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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the

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Speaker 1: Bloomberg Intelligence Podcast. Catch us live weekdays at ten am

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Speaker 1: Eastern on Applecarplay and Android Auto with the Bloomberg Business App.

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Speaker 1: Listen on demand wherever you get your podcasts, or watch

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Speaker 1: us live on YouTube.

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Speaker 2: The Nike putting up some good results.

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Speaker 3: The stock is up fifteen percent here today. That's got

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Speaker 3: a market kappa north of one hundred billion dollars.

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Speaker 2: Put them oil.

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Speaker 3: She covers all the retailers for Bloomberg Intelligence. She joins

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Speaker 3: us now pooh them. The street likes what bloom What Nike?

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Speaker 3: You had to say? What did you hear on their earnings?

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Speaker 4: Yeah, you know, it kind of seems like we hit

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Speaker 4: the bottom, so I think, you know, there's only upside

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Speaker 4: from here, is what it seems like. The results weren't spectacular.

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Speaker 4: Sales still fell twelve percent, but they're expected to fall

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Speaker 4: mid single digits in the first fist whole quarter, which

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Speaker 4: was ahead of consensus. And it seems that things are working.

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Speaker 4: The holiday order book is up, so you know, positive

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Speaker 4: things going forward, and still a choppy environment. We're not

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Speaker 4: at positive sales. It's still going to take time, but

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Speaker 4: I think we've hit the bottom.

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Speaker 5: Hey, put on what is it?

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Speaker 2: Though?

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Speaker 6: We were breaking it down with you last night after

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Speaker 6: the earnings broke and the stock was kind of bouncing around,

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Speaker 6: you know, and so obviously some stuff got clarified on

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Speaker 6: the call with.

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Speaker 5: Analysts and investors.

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Speaker 6: What is it in particular did they say or say

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Speaker 6: over and over again that kind of gave investors hope

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Speaker 6: and saying that, Okay, yeah, maybe the worst is over.

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Speaker 4: Yeah. The first thing is on the inventory, and we

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Speaker 4: spoke about yesterday inventories were basically just flat right, and

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Speaker 4: you expected to see them down more. They talked a

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Speaker 4: little bit about that, and they talked about how the

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Speaker 4: order book is stronger heading into the holiday season. So

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Speaker 4: that is why they're building up some of the inventory.

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Speaker 4: They're continuing to clear out access inventory of things like

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Speaker 4: the dunk, which they have too much of and they

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Speaker 4: actually do want to get rid of. But then they're

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Speaker 4: building inventory of new things which are selling, which there

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Speaker 4: is demand for. Store sales were positive, the holiday order

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Speaker 4: book is positive. Those were really good indications as we

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Speaker 4: move forward, and their guidance, of course was better than expected.

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Speaker 4: So I think all of that together just kind of

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Speaker 4: sent the message that we're going up from here, things

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Speaker 4: are going to get better.

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Speaker 3: Pudin What are they saying about the impact of tariffs,

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Speaker 3: either on their cost structure or on consumer demand.

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Speaker 4: Yeah, so tariffs definitely have an impact on their cost structure.

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Speaker 4: We sought in the margin guidance, which there's one hundred

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Speaker 4: basis point hit from tariffs. It's a billion dollars in

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Speaker 4: additional costs, So there is definitely implications from that. They

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Speaker 4: are able to offset a lot of it through price increases,

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Speaker 4: internal efficiencies, supplier negotiations, but it's still going to hit

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Speaker 4: the margin line. In terms of demand, it's not clear

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Speaker 4: that it's actually pulled back any demand yet. And the

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Speaker 4: way the Nike is strategically taking up these price increases

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Speaker 4: five dollars on shoes that are over one hundred dollars,

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Speaker 4: no increase on kids, et cetera. I think their customer

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Speaker 4: can absorb that without pushing back meaningfully unless things deteriorate

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Speaker 4: in the consumer macro world from here onward.

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Speaker 6: But am I going to tell you Paul's got a

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Speaker 6: pretty snazzy pair of loafers on.

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Speaker 5: I'm just going to say I love the color. They're

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Speaker 5: pretty cool. I don't know if he has snowfers yet

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Speaker 5: from Nike, but I mean these are not inexpensive.

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Speaker 6: We talked about that last night too, and the resale

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Speaker 6: of some of them going for like five hundred dollars.

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Speaker 6: I mean, this is a company that does continue to

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Speaker 6: have the ability to innovate and really capture consumers and

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Speaker 6: you know, really be a product in demand.

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Speaker 4: Yeah, you said it absolutely right. You know, Nike just

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Speaker 4: needs to innovate. It needs to bring performance product, it

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Speaker 4: needs to bring style more of it. It's not that

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Speaker 4: they never did it. They did, but they just needed

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Speaker 4: to continue to be at the cutting edge of it.

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Speaker 4: And they're coming back to that. They're coming back to

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Speaker 4: their roots, they're coming back to sports, They're coming back

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Speaker 4: to innovation and being the brand that cuts out the

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Speaker 4: newness first. So I think this is one example of it. Clearly,

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Speaker 4: it's not going to be you know, the shoe that's

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Speaker 4: going to be made in you know, millions of quantity.

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Speaker 4: So that's why you're seeing it on the resale platforms.

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Speaker 4: But as long as they stay true to performance and sports,

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Speaker 4: I think they will continue to do better.

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Speaker 2: Hey put them in in the sneaker business.

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Speaker 3: How important is the athletic endorsement, getting signing up the

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Speaker 3: newest pro that kind of thing. I think a Cooper flag,

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Speaker 3: the number one draft pick in the NBA. Do g

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Speaker 3: Red wondering if that's still a thing.

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Speaker 4: It is a thing. I mean, Nike definitely has a

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Speaker 4: deep pockets to get the athletes that are already some

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Speaker 4: of the biggest athletes. But when you think about the

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Speaker 4: rookies are the ones that are coming up. If Nike

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Speaker 4: could secure the best ones, it definitely helps them because

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Speaker 4: they resonate and they connect better with shoppers. So creating

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Speaker 4: a line for them or creating the shoe that they're

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Speaker 4: wearing or their own shoe help to connect with the shopper.

