoom saying?
Speaker 11: Yeah, Zoom said pretty much everybody else has said, which
Speaker 11: is we're gonna work better in the office, come back
Speaker 11: in two days a week.
Speaker 5: It'll be great see your colleagues.
Speaker 11: And what's kind of funny about that to a lot
Speaker 11: of people is right that Zoom facilitated work from home.
Speaker 11: Without them, we'd probably all be using Skype. But yeah,
Speaker 11: I think what's interesting here, though, is that Zoom will
Speaker 11: say that this actually aligns pretty closely with our current strategy.
Speaker 11: They recognize that a lot of companies are going back
Speaker 11: at least part time, and so they've really worked on
Speaker 11: developing software for in office collaboration hybrid and so they
Speaker 11: figure to make these tools and make some more sense
Speaker 11: for their workers too to be in the office at
Speaker 11: least part of the time.
Speaker 2: The reality of this story, Brady, as you've written about,
Speaker 2: is that in the post pandemic world, Zoom's really struggled
Speaker 2: to keep its pace of growth. Tell me about the
Speaker 2: reasons why.
Speaker 11: Absolutely well, most tech companies ended up peaking around late
Speaker 11: twenty twenty one. Zoom peaked a fall year earlier in
Speaker 11: October twenty twenty because there was just this elation when
Speaker 11: everybody said we're working for home forever. We have companies
Speaker 11: all over the place, I mean, Salesforce said we're never
Speaker 11: going back to the office, and it became clear that
Speaker 11: some of these old ways of working will create back
Speaker 11: and that's really what's dented Zoom. I mean, they have
Speaker 11: a fantastic single product. Most people will say it's better
Speaker 11: than the competition, but it's hard to make a successful
Speaker 11: platform company on one product, especially when most people who
Speaker 11: want that product have already purchased it.
Speaker 2: Let's be clear about the CEO, Eric Dwan's position on this,
Speaker 2: though he still believes in hybrid working.
Speaker 11: Yeah, and that's what's interesting. I think a lot of
Speaker 11: companies that are increasingly pushing workers back to the office
Speaker 11: will say we're staying hybrid. The question is whether that
Speaker 11: number continues to creep up.
Speaker 2: Right?
Speaker 11: Does it start at two and then next year it's three,
Speaker 11: next year it's four. Are we in a three days
Speaker 11: a week white collar work world forever? You know, if
Speaker 11: you look at finance Obviously some places are five days
Speaker 11: a week. Even sales positions at a lot of tech
Speaker 11: companies are getting to four days a week now. So
Speaker 11: the question is whether it stabilizes hybrid or it's just
Speaker 11: going to continue creeping back to the old ways.
Speaker 2: Brody Forward coming to us live from an office or
Speaker 2: office in New York City. I mean, are there any
Speaker 2: other tech companies that you cover that are taking a
Speaker 2: similar approach that have recalled staff in recent weeks?
Speaker 11: Well, here's an interesting one. Amazon, because a lot of
Speaker 11: tech companies said, hey, if you live near an office,
Speaker 11: you have to go because a lot of hiring was
Speaker 11: totally remote in the pandemic. Amazon took a step to
Speaker 11: say that if you don't live near an office, you
Speaker 11: gotta move, you gotta come back. And to me, that
Speaker 11: was an unprecedented step within the big techies. Again, if
Speaker 11: you look at finance or others, my guess has been
Speaker 11: a little bit harder for a while now.
Speaker 5: Bombos, Brady Ford always good to catch up. Thank you
Speaker 5: out in New.
Speaker 2: York Artisiz Patrick Drahi said he felt quote betrayed and
Speaker 2: deceived by a small group of individuals, including one of
Speaker 2: his oldest colleagues, This was in response to a criminal
Speaker 2: corruption probe in Portugal focused on key figures connected to
Speaker 2: his telecommunity communications empire. Here with the latest out of
Speaker 2: Lisbon Bloomberg's Enriqualmeida. So let's go back to the beginning.
Speaker 2: How did some Autists officials become caught up in a
Speaker 2: Portuguese probe about the company.
