Speaker 1: From the heart of where innovation, money and power colli
Speaker 1: in Silicon Valley and beyond. This is Bloomberg Technology with
Speaker 1: Emily jay I. Remember we check in San Francisco and
Speaker 1: this is Bloomberg Technology coming up. In the next hour,
Speaker 1: tech stocks turn sharply lower as the semiconductor slowdown takes
Speaker 1: the industry down with it. We're gonna have more on
Speaker 1: the warnings from chipmakers and when we might see a recovery. Plus,
Speaker 1: the gig economy faces a new reality after the labor
Speaker 1: department proposes some gig workers be classified as employees, sending
Speaker 1: shares of Uber down more than We're going to talk
Speaker 1: about what it means for Uberlift, door, dash, and more,
Speaker 1: and we get a glimpse into Mark Zaggerberg's vision for
Speaker 1: them be averse. The company is leaning into the virtual
Speaker 1: workplace with new partnerships with Zoom and Microsoft. Zuckerberg also
Speaker 1: unveiling the new Quest pro headset and showing off his
Speaker 1: Avatar legs. Hundreds of billions of dollars have been wiped
Speaker 1: off the chip industry following a worldwide drop in demand
Speaker 1: for reference Taiwan Semiconductor, the most valuable chip maker in
Speaker 1: the world, suffering its biggest drop since for more, Let's
Speaker 1: bring back our Bloomberg Intelligence Senior Alice ujin Ho, who
Speaker 1: has been of course following all the moves and chips
Speaker 1: and you know, Lu, we were talking about potential glut
Speaker 1: in UH supply for months, but it seems to have
Speaker 1: taken everyone by surprise, just this idea that we didn't
Speaker 1: have enough and now we have too much. You know, why?
Speaker 1: Why is this all happened so fast? Sure? So thanks
Speaker 1: for having me on again, Emily So So a couple
Speaker 1: of things, right, um, I think the recessionary environment, the
Speaker 1: recessionary concerns going to they started to hit the U,
Speaker 1: the end markets, servers, PCs, UH, TV so on and
Speaker 1: self worth, any any electronic goods UH that seems to
Speaker 1: be pairing that back. And we saw evidence of that
Speaker 1: last quarter as in with respect to a m D
Speaker 1: and Intel UH they made their first round of cuts.
Speaker 1: And I think what's surprised everyone else is that when
Speaker 1: we thought it was over, there was another round of
Speaker 1: cuts by Micron as well as a m D. And
Speaker 1: then layer that on with the geopolitical risk which is
Speaker 1: also weighing on t SMC. So would you say a
Speaker 1: downturn in chips is a leading or lagging indicator for
Speaker 1: the rest of the technology industry. Sure so, so why
Speaker 1: don't I take you back into history if we look
Speaker 1: at pre COVID, UH, the chip makers were an early
Speaker 1: cycle has always been an early cycle UH industry, and
Speaker 1: they were the first one to come down once UH
Speaker 1: COVID hit. But once we figured out that COVID was
Speaker 1: not going to be bad as bad as initially thought,
Speaker 1: they were the first ones to come back up. From
Speaker 1: an evaluation perspective, right, it's gonna take a while for
Speaker 1: estimates to to catch up. So I know that there
Speaker 1: were a couple of rounds of cuts on the chip
Speaker 1: sector already. But even at fourteen times, it's still not
Speaker 1: a trough multiple is going back to. It's still seventeen
Speaker 1: times seventeen percent premium to trough multiple. So there's still
Speaker 1: maybe another round of learnings. Because to reflect three expectations,
Speaker 1: which companies are in the worst position based on what
Speaker 1: chips they make? And what is most you know, in
Speaker 1: the most in oversupply? Sure so so, UM, if we
Speaker 1: think about it from an end market perspective, UH companies
Speaker 1: that are over indexed on the consumer side are hurt
Speaker 1: uh if and and one of the reasons why tm
Speaker 1: SMC is hurt so badly is because some of the
Speaker 1: leading chip manufacturers rely on t S, MCS, fabs and
Speaker 1: and think about it, Apple smartphone manufacturers as well as
Speaker 1: A A M d uh for for their PCs chips.
