Speaker 1: This is Bloomberg Business Week. I'm Carol Masser and I'm
Speaker 1: Bloomberg Quick Takes Tim Stanivik. We're here every day bringing
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Speaker 1: Business Week cal Master along with Tim Stanivic live at
Speaker 1: the Milk and Institute Global Conference here on the West
Speaker 1: coast um. And you know what's interesting is we did
Speaker 1: talk with Mark Jenkins ahead of Global Credit Carlisle Group
Speaker 1: earlier big players in the credit markets, and he talked
Speaker 1: about making credit right private, uh, you name it, more
Speaker 1: accessible to investors. And our next guest is working on
Speaker 1: making alternative asset classes more accessible as well. Matt Brown
Speaker 1: is the founder and CEO of CASE. He joins us
Speaker 1: here at the can Institute Global Conference. Matt, it's really
Speaker 1: great to have you on the show. You've been really
Speaker 1: busy over the last couple of days. Yeah, it's been
Speaker 1: a it's been a great couple of days. Uh. This
Speaker 1: theme of democratizing finance has really, uh just been a
Speaker 1: big front and center topic for the for the conference.
Speaker 1: We'll take us into your panel yesterday because you moderated
Speaker 1: a panel with people like Gene Case Cathy would Carol,
Speaker 1: who you're speaking to? What in just a couple of hours, right, exactly?
Speaker 1: What were some big takeaways from from what you learned?
Speaker 1: You know, I think the real big theme there was,
Speaker 1: you know, inclusion, making sure that we have a financial
Speaker 1: system that actually allows all participants. Uh. It was about decentralization.
Speaker 1: It was about removing the intermediaries like big banks and
Speaker 1: brokerage firms and allowing participants uh to have direct interaction
Speaker 1: with each other to reduce cost and efficiency and increased efficiency. Um.
Speaker 1: But overall it was a fascinating conversation. Kathy would really
Speaker 1: uh dug into kind of democratizing access for individual investors,
Speaker 1: young and stirs, the millennials. Um, we're just living the
Speaker 1: whole different world than I grew up in It's interesting.
Speaker 1: I just got off a panel talking with heads in
Speaker 1: the M and A world and and some of your
Speaker 1: established players, whether it's a Deutch, a bank or city group, uh,
Speaker 1: and talking about fintech and the up starts, you know,
Speaker 1: and obviously they're talking their book a little bit. But
Speaker 1: the idea that you know, there's incredible regulatory oversight over
Speaker 1: the investment space, and many would say that that's necessary
Speaker 1: to make sure that investors aren't unduly or folks who
Speaker 1: tapped the financial system right that they are protected. So
Speaker 1: how do the up starts? How are they because there's
Speaker 1: I think there's a feeling that the regulatory environment isn't
Speaker 1: keeping up with it and maybe understand the risks or
Speaker 1: the benefits. Yeah, there's a big there's a big feeling
Speaker 1: around that. Just to take a step back, you know, ten,
Speaker 1: well thirty years ago, especially around alternative investments or private
Speaker 1: funds or private credit, the SEC and the government's position
Speaker 1: was that, you know, you have to be wealthy enough
Speaker 1: that you can lose some money in these types of
Speaker 1: investment credit and credit investor. And as a result, what
Speaker 1: they effectively did was exclude a huge population of you know,
Speaker 1: the US and internationally from participating in alternative investments. What's
Speaker 1: happening today is I think there's been a relook at
Speaker 1: that and they're realizing now that alternative investments, including private
Speaker 1: credit as you mentioned, are doing their job. They have
Speaker 1: a really a role in a portfolio, and done the
Speaker 1: right way, they can really preserve and grow wealth over time.
Speaker 1: And to exclude and not allow the democratization of these
Speaker 1: types of investments is not the right idea. How do
Speaker 1: you do that in the right way? Though? What what
Speaker 1: regulators need to do in order to make sure that
Speaker 1: if people who can't afford to lose money aren't aren't
Speaker 1: excluded from these alternative asset classes. It's really coming down
Speaker 1: to certification, education, scalable education. Fintech as we think about,
Speaker 1: oftentimes does allow access to to financial products. But fintech
Speaker 1: can bring a lot of different things in a scalable format,
Speaker 1: the most of which could be education. So really you
Speaker 1: can't talk about democratizing access to investments and aless you're
Speaker 1: talking about educating a broad group of new participants who
Speaker 1: are going to be making investments, so they're going in
Speaker 1: with open eyes. You look at Robin Hood and some
Speaker 1: of the read at some of the kind of the
Speaker 1: concern there is the gamification of these platforms and maybe
Speaker 1: not everyone knows exactly what's going on and can they
Speaker 1: lose too much money? So you're going to see a
Speaker 1: real rise of education as kind of a cornerstone in this.
