1 00:00:00,800 --> 00:00:04,040 Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside 2 00:00:04,040 --> 00:00:06,920 Speaker 1: my co host Matt Miller. Every business day we bring 3 00:00:06,960 --> 00:00:11,520 Speaker 1: you interviews from CEOs, market pros, and Bloomberg experts, along 4 00:00:11,520 --> 00:00:15,600 Speaker 1: with essential market moving news. Find the Bloomberg Markets Podcast 5 00:00:15,600 --> 00:00:18,439 Speaker 1: on Apple Podcasts or wherever you listen to podcasts, and 6 00:00:18,480 --> 00:00:22,360 Speaker 1: at Bloomberg dot com slash podcast. You know, we've got 7 00:00:22,360 --> 00:00:24,680 Speaker 1: the market again, as Greig was just reporting up a 8 00:00:24,680 --> 00:00:26,480 Speaker 1: one and a half percent, so pretty decent week here. 9 00:00:26,520 --> 00:00:29,120 Speaker 1: The question is for a lot of folks, uh, dead 10 00:00:29,160 --> 00:00:31,960 Speaker 1: cat bounce or is maybe this market trying to find 11 00:00:32,000 --> 00:00:34,479 Speaker 1: inform some type of bottom here. Let's check in with 12 00:00:34,520 --> 00:00:38,479 Speaker 1: Scott Ladner, chief investment officer of Horizon Investments. Uh, Scott, 13 00:00:38,520 --> 00:00:41,800 Speaker 1: thanks so much for joining us. Despite you being from 14 00:00:41,920 --> 00:00:44,159 Speaker 1: UNC Chapel Hill, we decided to have you on. Hopefully 15 00:00:44,159 --> 00:00:46,879 Speaker 1: it'll go well. What are you looking at, Scott as 16 00:00:46,920 --> 00:00:49,080 Speaker 1: you take a look at these last few days here? 17 00:00:49,120 --> 00:00:51,280 Speaker 1: Maybe the market you're trying to find a bottom here? 18 00:00:51,640 --> 00:00:53,680 Speaker 1: How how do you guys think about it? Yeah? I 19 00:00:53,720 --> 00:00:55,680 Speaker 1: mean if you think that this trading kind of kind 20 00:00:55,680 --> 00:00:59,920 Speaker 1: of reechs of like hope, um right, hoping this is 21 00:01:00,040 --> 00:01:03,160 Speaker 1: over Um, it is very technical in nature. It is 22 00:01:03,200 --> 00:01:05,920 Speaker 1: not happening on a lot of volume. Um, you know. 23 00:01:05,959 --> 00:01:08,759 Speaker 1: And and look, markets don't go one direction forever, right, 24 00:01:08,800 --> 00:01:10,720 Speaker 1: So it has been seven or eight weeks of this 25 00:01:10,840 --> 00:01:14,119 Speaker 1: sort of malaise and just kind of grinding lower. Um. 26 00:01:14,120 --> 00:01:15,880 Speaker 1: This this doesn't look a little bit of a deal 27 00:01:15,880 --> 00:01:19,119 Speaker 1: of a relief rally. But I mean, unfortunately, it's it's 28 00:01:19,120 --> 00:01:21,160 Speaker 1: really tough to lose sight of the main points. And 29 00:01:21,240 --> 00:01:23,520 Speaker 1: the main point is the Fed has told us they 30 00:01:23,560 --> 00:01:26,400 Speaker 1: want tighter financial conditions and and uh you know that 31 00:01:26,400 --> 00:01:28,080 Speaker 1: that is that is the way they're going to try 32 00:01:28,080 --> 00:01:30,280 Speaker 1: to control inflation. They want tighter financial condissions to bring 33 00:01:30,440 --> 00:01:33,800 Speaker 1: the band down. Um and until dar unless that changes, uh, 34 00:01:33,840 --> 00:01:35,480 Speaker 1: you know this this is probably we're probably in the 35 00:01:35,959 --> 00:01:39,720 Speaker 1: cell rallies kind of mode. Alright. Interesting, Um, you know 36 00:01:39,760 --> 00:01:42,240 Speaker 1: Matt Miller jumped out for some reason, left to do 37 00:01:42,319 --> 00:01:44,440 Speaker 1: do something about doing a TV interview. But not to worry, 38 00:01:44,440 --> 00:01:47,119 Speaker 1: because pretty good to saw the Anpty seat jump right in. Cretty. 39 00:01:47,160 --> 00:01:49,160 Speaker 1: Thanks for so much for filling in here. Appreciate it. 40 00:01:49,200 --> 00:01:52,720 Speaker 1: I'll take any opportunity to coinker Sweeney um and and 41 00:01:52,800 --> 00:01:55,880 Speaker 1: Scott you should know Paul gives everyone who's not duke 42 00:01:56,120 --> 00:01:58,840 Speaker 1: a hard time. And usually I'll come in and defend them. 43 00:01:58,880 --> 00:02:01,480 Speaker 1: But for you, I'm a U V A M. So 44 00:02:01,760 --> 00:02:03,440 Speaker 1: I'm going to draw on your own. Yeah, you're on 45 00:02:03,440 --> 00:02:07,320 Speaker 1: your on this one. Um. I have to ask about 46 00:02:07,440 --> 00:02:11,200 Speaker 1: these recession odds that everyone's talking about. It's it's it's 47 00:02:11,880 --> 00:02:14,480 Speaker 1: it's kind of wild to see, at least for me, 48 00:02:14,639 --> 00:02:17,400 Speaker 1: that the market or the economy. I should say, it's 49 00:02:17,440 --> 00:02:19,480 Speaker 1: not the same thing. I should point out the economy 50 00:02:19,840 --> 00:02:22,600 Speaker 1: is growing at a two percent clip, and here we 51 00:02:22,639 --> 00:02:25,359 Speaker 1: are talking about an outright recession. So especially going from 52 00:02:25,360 --> 00:02:29,160 Speaker 1: two to below zero in the span of a couple 53 00:02:29,160 --> 00:02:34,760 Speaker 1: of quarters. Maybe are those fears realistic? I mean pretty 54 00:02:34,960 --> 00:02:38,960 Speaker 1: it's you know, a year ago. We should probably say no. Um, 55 00:02:39,040 --> 00:02:41,920 Speaker 1: But I think of how fast everything has been happening 56 00:02:41,960 --> 00:02:44,240 Speaker 1: cycle wise. I mean that the last couple of three 57 00:02:44,280 --> 00:02:47,000 Speaker 1: years I've really taught us anything is that economic cycles 58 00:02:47,040 --> 00:02:50,040 Speaker 1: are just are ever more compressed. Things are happening like 59 00:02:50,120 --> 00:02:52,560 Speaker 1: ever faster. Um. And and so you know, to think 60 00:02:52,560 --> 00:02:55,680 Speaker 1: that we can't get like a recession and like measured 61 00:02:55,720 --> 00:02:58,880 Speaker 1: in months rather than recesion matter measurement quarters or years 62 00:02:59,520 --> 00:03:02,120 Speaker 1: probably is and totally crazy anymore. Just just because of 63 00:03:02,480 --> 00:03:04,760 Speaker 1: how quickly everything is moving through the system and how 64 00:03:04,840 --> 00:03:07,720 Speaker 1: quickly um, you know, like not only policymakers, but the 65 00:03:07,720 --> 00:03:10,680 Speaker 1: market reacts, uh to you know, two changes and things. 