Speaker 1: So those three buckets alone is going to create that lie. Um.
Speaker 1: I think if you think about companies that that manufactured
Speaker 1: their own ships, you have companies like analog devices that
Speaker 1: do not have as much consumer exposure, but they do
Speaker 1: have a fair amount of consumer exposure as well that
Speaker 1: may see a negative impact, as well as companies like
Speaker 1: a video that's already warned on on weakness on the
Speaker 1: consumer side. All right, uh went, how thank you for
Speaker 1: helping us work through all of this new information. Are
Speaker 1: bloomberk Sen your intelligence analysts appreciate it? Meantime, a new
Speaker 1: proposal from the Biden administration would classify millions of gig
Speaker 1: workers as employees rather than independent contractors. That could have
Speaker 1: extreme repercussions for companies like Uber and Left, which plunged
Speaker 1: on this news. Let's bring in Bloomberg's Jackie Dablos. So
Speaker 1: Jackie tell us exactly what this new law involved and
Speaker 1: how it would impact the companies that you cover. So
Speaker 1: the proposal, which is still being considered, UM, is essentially
Speaker 1: a new outline for how companies can determine whether their
Speaker 1: workers are independent contractors or employees which carry certain legal
Speaker 1: and wage benefits. UM, things like dental and medical. We
Speaker 1: all enjoy those as full time employees. However, uh, independent
Speaker 1: contractors like careers and delivery drivers just don't have those
Speaker 1: same kinds of benefits. So this new proposal is effectively
Speaker 1: making it easier for companies to look at this certain
Speaker 1: criteria UM, some of it which has been refined from
Speaker 1: the Trump era rule that it's replacing, like how integral
Speaker 1: are workers uh to the business overall? Um? You know,
Speaker 1: how much control do they have over their earnings? How
Speaker 1: much control do they have over how they can do
Speaker 1: their jobs? And these types of questions which are really um,
Speaker 1: you know, new ones compared to even the Obama era rule.
Speaker 1: UM that that it's mirroring. UM, it's effectively more gig
Speaker 1: worker friendly and Uber Live, Door, Dash, insta cart all
Speaker 1: have workers that have been clamoring for for these types
Speaker 1: of benefits, so for them it's certainly a positive. So
Speaker 1: what happens next. You know, there is a little bit
Speaker 1: of confusion around, uh, just how much of an impact
Speaker 1: this is actually going to have. And if you look
Speaker 1: at the statements that Uber and door Dash and Lift released,
Speaker 1: you know, they just weren't surprised. This is something that
Speaker 1: they were expecting since day one of the Biden administration.
Speaker 1: But what this really does, it's more of an interpretive guidance.
Speaker 1: So it's not going to wipe out the gig worker
Speaker 1: classification system. What it's doing is saying, look, this is
Speaker 1: how we're going to look on it, look at it
Speaker 1: from here on out, and it has more ramifications, say
Speaker 1: and you know, litigation if someone sues one of the
Speaker 1: companies for misclassification. This is the basis that can be
Speaker 1: used now for the companies. You know, we we look
Speaker 1: at Uber, who's kind of had to deal with this
Speaker 1: in London when the Supreme Court over there ruled that
Speaker 1: they had to classify their London drivers as employees. So
Speaker 1: they're not totally new to kind of the uh, the
Speaker 1: impact of what it will take if they have to
Speaker 1: switch the model around a bit, but it's certainly going
Speaker 1: to be somewhat of a hybrid from what legal experts
Speaker 1: UM as well as analysts are are are saying right now. Meantime,
Speaker 1: Uber's former security chief, in another story dealing with some
Speaker 1: old legal issues, was found guilty of hiding information in
Speaker 1: a corporate hack attack dating back to sixteen. You know,
Speaker 1: a pretty astounding verdict here. What was your reaction to this,
Speaker 1: What's been the reaction internally and within the industry to
Speaker 1: this and in terms of what it means for corporate transparency?