Speaker 1: There's education, there's education, and there's education and others. You
Speaker 1: can go to website and read some stuff. You know,
Speaker 1: it's very passive, but does it need to be something
Speaker 1: that's much more formal so that you've got to pass
Speaker 1: some form of a financial literacy test that you're driving
Speaker 1: to some extent, so that you really know you're talking
Speaker 1: about your welfare, your investments, your money that you might
Speaker 1: need to you know, live on. So the SEC right
Speaker 1: now is currently amended the accreditation role to include a
Speaker 1: new lane for education, and the way they're determining that
Speaker 1: is based on your uh, your your profession, your experience,
Speaker 1: your licenses in the finance industry u UM. So they're
Speaker 1: already moving away from net worth is just the only criteria,
Speaker 1: and now they're saying, you know what, if you're smart
Speaker 1: enough and you can certify that, then you should be
Speaker 1: able to participate. So that's that first step in removing
Speaker 1: a net worth requirement, but you're right, it's actually about
Speaker 1: making sure you can prove that the work has been
Speaker 1: done right. Is there any concern that there could be
Speaker 1: I don't know, people getting around these guard rails and
Speaker 1: some ugly situations that cause regulators think differently about this, Well,
Speaker 1: what regulators are doing around robin Hood right now. Yeah,
Speaker 1: it is a concern, and so our company hasn't reached
Speaker 1: out to the end investor. Were a B two B platform,
Speaker 1: So our client who uses our platform to access alternative
Speaker 1: investments is a financial advisor, professional investment and r I
Speaker 1: A exactly, so we are all we do have our
Speaker 1: concerns as well. So we're watching it very closely, watching
Speaker 1: what the government's doing, and we want to be part
Speaker 1: of the solution on that. And I do wonder if
Speaker 1: it's some of these all the investments, is it is?
Speaker 1: If it's a fun you're getting a piece of it right,
Speaker 1: so that you're not all in and that you would
Speaker 1: do some of your risk. It's a diversified pool, but
Speaker 1: liquid it is a big point as well. I know
Speaker 1: we're kind of about a time here, but you know,
Speaker 1: are you locking your capital up for a month a
Speaker 1: week for five years or ten. So, but you think
Speaker 1: about if universities and endowments wanted to be able to
Speaker 1: tap these all investments because they because in the search
Speaker 1: for yield, but they've also got to make sure that
Speaker 1: those endowments are there for the future. You have to
Speaker 1: wonder about opening up to a wider pool up investors.
Speaker 1: It's basically what we're talking about. Hey, Matt Brown, thank you, Hey,
Speaker 1: thank you very much. You're listening to Bloomberg Business Week
Speaker 1: with Carol Messer and Bloomberg Quick Takes Tim Stinovic on
Speaker 1: Bloomberg Radio. We want to at bit about spacks because
Speaker 1: they've had their ups. They've had their downs this year,
Speaker 1: no doubt about it. Uh. And we have a great
Speaker 1: guest to talk about. Orlando Bravo is founder and managing
Speaker 1: partner at Toma Bravo. He's with us at the Milk
Speaker 1: and Institute Global Conference right now. First of all, how's
Speaker 1: your conference going. I mean we talked a lot about yesterday.
Speaker 1: How really feels like things are kind of getting back
Speaker 1: to normal, albeit with masks on. Well, First, thanks so
Speaker 1: much for having me. The conference is awesome. Think about it.
Speaker 1: We're here in l A. A lot of it is outside.
Speaker 1: The weather's perfect. I've gotten to see some of our
Speaker 1: limited partners that I haven't seen in two to three years,
Speaker 1: so some of the old friends, and also meet a
Speaker 1: lot of new people. So it's just been great, one
Speaker 1: meeting after the other, right, fifteen minute meetings and then
Speaker 1: trying to see as many people face to face, like
Speaker 1: it's remarkable, right, unbelievable. So okay, let's talk about SPACs
Speaker 1: because I was looking at some of the indexes. They're
Speaker 1: down as as a group about ten percent so far
Speaker 1: this year. They're down about if you look at certain
Speaker 1: indexes from the mid February hype, where are we because
Speaker 1: people are talking about the death of SPACs um and
Speaker 1: as to mention earlier, I mean, these are cycles that
Speaker 1: things go through. SPACs are not a new investment vehicle exactly.
Speaker 1: Sparks are going to come back. They are They've been
Speaker 1: around for whatever five or thirty years. But why do
Speaker 1: why do we think that there was this incredible craze
Speaker 1: to SPACs. It's because I think knowlogy companies, there's so
Speaker 1: much innovation and so much new business creation and so
Speaker 1: many tech companies being performed that are getting to scale
Speaker 1: that the financial markets are trying to adapt of how
Speaker 1: can we absorb all these new assets into the market
Speaker 1: because we're not seeing a lot of I I mean,
Speaker 1: we saw the I p O market fall off a
Speaker 1: little bit, right it didn't now it's back. Now it's back.