66 00:03:10,760 --> 00:03:13,480 Speaker 1: So it's you know, it's it's it's not really out 67 00:03:13,480 --> 00:03:15,360 Speaker 1: of the realm to think that read they might end 68 00:03:15,400 --> 00:03:16,720 Speaker 1: up in the recession. We don't think it's will be 69 00:03:16,760 --> 00:03:18,760 Speaker 1: a very bad one that we do. There's there's really 70 00:03:18,800 --> 00:03:20,680 Speaker 1: no there's no accesses in the system to to speak 71 00:03:20,880 --> 00:03:22,840 Speaker 1: where they've been there there there in the posting ring 72 00:03:23,120 --> 00:03:25,760 Speaker 1: wrung out um and there's really not not very much 73 00:03:25,840 --> 00:03:28,040 Speaker 1: leverage in the system. So there's not and that's sort 74 00:03:28,080 --> 00:03:30,800 Speaker 1: of the ingredients for a like a really nasty type 75 00:03:30,800 --> 00:03:33,919 Speaker 1: of recession but kind of a garden variety earnings recession, 76 00:03:33,960 --> 00:03:35,840 Speaker 1: industrial slowdown type of thing in the back half of 77 00:03:35,840 --> 00:03:37,520 Speaker 1: the year. You know. But the market is starting to 78 00:03:37,520 --> 00:03:39,440 Speaker 1: sniff that out and we think that that makes some sense. 79 00:03:40,280 --> 00:03:44,440 Speaker 1: So Scott at at your shop, are you guys kind 80 00:03:44,440 --> 00:03:46,280 Speaker 1: of trying to during this you know, the sell off 81 00:03:46,280 --> 00:03:50,200 Speaker 1: we've had year today, trying to find safe havens or 82 00:03:50,680 --> 00:03:53,480 Speaker 1: do you just say, hey, we're going to take opportunities 83 00:03:53,520 --> 00:03:56,080 Speaker 1: to buy companies that we like and maybe add to 84 00:03:56,200 --> 00:03:58,880 Speaker 1: positions of core holdings. How do you guys try to 85 00:03:58,960 --> 00:04:01,160 Speaker 1: navigate through what has been a very tough start to 86 00:04:01,200 --> 00:04:03,680 Speaker 1: the year. Yeah, I mean it has been tough start 87 00:04:03,720 --> 00:04:04,960 Speaker 1: to the year, and so we've we've got a few 88 00:04:04,960 --> 00:04:06,760 Speaker 1: different strategies we have. You know, one of them is 89 00:04:06,920 --> 00:04:09,280 Speaker 1: is more of an algorithmic derisking and re risking strategy, 90 00:04:09,320 --> 00:04:11,200 Speaker 1: and so that's that's sort of doing it something. But 91 00:04:11,280 --> 00:04:13,720 Speaker 1: inside sort of the core allocation portfolios, um, you know, 92 00:04:13,720 --> 00:04:16,720 Speaker 1: how how camera managing client money and those is really 93 00:04:17,240 --> 00:04:19,320 Speaker 1: trying to trying to play some defense right now, trying 94 00:04:19,320 --> 00:04:21,159 Speaker 1: to sort of sort of like let let the talk 95 00:04:21,200 --> 00:04:23,560 Speaker 1: play out. You know, this is obviously it's tough to 96 00:04:23,560 --> 00:04:26,680 Speaker 1: time anything perfectly. But but in terms of um, you know, 97 00:04:26,680 --> 00:04:28,280 Speaker 1: in terms of like where we're putting money, like, we 98 00:04:28,320 --> 00:04:30,400 Speaker 1: have been pretty defensive. We've been pretty US based, We've 99 00:04:30,440 --> 00:04:32,800 Speaker 1: been pretty value based and like, and we don't know 100 00:04:32,880 --> 00:04:35,200 Speaker 1: those are not overweights that we've had, you know, typically 101 00:04:35,520 --> 00:04:37,680 Speaker 1: a lot over the last five or six years at least, 102 00:04:37,800 --> 00:04:39,640 Speaker 1: especially on the value side. But we are we are 103 00:04:39,680 --> 00:04:40,880 Speaker 1: just sort of trying to run out the clock a 104 00:04:40,880 --> 00:04:42,800 Speaker 1: little bit. And you know, we think that time will 105 00:04:42,839 --> 00:04:44,800 Speaker 1: end up healing the inflation problem, and time will end 106 00:04:44,839 --> 00:04:47,080 Speaker 1: up healing some of that, some of this, uh some demands. 107 00:04:47,120 --> 00:04:50,200 Speaker 1: It's fly and balanced problem, but there's no like really 108 00:04:50,240 --> 00:04:52,160 Speaker 1: quick fixed for it. And so as so long as 109 00:04:52,160 --> 00:04:54,080 Speaker 1: there's no really quick fixed for it, we got gotta 110 00:04:54,120 --> 00:04:56,120 Speaker 1: sort of like play along in places and place in 111 00:04:56,200 --> 00:04:58,360 Speaker 1: defense and a sort of go in the boring staples 112 00:04:58,360 --> 00:05:01,120 Speaker 1: types of the types of the world, um and and 113 00:05:01,200 --> 00:05:03,400 Speaker 1: just you know, hang out until the until we have 114 00:05:03,480 --> 00:05:05,640 Speaker 1: a chance for the Fed and Center banks to be 115 00:05:05,680 --> 00:05:08,159 Speaker 1: able to pivot. Um and when that happened, and we 116 00:05:08,200 --> 00:05:09,520 Speaker 1: think that there will be a chance of that to 117 00:05:09,560 --> 00:05:12,440 Speaker 1: happen later later this year, um, you know, that'll be 118 00:05:12,520 --> 00:05:14,680 Speaker 1: the time to really go for you know, go go 119 00:05:14,960 --> 00:05:18,080 Speaker 1: gangbusters again. But you know, until then, uh, you know, 120 00:05:18,520 --> 00:05:21,840 Speaker 1: until basically inflation is a secondary concern and growth is 121 00:05:21,880 --> 00:05:25,120 Speaker 1: a primary concern. Until that, until that has an opportunity 122 00:05:25,120 --> 00:05:27,200 Speaker 1: to happen, we discuss replay defense a little bit. It's 123 00:05:27,240 --> 00:05:28,960 Speaker 1: kind of boring, but that's that's how we're that's how 124 00:05:29,000 --> 00:05:31,720 Speaker 1: we're working. We have about thirty seconds here. Let's talk 125 00:05:31,720 --> 00:05:33,679 Speaker 1: about the volatility. Here. We're looking at a twenty seven 126 00:05:33,720 --> 00:05:36,200 Speaker 1: handle on the vix. Is it going to go back 127 00:05:36,520 --> 00:05:40,560 Speaker 1: above thirty five? Let's say when we started to originally 128 00:05:40,560 --> 00:05:42,799 Speaker 1: see the onset of the war in Ukraine. What's next 129 00:05:43,040 --> 00:05:46,080 Speaker 1: when it comes to volatility. Yeah, I mean in terms 130 00:05:46,120 --> 00:05:47,280 Speaker 1: of the ball market, is it is it that has 131 00:05:47,279 --> 00:05:49,919 Speaker 1: been pretty interesting. I'm I'm an old vultility trader and 132 00:05:49,960 --> 00:05:54,320 Speaker 1: it's it's um, yeah, that what we've the dynamics we've 133 00:05:54,320 --> 00:05:55,960 Speaker 1: seen in the option markets over the last over the 134 00:05:56,000 --> 00:05:58,640 Speaker 1: last couple of months have been somewhat striking because we 135 00:05:58,680 --> 00:06:00,520 Speaker 1: have not seen any of that pan these types of 136 00:06:00,520 --> 00:06:03,560 Speaker 1: things that I'm sure you guys are aware, um for 137 00:06:03,560 --> 00:06:06,800 Speaker 1: for that capitulation that everybody's looking for, um. You know, 138 00:06:06,960 --> 00:06:08,800 Speaker 1: we we probably do need to see the thick spike. 