Speaker 1: You know, Emily, it's funny because that ruling actually, uh,
Speaker 1: that trial was going ongoing while Uber actually had a
Speaker 1: recent hack for UM, I don't it was their slack
Speaker 1: systems that actually been hacked by by some one, and
Speaker 1: it was incredible to kind of see the UM the
Speaker 1: different reaction the company had. There was a blog post
Speaker 1: that outlined, you know, uh, day by day, what the
Speaker 1: updates were, what the impact were to customer data UM
Speaker 1: and coming out of that trial, it's really two different Ubers.
Speaker 1: Now the Travis Kallinik yours really trickled down into just
Speaker 1: how the company helped handled corporate transparency. Now under new leadership,
Speaker 1: you've really seen that shift. The company is really UM
Speaker 1: I think more focused on just putting everything out on
Speaker 1: the table, all right, uh so intriguing their blooms. Jacky
Speaker 1: Javelos will of course follow what's happening with this new law,
Speaker 1: appreciate it. We build Horizon workrooms as a first step
Speaker 1: towards a virtual office in the metaverse. It feels more
Speaker 1: like being there than any video call. You see more
Speaker 1: of people's body language, and the spatial audio gives you
Speaker 1: a sense of each person's place in the room, and
Speaker 1: you can have side conversations with the people sitting next
Speaker 1: to you or a gesture without physically being there together.
Speaker 1: It's hard to fully wrap your head around this until
Speaker 1: you get to experience it. Just some of Mark Zuckerberg's
Speaker 1: vision there for the workplace of the metaverse, and among
Speaker 1: other news at the Medicannect event, Zuckerberg announced partnerships with
Speaker 1: Microsoft and Zoom to promote virtual collaboration unmail the fifteen
Speaker 1: hundred dollar Quest pro headset, and says Meta will add
Speaker 1: legs soon to avatars. There they are let's bring in
Speaker 1: food works Kurt Wagner and to Economy founder David Kirkpatrick. So, Kurt,
Speaker 1: what are your big takeaways today? Is it the avatar legs?
Speaker 1: The avatar legs was a pretty easy one to point
Speaker 1: out and fun obviously a little bit better than just
Speaker 1: floating around in the metaverse. But now, I mean the
Speaker 1: headset was sort of the flying ship product that was
Speaker 1: announced today, This new kind of high end b our device. Um,
Speaker 1: you know, it's it's as Mark said in that video,
Speaker 1: it's more tailored towards working professionals. They're kind of going
Speaker 1: after a higher end clientele than I think they have
Speaker 1: with some of their other stuff. But you know, a
Speaker 1: lot of the technology that they kind of showed off
Speaker 1: towards the end of the presentation is the stuff, in
Speaker 1: my opinion, that's most interesting. Uh. You know, this is,
Speaker 1: for example, like lifelike avatars, right or even uh you know,
Speaker 1: the ability to kind of use your hand or your
Speaker 1: wrist as a controller. Um, all of that is very cool,
Speaker 1: And the problem is it's just years and years away, right,
Speaker 1: So now you're asking people to be very patient. You're
Speaker 1: asking investors to be very patient as they build and
Speaker 1: work on this stuff. And so I think, you know,
Speaker 1: that's where the issue comes in. It's not that the
Speaker 1: technology is not cool, it's just it's really far off. David,
Speaker 1: the staff dropped almost fo why do you think that is? Well,
Speaker 1: one way to look at it would be, this is
Speaker 1: a company with three and a half billion people in
Speaker 1: a business that's generating like forty billion a year in
Speaker 1: after checks profit. That is talking about a business that
Speaker 1: for which they've sold fifteen million devices and a metaverse
Speaker 1: product that has three thousand users a day, and that's
Speaker 1: what the management is putting its primary focus on. It
Speaker 1: would seem if you're an investor in a company that
Speaker 1: is has such misguided priorities, I think you would be
Speaker 1: very disappointed. Is the workplace David ready for metaverse technology? No,
Speaker 1: not at all. No, it is not. It is not.
Speaker 1: It's simply not. We don't want to meet in the metaverse.
