Speaker 1: Bloomberg Audio Studios, podcasts, radio news. Bloomberg Tech is alive
Speaker 1: from coast to coast, with Caroline Hide in New York
Speaker 1: and Edlavelow in San Francisco.
Speaker 2: This is Bloomberg Tech Coming up. Meta finally finalizes a
Speaker 2: fourteen billion dollar investment in Scale AI and has the
Speaker 2: CEO amping up its AGI efforts. Plus Adobe sales outlook.
Speaker 2: It tops estimates, but it's not enough to quell investors
Speaker 2: concern that it's losing the AI race, and reports of
Speaker 2: stable coin plans by the world's biggest retailers puts pressure
Speaker 2: on Visa a MasterCard. We discussed with the CEO of
Speaker 2: crypto firm Circle, but first we check in on what
Speaker 2: the markets are doing today. There is a clear geopolitical
Speaker 2: risk that is fund and center for investors. We think
Speaker 2: about what the Israeli A tacks on Iran means for
Speaker 2: the search for safety, and we do. Then that's that
Speaker 2: one hundred off by eight tenths of a percent. There
Speaker 2: are idiosyncratic news within the benchmark, but Bitcoin not your
Speaker 2: savior of choice at the moment, not the area to
Speaker 2: go for safety. We're currently off by nine tenths percent
Speaker 2: on bitcoin move on and have a look at some
Speaker 2: of the individual movers. Look, we've got to get into,
Speaker 2: in particular some tech news that is all about Meta,
Speaker 2: another aquahier, but this one costing more than fourteen billion dollars.
Speaker 2: We're off by five tens of percent, but generally the
Speaker 2: market likes the move, the spending of Meta on the
Speaker 2: future of AGI. Let's get to it all with Kurt Wagner,
Speaker 2: who's been breaking this story. Set by step. You brought
Speaker 2: us the idea that, of course Alexander Wang was going
Speaker 2: to be part of this crucial team that Mark Zuckerberg
Speaker 2: is forming. This does seem to be yet another example
Speaker 2: of an aquahier by a big tech company.
Speaker 3: It does because, as you mentioned, Caroline, there is that
Speaker 3: fourteen point three billion dollar investment. But Alexander Wang is
Speaker 3: joining Meta, so are some of the other employees from
Speaker 3: Scale Lai. So while Meta is obviously, you know, now
Speaker 3: a forty nine percent stakeholder, and Scale it's taking the
Speaker 3: CEO over to Meta, So a lot of people are
Speaker 3: sort of viewing this as a very expensive aquahier. Obviously,
Speaker 3: there's still Scale is still going to be operating independently.
Speaker 3: It's going to have an interim CEO. But you know,
Speaker 3: given the talent that is moving from Scale to Meta,
Speaker 3: this is this is a very expensive talent grab. And
Speaker 3: this is something that I think we've seen from Mark
Speaker 3: Zuckerberg before and something that he is clearly very very
Speaker 3: focused on AI right now.
Speaker 2: We've seen it from other key tech companies. This aquahar idea,
Speaker 2: the fact that maybe you skirt any regulatory oversight, particularly
Speaker 2: when perhaps metas in frontline. When it comes to the
Speaker 2: FTC investigation, You're thinking Microsoft with inflection, You're thinking Amazon
Speaker 2: with a debt to thinking of Google with character AI Kert,
Speaker 2: What does this show about the anxiety that Mark Zuckerberg
Speaker 2: has right now.
Speaker 3: Well, part of the momentum here is because he felt
Speaker 3: like they are behind, right. We had a story a
Speaker 3: couple of days ago about him building this new super
Speaker 3: intelligence AI team and that was really motivated by the
Speaker 3: fact that their lamafour launch back in April was underwhelming
Speaker 3: and that he felt that Meta was not keeping pace
Speaker 3: in the way that they should. So I think there's
Speaker 3: a real paranoia there. This is, you know, a sort
Speaker 3: of a classic Mark Stuck Colt Bring move for him
Speaker 3: to just get incredibly in the weeds on something that
Speaker 3: he feels his business is sort of lacking. But I
Speaker 3: also think it just speaks to the you know, the
Speaker 3: limit in terms of how much talent there is out
Speaker 3: there in the AI space, like really good talent. Like
Speaker 3: the fact that they're willing to spend this much on
Speaker 3: these on these folks sort of says that it's a
Speaker 3: very competitive landscape when it comes to hiring people. And
Speaker 3: I think we've seen that across the board, and it's
Speaker 3: only going to get tighter now that everyone sort of
Speaker 3: picked their various startup that they're backing here.
Speaker 2: It's interesting that we've already heard from Open Ai saying
Speaker 2: they're going to stick working with Scaleai, which is now
Speaker 2: going to be helmed by Jason Droges. He was previously
Speaker 2: the strategy officer, now him becomes a CEO. But talk
Speaker 2: to us about what Alexander wanglings in particular, He's got
Speaker 2: a very good way of networking, particularly on Capitol Hill.
Speaker 3: Yeah, so, you know, I've been told by several folks
Speaker 3: over the last week that Mark Zuckerberg just thinks that
Speaker 3: Alexander Wang is the best guy. You know, he thinks
Speaker 3: he is so talented, He's he's super bullish on this guy.
Speaker 3: I believe he's just twenty eight years old, and you're right, Caroline,
Speaker 3: he brings a great network. Everyone I've talked to is
Speaker 3: that this guy knows everybody in the AI space. He also,
Speaker 3: as you point out, knows folks on Capitol Hill. This
Speaker 3: is a time when I think Meta and Mark Zuckerberg
Speaker 3: in particular are trying to build relationships with the Trump administration.
Speaker 3: You know, we've seen them sort of announced plans to
Speaker 3: partner with Andreil on potential military tech. So it's a
Speaker 3: bit of a new, you know, direction for this company
Speaker 3: trying to get into perhaps government contracts, and I think
Speaker 3: Alexander Wang brings some of that connectivity to Meta and
Speaker 3: Mark Zuckerberg, and so in addition to the AI experience,
Speaker 3: you know, this is also someone who might be able
Speaker 3: to help him out relationship.