139 00:06:08,839 --> 00:06:10,599 Speaker 1: We do need to see some of that panic thing happening. 140 00:06:11,000 --> 00:06:13,279 Speaker 1: But you know, unfortunately there is little bit of like 141 00:06:13,279 --> 00:06:15,719 Speaker 1: like Heisenberg and certainty principal types of things when we 142 00:06:15,720 --> 00:06:17,400 Speaker 1: when we look at altimlatey market, like if you look 143 00:06:17,440 --> 00:06:19,320 Speaker 1: at it too closely, it's like it'll know you'll never 144 00:06:19,360 --> 00:06:21,880 Speaker 1: see it. Um. And so when everybody's looking for that, 145 00:06:21,960 --> 00:06:23,719 Speaker 1: for that thing, it's you know, it makes it harder 146 00:06:23,760 --> 00:06:26,320 Speaker 1: and harder to get actually a rum. So that's that's 147 00:06:26,360 --> 00:06:28,440 Speaker 1: what we're looking for. That's good stuff. Scott, Really appreciate 148 00:06:28,440 --> 00:06:31,320 Speaker 1: you taking the time sharing your thoughts. Scott Latner, chief 149 00:06:31,320 --> 00:06:35,320 Speaker 1: investment officer Horizon Investments for unc GRED, I think he 150 00:06:35,360 --> 00:06:41,960 Speaker 1: did pretty well. Maybe we'll have him back. Big tech 151 00:06:42,040 --> 00:06:46,240 Speaker 1: deal goes formal today. Broadcom agreed to buy cloud computing 152 00:06:46,279 --> 00:06:49,280 Speaker 1: company vm Ware for about sixty one billion dollars in 153 00:06:49,320 --> 00:06:51,039 Speaker 1: one of the largest tech deals of all time, turning 154 00:06:51,360 --> 00:06:54,880 Speaker 1: the chip maker into a bigger force in software. Let's 155 00:06:54,920 --> 00:06:56,960 Speaker 1: get the strategy behind it, Let's get the numbers behind 156 00:06:57,000 --> 00:07:01,000 Speaker 1: it with Wujenhoe, senior hardware analysts for Bloomberg and Leigence. Uh, 157 00:07:01,120 --> 00:07:02,800 Speaker 1: we'll talk to us about broadcast. Like, what I know 158 00:07:02,839 --> 00:07:05,359 Speaker 1: about Broadcom is this is a company that grows pretty 159 00:07:05,440 --> 00:07:08,080 Speaker 1: much or large part through acquisitions, and this is a 160 00:07:08,200 --> 00:07:10,520 Speaker 1: big one vm Ware. Talk to us about the strategy 161 00:07:10,560 --> 00:07:12,920 Speaker 1: behind the deal. Sure, hey, thanks for having me on. 162 00:07:13,040 --> 00:07:16,520 Speaker 1: Paul so um No, the CEO of Broadcom has been 163 00:07:16,600 --> 00:07:20,000 Speaker 1: laying out this, uh the birse of action strategy ever 164 00:07:20,080 --> 00:07:23,720 Speaker 1: since it's made it the a acquisition in and um 165 00:07:23,880 --> 00:07:27,120 Speaker 1: you know, it has essentially grown from a chip business 166 00:07:27,680 --> 00:07:32,200 Speaker 1: back to about of of its sales coming from software 167 00:07:32,360 --> 00:07:35,520 Speaker 1: through c A as well as a ManTech adding VM 168 00:07:35,600 --> 00:07:39,280 Speaker 1: whare just extends and grows its software exposure to about 169 00:07:39,880 --> 00:07:43,600 Speaker 1: of total sales, so it actually extends to where wants 170 00:07:43,640 --> 00:07:47,040 Speaker 1: to go directionally going over the long time, it kind 171 00:07:47,080 --> 00:07:48,960 Speaker 1: of seems like this is coming into a broader trend 172 00:07:49,040 --> 00:07:52,559 Speaker 1: of chip makers wanting to diversify and video is another 173 00:07:52,640 --> 00:07:56,480 Speaker 1: example looking going into you know, graphics chips to diversify 174 00:07:56,520 --> 00:07:58,640 Speaker 1: the different kinds of things they make. Is this something 175 00:07:58,720 --> 00:08:01,560 Speaker 1: we can start to expect from the likes of Advanced 176 00:08:01,600 --> 00:08:05,720 Speaker 1: micro Devices for example, or Qualcom. What's your take? Sure? So, 177 00:08:05,880 --> 00:08:08,920 Speaker 1: so AMDs actually starts to make that transition away from 178 00:08:09,040 --> 00:08:13,000 Speaker 1: the CPU chip and and UH. They've also made other 179 00:08:13,400 --> 00:08:15,960 Speaker 1: other acquisitions like that the zy Links deal that they've 180 00:08:16,000 --> 00:08:18,760 Speaker 1: made UH to to get away from just being a 181 00:08:18,840 --> 00:08:22,440 Speaker 1: CPU but also be a data processor unit or a 182 00:08:22,560 --> 00:08:27,400 Speaker 1: cloud computing UH and and storage processing unit. So we 183 00:08:27,560 --> 00:08:31,560 Speaker 1: do expect to see these UM UH silo chip companies 184 00:08:31,800 --> 00:08:35,280 Speaker 1: to potentially extend and and broaden out that footprint, especially 185 00:08:35,360 --> 00:08:38,400 Speaker 1: given how much cash at the generator over the past 186 00:08:38,480 --> 00:08:42,360 Speaker 1: couple of years, given the strong cycle that they've enjoyed. Um. 187 00:08:42,760 --> 00:08:46,080 Speaker 1: You know, Broadcome is somewhat unique, uh in a sense, 188 00:08:46,440 --> 00:08:49,679 Speaker 1: different from Video to some degree with creating and and 189 00:08:49,760 --> 00:08:52,280 Speaker 1: the reason is it's because I do think that UM, 190 00:08:52,480 --> 00:08:55,119 Speaker 1: the CEO is trying to look for ways to diversify 191 00:08:55,200 --> 00:08:59,240 Speaker 1: its business away from a very cyclical chip business and 192 00:08:59,480 --> 00:09:01,520 Speaker 1: and VM it does that. I want to call out 193 00:09:01,720 --> 00:09:04,920 Speaker 1: Dina Bass and Leona Baker from Bloomberg Newsday reported on 194 00:09:05,040 --> 00:09:09,839 Speaker 1: this deal back on May one. Um, and you know 195 00:09:10,080 --> 00:09:13,960 Speaker 1: the stock this is this offers a premium to that date, 196 00:09:14,160 --> 00:09:16,839 Speaker 1: you know, kind of before the Bloomberg News story came out. 197 00:09:17,440 --> 00:09:19,760 Speaker 1: Is thisn't a creative deal? Is this dilutive? What's it 198 00:09:19,760 --> 00:09:23,640 Speaker 1: gonna do to