Speaker 1: But I'm just saying that you know that there's alternatives
Speaker 1: for growing public here, and the alternatives are great. Direct
Speaker 1: listings are great, and this fact provides a great alternative
Speaker 1: because it really really does is it allows a company
Speaker 1: to be able to openly talk about its projections with
Speaker 1: its investors. Every investor think about it. If you're looking
Speaker 1: to buy a company, if you're if we are together
Speaker 1: going to buy a private company, wouldn't we like to
Speaker 1: sit down with management and say, let's see what you've
Speaker 1: done in the past, and how do you think about
Speaker 1: next year and the following year, and how does your
Speaker 1: operating plan and strategic plan aligned with that financial plan
Speaker 1: that you have. It gives you so much insights as
Speaker 1: to how management thinks about their own business. But are
Speaker 1: you concerned at all that there is a lack of
Speaker 1: quality companies to be acquired by SPACs that are out
Speaker 1: there looking for targets Right now? I'm always concerned about quality.
Speaker 1: What ended up happening as well with this pac boom
Speaker 1: is a number of companies went public through SPACs or
Speaker 1: merged with SPACs that are venture capital companies that are
Speaker 1: really young companies. Now. Retail investors in particular participated in
Speaker 1: that because the regulatory environment doesn't allow them to participate
Speaker 1: in venture capital and private equity, so they rush to
Speaker 1: this market and then the regulators get worried that, oh,
Speaker 1: they're gonna lose money, or these companies have lack of
Speaker 1: a track record, or they're gonna miss their numbers. Now
Speaker 1: we'll see what ultimately happens. But one of the things
Speaker 1: you said at the beginning is SPACs are out of favor. Now,
Speaker 1: of course nobody likes backs, but the trading should be
Speaker 1: the underlying company. Forget of whether it was a SPAC
Speaker 1: or I p O or direct listing. It's what matters
Speaker 1: is the underlying business. And is that what happened though, Orlando,
Speaker 1: in your view that we get a little floppy in
Speaker 1: terms of looking at the end of underlying fundamentals, the
Speaker 1: basics of like understanding the business and the growth trajectory. Absolutely,
Speaker 1: there is a It takes about nine months for a
Speaker 1: de SPAC to begin trading on its own merits versus
Speaker 1: from the fact that it was a SPAC to begin with.
Speaker 1: And that's an inefficiency in the market that shouldn't exist.
Speaker 1: But is there something that the industry needs to get
Speaker 1: I just came through a panel um of folks in
Speaker 1: the M and A world and saying, you know, we'll
Speaker 1: get through this, okay, but just got about forty seconds
Speaker 1: left here. But we need to as an industry get
Speaker 1: together and maybe set some rules, some understandings of what
Speaker 1: a SPACT needs to be. I give you two great
Speaker 1: rules that we should have intwods on one's transparency, So
Speaker 1: the SPAC should be able to post these are my
Speaker 1: projections or our projections and every quarter compare to how
Speaker 1: you were doing every quarter. Just show that in the
Speaker 1: front page or show that in your communications. And the
Speaker 1: other one it is alignment. Bring the best of private
Speaker 1: equity to SPACs, which is the sponsor has to invest
Speaker 1: significant capital in that pipe sub get in the game.
Speaker 1: Absolutely all right, That would certainly be a game changer. Orlando,
Speaker 1: thank you so much. So he scratched the surface, but
Speaker 1: so hopefully we can continue in the future. Orlando, Bravo.
Speaker 1: Founder imaging partner of Tomo Bravo joining us here at Milkin.
Speaker 1: This is Bloomberg Business Week with Carol Masser and Bloomberg
Speaker 1: Quick Takes Tim Stinovic on Bloomberg Radio. Can I just
Speaker 1: tell you you know? At Milking yesterday I hosted a
Speaker 1: panel and it was all about the role of technology
Speaker 1: and longevity. We're talking about aging. One of the panelists
Speaker 1: studies the brain. We talked a lot about what happens
Speaker 1: as we age and what we can do about it.
Speaker 1: You gotta tell the panelist about Sarah McBride's next story.
Speaker 1: I am totally. It's in the special double issue. It's
Speaker 1: the Persuasion issue of Bloomberg Business Week. So let's get
Speaker 1: to it. Let's get to it with Sarah McBride, venture
Speaker 1: capital reporter at Bloomberg News. She joins us on the
Speaker 1: phone from San Francisco. Sarah's story what a brain scan
Speaker 1: reveals about the science of persuasion. It's in the current
Speaker 1: issue of Bloomberg Business Week, which Carol mentioned is the
Speaker 1: persuasion issue. Sarah, neuroscientists have come a long way and
Speaker 1: understanding how and when people come around to a different
Speaker 1: point of view. So what exactly happens to our brain
Speaker 1: when we change our mind. Okay, well they have come
Speaker 1: a long way, but there's still a long way to go.