Speaker 2: Well. So far, investors have trusted the steerage of Mark Zuckerberg.
Speaker 2: Just a significant out performance of eighteen percent so far
Speaker 2: on the year Blue Most Kurt Wagner, thanks so much
Speaker 2: on all things Meta. Let's bring it out. Michael Reynolds
Speaker 2: is with US vice president and investment strategy at Glen Mead,
Speaker 2: manages forty five point six billion dollars in assets and
Speaker 2: just focus for a moment on the AI trade and
Speaker 2: this rush to spend by the hyperscalis of which Meta
Speaker 2: is now one. What do you make of this?
Speaker 4: Aquaha, thanks for having me.
Speaker 5: So we think without a doubt AI is transformational, and
Speaker 5: anyone who disagrees with that just probably hasn't been using
Speaker 5: it properly. But I think we're cautioning investors on our
Speaker 5: end to think through the connection between a transformational technology
Speaker 5: and what it actually leads to in terms of investment opportunities.
Speaker 5: History is littered with examples of great technology that just
Speaker 5: was not a good investment. Gutenberg invented the printing press,
Speaker 5: but he died in poverty. Rare Road bonds were notoriously
Speaker 5: poor investments. We're just not seeing a lot of pure
Speaker 5: plays in AI right now in the public markets. But
Speaker 5: perhaps if investors are turning to the private markets, that
Speaker 5: may be a little bit more plentiful with opportunities for
Speaker 5: AI as there's certainly going to be winners and losers
Speaker 5: in this space, but we're certainly in early stages.
Speaker 2: Okay, So how are investors getting access to the private
Speaker 2: markets on this particular area. Are they looking more to
Speaker 2: access well VC liquidity in some way.
Speaker 5: It would think it's a combination of trying to get
Speaker 5: that direct exposure with those that are actually building the
Speaker 5: software and delivering the AI tools that the end user
Speaker 5: is actually using, but also some of sort of the
Speaker 5: ancillary providers that can help on the margins, whether it's
Speaker 5: delivering the hardware on the tech or it's maybe the
Speaker 5: data centers that are delivering the energy that can help
Speaker 5: facilitate all of this. That the best solution is probably
Speaker 5: a combination of the two, as you don't want to
Speaker 5: sort of put all your bets on one side of
Speaker 5: a trade here and end up missing some of the
Speaker 5: bigger beneficiaries that we're perhaps a little long intuitive as
Speaker 5: you were thinking through it in real time, Mike.
Speaker 2: So's sticking with public markets, you're seeing people trying to
Speaker 2: bet on whether it be the energy stack, whether it
Speaker 2: be the AI hardware or the software stack. From an
Speaker 2: equity perspective, or they're going into the bob market.
Speaker 6: Too, a little bit of both.
Speaker 5: I think the equity markets are probably a little sexier
Speaker 5: from that perspective. Data centers have been really great performers
Speaker 5: over the last couple of years in expectation that there's
Speaker 5: just going to be a big energy sink to be
Speaker 5: able to use these models at scale. We've seen a
Speaker 5: little bit of pushback on that, given some of the
Speaker 5: opportunities we've seen coming out of Deep Seek where they
Speaker 5: were pay able to perhaps do things a little more
Speaker 5: efficiently and pull back on some of those expectations. But
Speaker 5: it's probably a little bit of both on both sides
Speaker 5: of the capital markets, stocks and bonds, where there's going
Speaker 5: to be opportunities here driven by technological innovation.
Speaker 2: I like that you bring that up, Mike, because it
Speaker 2: actually was quite recently that we were all panicking around
Speaker 2: actually whether you needed the scale of investment, you needed
Speaker 2: a scale of infrastructure because of Deep Seat. Well that's
Speaker 2: almost been put to bed. You look at Oracles numbers
Speaker 2: this week. You think about the anxiety around supply. Really,
Speaker 2: that's what the nature of the story has been, people
Speaker 2: can't build it fast enough. Is that where we're back
Speaker 2: to in terms of the market psyche.
Speaker 5: To some extent, I think over the last year or so,
Speaker 5: perhaps pre Deep Seek, there was a lot of concerns
Speaker 5: that just wasn't enough energy to go around, that some
Speaker 5: of these data centers were going to have to build
Speaker 5: out alternative energy sources, maybe flirting with nuclear, but it's
Speaker 5: really I think it falls into the historical precedence where
Speaker 5: when you have a breakthrough technology, it often seems like
Speaker 5: there's a lot of startup costs to really break through
Speaker 5: and get the technology working at scale. But innovation is
Speaker 5: a beautiful thing and finding things, finding ways to do
Speaker 5: things more effectively and efficiently always just seems to occur.
Speaker 5: I think that's happening in real time this year, and
Speaker 5: we could continue to expect that to unfold over the
Speaker 5: years ahead, just finding better ways to build it and
Speaker 5: building a better mousetrap.
Speaker 2: Okay, what about the mousetop? Is it all about the
Speaker 2: United States? Are you looking at other opportunities? Are your investors,
Speaker 2: the people that you're speaking to, wanting to get out
Speaker 2: into Europe and Asia?
Speaker 7: Yeah?
Speaker 5: There was certainly this theory that US exceptionalism in Ai was,
Speaker 5: you know, an uncrackable theme, and I think there are
Speaker 5: some sort of fissures into that theme this year, where
Speaker 5: again you had the deep seek news out of China.
Speaker 5: You have several other countries that are really doing a
Speaker 5: lot to incentivize domestic development of these types of technologies.
Speaker 5: It's happening in the UAE and European Union, many parts
Speaker 5: of Asia. They're trying to build out this technology. So
Speaker 5: it's you know, is the US going to have a
Speaker 5: monopoly on this technology for the foreseeable future remains unseen,
Speaker 5: But you know there's quite a few players that are
Speaker 5: emerging in this market that could end up sharing market
Speaker 5: share on this at.
Speaker 2: G forty two making inroads into Europe and the UK
Speaker 2: will discuss that later in the show. You've had Jensen
Speaker 2: Wang over there in the United Kingdom and Europe making deals.