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Speaker 4: And that's how some of these other rivals of theirs

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Speaker 4: are making their mark and really taking shares. They're investing

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Speaker 4: and they're getting these rookies and they're able to draw

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Speaker 4: these connections that help them. So I do think endorsements

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Speaker 4: in sports and getting the right athlete is still very

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Speaker 4: very important to the game and to any athletes.

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Speaker 5: Share brand, all right.

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Speaker 2: Put them Oyle, thank you so much. We appreiate it.

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Speaker 2: Put them Oyle.

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Speaker 3: She covers all the retail companies for Bloomberg Intelligency based

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Speaker 3: down there.

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Speaker 2: At Princeton and New Jersey.

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Speaker 3: A great quarter from the perspective of the market stocks

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Speaker 3: of fifteen percent.

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Speaker 2: It had been down, you know, kind of on the

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Speaker 2: year or so.

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Speaker 3: As Punham suggested, it seems like the market's saying these

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Speaker 3: guys have kind of hit bottom.

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Speaker 2: They've kind of now have some runway to go. So

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Speaker 2: we keep an eye on that.

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Speaker 6: Even with that bump up, as you said, sixteen percent

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Speaker 6: or so, it's still done about four percent yeter date.

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Speaker 5: Just shows you what it's been coming back on.

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Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live

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Speaker 1: weekdays at ten am Eastern on Applecarplay and Android attil

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Speaker 1: with the blue Berg Business app. Listen on demand wherever

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Speaker 1: you get your podcasts, or watch us live on YouTube.

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Speaker 3: Carol Masher Paul Sweeney, We're live here at the home

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Speaker 3: of Michael Lobe out here in Southampton and New York

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Speaker 3: at the annual Uncharted Summit where they get together a

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Speaker 3: whole bunch of entrepreneurs, funders and they talk about creating business,

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Speaker 3: creating value. We're joining right now by our co host

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Speaker 3: Michael Lowe, founder and CEO of lob dot NYC and

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Speaker 3: no Freedom, CEO of Uncharted.

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Speaker 2: Gents, thanks so much for joining us. Got the light

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Speaker 2: blue and the dark blue.

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Speaker 3: We're looking solid here Hampton's Casual.

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Speaker 2: I got my support, cooks, my best effort I can do.

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Speaker 3: Michael, talk to us about what this conference is about.

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Speaker 2: What do you guys really look to do here.

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Speaker 7: So we're not going to talk about your wardrobe.

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Speaker 5: We're not going to go there because got great flowers.

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Speaker 7: On it looks amazing. Check busses.

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Speaker 8: Yeah, somebody dressed you in the morning exactly. So what

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Speaker 8: the intention is is that Noah and I started building

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Speaker 8: Uncharted four years ago, was in the teeth of COVID

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Speaker 8: when nobody was getting together with anybody else, and we

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Speaker 8: started having dinners at my house in the city.

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Speaker 7: And was very popular.

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Speaker 8: And what the thesis is is that entrepreneurs need as

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Speaker 8: much support as they can get, including emotional support, and

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Speaker 8: the best way to do that is put entrepreneurs in

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Speaker 8: a room with other entrepreneurs and they are as a class.

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Speaker 8: They drive the economy, drive jobs, drive wealth, and yet

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Speaker 8: there I think underappreciated, and as a serial entrepreneur myself

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Speaker 8: and actually one or two things worked, I'm very empathetic

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Speaker 8: and just with all the miles on the tires. I

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Speaker 8: am kind of a senior statesman by definition. Right, this

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Speaker 8: is a young guy's game. I say that I have

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Speaker 8: the privilege of working with people half my age and

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Speaker 8: twice as smart. I used to say that. Now it's

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Speaker 8: three as smart and one third of my age, but

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Speaker 8: that was the intention. And it's grown to tribe of

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Speaker 8: maybe twenty five hundred entrepreneurs, of which about a third

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Speaker 8: of them show up to this, so we will have

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Speaker 8: about eight hundred today.

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Speaker 5: No, come on in on this.

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Speaker 6: You're the CEO of Uncharted too, right, and so we're

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Speaker 6: seeing things being set up. There's going to be a

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Speaker 6: lot of great conversations and speakers going on. Tell us

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Speaker 6: what it's been grown into and what kind of conversations

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Speaker 6: are going to be happening later on.

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Speaker 9: The common thread of everything that we've done it Uncharted

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Speaker 9: since the first dinner on May twenty, twenty twenty one.

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Speaker 9: And I'll never forget it.

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Speaker 5: Was it just you too? By the way, Justice us.

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Speaker 7: To a dinner. Yeah, it was just us too. We

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Speaker 7: just sat and talked for four hours and here we go. No,

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Speaker 7: not about it. We also held ounce we did all

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Speaker 7: dance the whole time. Yeah, it's very romantic.

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Speaker 9: Now, we had about twenty entrepreneurs around the table, kind

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Speaker 9: of yeah, eight of each of our friends and then

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Speaker 9: a couple of others. If you will look, the common

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Speaker 9: thread of every single event we've done, whether it's our

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Speaker 9: dinners or the past three summits of the breakfast we've done,

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Speaker 9: has always been trying to create safe spaces for real entrepreneurs, founders,

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Speaker 9: exceptional particips bent in the entrepreneuri community, as we say,

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Speaker 9: to truly drop their guard, drop their hair, and trust

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Speaker 9: that they're in an environment where they can speak openly

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Speaker 9: and honestly any entrepreneur or anyone who's building and really

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Speaker 9: doing it, the real ones. Hopefully this will resonate when

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Speaker 9: they hear it. It is really f and hard. It's very

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Speaker 9: hard to build businesses. It's really hard to play this

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Speaker 9: game at the high level. And I think if we

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Speaker 9: can offer a rare environment where people can feel like

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Speaker 9: they are amongst their true peers, or they can really

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Speaker 9: drop their guard and connect with people in a place

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Speaker 9: where no matter who you go talk to, they're all

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Speaker 9: going to be exceptional.

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Speaker 10: It's special.

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Speaker 9: And so we've really tried to guard the energy. We've

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Speaker 9: really tried to keep the sanctity of the fact that

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Speaker 9: if you come to an uncharted event, you're going to

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Speaker 9: meet someone amazing. And that's really been the common thread.