Broadcom's earnings and all that kind of stuff? Yeah, 199 00:09:23,679 --> 00:09:26,719 Speaker 1: that was my tastic reporting by by Bloomberg News on that. 200 00:09:26,880 --> 00:09:30,120 Speaker 1: So so we we did the deal in math Um. 201 00:09:30,760 --> 00:09:33,640 Speaker 1: It seems to be earnings neutral if you add the 202 00:09:33,679 --> 00:09:38,040 Speaker 1: two companies together. Uh, there may be some uh some 203 00:09:38,240 --> 00:09:41,360 Speaker 1: some cost imagies that they can yield immediately. And UM, 204 00:09:41,679 --> 00:09:43,440 Speaker 1: you know, we think that it could be an EPs 205 00:09:43,480 --> 00:09:46,240 Speaker 1: secretive deal, especially given that it's a cashion stock deal. 206 00:09:46,640 --> 00:09:51,559 Speaker 1: A longer term, Broadcom expects to have eight point five 207 00:09:51,640 --> 00:09:57,160 Speaker 1: billion dollars in um iba DA out of vm Ware. 208 00:09:57,200 --> 00:10:00,280 Speaker 1: That's an additional four billion dollars in ibadalla over the 209 00:10:00,360 --> 00:10:02,680 Speaker 1: next three or five years. And it all fits within 210 00:10:02,960 --> 00:10:07,360 Speaker 1: um broadcom strategy now now in terms of the share 211 00:10:07,520 --> 00:10:09,400 Speaker 1: and in terms of valuation, and I think this is 212 00:10:09,440 --> 00:10:12,040 Speaker 1: where you're going out, Paul. You know, we rounded the 213 00:10:12,160 --> 00:10:15,600 Speaker 1: valuation math and it's quite frankly, given how much UH 214 00:10:15,720 --> 00:10:19,439 Speaker 1: the software sector and technology evaluations dropped over the past 215 00:10:19,520 --> 00:10:24,160 Speaker 1: month or so, the deal valuation isn't UM stretched. I 216 00:10:24,200 --> 00:10:27,080 Speaker 1: mean we calculated to be five times easy to sales 217 00:10:27,400 --> 00:10:31,000 Speaker 1: twenty times UM twenty times on a four P basis, 218 00:10:31,200 --> 00:10:35,320 Speaker 1: and that's consistent with larger broad tech names. Yeah, that's 219 00:10:35,360 --> 00:10:37,439 Speaker 1: kind of where I wanted to go would because it 220 00:10:37,520 --> 00:10:39,080 Speaker 1: seems like, you know, a lot of folks are not well, 221 00:10:39,120 --> 00:10:40,440 Speaker 1: not a lot of folks, but a couple of tech 222 00:10:40,480 --> 00:10:42,320 Speaker 1: folks that I chatted, which is in the last month 223 00:10:42,440 --> 00:10:44,640 Speaker 1: or so kind of you mentioned. Kind of what you're 224 00:10:44,640 --> 00:10:47,600 Speaker 1: saying is there could be some some bargains out there, 225 00:10:47,640 --> 00:10:50,560 Speaker 1: given how much some of these tech names have sold off. 226 00:10:50,600 --> 00:10:54,559 Speaker 1: Do you anticipate seeing some more m and a going forward? Well, 227 00:10:54,920 --> 00:10:58,240 Speaker 1: give me where the valuations are UM I. I think 228 00:10:58,360 --> 00:11:01,720 Speaker 1: that the larger companies who are talking with smaller companies 229 00:11:01,760 --> 00:11:06,240 Speaker 1: in the past UH may start becoming a bit more 230 00:11:06,280 --> 00:11:08,960 Speaker 1: active right now. Now. The question is is that are 231 00:11:09,040 --> 00:11:12,480 Speaker 1: are they willing sellers now? And given how much ware 232 00:11:12,520 --> 00:11:15,599 Speaker 1: the valuation has has come down, and if there's a 233 00:11:15,640 --> 00:11:18,640 Speaker 1: concern that this is going to be UH in an 234 00:11:18,720 --> 00:11:22,360 Speaker 1: extended period of lower valuations, some of these CEOs who 235 00:11:22,400 --> 00:11:25,080 Speaker 1: have held out for higher valuations, they have to rethink 236 00:11:25,120 --> 00:11:28,240 Speaker 1: that the strategy of either going alone or being under 237 00:11:28,280 --> 00:11:30,559 Speaker 1: the umbrella of a large company. So there might be 238 00:11:30,640 --> 00:11:32,719 Speaker 1: a mix of both going forward, and there might be 239 00:11:32,880 --> 00:11:37,240 Speaker 1: some increased deal activity, especially given how much valuations of 240 00:11:37,559 --> 00:11:40,640 Speaker 1: pull pack. I'd really like talking about supply chains here 241 00:11:40,640 --> 00:11:42,520 Speaker 1: because something bringing it back to end video. I know 242 00:11:42,559 --> 00:11:44,520 Speaker 1: we're talking about Broadcom. It don't worry. I'll connect the 243 00:11:44,600 --> 00:11:48,400 Speaker 1: dots and video here. In their earnings said that we 244 00:11:48,480 --> 00:11:51,640 Speaker 1: see the demand, we know that we can grow. What's 245 00:11:51,679 --> 00:11:54,800 Speaker 1: getting in our way is these UH COVID lockdowns, the 246 00:11:54,800 --> 00:11:57,920 Speaker 1: supply chain issues. We're not able to meet our capacity. 247 00:11:58,280 --> 00:12:02,640 Speaker 1: Will Broadcom have the same issue, um Well, Broadcom said 248 00:12:02,679 --> 00:12:06,080 Speaker 1: on the call that they haven't seen those issues. UM 249 00:12:06,720 --> 00:12:09,240 Speaker 1: as a matter of fact, they reported darning this UH 250 00:12:09,559 --> 00:12:14,880 Speaker 1: this morning and essentially UH they beat expectations, and a 251 00:12:14,960 --> 00:12:17,319 Speaker 1: lot of it has to do with UM on the 252 00:12:17,400 --> 00:12:19,079 Speaker 1: networking side. Part of it has to do with it 253 00:12:19,160 --> 00:12:22,679 Speaker 1: they're not directly manufacturing the chips, and they're relying a 254 00:12:22,840 --> 00:12:26,520 Speaker 1: lot more on t SMC too to manufacture the chips 255 00:12:26,640 --> 00:12:29,199 Speaker 1: for them, and they don't have the graphics. They don't 256 00:12:29,240 --> 00:12:32,560 Speaker 1: need the PCB boards or broader supply chain to help 257 00:12:33,200 --> 00:12:37,719 Speaker 1: UM to have a built out kit for for instance. Now, ironically, 258 00:12:37,920 --> 00:12:41,760 Speaker 1: vm Ware mis consensus expectations by about three percent when 259 00:12:41,800 --> 00:12:44,600 Speaker 1: they reported this morning, and they didn't give much detail 260 00:12:44,640 --> 00:12:46,160 Speaker 1: on the call, but I suspect that it has had 261 00:12:46,200 --> 00:12:49,280 Speaker 1: to do with supply chain because their hardware providers could 262 00:12:49,320 --> 00:12:53,720 Speaker 1: not provide the the equipment needed to load VM or software. 