Speaker 2: Mike iland it here. Therefore, because we've gone global, and
Speaker 2: day is a global day in nature, how people are
Speaker 2: feeling about potential increased tensions in the Middle East, maybe
Speaker 2: even more, How are your investors responding to that at
Speaker 2: this moment.
Speaker 5: So we're cautioning our investors not to react too quickly
Speaker 5: to unfolding geopolitical conflict here so far, I think we're
Speaker 5: following a pretty standard geopolitical blueprint where markets are reacting
Speaker 5: to the uncertainty that just didn't exist a few hours ago.
Speaker 5: But in general, markets tend to see through this type
Speaker 5: of thing, especially for those countries that are not directly
Speaker 5: involved this time around. I think inflation is going to
Speaker 5: be really important to watch here. If energy infrastructure in
Speaker 5: the region starts to come in the crosshairs figuratively or
Speaker 5: perhaps even literally speaking, that could have potential inflationary impacts
Speaker 5: for energy, which is just not just an input cost
Speaker 5: for a direct input costs for consumers, but also for
Speaker 5: a lot of the goods they consume also consume energy,
Speaker 5: So it's we're looking at that pretty close. As well
Speaker 5: as the shipping lanes throughout that region, which can be
Speaker 5: pretty important for global trade. Those are going to be
Speaker 5: really important to watch over the weekend.
Speaker 2: Michael Raynolds, we hope you get some rest over the weekend,
Speaker 2: Vice President of the Investment Strategy at Glen Mead. We
Speaker 2: appreciate your time. Now let's discuss that key story, Israel
Speaker 2: launching multiple strikes across Iran, targeting nuclear facilities, killing top
Speaker 2: military officials. President Trump urging Iran to accepting nuclear deal
Speaker 2: in an effort to avoid further attacks. Iran vowing to
Speaker 2: continue its nuclear program despite the Israeli strikes. For more,
Speaker 2: we turn to Bloombogs. Jomana Vassetchi joins us. Now actually
Speaker 2: based in London just for this week and Jomana you're
Speaker 2: usually in the Middle East, And it's interesting we're getting
Speaker 2: a US official telling Bloomberg News that indeed we are
Speaker 2: still seeing talks lightly to be conducted between the United
Speaker 2: States in Iran.
Speaker 8: Yes, perhaps there is a potential for a de escalation here,
Speaker 8: especially as those sixth round of talks between US and
Speaker 8: Iran we're slated to take place in Oman this weekends.
Speaker 8: Giving the events over the last twenty four hours, at
Speaker 8: the the eventual possibility of those happening was thrown into doubt.
Speaker 8: But of course what we have seen, just as a
Speaker 8: recap is the most significant attack on Iran going back
Speaker 8: to the eighties.
Speaker 2: What Israel did in the.
Speaker 8: Last twenty four hours supersedes all of the events that
Speaker 8: happened last year, both back in April and in October,
Speaker 8: and really constitutes a major blow to Iran, not just
Speaker 8: in terms of the fact that Israel went after specific
Speaker 8: nuclear facilities and even though no radiation has actually been
Speaker 8: recorded from those nuclear facilities, what they did succeed at
Speaker 8: doing is that taking out some senior IRGC. So these
Speaker 8: are Revolutionary Guard commanders, the chief of staff of the
Speaker 8: Armed forces. Some of these people are key masterminds behind
Speaker 8: the attacks that had been conducted on Israel and the
Speaker 8: last year, but also on the IRANQO facilities in Saudi
Speaker 8: Arabia back in twenty nineteen. So some of the key
Speaker 8: players have been taken out with these strikes. Now where
Speaker 8: we go from here. Iran has vowed a harsh retaliation
Speaker 8: already this morning they fired over one hundred drones directed
Speaker 8: towards Israel.
Speaker 2: Those were mainly intercepted.
Speaker 8: But the question from here onwards is how many more
Speaker 8: ballistic missiles they're looking to send towards Israel, whether or
Speaker 8: not this will encapsulate other proxies in the region as well,
Speaker 8: whether the likes of Hezbalahthi's Hamas may get involved in
Speaker 8: the retaliation, and then also whether or not the international
Speaker 8: community look to de escalate from this point onwards. And
Speaker 8: to your point, US plays a significant role here because
Speaker 8: of the possibility of a furthering of those nuclear discussions.
Speaker 8: And let's see whether Iran actually does come to the
Speaker 8: table in good faith.
Speaker 2: Jermanavasseatchi, we really appreciate your time today. Thank you. Now
Speaker 2: coming up, we go back to tech. Apple sets a
Speaker 2: new target for revamp Siri or on that next this
Speaker 2: is pretty bad Tech said to be targeting a new
Speaker 2: internal date of spring twenty twenty six where it's revamped
Speaker 2: SyRI upgrade of the multiple delays. Now that's according to sources.
Speaker 2: Let's get to our own Mark German for more. It
Speaker 2: was but this week that WWDC left us hanging on
Speaker 2: Siri and you bring us some clarity.
Speaker 6: That's exactly right. So they did not talk about serie
Speaker 6: features pretty much at all at WWDC other than to
Speaker 6: say they're still delayed and they'll be arriving in the
Speaker 6: coming year. So I looked into it, and the new
Speaker 6: launch timeframe is likely going to be as part of
Speaker 6: what will be known as iOS twenty six point four,
Speaker 6: and that's currently scheduled for the springtime next year, so
Speaker 6: around March April, and this will deliver the delayed serie features.
Speaker 6: These are the features e to an AI overhaul for
Speaker 6: the voice assistant that we're announced back in June of
Speaker 6: twenty twenty four. So the three main features are the
Speaker 6: ability to tap into your personal data to fulfill serie queries.
Speaker 6: So if I asked for a question such as what
Speaker 6: was the big I sent Caroline last week. It would
Speaker 6: be able to pull up that video or a podcast
Speaker 6: or a song. If I wanted to get analysis of
Speaker 6: something on my screen using Siri, it could do that
Speaker 6: as well. And it has precise control of applications. So
Speaker 6: for instance, I could say, pull up this photo of
Speaker 6: Caroline and edit it and send it to her as
Speaker 6: well as a few other people in our group chat. Right. Yeah,
Speaker 6: those are impressive and big features, all delayed now coming
Speaker 6: about nine months from now.