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Speaker 6: I just want to say, it's a reminder of that,

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Speaker 6: like Google, Apple, all of these companies that are now

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Speaker 6: you know, the biggest market caps that are out there

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Speaker 6: and that we talk about and you know all the time.

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Speaker 6: I mean, they all started as an idea an entrepreneur.

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Speaker 6: And that's the point.

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Speaker 8: Yeah, one percent, And if you look at kind of

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Speaker 8: success rates and everything else, if you're an entrepreneur, if

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Speaker 8: you really knew all.

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Speaker 7: That stuff, why would you you do this?

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Speaker 8: Because the failure rate is incredibly high, hours are incredibly long,

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Speaker 8: the pay you know, is dreadful until it's not until

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Speaker 8: you have a big score.

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Speaker 7: But the number of big scores is very very small.

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Speaker 8: And there's so many forces and so many you know,

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Speaker 8: so many exogenous things that are you know, anti entrepreneur

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Speaker 8: that we wanted to have a sanctuary here that other

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Speaker 8: entrepreneurs can meet other entrepreneurs. And Noah, you're fond of

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Speaker 8: saying that not a week or two goes by where

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Speaker 8: we don't get a phone call saying I met my

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Speaker 8: co founder here two years ago.

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Speaker 3: Yep, No, who's a What are the areas that are

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Speaker 3: most interested entrepreneurs today?

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Speaker 2: Is it technology? Is healthcare?

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Speaker 3: Are there certain industries that are getting most of the attention.

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Speaker 9: Look, I think the obvious buzzword that you can't go

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Speaker 9: too far in any of the new cycles to that

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Speaker 9: hearing is AI. And I think that unlike other cycles

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Speaker 9: that have come and went and entered the Zeitgeison left,

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Speaker 9: this one feels very real. I can tell you that

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Speaker 9: amongst all my friends, whether they're in CpG, health tech,

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Speaker 9: pure AI, deep tech, what have you tech, and all

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Speaker 9: of them are thinking explicitly about how AI is going

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Speaker 9: to impact their business if they're not already, and how

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Speaker 9: they're going to get into it. So I think we're

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Speaker 9: certainly going to talk about that a lot today. I

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Speaker 9: think it's top of mind for a lot of people.

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Speaker 9: The movement is real. I think that the implications and

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Speaker 9: repercussions are unclear how it's going to land right now,

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Speaker 9: but everybody's thinking about it, and they should be.

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Speaker 8: But I think it's unclear, but it's going to be brought,

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Speaker 8: It's going to be broad it's going to be brought

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Speaker 8: and you mentioned cycles. I've been around for a few.

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Speaker 8: This reminds me of the late nineties, where the Internet

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Speaker 8: happened and we had a lot of false starts.

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Speaker 7: Two three years ago.

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Speaker 8: Everybody was talking about NFTs before that, blockchain before that,

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Speaker 8: cannabis before that, you know, something else.

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Speaker 7: But this feels like another eruption.

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Speaker 8: This feels like another advent of the Internet, one that

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Speaker 8: we haven't had in absolutely years.

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Speaker 5: Yeah, on the same level, no doubt about it, or even.

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Speaker 8: More I think on the same level.

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Speaker 10: Yeah.

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Speaker 8: I mean, you know, it's hard to project and predict,

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Speaker 8: but I had breakfast with a heroic.

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Speaker 7: Entrepreneur a couple of days ago.

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Speaker 8: He has built a business now worth one point eight

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Speaker 8: billion dollars, and over breakfast, he says, I have two

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Speaker 8: hundred and seventy people by year end, it's going to

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Speaker 8: be one twenty.

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Speaker 7: Yeah, okay, interesting.

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Speaker 9: I would add to that, if I'm may, sorry, I

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Speaker 9: think that there's this interesting tension with AI right now

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Speaker 9: where I think Michael's right, and I would even argue

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Speaker 9: that this might I didn't live through the late nineties

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Speaker 9: period of seeing it at least all right, let me see,

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Speaker 9: thanks for having me guys, if.

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Speaker 7: You know, but I think that let your hair down shot.

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Speaker 4: Why.

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Speaker 9: I know, it's crazy everyone asked me that, But I

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Speaker 9: think there's an inherent tension where I actually think it

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Speaker 9: could be more disruptive and at the same time, I

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Speaker 9: do think that there's a lot of people who are

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Speaker 9: betting big dollars than AI that are going to get

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Speaker 9: wiped out because I think there's going to be an

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Speaker 9: absolute power law dynamic here where small select group of

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Speaker 9: companies at the top end aggregate a ton of power

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Speaker 9: and resource. I also think it's going to be a

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Speaker 9: Barbell warre on the bottom end. You know, I've invested

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Speaker 9: personally in companies that have like two or three people

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Speaker 9: on the team and have rocketed millions in are because

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Speaker 9: they're able to get ten x productivity if it's a

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Speaker 9: killer founder. So I think there's a Barbell thing happening

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Speaker 9: right now where the killer founders who actually know how

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Speaker 9: to leverage resources are going to crush it, as are

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Speaker 9: the big businesses.

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Speaker 2: Well.

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Speaker 6: Because of that and what AI can do generative AI

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Speaker 6: and so on, I mean, does it give entrepreneurs even

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Speaker 6: more opportunities to start up? We talked about that after

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Speaker 6: the pandemic. Basically create a website and you can go

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Speaker 6: and then maybe that's simplifying things, But does AI kind

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Speaker 6: of have a multiplier effect to on entrepreneurial.

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Speaker 5: Activities Without a doubt, I think that's opportunities.

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Speaker 7: I think that's right.

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Speaker 8: And if you just look at what has happened over

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Speaker 8: the years, you know, it used to be that if

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Speaker 8: you build a business, a brand new business.

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Speaker 7: In the Internet, you need it.

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Speaker 8: You needed hundreds of people, right, and now that's really

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Speaker 8: compressed to just a few.

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Speaker 7: But to Noah's point, there's.

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Speaker 8: Going to be winners and there's going to be a

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Speaker 8: lot of losers, and that's very hard to predict.

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Speaker 3: Michael, talk to us about monetization. I'm not seeing a

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Speaker 3: lot of IPOs. I'm not seeing a lot of m

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Speaker 3: and A. How do these great entrepreneurs monetize the value

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Speaker 3: they've created?