263 00:12:53,960 --> 00:12:58,360 Speaker 1: So you are seeing the supply side affect other areas 264 00:12:58,880 --> 00:13:02,320 Speaker 1: UM UH in the tech chain. You know, it's interesting, 265 00:13:02,360 --> 00:13:05,080 Speaker 1: you know, with the zero COVID policy coming out of China, 266 00:13:05,760 --> 00:13:07,520 Speaker 1: I guess you could pay in a bear case that 267 00:13:08,160 --> 00:13:10,880 Speaker 1: this supply chain issue, particularly reach the chips and other 268 00:13:10,880 --> 00:13:13,040 Speaker 1: things coming out of China any going away anytime soon? 269 00:13:13,160 --> 00:13:17,120 Speaker 1: Is it? Well, Cisco addressed it on their call UM 270 00:13:17,920 --> 00:13:20,080 Speaker 1: a couple of weeks back, and essentially what they're saying 271 00:13:20,200 --> 00:13:23,880 Speaker 1: is that, look, uh, the shutdowns of lockdowns may be 272 00:13:24,600 --> 00:13:29,000 Speaker 1: lifted in June, but you have this whole backlog of 273 00:13:29,120 --> 00:13:32,520 Speaker 1: suppliers who really want to get the products out the door, 274 00:13:32,880 --> 00:13:36,320 Speaker 1: and you have this, uh, this huge logistics problem going 275 00:13:36,440 --> 00:13:38,520 Speaker 1: on going past you. And even if it is UM 276 00:13:39,600 --> 00:13:43,000 Speaker 1: the shutdown being being lifted. So I agree with you, Paul, 277 00:13:43,120 --> 00:13:45,760 Speaker 1: this isn't going to end in the in the second quarter, 278 00:13:46,280 --> 00:13:48,439 Speaker 1: nor are we going to see an easing of the 279 00:13:48,480 --> 00:13:51,120 Speaker 1: pressure going into the third quarter. Um. Some of the 280 00:13:51,320 --> 00:13:55,000 Speaker 1: chipmakers are always pushing back. The supply chain isn't going 281 00:13:55,040 --> 00:13:57,800 Speaker 1: into the middle of three now, uh, And I was 282 00:13:57,840 --> 00:14:01,760 Speaker 1: calling for the middle of two. So yeah, it's it's 283 00:14:01,800 --> 00:14:04,600 Speaker 1: it's gonna be tough times for the hard hardware vendors, 284 00:14:04,960 --> 00:14:07,680 Speaker 1: chip makers as well as the companies who are looking 285 00:14:07,720 --> 00:14:11,280 Speaker 1: to buy UM buy hardware as well. Ye. Absolutely, it's 286 00:14:11,280 --> 00:14:13,839 Speaker 1: the supply chain issue that is not going away anytime 287 00:14:13,920 --> 00:14:15,480 Speaker 1: soon for large parts of the economy. And I'm thinking 288 00:14:15,480 --> 00:14:17,360 Speaker 1: about the auto industry, you know, you think about all 289 00:14:17,400 --> 00:14:19,320 Speaker 1: the chips to go in the auto industry, and if 290 00:14:19,360 --> 00:14:21,400 Speaker 1: this is going to be an issue. Um, I have 291 00:14:21,560 --> 00:14:24,120 Speaker 1: to see what those folks are saying. Lugin Hoe, he's 292 00:14:24,160 --> 00:14:26,800 Speaker 1: a senior hardware analyst for Bloomberg Intelligence, one of the 293 00:14:26,840 --> 00:14:29,640 Speaker 1: best on the street. We appreciate having access uh to 294 00:14:29,840 --> 00:14:31,800 Speaker 1: him and his analysis. Again, you can read all of 295 00:14:31,920 --> 00:14:35,000 Speaker 1: his analysis and that of Bloomberg Intelligence. Be I go 296 00:14:35,280 --> 00:14:40,680 Speaker 1: on the terminal. All right, let's talk crypto here, but 297 00:14:40,720 --> 00:14:41,920 Speaker 1: I want to talk about it. You know, when we 298 00:14:41,960 --> 00:14:43,880 Speaker 1: talk crypto often we just kind of fall back and say, 299 00:14:43,880 --> 00:14:45,640 Speaker 1: you know, bitcoin, where is it trading? Well, it's trading 300 00:14:45,680 --> 00:14:48,760 Speaker 1: off about one point three percent today, nine thousand, four hundred. 301 00:14:48,760 --> 00:14:50,960 Speaker 1: It's kind of been a fairly stable range down in 302 00:14:51,040 --> 00:14:52,960 Speaker 1: that area. But I'm gonna talk about just the broader 303 00:14:53,440 --> 00:14:56,280 Speaker 1: topics of crypto. Was actually a fairly big topic of 304 00:14:56,320 --> 00:15:00,440 Speaker 1: conversation in Davos, Switzerland, which is wrapped up today. Danielle Dixon, 305 00:15:00,720 --> 00:15:05,520 Speaker 1: CEO and executive Director of the Stellar Development Foundation, joins us. 306 00:15:05,600 --> 00:15:07,680 Speaker 1: Daniel First, I love for you just to quickly tell 307 00:15:07,760 --> 00:15:12,640 Speaker 1: us what the Stellar Development Foundation is. Great, Yes, thank 308 00:15:12,680 --> 00:15:14,880 Speaker 1: you for having me. The Stellar Development Foundation is a 309 00:15:14,960 --> 00:15:17,920 Speaker 1: non stock and entity and nonprofit entity that's focused on 310 00:15:17,960 --> 00:15:21,320 Speaker 1: the growth and development of the Stellar foundation of Stellar Network. 311 00:15:21,640 --> 00:15:24,440 Speaker 1: Really we're focused on creating equitable access to the global 312 00:15:24,480 --> 00:15:29,600 Speaker 1: financial system using Stellar's blockchain technology. So what was the 313 00:15:30,800 --> 00:15:32,800 Speaker 1: topic or how are people in Davos, how are they 314 00:15:32,880 --> 00:15:36,920 Speaker 1: thinking about crypto as you had your conversations throughout the week. Yeah, 315 00:15:36,960 --> 00:15:39,720 Speaker 1: it's really kind of fascinating. This year in DAVOSK there 316 00:15:39,800 --> 00:15:43,520 Speaker 1: were crypto companies and blockchain companies that filled the whole promenade, 317 00:15:43,600 --> 00:15:46,320 Speaker 1: which is the areas outside of Congress. In Congress, I 318 00:15:46,440 --> 00:15:48,680 Speaker 1: was on one panel UM and they didn't have very 319 00:15:48,760 --> 00:15:51,800 Speaker 1: many actually crypto focused panels, but we I think they 320 00:15:51,880 --> 00:15:53,800 Speaker 1: only had one crypto focused panel and the rest of 321 00:15:53,840 --> 00:15:56,520 Speaker 1: them they sort of layered crypto into remittances and whatnot. 