Speaker 2: I'm waiting for that photo Mark put it on our
Speaker 2: group chat. But Mark, I'm also just remind us what
Speaker 2: the problem has been here? Why has it been so
Speaker 2: difficult to integrate with Siri?
Speaker 6: Apple has been facing some serious engineering and management problems.
Speaker 6: But just to break it down and not to get
Speaker 6: too technical, essentially, Apple had to split Siri into two brains, right.
Speaker 6: The first brain, the more basic one, has to do
Speaker 6: with features like setting alarms, phone calls, all the legacy stuff.
Speaker 6: Then they built a second brain, more based on large
Speaker 6: language models at the core of modern AI, for those
Speaker 6: more advanced features I talked about, right, But making one
Speaker 6: SERI that has two brains combined to do two different
Speaker 6: set of actions had compatibility problems in real world use,
Speaker 6: and I'm told it didn't work properly up to a
Speaker 6: third of the time, which is a lot based on
Speaker 6: how much usage these things are going to get. And
Speaker 6: so what Apple is doing now is rebuilding the underlying
Speaker 6: serie architecture to have one brain based on that newer
Speaker 6: generation technology to handle everything, and that would eliminate the
Speaker 6: compatibility issues, but obviously is going to take more time
Speaker 6: to put.
Speaker 2: Together brilliant storytelling. Marcum and thank you so much for
Speaker 2: the breaking news as well. But let's turn our attention
Speaker 2: to Adobe. Now shares under pressure after the company actually
Speaker 2: gave a sales outlook that was pretty good, but it
Speaker 2: failed to come invest as skeptical about its ability to
Speaker 2: really compete with the AI focused startups. Whimberg's Brady Ford
Speaker 2: joins us now and look shares are off by five
Speaker 2: percent worst days it's March twenty twenty five. Even though
Speaker 2: they've beaten they.
Speaker 9: Raised, right. I mean, so Adobe is this kind of
Speaker 9: poster child of a company which was the kind of
Speaker 9: leader of their industry for twenty years. Nobody could touch them,
Speaker 9: And the question is okay AI's coming. A lot of
Speaker 9: these apps are much.
Speaker 2: More lightweight, cheaper, easier to use.
Speaker 9: Does Adobe stay relevant That's a big question, and investors
Speaker 9: are not convinced. I mean, I think they're down ten
Speaker 9: percent over the last year Adobe's stock and down further today.
Speaker 9: And it's all because of those AI disruption anxieties.
Speaker 2: You're thinking mid journey for example, we're thinking even Soora
Speaker 2: making roads when it comes to making the video side
Speaker 2: of the equation. But Firefly has it been getting some use?
Speaker 2: What was it like two point four billion content stayed
Speaker 2: over the course of it's being used out there in
Speaker 2: the wild. It's been getting used.
Speaker 9: But when I was growing up, if you wanted to
Speaker 9: be like a cool creative person, you had to go
Speaker 9: find a copy of photoshops somewhere Adobe Premier's video editing.
Speaker 9: It's not that way anymore. If you talk to people
Speaker 9: who are young, who are really kind of making cutting edge,
Speaker 9: aren't there using the like these mid journeys Google's vo
Speaker 9: I mean, when it comes to the enterprise level where
Speaker 9: you have a CIO who's worried about cybersecurity, they're still
Speaker 9: buying Adobe. But the question is that next generation, where
Speaker 9: is the mind share going.
Speaker 2: What was also interesting is they tried to win the
Speaker 2: IP battle. I'm trying and say, look, we've got you covered.
Speaker 2: You don't need to be worried. We'll even pay out
Speaker 2: if we find that any of the images you're creating
Speaker 2: are based on some other IP. But people aren't worried
Speaker 2: about that so much anymore.
Speaker 9: It's an interesting question. I mean, we saw Disney suing
Speaker 9: mid Journey a couple of days ago. I'm sure the
Speaker 9: CIO of our company or others is not gonna go
Speaker 9: and pay for a company getting sued by Disney. But
Speaker 9: at this current moment, it's still unsettled. It appears that
Speaker 9: the anxieties around hey, scraping data to build models, is
Speaker 9: that gonna be okay? It seems like a lot of
Speaker 9: buyers at this point are swayed.
Speaker 2: Against it, like I'm more convincing to do Brinberg's berdie
Speaker 2: Ford brilliant as always, Thank you. AMD CEO Lisa Soon
Speaker 2: said her company's latest day I processes can challenge in
Speaker 2: video chips in a market she expects to saw past
Speaker 2: five hundred billion dollars in the next three years now.
Speaker 2: This is as the company aims to play catch up
Speaker 2: with in video in AI accelerators with its new products.
Speaker 2: Let's talk about them. Bring meg Intelligence analyst Contrins Savani's
Speaker 2: hey with us. You're at the event, you're assessing what's
Speaker 2: been discussed the Mi three fifty. Will it be fast
Speaker 2: enough to stop winning more market share?
Speaker 10: I mean, if you look at their event and announcement
Speaker 10: in isolation, we think there were many positives. One the
Speaker 10: customer adoption is broadening some of the new names like Xai,
Speaker 10: open Ai, Oracle. The deal with Oracle, which we think
Speaker 10: will be the largest three to fifty five deals so
Speaker 10: far yet for and will show results in the second half.
Speaker 10: These were really surprisingly positive. Remember these have been traditionally
Speaker 10: and VIDIA only houses, so them getting to these customers
Speaker 10: is a pretty big deal. They showed continued progress on
Speaker 10: the hardware with the announcement of the roadmap with the
Speaker 10: four hundred Elio server rack, and it's more important the software,
Speaker 10: which they have been lagging until as of last year.
Speaker 10: So a what a lot of impressive progress on all aspects.
Speaker 10: But the challenge is the competition also continues to speed ahead,
Speaker 10: and they have had a headstart.
Speaker 2: They have and boy does everyone just relentlessly compare them
Speaker 2: to Jensen's powerhouse. You say on your note that really
Speaker 2: that MI four hundred ramp up in twenty twenty six
Speaker 2: is gonna be the key inflection point for potential share
Speaker 2: gain in a way, though, do they need it, Kenjym
Speaker 2: because in many ways the issue for Nvidia is a
Speaker 2: supply side issue. They can't make them fast enough. So
Speaker 2: is there still so much market for Lisa's who to.