Speaker 1: It's very nice that Zoom and Microsoft have talked meta
Speaker 1: about possibly making a three D version of their meeting products,
Speaker 1: but that is not what most people want to do.
Speaker 1: The company's behaving as if it was a gaming company.
Speaker 1: I mean everything today was talked about as if it
Speaker 1: was a company for gaming, the kind of technologies or
Speaker 1: gaming technologies. It's kind of a gaming psychology, gaming aesthetics, um,
Speaker 1: but that isn't really what this company he is, and
Speaker 1: it's it's a it's a scary, scary situation this company
Speaker 1: has put itself in, in my opinion, what's your response
Speaker 1: to that? I think David's right, I mean, as I
Speaker 1: kind of alluded to their right to tech school, but
Speaker 1: can they convince investors that it's worth waiting ten years
Speaker 1: for right? And and uh, as David points out, like
Speaker 1: they have a business here that that needs at tension
Speaker 1: right now, which is the advertising business, right, I mean,
Speaker 1: they're they're kind of dealing with a real serious threat
Speaker 1: right here and now with TikTok uh and and young
Speaker 1: people not necessarily wanted to use their apps. And so
Speaker 1: when you think about that, that's the current state of
Speaker 1: the business, and then you look at you know, what
Speaker 1: the priorities seem to be from Mark Zuckerberg. It doesn't
Speaker 1: necessarily align. And I imagine that there are a lot
Speaker 1: of people, clearly, I guess given the stock movement today
Speaker 1: that saw this and thought, man, why are they spending
Speaker 1: so much time and money on this problem when they
Speaker 1: have others that they need to be addressing. Now. We
Speaker 1: spoke to Francis Hogan uh last week, of course, that's
Speaker 1: Facebook whistleblower, and she had an interesting thought about Cheryl
Speaker 1: Sandberg leaving the company, and you know the company now,
Speaker 1: you know, for of course being fully in the hands
Speaker 1: of of Mark Zuckerberg. Take a listen to what she
Speaker 1: had to say. You know, Marcus surrounded himself with people
Speaker 1: who tell him the same kinds of stories over and
Speaker 1: over again. You know, Facebook is just a mirror. It
Speaker 1: doesn't have responsibility. All these things that we're complaining about
Speaker 1: have always been present. We're just showing them to people
Speaker 1: who don't. We don't play any role in this. We
Speaker 1: have no power. David curious what your thoughts are on that. Well,
Speaker 1: I completely agree with her analysis of how they see this.
Speaker 1: I mean, to the degree Zuckerberg thinks about the sort
Speaker 1: of socio cultural impact of the products that he's built.
Speaker 1: He's still basically in the mindset of making the world
Speaker 1: more open and connected is really cool, and he thinks
Speaker 1: the metaverse is the next stage of that. He doesn't
Speaker 1: want to take responsibility for the ongoing problems that he
Speaker 1: is not resolved. And I continue to think that the
Speaker 1: reason the company changed its name almost exactly a year ago,
Speaker 1: at the height of Francis Hogan's revelations about numerous misdeeds
Speaker 1: and errors and unresolved problems. Was to change the narrative, which,
Speaker 1: for their to their credit, was very successful as a
Speaker 1: PR move, but isn't really successful as a business move
Speaker 1: long term. And now they're stuck with a new name
Speaker 1: and a sensible direction that isn't really rational. Um. So
Speaker 1: they have such serious problems. And if any other company
Speaker 1: had these problems, the CEO would be out. But this
Speaker 1: is a company with no governance, with a board that
Speaker 1: is just a paperboard. Because Zuckerberg completely controls that he
Speaker 1: can't be fired. He don't. He controls all the shares.