322 00:15:56,840 --> 00:15:59,080 Speaker 1: But there was a lot of discussion around sustainability, not 323 00:15:59,200 --> 00:16:01,280 Speaker 1: surprisingly but because they focus a lot on proof of 324 00:16:01,320 --> 00:16:04,800 Speaker 1: work and proof of steak UH consensus mechanisms. Stellars is 325 00:16:04,840 --> 00:16:07,360 Speaker 1: a different mechanism, it's proof of agreement, so there's a 326 00:16:07,440 --> 00:16:10,720 Speaker 1: different sustainability. We're actually very sustainable from the standpoint of 327 00:16:10,760 --> 00:16:12,760 Speaker 1: the network. So there was a lot of focus there 328 00:16:13,080 --> 00:16:16,840 Speaker 1: outside of the Congress. In the in the area, there's 329 00:16:16,880 --> 00:16:21,200 Speaker 1: discussions just around regulation, global sort of focusing on the 330 00:16:21,240 --> 00:16:24,400 Speaker 1: global pieces of regulation and also in the US UH 331 00:16:24,520 --> 00:16:27,080 Speaker 1: and the need for us to be able to create 332 00:16:27,240 --> 00:16:30,240 Speaker 1: some really strong stability because we've taken so many steps 333 00:16:30,280 --> 00:16:34,040 Speaker 1: forward as an industry and we need to focus on sustainability, 334 00:16:34,240 --> 00:16:36,440 Speaker 1: but as well, we need to focus on just continuing 335 00:16:36,520 --> 00:16:40,280 Speaker 1: to really highlight the use cases, the really good use cases, 336 00:16:40,400 --> 00:16:43,000 Speaker 1: so that we can demonstrate to governments and regulators all 337 00:16:43,040 --> 00:16:45,800 Speaker 1: over the world the value that blockchain brings to their region. 338 00:16:46,640 --> 00:16:48,880 Speaker 1: I have to ask here, when we're talking about cryptocurrencies, 339 00:16:48,960 --> 00:16:51,000 Speaker 1: let's put this in the perspective of it's not just 340 00:16:51,240 --> 00:16:54,840 Speaker 1: the crypto players in kind of competing in the space 341 00:16:54,960 --> 00:16:56,680 Speaker 1: right now, you're actually looking at the e c B, 342 00:16:56,880 --> 00:16:59,920 Speaker 1: the p BOC looking at creating a digital you want 343 00:17:00,120 --> 00:17:03,680 Speaker 1: a digital euro, I think a digital doll or maybe 344 00:17:03,680 --> 00:17:06,080 Speaker 1: a little bit far away. But I have to ask, 345 00:17:06,480 --> 00:17:09,080 Speaker 1: when you think about that from a regulatory standpoint, and 346 00:17:09,480 --> 00:17:14,200 Speaker 1: those actually backed by these major central banks, what is 347 00:17:14,480 --> 00:17:18,520 Speaker 1: the value or what is the appeal of cryptocurrencies. Well, 348 00:17:18,600 --> 00:17:20,760 Speaker 1: so the fact of the matter is, once stellar, we 349 00:17:20,800 --> 00:17:23,399 Speaker 1: focus a lot on stable coins, and CBDCs are an 350 00:17:23,400 --> 00:17:25,240 Speaker 1: asset that we would love to have because we focus 351 00:17:25,320 --> 00:17:29,320 Speaker 1: on payments and payments. Really you want to use a 352 00:17:29,400 --> 00:17:32,960 Speaker 1: stable coin or a CBDC because it's going to create 353 00:17:33,040 --> 00:17:35,480 Speaker 1: trust and going to create credibility. When you're sending a payment, 354 00:17:35,560 --> 00:17:37,040 Speaker 1: you want to know that what you send is also 355 00:17:37,080 --> 00:17:39,040 Speaker 1: what you're going to receive on the other side or 356 00:17:39,080 --> 00:17:40,800 Speaker 1: the person is going to receive on the other side. 357 00:17:40,880 --> 00:17:44,040 Speaker 1: So I actually think it's a really strong uh, it's 358 00:17:44,080 --> 00:17:46,840 Speaker 1: a strong message that government see the value of this technology. 359 00:17:46,960 --> 00:17:49,760 Speaker 1: If you issue a CBDC and it's available on lots 360 00:17:49,800 --> 00:17:52,520 Speaker 1: of different chains, it creates this opportunity to be able 361 00:17:52,560 --> 00:17:55,399 Speaker 1: to leverage these assets in a really positive way. It 362 00:17:55,520 --> 00:17:59,480 Speaker 1: creates this sort of borderless economy of scale for for 363 00:17:59,560 --> 00:18:01,960 Speaker 1: folks to be able to send and receive value all 364 00:18:02,000 --> 00:18:04,879 Speaker 1: over the world. Then give us, if you could just 365 00:18:05,000 --> 00:18:07,040 Speaker 1: kind of an overview of kind of where we are 366 00:18:07,240 --> 00:18:11,719 Speaker 1: in the regulatory environment for the crypto space. What are 367 00:18:11,800 --> 00:18:13,880 Speaker 1: some of the things that you're looking at investors should 368 00:18:13,920 --> 00:18:16,920 Speaker 1: be looking at. You think, Yeah, so in the US, 369 00:18:16,960 --> 00:18:18,640 Speaker 1: a lot of the focus right now, I think it's 370 00:18:18,640 --> 00:18:21,119 Speaker 1: going to be on stable coins. Not surprisingly, what happened 371 00:18:21,200 --> 00:18:23,920 Speaker 1: with Terra and Luna a couple of weeks ago really 372 00:18:24,119 --> 00:18:26,920 Speaker 1: created more and more focused on this particular issue. We've 373 00:18:26,960 --> 00:18:30,199 Speaker 1: been advocating for stable coin legislation for a while now, 374 00:18:30,720 --> 00:18:32,960 Speaker 1: and again this is important to us because we like 375 00:18:33,119 --> 00:18:35,760 Speaker 1: to be able to have stable coins, which are just 376 00:18:35,920 --> 00:18:38,800 Speaker 1: to get clarity. From our standpoint, we see stable coins 377 00:18:38,840 --> 00:18:40,800 Speaker 1: as those assets that are one to went backed with 378 00:18:41,280 --> 00:18:44,760 Speaker 1: fiat so currency like stable currency, and that you can 379 00:18:44,840 --> 00:18:47,680 Speaker 1: hold those assets, that those assets are held in an account, 380 00:18:48,000 --> 00:18:51,080 Speaker 1: that is, they're reserved and they're held in an insured account, 381 00:18:51,320 --> 00:18:52,960 Speaker 1: so that you know that you're going to be able 382 00:18:53,000 --> 00:18:55,639 Speaker 1: to trust and have credibility with respect to the asset 383 00:18:55,720 --> 00:18:57,760 Speaker 1: that you're sending. So I think we're going to see 384 00:18:57,800 --> 00:19:00,800 Speaker 1: at least in the US some regulation around on stable coins, 385 00:19:00,920 --> 00:19:03,840 Speaker 1: so that basically in what I just said in terms 386 00:19:03,880 --> 00:19:07,280 Speaker 1: of having audits and reserves and making sure that they're 387 00:19:07,320 --> 00:19:09,199 Speaker 1: the back one to one and that there's a lot 388 00:19:09,240 --> 00:19:12,280 Speaker 1: of transparency for the the companies and the end users 389 00:19:12,359 --> 00:19:14,320 Speaker 1: that are leveraging those assets so that they can feel 390 00:19:14,359 --> 00:19:16,600 Speaker 1: good about them. So we've see a lot of movement 391 00:19:16,640 --> 00:19:18,639 Speaker 1: towards this. I think that we'll see something like this, 392 00:19:18,760 --> 00:19:20,800 Speaker 1: if not by the end of this year early next year, 393 00:19:21,320 --> 00:19:24,320 Speaker 1: and then there's obviously going to be focused around the 394 00:19:24,440 --> 00:19:27,240 Speaker 1: trading pieces and what's happening in that market. All right, 395 00:19:27,320 --> 00:19:30,639 Speaker 1: daniel thank you very much for that overview. Danielle Dixon, 396 00:19:30,840 --> 00:19:34,480 Speaker 1: CEO and executive director the Stellar Development Foundation, kind of 397 00:19:34,480 --> 00:19:36,760 Speaker 1: getting an overview kind of where we are on some 398 00:19:36,920 --> 00:19:40,040 Speaker 1: of the big big macro issues on the crypto space. 