Speaker 4: Hi ed Well?
Speaker 12: This all began last month when Portuguese police searched about
Speaker 12: nightighty homes and offices in Portugal and later detained the
Speaker 12: co founder of artist Romandu Preidra and three other people
Speaker 12: for question. Now, prosecutors believe that Pareta and a close
Speaker 12: group of people rigged procurement contracts at Altis's portual in
Speaker 12: a way that harmed the group's.
Speaker 4: Own companies for their own benefit.
Speaker 12: Pareida is considered Drahi's right hand man, which has raised
Speaker 12: fears that such practices could be taking place in other
Speaker 12: countries where the group operates. The irony of this all
Speaker 12: is that Altis has earned a name for itself here
Speaker 12: in Portugal for cutting costs.
Speaker 4: A union leader told me.
Speaker 12: Last month that when Altis spot Portugal Telecom, the country's
Speaker 12: biggest telecom company, Peda told units that he had to
Speaker 12: cut about five thousand jobs, that's about half of the workforce.
Speaker 4: Now he suspected, along.
Speaker 12: With a group of other people, of allegedly setting up
Speaker 12: businesses that want supply contracts from Altese to line up
Speaker 12: his pockets.
Speaker 2: Altis in Europe is just a telecom's giant now, right,
Speaker 2: The question is, Henry, what happens if this escalates beyond
Speaker 2: Portugal to other European countries or even the US.
Speaker 4: Well, that's the key question here.
Speaker 12: Altis has alleged to be a victim of foul play
Speaker 12: and that the case for now is limited to Portugal,
Speaker 12: but the fact that one of its co founders is
Speaker 12: under house arrest has raised concerns of poor governance elsewhere,
Speaker 12: and the investigation couldn't need spread to other countries where
Speaker 12: it operates, like France.
Speaker 4: Or the US.
Speaker 12: One alarm bell has been the dismissal of Altis USA
Speaker 12: chief procurement officer Yossi venture Trids, who is prayed as
Speaker 12: son in law. Yossi and his wife Gael made headlines
Speaker 12: in two thousand and two for buying a seventy million
Speaker 12: apartment in Manhattan. Now, if authorities in the US get involved,
Speaker 12: Altiace could face potential fines poor governance, but the biggest
Speaker 12: concern for now is Altis's huge debt pile. The company's
Speaker 12: debt has belonged to more than sixty million after years
Speaker 12: of aggressive acquisition at the same time getting more preentive.
Speaker 2: Yep, no, I'm sorry to cut you off with short
Speaker 2: on time and read, but thank you for your on
Speaker 2: the ground reporting at Lisbon will continue to track the story.
Speaker 2: Welcome back to Bloomberg Technology. Ed love Low here in
Speaker 2: San Francisco. The single name that I'm watching though halfway
Speaker 2: through the program soft Bank in Japan. You look at
Speaker 2: the parent group, SoftBank Group down nine ten to one percent,
Speaker 2: but kind of paired its losses. We get their earnings
Speaker 2: very late night West Coast time early hours of Tuesday
Speaker 2: morning East Coast time. All focus on Vision Fund expected
Speaker 2: to return to profitability after five quarters of losses in
Speaker 2: that Vision Fund.
Speaker 5: What's going to drive the rebound?
Speaker 2: Bloomberg's Isabelle Lee with me now with the latest Isabelle.
Speaker 2: This is an artificial intelligence story.
Speaker 13: It definitely is ed and is it even a surprise?
Speaker 13: AI is really what's going to fuel the rally or
Speaker 13: the soft rebound? Rather modest rebound, however you want to
Speaker 13: call it. But this is a big deal considering that
Speaker 13: the Soft Fund Vision Fund, which is a venture capital
Speaker 13: arm of Soft Fund, have seen losses in the past
Speaker 13: five quarters so to the tune of forty eight billion.
Speaker 13: So this quarter, if it sees modest gains, it'll be good.