Speaker 6: Take there is?
Speaker 10: And why that's a inflection point is when you think
Speaker 10: about the current competition or the playground, right, it is
Speaker 10: all about server level rack solution, not about chips anymore.
Speaker 10: AMD is still not there yet. So the Helios RAC
Speaker 10: will be their first iteration using the ZT acquisition talent
Speaker 10: that they acquire and expertise where they can really compete
Speaker 10: head to head with Nvidia, assuming and Media doesn't move
Speaker 10: forward another year from there. But that is what they
Speaker 10: really need. What they're really missing is a big cluster
Speaker 10: level server RACKCHI view solution.
Speaker 2: What's interesting is are they all still fighting for the
Speaker 2: training side of the equation. We've all just been dominated
Speaker 2: about the inference and there are some really powerful scartups
Speaker 2: coming into that space trying to take marketshap too.
Speaker 10: I think they're leading by competing in inference because that
Speaker 10: is where they have the edge given their higher or
Speaker 10: I would say apples to apples, higher memory bandwidth and
Speaker 10: efficiency there and a lower TCO. So they're getting into
Speaker 10: the customer doors through inference, and once they're proven and
Speaker 10: starting to gain a little bit more share, then they're
Speaker 10: showing up like, hey you can still try us for training,
Speaker 10: and you know that's how they're trying to increase a
Speaker 10: little bit of a share in training. We still like
Speaker 10: the inference play. Remember, going forward, inference we expect to
Speaker 10: grow faster than training. Yes, training will be a big
Speaker 10: chunk still, but there will be a lot more broader
Speaker 10: customer based for influence.
Speaker 2: Bloomberg Intelligence analyst Savani So great to get your analysis.
Speaker 2: Thank you, Welcome back to Bloomberg Tech. I'm Caroline Hide
Speaker 2: in New York. Let's get a quick check on these markets.
Speaker 2: But we are consumed by geopolitics today, anxiety around the
Speaker 2: Middle East after Israel's track on Iran. We see the
Speaker 2: NASA that one hundred off by six ten percent, as
Speaker 2: we see that risker version play in, but not for
Speaker 2: all names. Oracle up five percent. It is just managing
Speaker 2: to ramp up higher a new record high after they
Speaker 2: posted earnings earlier in the week saying that they are
Speaker 2: going to be getting seventy percent gaining cloud infrastructure sales
Speaker 2: in this fiscal year. Adobe is down on its earnings.
Speaker 2: We discussed it with Brodie Ford of by five percent,
Speaker 2: not enough to quell anxiety that it won't be an
Speaker 2: AI winner. Move on, have a look at what's happening
Speaker 2: in broader assets, though. I want to shine a light
Speaker 2: on what's happening in the world of crypto because Bitcoin,
Speaker 2: look isn't actually playing out as a haven today so much.
Speaker 2: It's coming off of its lows. Look, we're still one
Speaker 2: hundred and five pound, but it is off by three
Speaker 2: tens percent as we sell risk. But let's just talk
Speaker 2: more broadly about the movement within crypto and stable coins
Speaker 2: in particular. This comes as a Senate nears the passage
Speaker 2: of the Genius Act, which would regulate integrating stable coins
Speaker 2: more into mainstream finance. I want to shine out, like
Speaker 2: what's happening with these names Visa and MasterCard currently off
Speaker 2: by five percent four percent because reports coming out of
Speaker 2: the Wall Street Journal that look, big players Amazon Walmart
Speaker 2: are studying their own stable coins. Does this cut out
Speaker 2: the middlemen, the card providers thus far, and of course
Speaker 2: we're going to speak to one beneficiary of all of
Speaker 2: this legislation, all of the move towards stable coins and
Speaker 2: digital payments. It's Circle Circle. CEO Jeremy Elaire joins me
Speaker 2: now on set this report that potentially we see Amazon
Speaker 2: Walmart already really galvanizing themselves to have their own stable coins.
Speaker 2: How quickly could that up end Visa and MasterCard.
Speaker 11: Well, look, I think if you're a major technology company,
Speaker 11: or your major commerce firm, or you're a major financial institution,
Speaker 11: when you get legal certainty that stable coin money is
Speaker 11: a new form of electronic money that is available to
Speaker 11: the global financial system, you're going to pay attention. And
Speaker 11: obviously you're going to look at the technology, the progress
Speaker 11: of the technology as well. And I think the conclusion
Speaker 11: that a lot of major firms are reaching is that
Speaker 11: this is the new money layer of the Internet, and
Speaker 11: it provides tremendous technology to innovate beyond.
Speaker 4: What we've been able to innovate with money.
Speaker 11: Before, and it offers tremendous benefits ultimately to these firms
Speaker 11: bottom lines. And so it's a it's a technology that's
Speaker 11: ready and it's you know, a technology with the Genius
Speaker 11: Act which you refer to, I think, which gets the
Speaker 11: legal certainty to really utilize this at scale. And so
Speaker 11: from my perspective, first of all, it's not surprising at all,
Speaker 11: and I think it's a it's a tremendous opportunity as
Speaker 11: the world connects to UH to this new form of
Speaker 11: currency on the Internet.
Speaker 2: Is it not surprising a tool because they're coming to
Speaker 2: you to help build the infrastructure there, how much would
Speaker 2: USDC or indeed what circle does be what Amazon and
Speaker 2: Walmart eventually adopt.
Speaker 11: We see tremendous opportunities to collaborate with major technology firms,
Speaker 11: major payments companies, major financial institutions, and we already do.
Speaker 11: We work with some of the biggest household names. I mean,
Speaker 11: even just yesterday we saw Shopify announce that they're making
Speaker 11: USDC payments a default option automatically for every merchant on
Speaker 11: their platform in the US and then in Europe.
Speaker 4: That's like a million merchants, so.
Speaker 2: Like a PayPal button, and then the USDC people will
Speaker 2: be there by default, and in fact, not only that
Speaker 2: they're offering, they'll be offering merchants half a percent cash
Speaker 2: back to the merchant.