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Speaker 7: That's a that's a great question.

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Speaker 8: I would I would say that everything you just mentioned

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Speaker 8: is part of a cycle, and we're just in that

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Speaker 8: type of cycle where everything is a little bit bollock

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Speaker 8: stop uh, But you know it's it's we're going to

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Speaker 8: be on the other side of that and there's going

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Speaker 8: to be some great companies built, and there's going to

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Speaker 8: be some great flameouts. A lot of people are going

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Speaker 8: to lose a lot of money, and then there's going

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Speaker 8: to be a few that are going to be extraordinarily successful.

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Speaker 8: But to your point, we can build it now with

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Speaker 8: instead of three hundred people, three and there's been predictions

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Speaker 8: that there's going to be a unicorn with all of

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Speaker 8: three people.

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Speaker 5: Serious, Yeah, I do that.

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Speaker 6: Yeah, Okay, that kind of makes sense. And we've started

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Speaker 6: to see IPOs actually in general come to market and

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Speaker 6: it's a much more favorable market. I got to ask you,

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Speaker 6: I think we'd be remiss of the macro that's going

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Speaker 6: on and different policies in the world being upended in geopolitics.

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Speaker 6: What does that do for the entrepreneur, entrepreneur who's trying

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Speaker 6: to you know, we know it can be lean and

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Speaker 6: mean in the beginning when it comes to a startup.

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Speaker 6: What about some of these macro issues, what would be

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Speaker 6: more helpful to them?

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Speaker 5: What kind of.

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Speaker 8: Environment, well, anything that helps with capital formation, anything that

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Speaker 8: kind of reduces regulation. I was hopeful that this administration

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Speaker 8: would attack some of that stuff and maybe not terriffs,

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Speaker 8: but anyway.

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Speaker 2: It's still early, it's still early.

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Speaker 7: We're here now.

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Speaker 8: They are very active and very proactive, and I'm just

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Speaker 8: hopeful that what you really want to give is entrepreneurs

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Speaker 8: just charter. I mean, let them do their thing as

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Speaker 8: much as you can. And our hope is by the

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Speaker 8: way that this environment, believe it or not, will put

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Speaker 8: a dent in that world, right, that they will find

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Speaker 8: support here in many different ways.

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Speaker 6: Well, I always think it's kind of amazing how much

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Speaker 6: time we spend and obviously this is our world, right,

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Speaker 6: the publicly held markets, right, this is what we track,

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Speaker 6: you know, all the movements. But we talk constantly about

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Speaker 6: the importance of small business and startups in terms of

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Speaker 6: the backbone, and I just think it kind of gets

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Speaker 6: lost a little bit.

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Speaker 7: Yeah.

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Speaker 8: I do think though that you're going to see AI

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Speaker 8: up end just about every industry, and I think those

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Speaker 8: big companies are going to find themselves woefully behind and

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Speaker 8: they're going to have no choice but to make some acquisitions.

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Speaker 3: Well said, no, what capital is it out there for

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Speaker 3: entrepreneurs today?

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Speaker 10: It is?

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Speaker 9: But I think that you're seeing an interesting dynamic with

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Speaker 9: the vcs and private equity that they're chasing a lot

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Speaker 9: of trends almost blindly. You know the fact that right

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Speaker 9: now there are really good businesses that don't have the

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Speaker 9: word AI that are struggling to raise money, whereas there's

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Speaker 9: other businesses that have a deck and pre seed and

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Speaker 9: barely an idea and or raising money at fifty million

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Speaker 9: dollars pre money valuations, I think is indicative of what's

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Speaker 9: going on.

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Speaker 5: Yeah, we saw venture raise. It's been really difficult.

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Speaker 9: It's been very difficult unless you're a credentialed AI founder

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Speaker 9: have a good idea in the AI space, because there's

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Speaker 9: a lot of VC funds chasing chasing ideas, and I

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Speaker 9: think some of them will work, but the unfortunate realities,

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Speaker 9: I think a lot of them are going to get

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Speaker 9: absolutely smoked because they can't all work, especially not at

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Speaker 9: fifty million dollar pre So to answer your question directly, sure,

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Speaker 9: there's capital out there, I wish.

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Speaker 7: There was more.

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Speaker 9: I wish there was more going to more ideas that

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Speaker 9: were based just on meritocracy and their actual traction versus

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Speaker 9: the notion that they have AI and it as bullish

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Speaker 9: as I am on AI and investing in it personally,

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Speaker 9: to be of abundantly clear.

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Speaker 7: But it's an interesting moment right now, very interesting.

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Speaker 8: I will only add that that is not too much

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Speaker 8: different than what we've always seen. True, there's always been

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Speaker 8: the bright shiny object, and the investors feel like they

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Speaker 8: got to follow that.

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Speaker 5: Did you really start working for you in high school?

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Speaker 2: Such fantastic got to start on?

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Speaker 3: Yeah, got us talk about that off air, exactly right, Michael,

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Speaker 3: thank you so much, having founder CEO of lobe dot

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Speaker 3: nyc it Noah Friedman, CEO of uncharged.

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Speaker 2: Thank you gentlemen for being having a great conference today.

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Speaker 3: I hope you have a lot of great ideas circle

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Speaker 3: about and a lot of great deals.

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Speaker 7: Thanks for having men.

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Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live

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Speaker 1: weekdays at ten am Eastern on Applecarplay and Android Auto

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Speaker 1: with the Bluemberg Business app. Listen on demand wherever you

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Speaker 1: get your podcasts, or watch us live on.

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Speaker 3: YouTube Powermaster and I we are here at the Hope

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Speaker 3: of Michael Southampton. It's starting to pick up the activity,

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Speaker 3: the weather's getting better. Of interesting folks coming through, and

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Speaker 3: we're fortunate to get a few of them to come

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Speaker 3: spend a few minutes with us, including Bill Howrid's former

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Speaker 3: CEO of PayPal, joining us here. Bill Serial entrepreneur. Is

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Speaker 3: that something we can go with to kind of start

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Speaker 3: the conversation here with you? Well, if you count eight

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Speaker 3: of them, yes, all right, that's where we're going.

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Speaker 2: What does a conference like this mean to you?