Speaker 1: It sounds like that particular area of study is really
Speaker 1: tricky for hero scientists, and that's because other things we
Speaker 1: do are more localized to one or just a few
Speaker 1: parts of the brain. For example, if you move a limb,
Speaker 1: whereas something that requires spot like persuasion, is spread out
Speaker 1: across so many parts of the brain. It's actually much
Speaker 1: harder to understand exactly what's going on. And this was
Speaker 1: a lesson in brain science and anatomy for me. I
Speaker 1: had to learn about all these different parts of the
Speaker 1: brain that get involved. And um, they're asking really interesting
Speaker 1: questions like if you're analyzing something, how do you separate
Speaker 1: those neurons to the neurons you lose used in memory,
Speaker 1: like when you're trying to remember what you analyzed previous
Speaker 1: flee or what your previous opinion was. And um, they
Speaker 1: scanned my brain, which was fascinating, and they're looking at
Speaker 1: areas like the ventral medial prefrontal cortex and the central
Speaker 1: strie itum and all these things which are kind of
Speaker 1: spread out in different areas across the brain and reflect persuasion.
Speaker 1: I mean we're talking about yeah, go ahead, jail, come
Speaker 1: on in. Joel Weber's with us Bloomberg Business Week editor
Speaker 1: back Uh in New York, Sarah, I just have to
Speaker 1: thank you for lending us your your brain. Um and
Speaker 1: like actually living up published photo of your brain. Uh So,
Speaker 1: so what was the whole process, Like, what was the
Speaker 1: whole process like to to have have your brain scanned
Speaker 1: for the purposes of persuasion. So I've never done anything
Speaker 1: like this, and um, I was hoping that they would
Speaker 1: have something very interesting to say about my brain. But
Speaker 1: they were like, yeah, it's very similar to the forty
Speaker 1: five other brains and we looked at for this study.
Speaker 1: Brain is special, right, Um So I had to get
Speaker 1: in this f m R. I don't know if we've
Speaker 1: ever done that before, but it's just a weird experience.
Speaker 1: You're in this big cylinder. It's very noisy. You can't
Speaker 1: really move a whole lot in there. My head was
Speaker 1: kind of drapped in I had They even gave me
Speaker 1: a little alarm unless I suddenly got plastrophobic and needed
Speaker 1: to come out. But they kind of arranged these mirrors
Speaker 1: and screens, so that I had this sensation that's having
Speaker 1: more room in there than what's actually the case. And then,
Speaker 1: believe it or not, I just got to watch cartoons.
Speaker 1: So it's like the greatest assignment ever. Careful you're talking
Speaker 1: to your boss here, so system so as you're watching cartoons, like,
Speaker 1: let's let's kind of get to the point where this, uh,
Speaker 1: you know, becomes a business story again, what what what
Speaker 1: are the potential takeaways for you know, the frontier of
Speaker 1: this research and what it means for for where where
Speaker 1: persuasion and business could go. Yeah, so they wanted me
Speaker 1: to watch normalized behavior, which was by day, we're watching uh,
Speaker 1: screening cartoons, whereas things like being unhealthy or not taking
Speaker 1: care of the environment were just standard in the cartoon.
Speaker 1: And then they showed me persuasive messages to see that
Speaker 1: I just kind of been showing the opposite. What would
Speaker 1: my brain be doing when I lift? Now shown Okay,
Speaker 1: you should exercise or you should recycle. So, um, the
Speaker 1: implications for this are pretty big for anybody trying to
Speaker 1: sell somebody something, or a politician trying to get some
Speaker 1: any to vote for them. So there's actually millions of
Speaker 1: dollars being invested in this science, and um, the hope
Speaker 1: is that UH will kind of know exactly what parts
Speaker 1: of the brain are affected when you're persuaded, which means
Speaker 1: not only will people be able to better persuade you,
Speaker 1: but the general public will also have a better idea
Speaker 1: of what's going on to if the science will kind
Speaker 1: of build up on both sides. Just so it sounds
Speaker 1: that listening about marketers, right, like sales and marketing, like
Speaker 1: just think about That's my question for you, Sarah. And
Speaker 1: I'm wondering when you reported this story, when when you
Speaker 1: went through this experience, if it makes you think differently
Speaker 1: about the way that you see advertisements, the way that
Speaker 1: people try to sell you something. I mean, are you
Speaker 1: are you taking a Do you have a different way
Speaker 1: of thinking about that? Now? Oh God, I've always been
Speaker 1: so successible to advertising this tradiction. Now I do kind
Speaker 1: of think about it, like what little things they might
Speaker 1: be tweaking. And I hadn't devoted much back to this
Speaker 1: idea of your social conditioning and what happens if people
Speaker 1: all around you think one thing. You know how much
Speaker 1: harter it is to change your mind about that? And
Speaker 1: then there are very fascinating things they're studying, like what
Speaker 1: happened if you're pretending to agree with something whereas deep
Speaker 1: down you don't really, but you wanted the social credibility
Speaker 1: that goes along with agreeing with your friends. So there
Speaker 1: are so many layers of this. It's really nuanced and
Speaker 1: got fascinating, you know, sir, I just wanted to say
Speaker 1: when I when I saw your brain, I was like,
Speaker 1: that looks like someone who's very perceptible to persuasive sales pitches.