399 00:19:43,880 --> 00:19:47,600 Speaker 1: Mika Kaufman, CEO and founder of Fiber joins us simple 400 00:19:47,960 --> 00:19:50,000 Speaker 1: on the New York Stock Exchange. You can punch into 401 00:19:50,000 --> 00:19:52,960 Speaker 1: your Bloomber terminal f v r R you can. Thanks 402 00:19:52,960 --> 00:19:55,000 Speaker 1: so much for joining us here for our audience. I'd 403 00:19:55,000 --> 00:19:56,440 Speaker 1: love free to just give us kind of the thirty 404 00:19:56,480 --> 00:19:59,199 Speaker 1: second overview of what fib is, what you guys are 405 00:19:59,280 --> 00:20:03,560 Speaker 1: up to these days. Thanks for having me so. Essentially, 406 00:20:03,640 --> 00:20:06,440 Speaker 1: Fiber is a two sound market place that connects any 407 00:20:06,480 --> 00:20:10,560 Speaker 1: type of business with tremendous amount of freelancers in almost 408 00:20:10,640 --> 00:20:14,600 Speaker 1: six hundred different categories of digital services. So anything you 409 00:20:14,720 --> 00:20:18,399 Speaker 1: can think from business formations, finding a name for your business, 410 00:20:18,840 --> 00:20:23,359 Speaker 1: to developing software for your business, or editing video, writing 411 00:20:23,560 --> 00:20:27,440 Speaker 1: content or helping you run marketing campaign, any type of 412 00:20:27,560 --> 00:20:30,280 Speaker 1: talent could be found on the on the platform. And 413 00:20:30,359 --> 00:20:32,960 Speaker 1: the average time that it takes anyone who visits the 414 00:20:33,040 --> 00:20:36,720 Speaker 1: site to actually place in order is fifteen minutes. This 415 00:20:36,920 --> 00:20:38,960 Speaker 1: is compared to the average time that takes to find 416 00:20:39,320 --> 00:20:43,200 Speaker 1: a freelancers elsewhere, this is about thirty days. UM. So 417 00:20:43,400 --> 00:20:48,560 Speaker 1: that's the efficiency compression that Fiber is presenting. The company 418 00:20:48,600 --> 00:20:51,639 Speaker 1: has been around in two thousand and ten, went public 419 00:20:52,160 --> 00:20:55,320 Speaker 1: three years ago, and continues to grow very very fast. 420 00:20:55,920 --> 00:21:01,560 Speaker 1: So I'm just wondering how how these freelancers compared to other, 421 00:21:02,480 --> 00:21:06,440 Speaker 1: you know, gig economy workers UM for example, compared to 422 00:21:06,600 --> 00:21:12,080 Speaker 1: like an Uber driver UM. Do they have issues with fees? 423 00:21:12,160 --> 00:21:18,119 Speaker 1: Do they have problems organizing? Is unionization a concern? Uh? 424 00:21:18,280 --> 00:21:22,159 Speaker 1: Not really, because we're talking about skilled labor. And the 425 00:21:22,280 --> 00:21:26,520 Speaker 1: difference between UM fiber and other gig economy platforms is 426 00:21:26,560 --> 00:21:30,440 Speaker 1: that on Fiber, the freeancers actually get to name their 427 00:21:30,480 --> 00:21:34,840 Speaker 1: own term. They decide when they work, how much they work, 428 00:21:35,200 --> 00:21:39,400 Speaker 1: how much they charge for their work. So from that perspective, 429 00:21:39,440 --> 00:21:42,320 Speaker 1: they have total freedom of deciding or or setting up 430 00:21:42,359 --> 00:21:44,800 Speaker 1: their destiny. But and then you take your cut from 431 00:21:44,880 --> 00:21:49,879 Speaker 1: the business or from the freelancer. We actually take both, UM. 432 00:21:50,200 --> 00:21:52,480 Speaker 1: We take some of it from the freelancer and some 433 00:21:52,600 --> 00:21:56,960 Speaker 1: of it from the customer. So because that the pandemic 434 00:21:57,080 --> 00:21:59,800 Speaker 1: must have altered your business or had a huge impact 435 00:21:59,840 --> 00:22:02,440 Speaker 1: on your business as people were working from home. Maybe 436 00:22:02,480 --> 00:22:04,480 Speaker 1: they lost their day job and now they're trying to 437 00:22:04,560 --> 00:22:06,600 Speaker 1: find some gig type of thing. Talk to us about 438 00:22:06,600 --> 00:22:09,680 Speaker 1: how your business kind of was impacted and maybe today 439 00:22:09,720 --> 00:22:11,520 Speaker 1: continues to be impacted by kind of the change in 440 00:22:11,520 --> 00:22:15,080 Speaker 1: the labor force. Sure, I think that what was interesting 441 00:22:15,119 --> 00:22:17,000 Speaker 1: when we started the business in two thousand and aintended 442 00:22:17,000 --> 00:22:20,920 Speaker 1: it was it was a decade when freelancing went from 443 00:22:21,040 --> 00:22:25,359 Speaker 1: being something people did in between jobs, being a full 444 00:22:25,560 --> 00:22:29,920 Speaker 1: time career decision and a life side decision. So freelancing 445 00:22:30,080 --> 00:22:32,600 Speaker 1: is very different right now by twenty thirty, by the 446 00:22:32,680 --> 00:22:36,280 Speaker 1: end of this decade, are going to be fifty percent 447 00:22:36,359 --> 00:22:39,879 Speaker 1: of the workforce, which is which is a huge cohort. Now. 448 00:22:40,040 --> 00:22:44,440 Speaker 1: Obviously throughout the years we've been growing very fast in 449 00:22:44,600 --> 00:22:47,960 Speaker 1: the pandemic. The pandemic in many ways have made the 450 00:22:48,080 --> 00:22:51,080 Speaker 1: case for what we've been preaching for the past ten years, 451 00:22:51,200 --> 00:22:54,639 Speaker 1: which is there's a tremendous amount of value in working 452 00:22:54,680 --> 00:22:57,560 Speaker 1: with freelancers, even if it's remote, because you don't need 453 00:22:57,720 --> 00:23:02,160 Speaker 1: control over people's time. All that companies care is output 454 00:23:02,920 --> 00:23:06,639 Speaker 1: and only not. They're super efficient beyond us. It's the 455 00:23:06,720 --> 00:23:09,320 Speaker 1: fact that UM, I think throughout the pandemic and now 456 00:23:09,520 --> 00:23:13,080 Speaker 1: if we're thinking about potential recession coming in, UM I 457 00:23:13,119 --> 00:23:16,080 Speaker 1: think more companies are thinking about deficiency and are thinking 458 00:23:16,080 --> 00:23:19,520 Speaker 1: about the varial book expenses versus stick expenses. And this 459 00:23:19,680 --> 00:23:22,600 Speaker 1: is what greenancing talent is giving you. It's giving you 460 00:23:22,720 --> 00:23:25,680 Speaker 1: the option to scale up or down is needed. And 461 00:23:25,760 --> 00:23:28,160 Speaker 1: I think that this is super powerful when when companies 462 00:23:28,560 --> 00:23:31,879 Speaker 1: are thinking about deficiencies. So I'm an old stock analyst. 