Speaker 13: And obviously it's written by the AI rally. You've corvered
Speaker 13: it in this show. AI rally has just fueled all
Speaker 13: indexes across the board NASA one hundred, so it's biggest
Speaker 13: record ever from January to June. And the Vision funds
Speaker 13: public holding.
Speaker 7: It's kind of a big firm.
Speaker 13: Kind of is probably not the best word, because it's
Speaker 13: one point one, it's billion. It's public holdings as of
Speaker 13: the June quarter, and among the companies that invests in
Speaker 13: our door Dash Grab Holdings, which also saw double digit
Speaker 13: gains this year, and it also has a steak in
Speaker 13: China's ted Global, So they're really banking on that AI
Speaker 13: rally and this is one of the concrete examples that
Speaker 13: it lifts the valuation of a fund higher.
Speaker 2: The other story we're tracking so closely here on Bloomberg
Speaker 2: Technology is what happens to Softbanks chip unit on the
Speaker 2: chip designer. We know that an IPO is likely in September,
Speaker 2: a month from now, we have a good gauge of
Speaker 2: the valuation.
Speaker 5: How big a factor is that.
Speaker 13: A lot of attenda on that actually, because ARM is
Speaker 13: looking to raise around ten billion for evaluation of around
Speaker 13: sixty to seventy billion, so that's pretty big. And if
Speaker 13: this happens, ARMS debut will be the biggest following Ali
Speaker 13: Baba and Metta. And you know that this has been
Speaker 13: a big story this year. Other than AI, it's been chips.
Speaker 13: Everything has been about chips. So soft Bank is really
Speaker 13: banking on this, and if it happens, it's going to
Speaker 13: be a big deal for background Vision Fund launch in
Speaker 13: twenty seventeen, and it has investments including Apple and Qualcom.
Speaker 13: So if ARM comes true, if it does go public,
Speaker 13: which is a loss by the way to UK because
Speaker 13: they initially said they would list there but now they
Speaker 13: filed confidentially in the US, it would be a win
Speaker 13: probably for SoftBank. Now we don't know how much SoftBank
Speaker 13: will stell its sell. It's sick when it comes to
Speaker 13: the IPO, but still we must be guessing that it must.
Speaker 2: Be substantial Plambase Isabelle Lie, my good friend out in
Speaker 2: New York, across everything Asia tech and the importance for markets.
Speaker 5: Thank you very much.
Speaker 2: Now up next, ROW, it's the all in one finance
Speaker 2: and investment management platform for businesses. It's now integrating our
Speaker 2: official intelligence into its services. ROW unveiling one click AP
Speaker 2: to help input data in seconds that will normally take
Speaker 2: finance teams.
Speaker 5: Ours.
Speaker 2: Joining us from New York is ROW CEO Everett Cook.
Speaker 2: This is interesting because what you're doing is at the
Speaker 2: heart of the debate of where AI disrupts. Does it
Speaker 2: aids jobs or does it displace jobs? But just start
Speaker 2: by explaining what your AI powered tool does.
Speaker 7: Thank you, Ded, It's great to be here, absolutely so.
Speaker 14: Row is an all on one finance platform that means
Speaker 14: we combine products like banking, expense management, corporate cards, and
Speaker 14: accounts payable, which is the newest solution that we launched
Speaker 14: this week. We're infusing AI into all of our products,
Speaker 14: starting with AP because we believe it contributes to a
Speaker 14: better user experience and ultimately takes people out of the
Speaker 14: tdum of manual data entry.
Speaker 7: For us, we don't believe that this is a job.
Speaker 14: We believe that it frees up finance teams to ultimately
Speaker 14: be strategic and.
Speaker 7: Add value to the organizations that they work for.
Speaker 2: How much of your decision to do this was driven
Speaker 2: by people just coming to you and saying, we need
Speaker 2: some help. We actually need AI to do something that's
Speaker 2: useful for us a lot.
Speaker 14: I mean that conversation wasn't about AI, but it was
Speaker 14: about you know, the finance team spending up to thirty
Speaker 14: percent of their time entering data and processing payments in
Speaker 14: a very manual way still today in twenty twenty two,
Speaker 14: twenty twenty three. So we understood these problems, and we
Speaker 14: understood the technology shifts that were happening with AI, and
Speaker 14: for us, it seemed like a very logical solution to
Speaker 14: apply to solving this very pervasive and.