Speaker 1: This is like a lot of home shopping at night. No, Like,
Speaker 1: show me an ice cream cone and I'll immediately think,
Speaker 1: oh my gosh, that looks delicious. So how much more
Speaker 1: research do we expect to be done before this might enter? Uh,
Speaker 1: you know, the next the next phases of applications. Well
Speaker 1: it's one of these things where they've made tremendous strides,
Speaker 1: but then it's just kind of showing them how much
Speaker 1: farther they have to go. So um, each piece of
Speaker 1: information they Jane is just one more step. But advertising
Speaker 1: is constantly being tweaked based on what we know and
Speaker 1: what people think they know about the brain. So I
Speaker 1: think elements of it will be reflected in advertising and
Speaker 1: marketing um in just a few years, and it will
Speaker 1: get better and better the deeper they can go into
Speaker 1: the brain and the more they learn about it. I'd
Speaker 1: say ten years. I wonder if Jill walked in, would
Speaker 1: they make him watch like the Squid Game or something.
Speaker 1: I can't think of a worse thing to do, And
Speaker 1: put me in an f R M R I machine
Speaker 1: and make me watch a squid game like no Ane
Speaker 1: on Squid Game. I'd pushing that button to get me
Speaker 1: out of there as quickly as possible. Oh, he knows.
Speaker 1: I want those images. Al right, guys, we gotta run
Speaker 1: venture capital reporter at Bloomberg New Sarah McBride. Check out
Speaker 1: her story What a brain scan reveals about the science
Speaker 1: of persuasion. This is fascinating. She of course was joining
Speaker 1: us with Bloomberg Business We get at her toe up.
Speaker 1: That's in the current special double issue, the Persuasion Issue,
Speaker 1: a business week magazine. This is Bloomberg Business Week with
Speaker 1: Carol Messer and Bloomberg Quick Takes Tim Stinovich from Bloomberg Radio. Well.
Speaker 1: The stock is up nearly two percent this year. The
Speaker 1: company CEO is known to retail investors as the silver Back,
Speaker 1: because they are the apes. We are talking none other
Speaker 1: than Adam Aaron. He's the chairman and CEO of AMC Entertainment.
Speaker 1: He joins us now here at the Milk and Institute
Speaker 1: Global Conference. Adam, it's good to see you. It's been
Speaker 1: a long time, Tim, Nice see you again. How are
Speaker 1: you great? Um? You know, if you had told me
Speaker 1: I run AMC now for almost six years and the
Speaker 1: company that I joined was a second largest movie theater
Speaker 1: chain the United States. A year and a half later,
Speaker 1: it was the largest movie theater chain in the world. Uh,
Speaker 1: everything was just happening, just fine. And if you told
Speaker 1: me in February of that we would somehow relive as
Speaker 1: a people on this planet the Spanish flu epidemic of
Speaker 1: nineteen eighteen and nineteen nineteen, I just couldn't have imagined,
Speaker 1: in this era of modern medicine that we would in
Speaker 1: our near term go through the last year and a
Speaker 1: half of disease and lockdown and mask wearing and uh uh,
Speaker 1: just think about all the loss and pain that has
Speaker 1: been suffered on this planet. Everyone has financially sacrificed, everyone
Speaker 1: has been overloaded with stress, except the people who work
Speaker 1: at claros. They're they're their business is really fooling nice people.
Speaker 1: Though they helped us with our safe and clean protocols
Speaker 1: at AMC. Theaters um and many people got sick and
Speaker 1: many people died. But that's only part of it. Uh.
Speaker 1: And that was the story of where AMC uh did
Speaker 1: everything in our power to have financial collapse, but we did.
Speaker 1: We raised billions of dollars in the equity and debt markets,
Speaker 1: got incredible assistance from our theater landlords and our lenders,
Speaker 1: and we entered one knowing that we could survive this
Speaker 1: pandemic no matter what came. Then. Well, we would never
Speaker 1: have predicted was that retail investors would descend on AMC
Speaker 1: the way they have this year. Uh. And so yeah,
Speaker 1: it's been it's been a fascinating two years. Needless to sign,
Speaker 1: They certainly have descended on AMC. And you announced earlier
Speaker 1: this year program for retail investors free popcorn and platform
Speaker 1: for them on the website. Does that seems like they're
Speaker 1: losing a little bit of momentum. The folks at Vanda
Speaker 1: Research said that retail traders have bought less than sixteen
Speaker 1: million dollars in a MC stock over the past week,
Speaker 1: compared to six million dollars at the height of things
Speaker 1: earlier this year. What are you working on to continue
Speaker 1: to connect with retail investors. Well, I have no Uh,
Speaker 1: I have no sense of whether they're uh picking up
Speaker 1: steam or losing steam through the research tools that you're
Speaker 1: talking about. But I do know that I tweet every
Speaker 1: single day, almost every day. Everyone I take I did,
Speaker 1: I take the day off? Everyone awhile from my Twitter feed.