463 00:23:31,920 --> 00:23:34,200 Speaker 1: I'm looking at your chart here. Ipoed in mid nineteen 464 00:23:34,240 --> 00:23:37,960 Speaker 1: at twenty one dollars a share, peaked in February one 465 00:23:38,080 --> 00:23:40,600 Speaker 1: and over three dollars. You share now today trades just 466 00:23:40,640 --> 00:23:43,720 Speaker 1: below forty dollars to share. That looks like a Peloton chart, 467 00:23:43,800 --> 00:23:47,439 Speaker 1: that looks like a zoom chart. Was your stock one 468 00:23:47,480 --> 00:23:49,240 Speaker 1: of those names that was just thrown on the list 469 00:23:49,320 --> 00:23:54,120 Speaker 1: of this is a pandemic stock to own. And then conversely, 470 00:23:54,160 --> 00:23:56,920 Speaker 1: coming out of the pandemic, like much of the world, 471 00:23:57,000 --> 00:23:58,919 Speaker 1: is that perhaps that's not the trade. Is that kind 472 00:23:58,960 --> 00:24:02,280 Speaker 1: of what's impacted your that price? Yeah, I think that 473 00:24:02,359 --> 00:24:04,840 Speaker 1: the market is a little bit is behaving a little 474 00:24:04,840 --> 00:24:09,200 Speaker 1: bit like a pendulum it's either overreacting or underreacting. UM. 475 00:24:09,560 --> 00:24:11,640 Speaker 1: I think that what we're seeing now is a little 476 00:24:11,640 --> 00:24:14,600 Speaker 1: bit of a spear. That's maybe the pandemic was a 477 00:24:14,720 --> 00:24:18,600 Speaker 1: one time boost to the business and that would not last. 478 00:24:18,760 --> 00:24:21,200 Speaker 1: Everything that we see from the fundamentals of the business. 479 00:24:21,560 --> 00:24:25,840 Speaker 1: So otherwise, which is fundamentals are extremely strong. Our core 480 00:24:26,000 --> 00:24:30,320 Speaker 1: behavior of the customers is stronger than pre pandemic. The 481 00:24:30,560 --> 00:24:35,399 Speaker 1: available market is just growing. The online portion of financing 482 00:24:35,760 --> 00:24:39,119 Speaker 1: it's about five percent. Listen, it's like e commerce twenty 483 00:24:39,240 --> 00:24:42,560 Speaker 1: years ago. We haven't even started. So there's so much 484 00:24:42,680 --> 00:24:44,680 Speaker 1: room to grow into it. If you take that example, 485 00:24:45,400 --> 00:24:48,440 Speaker 1: in the past twelve months, we've had four point two 486 00:24:48,600 --> 00:24:52,639 Speaker 1: million active businesses on the platform. Half of them are 487 00:24:52,680 --> 00:24:54,800 Speaker 1: in the U S which is two point one million, 488 00:24:55,240 --> 00:24:57,720 Speaker 1: but that is two point one million out of more 489 00:24:57,760 --> 00:25:00,919 Speaker 1: than thirty millions and be deveilable in the US alone, 490 00:25:00,960 --> 00:25:04,680 Speaker 1: So there's so much room to grow into that. We 491 00:25:04,760 --> 00:25:06,920 Speaker 1: don't have any concern about the ability to grow. I 492 00:25:06,960 --> 00:25:08,920 Speaker 1: think the marketing is going to correct itself. It's just 493 00:25:09,480 --> 00:25:12,360 Speaker 1: just patient. We can't optimize for the for the shore 494 00:25:12,440 --> 00:25:14,680 Speaker 1: of the price. We we optimized for the performance of 495 00:25:14,720 --> 00:25:17,520 Speaker 1: the business by the way you have now. I think 496 00:25:17,520 --> 00:25:21,399 Speaker 1: about eight verticals right, including graphic design, including digital marketing. 497 00:25:21,440 --> 00:25:24,240 Speaker 1: Obviously writing code is a big deal. Um. Do you 498 00:25:24,600 --> 00:25:29,320 Speaker 1: do you see yourself growing into more traditional sectors or 499 00:25:29,400 --> 00:25:34,439 Speaker 1: is it all about digital services? We focus on digital 500 00:25:34,520 --> 00:25:39,920 Speaker 1: services because physical services face tremendous amount of friction, um 501 00:25:40,200 --> 00:25:43,280 Speaker 1: and and and challenges right now. I mean when we 502 00:25:43,359 --> 00:25:45,280 Speaker 1: took it to Combody Publics three years ago, we've had 503 00:25:45,320 --> 00:25:49,119 Speaker 1: about three hundred categories. We now have about six hundred, 504 00:25:49,480 --> 00:25:52,920 Speaker 1: so we're adding about thirty new categories every quarters. There's 505 00:25:53,040 --> 00:25:56,200 Speaker 1: so much categories to grow into. If you look at it, 506 00:25:56,520 --> 00:26:00,600 Speaker 1: it's classical e commerce. Amazon has about thirty thousand different categories. 507 00:26:00,640 --> 00:26:03,320 Speaker 1: We have a we have room to grow into, all right, Mika, 508 00:26:03,440 --> 00:26:07,440 Speaker 1: really really fascinating stuff, Maka Kaufman, CEO and founder of 509 00:26:07,560 --> 00:26:10,480 Speaker 1: the firm Fiber, New York stockygage symbol for your Bloomberg 510 00:26:10,560 --> 00:26:14,480 Speaker 1: terminal f v r R, publicly traded company. They're really 511 00:26:14,560 --> 00:26:18,200 Speaker 1: fascinating story, fascinating part of the market. Uh. Catering to 512 00:26:19,040 --> 00:26:23,760 Speaker 1: the folks that are working from home, I guess thanks 513 00:26:23,800 --> 00:26:27,200 Speaker 1: for listening to the Bloomberg Markets podcast. You can subscribe 514 00:26:27,280 --> 00:26:31,000 Speaker 1: and listen to interviews of Apple Podcasts, or whatever podcast 515 00:26:31,040 --> 00:26:34,560 Speaker 1: platform you prefer. I'm Matt Miller. I'm on Twitter at 516 00:26:34,640 --> 00:26:38,200 Speaker 1: Matt Miller three. Pet On Ball Sweeney I'm on Twitter 517 00:26:38,320 --> 00:26:41,120 Speaker 1: at pt Sweeney. Before the podcast, you can always catch 518 00:26:41,240 --> 00:26:42,760 Speaker 1: us worldwide at Bloomberg Radio