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Speaker 3: And what does it mean to some of the young

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Speaker 3: folks who are coming with ideas and energy and maybe

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Speaker 3: the looking for a little bit of a guidance.

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Speaker 2: Would you hope to get done here?

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Speaker 11: Well, you know, I think I can encourage. I don't

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Speaker 11: think I can guide because you know, there aren't a

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Speaker 11: lot of rules to this.

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Speaker 10: Every time is different, and you.

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Speaker 11: Know, I'll tell you the thing that I will tell

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Speaker 11: people what makes it hard to do a startup?

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Speaker 10: People think about, well.

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Speaker 11: There's the risk, there's the career risk, there's the financial risk.

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Speaker 11: But that's not really the thing. But you need to

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Speaker 11: be comfortable in ambiguity because you come to work every

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Speaker 11: day and you really don't know what's happening next. You

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Speaker 11: don't have a play book and so you have to

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Speaker 11: love the thrill of making it up as.

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Speaker 10: You go along.

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Speaker 6: Does it get any easier like the second, third, fourth,

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Speaker 6: fifth time around?

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Speaker 11: It doesn't get any easier from the point of view

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Speaker 11: of you know, sort of knowing a formula, but it

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Speaker 11: does get easier because you're more used to the thrill.

443
00:19:16,840 --> 00:19:22,920
Speaker 3: What's the challenge here for a young entrepreneur in today's market, Well, first.

444
00:19:22,760 --> 00:19:27,480
Speaker 11: Of all, you know, having the being able to understand yourself.

445
00:19:27,520 --> 00:19:30,800
Speaker 11: Self awareness, that's the most important thing. Everybody for instance,

446
00:19:30,800 --> 00:19:35,320
Speaker 11: Silicon Valley or this arena, everybody thinks of themselves as

447
00:19:35,359 --> 00:19:39,560
Speaker 11: a change agent. In fact, the vast majority of humans

448
00:19:39,560 --> 00:19:42,720
Speaker 11: are not. The vast majority of humans want to know

449
00:19:42,760 --> 00:19:44,320
Speaker 11: when they get up, what they go to do and

450
00:19:44,320 --> 00:19:47,160
Speaker 11: how they do it. And that is as it should be,

451
00:19:47,160 --> 00:19:51,280
Speaker 11: because that's how society moves forward. But if you have

452
00:19:51,400 --> 00:19:54,119
Speaker 11: enough self awareness to know what you like and know

453
00:19:54,160 --> 00:19:58,399
Speaker 11: what you're capable of and this is it, then you

454
00:19:58,440 --> 00:19:59,919
Speaker 11: know have the courage to go ahead.

455
00:20:00,040 --> 00:20:00,960
Speaker 5: How much easier is it?

456
00:20:01,000 --> 00:20:04,439
Speaker 6: When I think for Evergreen Money, your wealth advisor that

457
00:20:04,480 --> 00:20:06,159
Speaker 6: you've got on the website, it says you built this

458
00:20:06,200 --> 00:20:08,960
Speaker 6: for yourself. So when you kind of identify something that's

459
00:20:09,000 --> 00:20:11,280
Speaker 6: needed in the marketplace, is it easier to do?

460
00:20:11,359 --> 00:20:14,320
Speaker 11: And oh, it's much easier. Yeah, Because you don't have data,

461
00:20:14,359 --> 00:20:16,680
Speaker 11: you don't have research. You really have to go from

462
00:20:16,720 --> 00:20:19,240
Speaker 11: your gut at the very beginning. Then of course, you

463
00:20:19,280 --> 00:20:21,520
Speaker 11: get the data and you have to adopt to it,

464
00:20:21,920 --> 00:20:24,959
Speaker 11: but it works so much easier if you have just

465
00:20:25,000 --> 00:20:29,080
Speaker 11: an innate sense of what's required. As an example, the

466
00:20:29,480 --> 00:20:33,600
Speaker 11: company that I tried just before this one which failed.

467
00:20:33,960 --> 00:20:36,920
Speaker 11: One of the reasons it failed is that the audience

468
00:20:37,240 --> 00:20:39,720
Speaker 11: was it was an attempt to give great credit to

469
00:20:39,880 --> 00:20:43,639
Speaker 11: people who are under banked who need it desperately. But

470
00:20:43,680 --> 00:20:46,400
Speaker 11: one of the problems is I didn't understand.

471
00:20:46,080 --> 00:20:47,320
Speaker 5: That market is this Mint.

472
00:20:48,200 --> 00:20:52,080
Speaker 11: Well, Mint is not that Mint is a personal finance manager.

473
00:20:52,520 --> 00:20:53,640
Speaker 10: I did have a hand in that.

474
00:20:53,720 --> 00:20:58,240
Speaker 11: I've done about three and a half personal finance managers

475
00:20:58,240 --> 00:21:02,320
Speaker 11: in my time. But this was a subprime lender. But

476
00:21:02,400 --> 00:21:06,480
Speaker 11: we tried to do lendings two people who did not

477
00:21:06,600 --> 00:21:09,800
Speaker 11: have good credit ratings. But rather than doing it at

478
00:21:09,840 --> 00:21:12,840
Speaker 11: five hundred percent, we tried to do it at less

479
00:21:12,840 --> 00:21:16,880
Speaker 11: than thirty six percent. It didn't work for a variety

480
00:21:16,880 --> 00:21:20,440
Speaker 11: of reasons. But now I'm back in my MILU. I

481
00:21:20,560 --> 00:21:23,119
Speaker 11: know about this stuff. Not only do I know about

482
00:21:23,520 --> 00:21:27,200
Speaker 11: managing money, but also, and most importantly, I know about taxes.

483
00:21:28,160 --> 00:21:30,399
Speaker 11: I ran TurboTax for ten years now. I've been doing

484
00:21:30,440 --> 00:21:32,360
Speaker 11: a whole lot of stuff. And the thing about it

485
00:21:32,400 --> 00:21:36,680
Speaker 11: is if you are an investor. My view, you can't

486
00:21:36,680 --> 00:21:39,560
Speaker 11: beat the market, but you can harness it, so you

487
00:21:39,600 --> 00:21:42,240
Speaker 11: need to harness it. That's the pre tax but much

488
00:21:42,280 --> 00:21:45,800
Speaker 11: more important than pre tax return is your after tax return,

489
00:21:45,800 --> 00:21:47,160
Speaker 11: because that's all you can put in the bank.