Speaker 1: It's fun. But I my tweets. I started tweeting in
Speaker 1: earnest in April, and every single day my Twitter followers
Speaker 1: increase A hundred ninety thousand this morning, Uh, my average
Speaker 1: tweet is reading one point one million times. My tweets
Speaker 1: since April have been read cumulatively a hundred and thirty
Speaker 1: million times. Uh. Just three or four weeks ago, I
Speaker 1: put out a tweet that had my all time highest
Speaker 1: readership at almost six and a half million people read
Speaker 1: one of my tweets. Unwelcomes are unwarranted celebrity Like are you?
Speaker 1: I mean you've become a celebrity of sorts, especially on
Speaker 1: social Yeah, well, your company and your stock certainly have been.
Speaker 1: What is it about the business that justifies the run
Speaker 1: up that we've seen in the price because we're I'm
Speaker 1: looking at it in terms of you know, your market cap,
Speaker 1: you're well over twenty billion at this point um roughly
Speaker 1: five times the value it was if you go back
Speaker 1: to that's when we saw the industry and economy much
Speaker 1: much better place. So how do you actually deliver on
Speaker 1: the growth expectations there? Those are high expectations. That's pressure.
Speaker 1: Uh So the answer to your question is that back
Speaker 1: in June, I think it was when we were raising
Speaker 1: money yet again, we put out a very important disclosure,
Speaker 1: uh so important that the Wall Street Journal carried it
Speaker 1: on page one above the fold in the banner headline,
Speaker 1: where we cautioned investors that we were trading away from
Speaker 1: historic fundamentals and that something entirely different was going on
Speaker 1: at a MC. And I don't think you drive a
Speaker 1: car by looking in the rearview mirror only, and so
Speaker 1: you look, you drive a car by looking through the
Speaker 1: windshield and looking at what's ahead. And our goal at
Speaker 1: AMC is not just to bring back from this pandemic
Speaker 1: the company that existed in two thousand nineteen, and our
Speaker 1: shareholders thankfully have armed us with what at the end
Speaker 1: of the June quarter was a more than a two
Speaker 1: billion dollar war chest of cash in the bank or
Speaker 1: undrawn revolving credit line to put to work to fundamentally
Speaker 1: transform the company. And that's what we're engaged in right now,
Speaker 1: in addition to bringing back the company of old, because look,
Speaker 1: we're uh, there's there's some really good news for AMC,
Speaker 1: the movie theater company. Uh, and yet we have a
Speaker 1: way to go. So the really good news is that
Speaker 1: if you look at the period of October, in the
Speaker 1: first two weeks of this month, it was the biggest
Speaker 1: fourteen days of industry box office, which is the basic
Speaker 1: measure of the health of our industry. This you know
Speaker 1: what what the revenues are. Um, it was the biggest
Speaker 1: fourteen day box office since February, since the pandemic started
Speaker 1: and forced the closure of theaters. It took a long time,
Speaker 1: took twenty months, but finally we got the highest box
Speaker 1: office in over a year and a half. Now we're
Speaker 1: still not a two thousand nineteen levels. But if you
Speaker 1: compare the box office so far in October to the
Speaker 1: box office in the third quarter, or the box office
Speaker 1: in the second quarter, or the box office in the
Speaker 1: first quarter or the box office last year. You can
Speaker 1: see this enormous progress you're making. We're making. No, that's
Speaker 1: hang in a second because we have to do a
Speaker 1: commercial break, But we're gonna come back and do some more. Sure. Yeah.
Speaker 1: One thing I want to talk about is if we
Speaker 1: ever yes or no, do we ever get back to
Speaker 1: uh pre pandemic levels en levels? In my judgment, yes,
Speaker 1: But the question is what when do you think? Uh,
Speaker 1: we don't. We're not in the business of making predictions.
Speaker 1: Were in the We're in the business of trying to
Speaker 1: make it happen as soon as we possibly can make
Speaker 1: it happen. Adam, you referred to the war chest that
Speaker 1: you have at AMC Entertainment. Right now, what are you
Speaker 1: doing in order to transform the theater experience to get
Speaker 1: people back into the theater, especially at a time when
Speaker 1: they're saying, wait a second, I can just watch this
Speaker 1: on streaming in a couple of weeks. Well, we have
Speaker 1: two challenges of the company. First, we can have to
Speaker 1: continue to innovate at our theaters and uh so that
Speaker 1: we get more movie cars and more theater goers. Tell
Speaker 1: me to our theaters. Uh, this is on the AMC
Speaker 1: is pretty good at We've been the innovator in our
Speaker 1: industry for many years now, and UH, some of the
Speaker 1: things that we've just done in the last few months.