Speaker 7: Meaningful problem.
Speaker 2: Your products and services are targeted at the CFO, finance lead,
Speaker 2: the finance team, how do you assess their competence their
Speaker 2: understanding of artificial intelligence?
Speaker 5: You know, people out.
Speaker 2: There trying to upskill as CFOs learn more about AI
Speaker 2: and why it's important for them.
Speaker 7: That's a great question.
Speaker 14: I think CFOs all around the world are trying to
Speaker 14: upscale all the time.
Speaker 7: I think, what's What's important.
Speaker 14: Here, though, is that they don't necessarily need to truly
Speaker 14: learn about AI to reap the benefits of it. It's
Speaker 14: going to immerse itself in all of the products that
Speaker 14: they probably use. Us as a you know, as a
Speaker 14: technology company, we're embedding it in so many products to
Speaker 14: just make everything.
Speaker 7: Much better for the end user.
Speaker 14: But I think that there are you know, leading edge
Speaker 14: CFOs and finance teams are definitely learning as much as
Speaker 14: they can about this new technology.
Speaker 2: Are you able to quantify the financial benefit of automating
Speaker 2: these functions? How much time money does it save a
Speaker 2: company on average?
Speaker 14: So we were able to reduce sort of the typical
Speaker 14: payment system payment process, which includes interpreting, checking, validating, and
Speaker 14: scheduling are payable and managing that with any payment method
Speaker 14: down from around twenty clicks to a round two.
Speaker 7: We call the product one click ap We're going to.
Speaker 14: Get it to one because this is really important for
Speaker 14: those organizations that may not sound like a lot, but
Speaker 14: you multiply that by one hundred, one thousand processes per
Speaker 14: month or per week and it really adds up.
Speaker 2: What about your company? Ever, I believe you raise this
Speaker 2: series B going all the way back to December twenty
Speaker 2: twenty one. Do you have any more financing needs or
Speaker 2: capital needs.
Speaker 14: We raise a meaningful Series B at the end of
Speaker 14: twenty twenty one. We were back by amazing investors. You know,
Speaker 14: we're continuing to put our heads down and bill.
Speaker 2: All right, Row CEO Everett Cook, thank you very much
Speaker 2: for your time. They're coming up here on Bloomberg Technology.
Speaker 5: It is our VC.
Speaker 2: Spotlight Sarah Guile, founder of Conviction AI firm, very focused
Speaker 2: on artificial intelligence software three point zero. She's going to
Speaker 2: join us. Next familiar face here on Bluebow Technology. This
Speaker 2: is Bloomberg. But before we go, quick look at shares
Speaker 2: of block trade and higher by about half a percentage point.
Speaker 5: Head's key numbers. This is Bloomberg.
Speaker 2: Let's shift the technology focus seven thousand miles east to Israel.
Speaker 2: We've just been speaking exclusively with Prime Minister Benjamin Netten
Speaker 2: Yahoo about the nation's status as a tech club. He
Speaker 2: says his government is working hard to benefit from the
Speaker 2: AI boom.
Speaker 5: Have listen.
Speaker 1: There's noise in the short term markets, there's clarity in
Speaker 1: the long term markets. I mean, now, Amazon just invests
Speaker 1: seven billion in cloud services year. Why are they doing that?
Speaker 1: Because they know something I'm going to do. What I'm
Speaker 1: organizing is government policy and the government board with money
Speaker 1: to make us or one of the three top AI
Speaker 1: powers on the world.
Speaker 2: That was Israel's Prime Minister benjaminette Nia, who's speaking with
Speaker 2: us this past Sunday. Let's keep the conversation on AI
Speaker 2: going in today's VC Spotlight.
Speaker 5: Joining us this Monday.
Speaker 2: Sarahwuile, founder of Conviction, early stage venture capital firm focus
Speaker 2: heavily on AI and software three point zero.