Speaker 11: So they're going to actually compensate the merchant, which is incredible.
Speaker 11: And so I think you're seeing platforms like this adopted
Speaker 11: USDC and so you know, as the operator of the
Speaker 11: world's largest regulated stable coin network in the world, we
Speaker 11: want to you know, we're really a market neutral infrastructure.
Speaker 11: We don't compete for consumers or merchants or businesses. We
Speaker 11: want to work with everybody to take advantage of this
Speaker 11: breakthrough technology innovation.
Speaker 2: The breakthrough comes with the regulatory support. As you say,
Speaker 2: Genius Act. When do you expect it to come into play?
Speaker 11: Well, yesterday the Genius Act passed a critical cloture vote
Speaker 11: with a super majority bipartisan, and so that sets it
Speaker 11: on a glide path to pass the Senate on Tuesday.
Speaker 4: Of next week.
Speaker 2: We actually previously did hear from Tim Scott. Of course
Speaker 2: he's been leading the charge in many ways on crypto
Speaker 2: more broadly, but he's been speaking to Bloomberg about some
Speaker 2: of the opportunities around stable coin and leading the charge
Speaker 2: here in the United States. As of course a key
Speaker 2: representative just take a listen.
Speaker 12: With a bipartisan genius ad we can do more than
Speaker 12: just pass a bill. We can deliver results for the
Speaker 12: American people. We can bring clarity for a sector that's
Speaker 12: been clouded by uncertainty, and we can make it known
Speaker 12: the United States will lead, not follow, in the digital
Speaker 12: asset revolution.
Speaker 2: Chairman of the Senate Banking Committee, an important voice. What's
Speaker 2: interesting with Tim Scott is now he's also pushing us
Speaker 2: towards where we go with broader crypto adoption. Yes, we
Speaker 2: get the Genius Act, but then what of the Clarity
Speaker 2: Act as it's called. How much further would that take
Speaker 2: your industry?
Speaker 11: Well, look, there's this incredible innovation of blockchains, there's this
Speaker 11: incredible innovation of digital assets, digital tokens, and we need
Speaker 11: legal clarity on what these are, how you can offer them,
Speaker 11: how they can be used, the platforms that where they
Speaker 11: need to be registered or regulated, and where you know,
Speaker 11: there's just very clear rules for issuers. So I think
Speaker 11: the Clarity Act is essential. I think it is a
Speaker 11: very strong piece of legend. I know there's more work
Speaker 11: to do on that ultimately in the Senate, but I
Speaker 11: think the combination of both the Genius Act and the
Speaker 11: Clarity Act ultimately creates an incredible environment for a rules
Speaker 11: based system in the United States a competitive environment, and
Speaker 11: I believe does accomplish the objective of making the United
Speaker 11: States sort of the capital of this new form of
Speaker 11: technology innovation.
Speaker 4: It's a great opportunity for American companies as well.
Speaker 2: Briefly, it's been good timing to go public. Your shares
Speaker 2: absolutely soored since they first started training last week. How
Speaker 2: does it feel.
Speaker 11: I mean, look, we're very excited to be a public company.
Speaker 11: It's critical from our perspective to just enhance the trust, transparency, compliance,
Speaker 11: good governance that we're known for. And I think in
Speaker 11: particular at this moment when we're getting this legal clarity
Speaker 11: around the world on stable coin money, and in particular,
Speaker 11: as you said, these major companies are looking at this.
Speaker 11: We think that being a public company will serve us
Speaker 11: well in.
Speaker 4: Working with the leading institutions of the world.
Speaker 11: So from that perspective, you know, we're really pleased and
Speaker 11: excited to build tremendous partnerships around the world.
Speaker 2: Oh and you sink some of those partnerships do come
Speaker 2: back on to talk all about it circle CEO Jeremy Elaire,
Speaker 2: we appreciate it coming up. Felisa's raises nine hundred million
Speaker 2: dollars in its tenth round. This is a fund of course,
Speaker 2: and Felice's managing partner, Sunday p Choo is going to
Speaker 2: be joining us next as the Bloomberg Tech. It is
Speaker 2: time now for talking tech first up. Chinese authorities have
Speaker 2: released draft guidelines on the transmission of car data from
Speaker 2: overseas vehicles look as a move that could benefit Tesla
Speaker 2: and it's autonomous driving features. In marks the first time
Speaker 2: Beijing has really clarified its stance on data generated and
Speaker 2: exported from within China. Plus Abu Dhabi's G forty two
Speaker 2: when it's planning to launch a European unit G forty
Speaker 2: two Europe and UK, but it's set to deploy a
Speaker 2: solutions for the private sector, partnering with governments too. Now.
Speaker 2: The announcement comes as in video CEO does and one
Speaker 2: forecasts a tenfold increase in Europe's AI computing capacity over
Speaker 2: the next two years. And GameStop Welz says the company's
Speaker 2: future is in training cards, saying the likes of pokemonon
Speaker 2: sports cards aligned with the company's heritage, maybe not gaming
Speaker 2: game stops. Collectible's business made up twenty nine percent revenue
Speaker 2: in the first quarter of the company planning to add
Speaker 2: two hundred and eighty more stores that will offer training
Speaker 2: card evaluation services. Right, it's time for today's VC spotlight.
Speaker 2: Now and Felisa's has announced a nine hundred million dollar
Speaker 2: tenth fund, the fund's largest ever to date. Let's bring
Speaker 2: in Sunday Peache is Felie's managing partner joining us now
Speaker 2: and Sunday just tell us who the LPs are, what
Speaker 2: they're excited about you allocating.
Speaker 7: Towards HI carline. It's wonderful to be here. It's it's
Speaker 7: a very exciting week for us. It's we've raised nine
Speaker 7: hundred million, our largest fund yet from mostly US institutions
Speaker 7: that we're super proud to take money from. And these
Speaker 7: are hospital systems, museums, university endowments that are all doing
Speaker 7: like great things in the world, and we're proud to
Speaker 7: be in business with them, and we're proud to like
Speaker 7: multiply their money and you know, have it, you know,
Speaker 7: go back to some great causes.