490
00:21:47,359 --> 00:21:49,440
Speaker 6: All I'm going to say is it's unfortunate though, because

491
00:21:49,440 --> 00:21:53,159
Speaker 6: here's someone who has done several companies. You understand this world,

492
00:21:53,240 --> 00:21:57,240
Speaker 6: and the underbank need representation and they need platforms. So

493
00:21:57,320 --> 00:22:00,000
Speaker 6: it's a shame that it is so tough. It is

494
00:22:00,200 --> 00:22:01,200
Speaker 6: kind of get these things going.

495
00:22:01,400 --> 00:22:04,399
Speaker 3: Yes, yeah, when do you know as an entrepreneur or

496
00:22:04,440 --> 00:22:07,000
Speaker 3: when do you admit failure when you know it's just.

497
00:22:07,000 --> 00:22:08,560
Speaker 7: Not you're to pull the plug.

498
00:22:08,720 --> 00:22:14,280
Speaker 11: Never early enough, okay, never early enough. First of all,

499
00:22:14,440 --> 00:22:17,840
Speaker 11: I've been I've been more frequently wrong by being too

500
00:22:17,880 --> 00:22:19,240
Speaker 11: early than too late.

501
00:22:19,800 --> 00:22:22,000
Speaker 10: And so when you're really early, you're the pioneer.

502
00:22:22,040 --> 00:22:25,879
Speaker 11: You've got the arrows in your back, and you're just

503
00:22:25,960 --> 00:22:28,800
Speaker 11: trying to do too much, break too much ground all

504
00:22:28,840 --> 00:22:31,399
Speaker 11: at once, and the market's usually not ready for you.

505
00:22:32,880 --> 00:22:36,080
Speaker 11: But if the market is on an upswing just starting,

506
00:22:36,160 --> 00:22:37,199
Speaker 11: that's the time to get in.

507
00:22:38,280 --> 00:22:40,560
Speaker 6: What do you find interesting about fintech there's just been

508
00:22:40,600 --> 00:22:42,639
Speaker 6: so many iterations and I think if you layer on

509
00:22:42,760 --> 00:22:44,960
Speaker 6: now what's going on with AI, how does that kind

510
00:22:44,960 --> 00:22:46,840
Speaker 6: of continue to disrupt that space.

511
00:22:47,520 --> 00:22:53,000
Speaker 11: Well, the great thing about financial technology and it's like media,

512
00:22:53,119 --> 00:22:56,240
Speaker 11: those are the two industries that can be completely digitized.

513
00:22:56,280 --> 00:22:59,040
Speaker 11: There is nothing physical about it, and so that's the

514
00:22:59,119 --> 00:23:02,119
Speaker 11: cool thing. You can do so much new stuff so

515
00:23:02,359 --> 00:23:06,040
Speaker 11: quickly because there's nothing physical that you have to either

516
00:23:06,080 --> 00:23:07,240
Speaker 11: build or transport.

517
00:23:08,320 --> 00:23:08,679
Speaker 10: AI.

518
00:23:09,520 --> 00:23:12,560
Speaker 11: We're really on the forefront of bringing AI into the

519
00:23:12,560 --> 00:23:18,000
Speaker 11: financial space because what you need to do is do

520
00:23:18,119 --> 00:23:21,320
Speaker 11: more than simply go to GPT. You need to build

521
00:23:21,359 --> 00:23:26,080
Speaker 11: a financial knowledge base, and then you have to build

522
00:23:26,080 --> 00:23:29,560
Speaker 11: a client portrait because if it is only GPT, all

523
00:23:29,600 --> 00:23:33,080
Speaker 11: you're getting is information. If I know about you and

524
00:23:33,160 --> 00:23:35,760
Speaker 11: your finances, now I can combine the information and the

525
00:23:35,840 --> 00:23:40,000
Speaker 11: understanding of the client and build a true advice engine

526
00:23:40,280 --> 00:23:44,560
Speaker 11: tell people in their particular circumstances what their consideration should be.

527
00:23:44,640 --> 00:23:47,720
Speaker 6: So Paul Sweeney gets an agent or agentic AI that's

528
00:23:47,800 --> 00:23:49,040
Speaker 6: just built for him essentially.

529
00:23:49,240 --> 00:23:51,639
Speaker 11: Well, yes, first, let me just say we don't do

530
00:23:51,840 --> 00:23:54,960
Speaker 11: only AI. We have what I think is the ideal

531
00:23:55,040 --> 00:24:00,760
Speaker 11: combination of human professional advisors and the AI resources, combine

532
00:24:00,760 --> 00:24:05,280
Speaker 11: them together. But yes, we know everything we can about

533
00:24:05,320 --> 00:24:08,520
Speaker 11: you and your finances, including not only what you own

534
00:24:08,920 --> 00:24:12,720
Speaker 11: both internally and externally, but also all of the conversations

535
00:24:12,760 --> 00:24:15,439
Speaker 11: you've had with us, and we put all that stuff

536
00:24:15,480 --> 00:24:18,760
Speaker 11: together and then apply the advice.

537
00:24:18,480 --> 00:24:19,199
Speaker 10: Engine to that.

538
00:24:20,000 --> 00:24:23,280
Speaker 3: Nomah Friedman, CEO of Uncharted, was our guest earlier this morning.

539
00:24:23,280 --> 00:24:24,520
Speaker 2: He made a comment about AI.

540
00:24:24,800 --> 00:24:27,600
Speaker 3: Yeah, that if you don't have AI in your story,

541
00:24:27,640 --> 00:24:29,639
Speaker 3: it's tough to raise capital today.

542
00:24:29,680 --> 00:24:31,080
Speaker 2: And maybe that's.

543
00:24:30,960 --> 00:24:34,600
Speaker 3: A concern of his crowding out some other ideas besides.

544
00:24:34,280 --> 00:24:36,200
Speaker 10: That, something that's absolutely true.

545
00:24:36,280 --> 00:24:39,879
Speaker 11: Okay, the money, the money always chases the fat, and

546
00:24:39,920 --> 00:24:41,440
Speaker 11: I'm not saying AI is a fat.