Speaker 5: Sarah, of course, a former partner.
Speaker 2: At Greylock, described as quote overly direct, and also the
Speaker 2: co host of the No Priors podcast. Welcome back to
Speaker 2: Bloomberg Technology, Sarah.
Speaker 8: Good to see you, Ed, Thanks for having me.
Speaker 2: So, I want to start on a data point that
Speaker 2: we've been going over a little bit on the show
Speaker 2: this past couple of weeks. In the first quarter of
Speaker 2: the year, at least almost half of venture backing for
Speaker 2: AI startups went to startups here in the city of
Speaker 2: San Francisco. Do you recognize that as being a genuine trend,
Speaker 2: the concentration of AI talent here in the city.
Speaker 4: Yeah.
Speaker 15: I think it's a reflection of how early we are
Speaker 15: in this market. There is great engineering and entrepreneurial talent
Speaker 15: all around the world. I've been on the boards of startups,
Speaker 15: you know, with Israeli founders, European founders, all around the
Speaker 15: United States. But at this particular moment, AI and this
Speaker 15: generation of it is very early, and a lot of
Speaker 15: the talent that was sort of working on the frontier
Speaker 15: of this technology was focused in a few large research labs,
Speaker 15: and those labs were staffed.
Speaker 8: In San Francisco and London mainly.
Speaker 15: So I do think that, you know, the AI boom
Speaker 15: has benefited from that research talent and is partly also
Speaker 15: to do with sort of the renaissance of San Francisco.
Speaker 2: I asked you that because you and I've spent time
Speaker 2: together in your offices. You know, you launch Conviction and
Speaker 2: you open the physical office space that since last we spoke,
Speaker 2: you also launched conviction ebed, essentially an accelerator for AI startups.
Speaker 2: Tell me about that, what prompted the move.
Speaker 8: So we think this is a unique moment in time.
Speaker 15: As we were just talking about, this is a very
Speaker 15: early stage of the AI market, and we want to
Speaker 15: bring people together at this frontier of technology is we
Speaker 15: think they are solving a lot of new problems, and
Speaker 15: some of those problems are very common, right, And so
Speaker 15: an example might be hardware and infrastructure is hard again
Speaker 15: for startups thank to the thanks to the cloud players,
Speaker 15: they haven't been hard for most startups for a long time.
Speaker 15: But if you are a company that needs to train
Speaker 15: or serve your own models, that's very challenging, right. And
Speaker 15: so you know, people talk about the AI GPU crunch,
Speaker 15: and so one of the things that we were really
Speaker 15: trying to do is focus on the set of challenges
Speaker 15: that AI native companies face, bring people together who want
Speaker 15: to work at the vanguard, and then also make it
Speaker 15: possible for companies to experiment, right. And so we're giving
Speaker 15: people enough capital to get going one hundred and fifty
Speaker 15: thousand dollars on very friendly terms, and then partnering with
Speaker 15: Microsoft Open AI and Thropic and base Time in order
Speaker 15: to sort of make it possible for people to experiment
Speaker 15: as well from the hardware side. And so I think
Speaker 15: it's in part because we think this is a really
Speaker 15: special moment in time we want to bring together some
Speaker 15: of that vanguard community, and in part because we think
Speaker 15: we can bring our network together and people will solve
Speaker 15: unique problems together.
Speaker 8: So today's actually the last.
Speaker 15: Day of application. So AI entrepreneurs, I hope you'll apply.
Speaker 2: Well, let let's linger on that for a moment. Then
Speaker 2: what is it that you're looking for? You know, if
Speaker 2: you are going to get a new wave of applicants
Speaker 2: that are watching Bloomberg Technology right now, how do they
Speaker 2: set themselves apart? What is it you're seeking to on Earth?