Speaker 1: We started showing professional sporting events. We are showing professional
Speaker 1: football on Sunday afternoons. For example. We've had some uh
Speaker 1: UFC fights, some w w E matches. UH we've had
Speaker 1: a big professional boxing fight in the night. Addition, we've
Speaker 1: been showing some live concerts or some concert movies. Both
Speaker 1: people go to them and they enjoy it. But but
Speaker 1: we've got something that's much bigger than just continue to
Speaker 1: innovated our theaters, because if all we do it is
Speaker 1: innovated our theaters. We're gonna bring back Post Pandemic, the
Speaker 1: company that existed in two thousand nineteen. And as you
Speaker 1: said in your build up in the last segment, the
Speaker 1: market cap of that company wasn't twenty billion dollars. So
Speaker 1: our next challenge is to transform the entire company, not
Speaker 1: just transformed the theatrical experience. And in that you're correct.
Speaker 1: We entered the second quarter with more than two billion
Speaker 1: dollars of cash and undrawn revolving credit line. We're gonna
Speaker 1: do something with that war chest. Uh, and add line
Speaker 1: of business that are related to our expertise, but not
Speaker 1: necessarily being a pure movie theater. Play Adam in twenty seconds,
Speaker 1: you said you are recently said that you'd accept crypto,
Speaker 1: including doscoin, Bitcoin, lightcoin and more. Are people buying tickets
Speaker 1: in crypto? They are there, but right now they're buying
Speaker 1: gift cards in crypto. Uh. But in a few weeks time,
Speaker 1: we'll actually be able to take cryptocurrency for online purchases
Speaker 1: of AMC tickets and AMC movie concessions at our theaters.
Speaker 1: All right, we gotta write it. Adam cool, come back.
Speaker 1: We'd love to talk about Adam Aaron over at AMC Entertainment.
Speaker 1: This is Bloomberg. You're listening to Bloomberg Business Week with
Speaker 1: Carol Messer and Bloomberg Quick Takes Tim Stinovic on Bloomberg Radio.
Speaker 1: So we talked a lot about sustainable investing yesterday and
Speaker 1: all of the money going into it. But I'm really
Speaker 1: looking forward to this next guest. We were just talking
Speaker 1: before we got going, because there is E s G
Speaker 1: and then there's impact investing, and this is something that's
Speaker 1: certainly in her world. Joining us right now is Joanna
Speaker 1: Rees she's co Heed co lead, I should say, of
Speaker 1: Impact Investing at Apollo Global Management with us on site
Speaker 1: at Milkin. Nice to have you here on Bloomberg. Thank
Speaker 1: you so much for having me. Um. We did start
Speaker 1: talking and I like throughout something about E s Genia Like, well,
Speaker 1: wait a minute, Carol, there's a difference between E s
Speaker 1: G and Impact because and so talk to us about that,
Speaker 1: because it does get used, I think sometimes interchangeable. Yes,
Speaker 1: it's the terms definitely run into each other and everyone
Speaker 1: has their own set of terms SOW which is part
Speaker 1: of the problem. Which is part of the problem, but
Speaker 1: we'll get there. Um. So E s G has been
Speaker 1: around for a long time. We had Apollo or just
Speaker 1: issued our twelfth annual E s G Report. So it's
Speaker 1: a big focus on the part of our firm, really
Speaker 1: on the part of any alternative asset manager or any
Speaker 1: asset manager overall. And we think of that as the
Speaker 1: ownership practices of the company, you know, being mindful of
Speaker 1: the environmental, social, and governments governance factors associated with a
Speaker 1: specific business measure them, get better understand what's unique to
Speaker 1: wipe the company you own. So that is relevant to
Speaker 1: any type of company in any type of ownership, so
Speaker 1: you would focus on e s G. Whether you were
Speaker 1: looking at, you know, a green energy type UM player
Speaker 1: as well as if you were looking at something that
Speaker 1: was on the on the far end. On the other
Speaker 1: you won't say it, but I'll say a coal company. Indeed,
Speaker 1: you know we're there for you. You can still focus
Speaker 1: on the s G from parting coal mine, you can
Speaker 1: still get better. Is that so is that troubling to you?
Speaker 1: Though not at all, because I think we need to
Speaker 1: as asset owners engage with the companies that are where
Speaker 1: they are today. But that is that is, you know,
Speaker 1: separate and apart from what what we're looking to do
Speaker 1: in the impact side, which is building upon that foundation.
Speaker 1: You know, we the data points are astonishing just coming
Speaker 1: out of Apollo. Our last report has data on fifty
Speaker 1: seven companies that have three thousand employees across their ploy
Speaker 1: based so it's a huge effort. But what we're doing
Speaker 1: an impact is related in the sense that we still
Speaker 1: need to be focused on the s G, we still
Speaker 1: need to report on it, get better at it. But
Speaker 1: impact is investing in companies where their goods or services
Speaker 1: improve the world, either socially or environmentally. Direct like, So
Speaker 1: it's not just that they donate to the local charity,
Speaker 1: it's not just that they have great governance practices, it's
Speaker 1: that what they do for a living makes the world
Speaker 1: a better place. So give us an example. So, the
Speaker 1: first investment we made on our platform is a company
Speaker 1: in the circular economy. Uh. It's the company is called
Speaker 1: Raino da Medici. They manufacture recycled carton board in Europe.