Speaker 2: I'm just really interested sending more broadly in where you
Speaker 2: therefore put the money, because at the moment it sounds
Speaker 2: as though you're going to be in general to AI
Speaker 2: more for Throttle. It's going to be the infrastructure air
Speaker 2: but that feels like a very busy, very crowded space.
Speaker 2: Who are the companies are depending on?
Speaker 7: Yeah, I mean just to give you know, take a
Speaker 7: step back here. Felicius was actually born in twenty tens.
Speaker 7: Our very first institutional fund was just at the beginning
Speaker 7: of the cloud and the mobile tech supercycle. And you know,
Speaker 7: we've been very fortunate that we found some like amazing,
Speaker 7: amazing businesses as part of that household names today like
Speaker 7: a shop of I add in, a Canva and a
Speaker 7: notion and so we're now at another exciting text supercycle
Speaker 7: in AI, you know, just in the first or second innings,
Speaker 7: if you will, And so there's a lot of excitemente
Speaker 7: In the past two years, two thirds of our investments
Speaker 7: have been AI native companies. Most of our investments are
Speaker 7: like usually first or second money in so we're playing
Speaker 7: very very much into the AI supercycle. Household names hopefully
Speaker 7: like the canvas of the world ten years from now
Speaker 7: that go public us both the infrastructure stack as well
Speaker 7: as the application stack.
Speaker 2: It's interesting. We had Meno Ventures partner on yesterday and
Speaker 2: Sean was telling us that in certain areas the funding
Speaker 2: just seems extraordinary. The valuations once again almost fail a
Speaker 2: kin to twenty twenty one. Is that what's happening right now?
Speaker 2: How are you getting in at a decent price point?
Speaker 6: Yeah?
Speaker 7: Look, I think valuations, you know, continue to be market
Speaker 7: driven in many ways. And we're not the only ones excited,
Speaker 7: BODYI But if you take a step back, the reason
Speaker 7: why everybody's excited, aboudyie is that even like you look
Speaker 7: at like the broad arc of tech history, what tech
Speaker 7: is really good at is providing us products and services
Speaker 7: that are previously expensive or like inaccessible except to like
Speaker 7: a very few, and bringing it all the way down
Speaker 7: tomarketizing that you know, to the masses if you will.
Speaker 7: And you know a great examples of these and the
Speaker 7: last tech cycle where companies like Canba that allowed everybody
Speaker 7: to design. Now over two hundred million people use Canba
Speaker 7: to design. You know, you have something like a Shopify,
Speaker 7: anybody can become an entrepreneur and millions have become entrepreneurs
Speaker 7: because of Shopify. An Uber gave us all private driver
Speaker 7: and Airbnb gave us all a vacation rental. And so
Speaker 7: you know, you take that forward and you think about
Speaker 7: like what AI can do for us. It's you know,
Speaker 7: every household I mean, think about how many times we
Speaker 7: keep talking about, you know, I wish I had like
Speaker 7: a private tutor for my kids. I wish I had,
Speaker 7: you know, a therapist like and they're so expensive. Every
Speaker 7: session is expensive. They're hard to find. Think about all
Speaker 7: of the labor that kind of goes into household services
Speaker 7: or if you move that to businesses, you have you know,
Speaker 7: things that are available to senior management, like executive assistant order,
Speaker 7: an executive coach, that are not available to everybody else.
Speaker 7: And EI is expanding the surface of software so drastically.
Speaker 7: And if you think think about this, Caroline, just one
Speaker 7: to two percent of world GDP currently spent on software.
Speaker 7: And EI is so radically restructuring the surface area of software.
Speaker 7: And you can be an AI pessimist or optimist, and
Speaker 7: those numbers in ten years are going to be different
Speaker 7: for each one of us, but none of us are
Speaker 7: going to disagree that that number is going to move
Speaker 7: up drastically.
Speaker 2: Something very briefly like you have had some superb exits
Speaker 2: and think a shop of fire Addy, and you are
Speaker 2: in some of the hottest names. When I think about
Speaker 2: Runway and in dcanva. How much pressure have you seen
Speaker 2: from LPs being like, we need the liquidity now. How
Speaker 2: quickly do you think these doors can remain open? Briefly?
Speaker 7: I think I think you know, for the very very
Speaker 7: best companies you think about a canva, like their shares
Speaker 7: can trade every single day. They don't have to even
Speaker 7: raise any primary money. They've been so profitable for so
Speaker 7: long that in the secondary markets you always have the
Speaker 7: ability to exit if you want. And we've selectively chosen
Speaker 7: that for our LPs and giving them back like some distribution,
Speaker 7: and so we've done that like an honor. Many other
Speaker 7: funds have done that, so I'm not worried about that.
Speaker 7: I think one of the things you know, think about
Speaker 7: is that given this new AI tech cycle, if you
Speaker 7: assume that the software as a percentage of GDP doubles,
Speaker 7: let's say conservatively, that's hundreds of billions of dollars of
Speaker 7: new spend that is going to get allocated to new
Speaker 7: products and services that are AI. Our job is to
Speaker 7: basically go and find those outlier businesses for our LPs
Speaker 7: and find the next Shopify and canby and add and
Speaker 7: you know before they're obvious.
Speaker 2: Sname Petru thanks for bringing it. Foreleases on the new
Speaker 2: tenth fund Media LGBTQ plus dating app Grinder. As popularity
Speaker 2: is growing globally, averaging fourteen and a half million monthly
Speaker 2: active users. Shares with the company are up thirty three
Speaker 2: percent year to date. We spoke with the Grinder CEO,
Speaker 2: George Arrison about the role AI is playing in that
Speaker 2: growth and how they handle privacy in the age of AI.
Speaker 13: Grinder privacies by farther paramount thing because we have users
Speaker 13: in countries where it's illegal to be gay, or in
Speaker 13: areas where while it might be legal, you still can't
Speaker 13: really be yourself, and so protecting them is really really crucial.
Speaker 13: We don't ask for a lot of information from users
Speaker 13: when they join the app, we don't require a photo,
Speaker 13: We don't try to be as minimal as we can
Speaker 13: in that regard, again, because privacy is so important to users.