Speaker 15: Yeah, I think the fundamental thing that we are looking
Speaker 15: for with any entrepreneur, besides the core entrepreneurial traits of
Speaker 15: you know, grit, the enthusiasm and deep understanding of a
Speaker 15: particular problem space, is actually experimentation today, like openness to
Speaker 15: new ideas and new experiences, and I think a more
Speaker 15: expansive view of the markets that can be disrupted with AI,
Speaker 15: and then sort of deep understanding of how the research
Speaker 15: and technology apply. I think one of the most exciting
Speaker 15: things about the opportunity to us is the fact that
Speaker 15: we don't look at the markets that are available to
Speaker 15: AI is just traditional software companies. Like some of the
Speaker 15: most interesting companies in AI today. And I'm biased because
Speaker 15: these are some of our portfolio companies as well, but
Speaker 15: you know, if you look at companies like Harvey in
Speaker 15: the legal space or mid journey in the image generation space.
Speaker 15: Those were not hotbeds for software in as verticals prior, right,
Speaker 15: And so we're really excited about people who you know,
Speaker 15: are experts in their domain and then also are thinking
Speaker 15: creatively about these applications versus sort of just expecting that
Speaker 15: these next generation of companies will be direct replacement for incumbents.
Speaker 2: You know, convictions really focused on the early stage. But
Speaker 2: you know, I know you and l Add on the
Speaker 2: No Prize podcast have names from the world of AI
Speaker 2: working at some of the biggest and most mature technology
Speaker 2: companies to discuss some of the broad themes. What are
Speaker 2: the advantages of focusing on young, early startups rather than
Speaker 2: you know, there's more mature sometimes megacap tech names that
Speaker 2: are still pumping money into into AI development.
Speaker 15: Well, I'm sure there's an updated increased number for Q two,
Speaker 15: but I think your viewers would definitely know in Q
Speaker 15: one a fifth of the S and P five hundred
Speaker 15: mentioned AI in their earnings calls, right, And so I
Speaker 15: do think since these starting gun of last November, technologists
Speaker 15: at companies of any scale recognize the opportunity and the risk,
Speaker 15: and definitely some are benefiting from it, right. You know,
Speaker 15: we see even in our mean alads, more advanced portfolios,
Speaker 15: or even in public companies, there are founders and CEOs
Speaker 15: who are taking advantage of the opportunity and motivating their
Speaker 15: teams to work with more speed and velocity than they
Speaker 15: ever have. Incumbents have always had the advantages of distribution,
Speaker 15: like relationships with customers, and then like very you know,
Speaker 15: large resources right engineering teams, access to infrastructure, for example.
Speaker 15: But I think these times of massive disruption are actually
Speaker 15: more advantage to startups. I think there's a lot of
Speaker 15: discussion amongst investors about access to data to train and
Speaker 15: fine tune models, but the data you want for model
Speaker 15: fine tuning and training is actually very specific, and incumbents
Speaker 15: often don't have it. So I think it's a you know,
Speaker 15: it's a race like many other technology shifts, where startups
Speaker 15: are trying to build the best product and build distribution
Speaker 15: and incumbents have the distribution advantage and are trying to
Speaker 15: figure out how quickly they can adapt to this new change.
Speaker 5: Last October, you.
Speaker 2: Came out and confirmed your first one hundred million dollar fund,
Speaker 2: and you got going quite quickly, and we talked about
Speaker 2: the physical space that you have the offices, but just
Speaker 2: share with our audience, Sarah, what it's been like building
Speaker 2: your own firm from scratch, where you've been able to
Speaker 2: make progress quickly, what the challenges have been as well.
Speaker 15: Yeah, I am reminded what it is like to be
Speaker 15: a founder. It's a lot of work, I'll be honest,
Speaker 15: but I'm really excited. I think the timing of our
Speaker 15: fund launch was we launched a publicly last October and
Speaker 15: chat GPT was released to the public in I think November,
Speaker 15: and so I can't say I was not surprised by
Speaker 15: how strong the consumer and enterprise reaction was to that,
Speaker 15: where like, this is the race year to incorporate AI
Speaker 15: into your existing products as an company, right, And so
Speaker 15: I'm positively surprised by how many entrepreneurs and how much
Speaker 15: great opportunity we are seeing. And I think, you know,
Speaker 15: we have a I think we have a reputation for
Speaker 15: domain expertise and network here and we want to go
Speaker 15: work with some of the very best companies. I'm very
Speaker 15: proud of the entrepreneurs already in the portfolio, but I'd
Speaker 15: say the amount of opportunity is also a challenge, right,
Speaker 15: We're hiring investors, and I think it will only grow
Speaker 15: from here. So I'd say perhaps the challenges look a
Speaker 15: little bit more like any scaling company that doesn't quite
Speaker 15: have enough peace because its market has arrived quickly.