547
00:24:41,480 --> 00:24:41,879
Speaker 10: It is not.

548
00:24:42,119 --> 00:24:44,719
Speaker 11: It is here to stay, and it's powerful. I mean,

549
00:24:44,760 --> 00:24:46,399
Speaker 11: I've been long enough, I'm old enough that I've been

550
00:24:46,400 --> 00:24:49,840
Speaker 11: in this business long enough to see a series of revolutions.

551
00:24:50,160 --> 00:24:53,520
Speaker 11: You know, the PC, the Internet, the mobile, now AI.

552
00:24:53,920 --> 00:24:54,520
Speaker 10: It's real.

553
00:24:54,880 --> 00:24:57,560
Speaker 11: However, when these things come in, there is such a

554
00:24:57,760 --> 00:25:02,640
Speaker 11: fury and so much focus on on the thing that yes,

555
00:25:02,720 --> 00:25:04,840
Speaker 11: it crowds everything else out and that's a shame, but

556
00:25:04,880 --> 00:25:05,280
Speaker 11: it's going to.

557
00:25:05,280 --> 00:25:07,000
Speaker 5: Make it better in your view in terms of like

558
00:25:07,040 --> 00:25:08,040
Speaker 5: wealth management and.

559
00:25:08,040 --> 00:25:09,520
Speaker 10: Oh, wealth management. Absolutely.

560
00:25:09,720 --> 00:25:12,000
Speaker 11: Most of the big firms are looking at AI to

561
00:25:12,520 --> 00:25:15,320
Speaker 11: reduce cost. They look at their contact center. I've got

562
00:25:15,359 --> 00:25:17,679
Speaker 11: five thousand people, sorry, five hundred people. Can I get

563
00:25:17,680 --> 00:25:20,720
Speaker 11: it to fifty? We have the benefit of not having

564
00:25:20,760 --> 00:25:23,879
Speaker 11: that objective, and so we can use AI actually to

565
00:25:23,920 --> 00:25:25,240
Speaker 11: make the service better.

566
00:25:26,640 --> 00:25:30,920
Speaker 3: Other than AI, yeah, other than AI. Dare you where should.

567
00:25:30,720 --> 00:25:31,280
Speaker 2: I be looking?

568
00:25:31,359 --> 00:25:35,320
Speaker 3: If I were a funder and a VC. Where else

569
00:25:35,760 --> 00:25:38,119
Speaker 3: can I see some opportunities? Do you think when I

570
00:25:38,160 --> 00:25:38,600
Speaker 3: come here?

571
00:25:38,880 --> 00:25:39,840
Speaker 2: Who do I want a corner?

572
00:25:41,160 --> 00:25:41,440
Speaker 7: Well?

573
00:25:42,200 --> 00:25:47,359
Speaker 11: You know, gosh in the financial services arena. What I

574
00:25:47,359 --> 00:25:52,959
Speaker 11: would say is anybody who is taking on a big,

575
00:25:53,240 --> 00:25:58,160
Speaker 11: established giant, because increasingly it's always been the case in technology,

576
00:25:58,200 --> 00:26:01,080
Speaker 11: but increasingly the people that I want to compete with

577
00:26:01,400 --> 00:26:06,399
Speaker 11: are big, have strong reputations, have customers, have assets, have

578
00:26:06,480 --> 00:26:09,760
Speaker 11: the whole thing. The problem is that they've got an

579
00:26:09,760 --> 00:26:13,720
Speaker 11: installed base. And the good Lord created the world in

580
00:26:13,760 --> 00:26:16,919
Speaker 11: seven days, he didn't have an installed base, yep, And

581
00:26:17,000 --> 00:26:20,040
Speaker 11: so they can't move and that's the opportunity.

582
00:26:20,800 --> 00:26:23,480
Speaker 3: Ohk ahead are the big banks.

583
00:26:23,520 --> 00:26:24,080
Speaker 2: When Karen and I.

584
00:26:24,080 --> 00:26:26,400
Speaker 3: Talked to the big financial institutions and go visit them,

585
00:26:26,880 --> 00:26:29,200
Speaker 3: all they talk about is the investments they are making

586
00:26:29,320 --> 00:26:33,960
Speaker 3: in AI to better serve their customers. That's tough for

587
00:26:34,000 --> 00:26:37,040
Speaker 3: guys like you who want to kind of dissin intermediate.

588
00:26:36,520 --> 00:26:37,840
Speaker 10: Well, it's not really, it's not really.

589
00:26:37,880 --> 00:26:39,880
Speaker 11: I mean, what they're doing in many of them are

590
00:26:39,920 --> 00:26:45,480
Speaker 11: doing very good work. However, it's a very different environment

591
00:26:45,640 --> 00:26:51,480
Speaker 11: paradigm people process the whole thing. Let's just before AI.

592
00:26:51,640 --> 00:26:56,600
Speaker 11: Let's just talk about software. They have thousands, if not

593
00:26:56,680 --> 00:26:59,399
Speaker 11: tens of thousands of software engineers.

594
00:26:58,880 --> 00:27:00,480
Speaker 10: Here India, all around the world.

595
00:27:00,840 --> 00:27:04,480
Speaker 11: I'm looking at, you know, twenty five and yet when

596
00:27:04,520 --> 00:27:06,280
Speaker 11: I really focus, I can move a heck of a

597
00:27:06,320 --> 00:27:07,480
Speaker 11: lot faster than they can.

598
00:27:08,359 --> 00:27:11,840
Speaker 6: What's kind of interesting about today's environment investment, environment innovation.

599
00:27:12,320 --> 00:27:14,480
Speaker 6: I'm just curious someone who's seen a lot of cycles,

600
00:27:14,840 --> 00:27:17,760
Speaker 6: right seeing things really change, some things didn't always pan out,

601
00:27:17,800 --> 00:27:18,920
Speaker 6: But I'm just curious.