Speaker 1: So you know that's a very clear sustainability story where
Speaker 1: but the company recycling those fibers, they can be used
Speaker 1: seven times. It's so much better environmentally than either using
Speaker 1: virgin fibers or using you know, god forbid, like plastic packaging. Uh.
Speaker 1: And so you know that's a company we're looking to support,
Speaker 1: to continue to grow, to to consolidate that industry and
Speaker 1: build upon their environmental leadership, which we think is you know,
Speaker 1: fundamental to what the company does. And that's why it's
Speaker 1: a non concessionary investment. It looks a lot like any
Speaker 1: other investment Apollo would have made. It just happens to
Speaker 1: be in a company that is focused on driving environment
Speaker 1: and you look at the same metrics, right absolutely, Okay,
Speaker 1: because because I do think that there's always like, Okay,
Speaker 1: do we do a little bit of a trade off
Speaker 1: in terms of performance or something. But I mean, you
Speaker 1: guys are looking you know, you're you're managing money for
Speaker 1: your investors, right, and there's going to be, you know,
Speaker 1: that exit point and you've got to make some money. Absolutely,
Speaker 1: we're underwriting the exact same way that we see in
Speaker 1: like our large cat fund, with the added focus on
Speaker 1: what is the impact of that company has, how do
Speaker 1: we measure it, how do we maximize that through our
Speaker 1: ownership period. But the concept that impact has to be
Speaker 1: concessionary I think comes in part from trying to shoehorn
Speaker 1: assets that don't have that kind of fundamental, mutually reinforcing
Speaker 1: dynamic that a company in the circular economy has where
Speaker 1: if they grow, earnings grow, they're also doing better for
Speaker 1: the world. If you're trying to be having an impact
Speaker 1: in a positive way, if you're trying to buy a
Speaker 1: company where profit and purpose or intention every day and
Speaker 1: do it in an impact portfolio, you're going to have
Speaker 1: to make that decision. Johan, are you are you ever
Speaker 1: doing any due diligence And you say to yourself, well,
Speaker 1: the numbers are there from where we think we expected
Speaker 1: returns are going to be, but E s G just
Speaker 1: asn't and as a result, we have to pass absolutely
Speaker 1: that happens with E s G across our platform where
Speaker 1: we find business businesses with business practices we can't fix
Speaker 1: and we walk away. But for us as we do,
Speaker 1: we do that, and then we also do our impact diligence.
Speaker 1: And if we can't confirm to ourselves that there is
Speaker 1: a tangible measurable positivity either socially or environmentally from what
Speaker 1: the company knows, we're not making that investment. But what
Speaker 1: happens then or do you leave it then to the
Speaker 1: venture capitalists the angel investors, because there are going to
Speaker 1: be those firms that will change the world. Look at
Speaker 1: an elon Musk and Tesla and for how long people
Speaker 1: are like, yeah, whatever, right, and here he is today, right,
Speaker 1: And if the investment money wasn't there to back it up,
Speaker 1: what a shame. So but do you leave those companies
Speaker 1: that financially might not fit your criteria at a apole
Speaker 1: and say, okay, there's plenty of other money at the
Speaker 1: venture angel stage, and then when it grows we can
Speaker 1: jump in and the preponderance of capital focus stan impact
Speaker 1: in private funds is focused on early stage businesses, and
Speaker 1: there are people who are doing incredible work supporting you know,
Speaker 1: hopefully the Tesla's of the future. That's just not us.
Speaker 1: And so we're looking u to do impact what we
Speaker 1: call it impact at scale later stage businesses Ibata and
Speaker 1: Casula positive, but UM to widen that aperture away from
Speaker 1: thinking that the only company that can have impact is
Speaker 1: a newborn company that is so mission driven. Um. You know,
Speaker 1: the company we just acquired was founded in nine seven,
Speaker 1: which is great. They didn't start out planning to improve
Speaker 1: the environment, right, That's where they are now, right, join
Speaker 1: very briefly, do we get to a point within our
Speaker 1: lifetimes where E s G is no longer a thing
Speaker 1: because it's just everything adheres to E s G standards?
Speaker 1: You know? That would be great, But I think where
Speaker 1: we are as a as a you know, human beings
Speaker 1: to constantly push for more, and so if we can
Speaker 1: improve the employment practices of our businesses will raise the standard.
Speaker 1: Joanna reee Over at Apollo thank you. Thanks for listening
Speaker 1: to Blomberg Business Week. Download the podcast on iTunes, SoundCloud
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Speaker 1: our radio show at two pm Eastern on Bloomberg Radio,
Speaker 1: or watch us on YouTube search Bloomberg Global News m