Speaker 2: Sarah Grau, conviction is so great to have you back
Speaker 2: on the program at I guess the digital coll face
Speaker 2: of building a venture firm but also investing in new
Speaker 2: companies in the field of AI.
Speaker 5: Thank you very much.
Speaker 2: As the iPhone fifteen debut approaches, Apple finally admitting the
Speaker 2: industry is facing a smartphone slow down here in the US,
Speaker 2: presents a challenge for the next iPhone, which promises to
Speaker 2: be the biggest updates of the device in three years.
Speaker 2: Here's one pac more Bloombos, Mark German and Mark you
Speaker 2: wrote your power on over the weekend. Actually, some new
Speaker 2: details about the timing of iPhone fifteen. We're expecting an event,
Speaker 2: a launch. When do they take place.
Speaker 16: I'm expecting Apple to announce the iPhone fifteen the week
Speaker 16: after Labor Day, so either on Tuesday September twelfth or Wednesday,
Speaker 16: September thirteenth. The phones will then go on pre order
Speaker 16: that Friday, and then the week after the following Friday
Speaker 16: on September twenty second, I expect the new models to
Speaker 16: go on sale. Now, this is not necessarily groundbreaking, This
Speaker 16: follows the cadence of typical Apple releases, but notably this
Speaker 16: event is happening about a week later than last year,
Speaker 16: but it's still within their normal timeframe of early September
Speaker 16: to mid September.
Speaker 2: The question, before we get to the comments from executives
Speaker 2: about slow down is what is the iPhone fifteen going
Speaker 2: to bring us? How is it different from prior generations
Speaker 2: Based on your reporting.
Speaker 16: Yeah, I think this iPhone fifteen launch is actually going
Speaker 16: to be the most significant upgrade to the iPhone since
Speaker 16: the iPhone twelve launched in twenty twenty. You know, typically
Speaker 16: they've been doing bigger upgrades to the profhones the last
Speaker 16: few years, and that will continue, but the baseline iPhone
Speaker 16: fifteen will be a pretty nice update as well. So
Speaker 16: I'll start with the cheaper bones. The fifteen will get
Speaker 16: the same forty eight megapixel back camera that the fourteen
Speaker 16: pro got last year, so a really big upgrade on
Speaker 16: those lower end phones. And then they're going to move
Speaker 16: from the notch to the dynamic island on the fifteen
Speaker 16: and fifteen plus as well. So that's going to be
Speaker 16: a nice improvement that people on the pro phones got
Speaker 16: last year. Now moving onto the pro devices, there's going
Speaker 16: to be an entirely new design. They're going to keep
Speaker 16: that sort of matt frosted glass back, but around the
Speaker 16: sides of the phone. The band that goes around the
Speaker 16: phone right now with sort of that shiny fingerprint full
Speaker 16: stainless steel band. Right that material is trying to titan
Speaker 16: It's a brush titanium. It looks a bit nicer, a
Speaker 16: bit more premium, but it also could make the phone
Speaker 16: a bit lighter. There's also going to be a much
Speaker 16: dinner border around the screen.
Speaker 5: All right.
Speaker 2: Bloomber is Martgum and check on power on these aecutives
Speaker 2: saying two quarters of slow down in the US. Does
Speaker 2: the iPhone fifteen change the trajectory that does it? To
Speaker 2: this edition of Bloomberg Technology coming up in the next hour.
Speaker 2: Kathe Wood of ARC joins the crew on the one
Speaker 2: PM from San Francisco.
Speaker 5: This is Bloomberg Technology