Speaker 13: And from there, the other really critical thing for us
Speaker 13: is to be able to keep all the data on Grinder,
Speaker 13: So we work with Amazon's Bedrock service, which is a
Speaker 13: virtual private space that allows us to actually keep everything
Speaker 13: in our end. Our data does not kind of stay
Speaker 13: with anybody else, and our data does not train anybody
Speaker 13: else's models, and that's been really helpful obviously. And the
Speaker 13: other thing we're now starting to do is actually take
Speaker 13: open source models and put them into our system and
Speaker 13: be able to train them to make them be a
Speaker 13: little more gay. And that's also quite interesting because that's
Speaker 13: kind of pushing us closer to the frontier of what's
Speaker 13: happening in THEI. But no one else is doing anything
Speaker 13: like that, and we think we can provide some really
Speaker 13: useful insights for our users.
Speaker 2: Through that grinder. CEO George Arrison. There, let's just talk
Speaker 2: about New York State as well. It is begun asking
Speaker 2: companies to disclose when artificial intelligence contributes to mass layoffs.
Speaker 2: It's a symbolic move as officials look to possibly regulating AI.
Speaker 2: The technology's impact on the workforce could have an uneven
Speaker 2: effect between men and women should be roused with us.
Speaker 2: She is the founderacy of up level. It's a platform
Speaker 2: AI platform designed to accelerate women in the workplace. Shuby
Speaker 2: is also an engineer, former tech executive. Yourself, Shuby, is
Speaker 2: there going to be an unequal impact of generative AI's
Speaker 2: use on the workforce?
Speaker 14: Do you think, well, when you look at what is
Speaker 14: happening in the world of AI and where the applications,
Speaker 14: at least today are. It's about automating jobs that are
Speaker 14: largely held by women. It just so happens that those
Speaker 14: jobs tend to be more administrative in nature and are
Speaker 14: perfect and right for automation, And so it will be
Speaker 14: really interesting to see what the data shows, especially if
Speaker 14: this does become legislation in New York. It is how
Speaker 14: it impacts women and how disproportionately that impact then creates
Speaker 14: further gender inequities.
Speaker 2: How is your technology perhaps trying to play a counterforce here.
Speaker 14: Yeah, you know, if you take a step back and
Speaker 14: think about today how the models are being trained from
Speaker 14: a generative AA perspective, Those large models, whether it's the
Speaker 14: Opening models or is Gemini or Cloud, have been trained
Speaker 14: largely from data of the Internet.
Speaker 15: And when you look at what is the data on
Speaker 15: the Internet, large spats of data of course are Wikipedia, Reddit, GitHub,
Speaker 15: you know, popular pop gender data sets, which tend to
Speaker 15: be highly male dominant. Then you look at the other
Speaker 15: data sets, whether that's related to academic papers. You know,
Speaker 15: publications are on business books and use cases healthcare where again,
Speaker 15: you know, up until recently, women were not even included
Speaker 15: in those clinical data sets. Really there's not a lot
Speaker 15: around caregiving unpaid labor. Right, so when you look at
Speaker 15: what that data set highly represents or over represents men
Speaker 15: than it does women, so you can so so that
Speaker 15: is the basis of the training data sets for majority
Speaker 15: of the models today.
Speaker 14: So the counter of course for Uplift, what we're trying
Speaker 14: to do at up level is create the world's largest
Speaker 14: gender data set so that this gender data set actually
Speaker 14: represents women both contextually from an experienced perspective, understands women's
Speaker 14: challenges around career, health, wealth, and more importantly, can be
Speaker 14: that counter force whereby you know, in theory, someday we
Speaker 14: could blend both those data sets, then then we'll have
Speaker 14: that gender equality across the broader training sets.
Speaker 2: Is really interesting. We you're hearing from the Grinder CEO
Speaker 2: saying they're training their large language models to be more
Speaker 2: gay from the perspective of maybe you start to counteract
Speaker 2: the bias within the applications that come from the large
Speaker 2: language models. But what about just unsaid biases about women
Speaker 2: and actually adopting this technology. Are we being first movers,
Speaker 2: are people being early adopters in the workforce, do you
Speaker 2: think at the same level as men.
Speaker 14: Yeah, you know, this is a disturbing number that you know,
Speaker 14: I keep seeing where it feels like the gap was
Speaker 14: maybe twenty percentage points between men adopting. And I'm talking
Speaker 14: about generative AI, not just AI broadly, but just even
Speaker 14: generative AI tools versus women. Part of that has to
Speaker 14: do with, you know, if you look at broader adoption
Speaker 14: of women in terms of big tech, yes, women might
Speaker 14: be on those platforms, but are not merely as active
Speaker 14: in terms of posting, sharing comments, reacting than men are.
Speaker 14: And so that'd be and why is that?
Speaker 16: Because you know, when you look at a lot of
Speaker 16: these platforms and there is has been a mass exodus
Speaker 16: of women, is because of the misogyny, the nursism, you know,
Speaker 16: the sexualization, etc.
Speaker 14: So there is this inherent issue that we have around
Speaker 14: trusting tech and that's bleeding itself into also using these
Speaker 14: generative AI tools. So a big part of that is
Speaker 14: just can I trust this or if I use this tool,
Speaker 14: then can I actually.
Speaker 9: Say this is my work?
Speaker 7: You know?
Speaker 14: So there is that bigger issue. So there have been
Speaker 14: impediments to adoption for women.
Speaker 2: In thirty seconds should be is it getting better.
Speaker 14: No, it's not getting better, it's actually widening. So or
Speaker 14: is it differently, Maybe women are still at the same
Speaker 14: rate of adoption and men are adopting it faster.
Speaker 2: More work to do, more reason to see up Level
Speaker 2: going in there and building these connections with big companies
Speaker 2: should be raw. So good to have you, the up
Speaker 2: Level founder and see how we appreciate it and that
Speaker 2: does it. From this edition in Bloomberg Tech, do not
Speaker 2: forget to check out our podcast. You can find it
Speaker 2: on the terminal as well as online on Apple, Spotify,
Speaker 2: and iHeart. From New York. This is Bloomberg Tech.