602
00:27:19,400 --> 00:27:21,560
Speaker 11: Well, I don't think you can predict the cycle, but

603
00:27:22,680 --> 00:27:25,240
Speaker 11: you have to be ready for it. And that means

604
00:27:25,280 --> 00:27:30,160
Speaker 11: always always have enough funding to get through whatever would

605
00:27:30,160 --> 00:27:32,719
Speaker 11: come at you in the next eighteen month. And you know,

606
00:27:33,000 --> 00:27:35,439
Speaker 11: the time that you're taking a real risk is if

607
00:27:35,480 --> 00:27:37,800
Speaker 11: you let yourself get down to six month funding or

608
00:27:37,800 --> 00:27:40,479
Speaker 11: something of that nature. Right now, all of a sudden

609
00:27:40,480 --> 00:27:42,439
Speaker 11: the market goes against you and your toast.

610
00:27:42,840 --> 00:27:45,600
Speaker 5: Is it a tougher cycle? How do you describe though?

611
00:27:45,640 --> 00:27:47,320
Speaker 6: I mean right now, well, we have seen in what

612
00:27:47,400 --> 00:27:50,320
Speaker 6: three or four months has just been crazy, But we've

613
00:27:50,320 --> 00:27:53,280
Speaker 6: been through tough times COVID great financial crisis other times.

614
00:27:53,359 --> 00:27:58,119
Speaker 11: Oh yeah, Listen, the tech world goes through incredible roller coasters.

615
00:27:57,920 --> 00:27:59,760
Speaker 10: Up and down all the time.

616
00:28:00,480 --> 00:28:04,720
Speaker 11: They're usually sort of multi year cycles, but nevertheless they're

617
00:28:04,840 --> 00:28:07,359
Speaker 11: very high, very low. I mean, I'm old enough to

618
00:28:08,040 --> 00:28:13,800
Speaker 11: have lived through the Internet bubble where the Nasdaq, you know,

619
00:28:14,040 --> 00:28:17,800
Speaker 11: was reduced by eighty percent and a decade to get back.

620
00:28:17,840 --> 00:28:20,639
Speaker 11: It took a decade to get back, and so you

621
00:28:20,760 --> 00:28:23,120
Speaker 11: have to be ready for that. So get yourself funded,

622
00:28:23,520 --> 00:28:26,439
Speaker 11: don't overspend, and be ready for whatever comes at you.

623
00:28:27,280 --> 00:28:30,320
Speaker 3: How long should I go before I think I'm going

624
00:28:30,359 --> 00:28:32,720
Speaker 3: to have success? Is there any kind of blueprint?

625
00:28:32,760 --> 00:28:34,320
Speaker 2: Is it a year? Two years, three years?

626
00:28:34,400 --> 00:28:36,360
Speaker 11: Well, once again, I'm not sure that I'm the guy

627
00:28:36,400 --> 00:28:39,720
Speaker 11: to answer, because I tend to stick with it longer than.

628
00:28:39,640 --> 00:28:40,440
Speaker 10: I probably should.

629
00:28:40,560 --> 00:28:45,080
Speaker 11: Got you, but if you don't have a significant you've

630
00:28:45,080 --> 00:28:46,480
Speaker 11: got a lot of pivots along the way.

631
00:28:46,520 --> 00:28:47,920
Speaker 10: You're going to take some dark alleys.

632
00:28:48,280 --> 00:28:50,840
Speaker 11: But if you don't have something that really feels right

633
00:28:50,920 --> 00:28:53,960
Speaker 11: and starts to move upward within two years, it's time.

634
00:28:53,800 --> 00:28:54,400
Speaker 10: To rethink it.

635
00:28:54,520 --> 00:28:56,480
Speaker 6: Listen, I think we only got about thirty forty seconds

636
00:28:56,560 --> 00:28:58,520
Speaker 6: left here, Bill, and I do always wonder about someone

637
00:28:58,560 --> 00:28:59,360
Speaker 6: like yourself, Like.

638
00:28:59,520 --> 00:29:01,120
Speaker 5: You know, always asks like what are you reading?

639
00:29:01,160 --> 00:29:01,800
Speaker 2: Who are you watching?

640
00:29:01,800 --> 00:29:04,120
Speaker 6: But is there somebody out there that you like kind

641
00:29:04,120 --> 00:29:07,360
Speaker 6: of look to for cues about kind of where the

642
00:29:07,360 --> 00:29:09,600
Speaker 6: world is going, what's next, pecially when it relates to

643
00:29:09,640 --> 00:29:10,080
Speaker 6: your world.

644
00:29:10,360 --> 00:29:12,160
Speaker 11: Well there's a lot of them, but I'll just mention

645
00:29:12,800 --> 00:29:15,920
Speaker 11: one person who's stuck their head up again is Mary Meeker. Yeah,

646
00:29:15,920 --> 00:29:18,360
Speaker 11: Mary Meeker. For years and years and years, she did

647
00:29:18,440 --> 00:29:21,000
Speaker 11: the book The Bible on the Internet. Then she went

648
00:29:21,040 --> 00:29:23,080
Speaker 11: off and became a VC and we didn't hear from her.

649
00:29:23,280 --> 00:29:25,560
Speaker 11: All of a sudden she's picked back up and she's

650
00:29:25,560 --> 00:29:26,720
Speaker 11: done the book.

651
00:29:26,680 --> 00:29:29,280
Speaker 3: On a really interesting I have to look out for

652
00:29:29,320 --> 00:29:30,560
Speaker 3: that because that is a question to read.

653
00:29:30,640 --> 00:29:34,200
Speaker 10: Yeah, go for four hundred pages of solid information.

654
00:29:34,400 --> 00:29:35,960
Speaker 3: That's why she was the best on the street for

655
00:29:35,960 --> 00:29:38,000
Speaker 3: a long time. Bill, thanks so much for journey. Us

656
00:29:38,000 --> 00:29:40,520
Speaker 3: really appreciate it. Bill Harris's former CEO of PayPal, getting

657
00:29:40,520 --> 00:29:42,000
Speaker 3: his thoughts on entrepreneurship.

658
00:29:42,480 --> 00:29:47,160
Speaker 1: This is the Bloomberg Intelligence Podcast, available on Apple, Spotify,

659
00:29:47,360 --> 00:29:50,840
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660
00:29:50,880 --> 00:29:54,840
Speaker 1: weekday ten am to Nooneystern on Bloomberg dot com, the

661
00:29:54,920 --> 00:29:58,800
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662
00:29:58,840 --> 00:30:02,120
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663
00:30:02,320 --> 00:30:04,280
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