Speaker 1: I mean, he controls a majority of the shares, so
Speaker 1: he can do whatever he wants. And that is a
Speaker 1: very dangerous situation. And it is dangerous for investors to
Speaker 1: be in this company. Even though it's PE is lower
Speaker 1: than any other major company tech company by a substantial mark,
Speaker 1: it's not a good investment going forward. Well, and that's
Speaker 1: in part because it's market captives drops so much since uh,
Speaker 1: Frances how good, And since the company changed its name,
Speaker 1: this is now a million dollar company. David, how bad
Speaker 1: would things have to get before Mark Zuckerberg considers something
Speaker 1: as as extreme as taking it private? Well, you know,
Speaker 1: that that's something that I have thought about as a
Speaker 1: possible remedy for the problems the company has, because then
Speaker 1: it could address the serious challenges it faces without the
Speaker 1: stock market breathing down its neck and judging it, you know,
Speaker 1: with the voting machine of the stock every single day.
Speaker 1: They have a lot of expensive problems to fix, and
Speaker 1: it would be a lot better to do it if
Speaker 1: they were private. But I think it would have to
Speaker 1: get a lot a lot worse. I mean, look, the
Speaker 1: stock is down from almost a trillion to three d
Speaker 1: and fifty billion now it could go down to two
Speaker 1: hundred and fifty billion, at which point I don't think
Speaker 1: it would be irrational for him to consider taking it
Speaker 1: private since he completely controls it. You know, we talked
Speaker 1: and seeing so much of their vision for virtual reality.
Speaker 1: What about augmented reality? How much further does this go? Yeah, well,
Speaker 1: we saw some glimpses of that in the headset right there.
Speaker 1: They're calling it mixed reality, but it's this idea that
Speaker 1: while you're wearing the headset, you can actually see the
Speaker 1: world around you. You can overlay graphics or or you know,
Speaker 1: digital objects on that world, and that's ultimately the vision
Speaker 1: that Zuckerberg has for a our glasses right that we
Speaker 1: might wear them to look sort of like reading spectacles.
Speaker 1: But you'll wear those and that's how you'll interact without
Speaker 1: more you know, not really a bulky headset. But you know,
Speaker 1: I think that David's point here. What's interesting is like
Speaker 1: Mark Zuckerberg would probably tell you, hey, listen, you're betting
Speaker 1: on me, right. I've made, for the most part, pretty
Speaker 1: good business decisions for almost twenty years, um, and that's
Speaker 1: why he has control and that's why people, you know,
Speaker 1: invest in this company. But over the last year or so,
Speaker 1: I think he's really raised some questions as to whether
Speaker 1: this is a pet project of his or whether this
Speaker 1: is actually a good you know, use of of you know,
Speaker 1: funds and attend and we won't know that for like
Speaker 1: ten years, and so that's I think the big trouble
Speaker 1: here is it's hard to say whether or not he's right.
Speaker 1: Ten years very long time, especially if you're an investor
Speaker 1: thinking about the near term. Bloomberg's Kurt Wagner and Economy
Speaker 1: founder David Kirkpatrick, thank you both. We're gonna be right
Speaker 1: back with more of Bloomberg technology. This is Bloomberg More
Speaker 1: allegations in the Elon Musk Twitter battle. Bloomberg has learned
Speaker 1: that just before the billionaire revived his proposal to buy
Speaker 1: the social media company, he accused Twitter of ordering a
Speaker 1: whistle blower to destroy evidence. According to court filings, Peter
Speaker 1: Zack Co said he burned ten handwritten notebooks and deleted
Speaker 1: a hundred computer files at the request of managers as
Speaker 1: part of a seven point eight million dollar sefferance package.
Speaker 1: The SEC is weighing an investigation of Yuga Labs, the
Speaker 1: creator of the popular board Ape yacht club n f
Speaker 1: T S. Sources say the SEC is deciding whether the
Speaker 1: n f T should follow the same disclosure rules as stocks.
Speaker 1: Board Apes are among the most high profile and f
Speaker 1: T s and have been traded for as much as
Speaker 1: two million dollars. The SEC has brought dozens of cases
Speaker 1: against digital asset managers, including the fifteen million dollar fine
Speaker 1: to Block five back in February, Welcome Back to Bonebar Technology,
Speaker 1: and Emily Changing in San Francisco after VC spent years
Speaker 1: aggressively buying steaks in cash burning tech startups. The current
Speaker 1: environment and cretering share prices of even mature tech companies
Speaker 1: have dimmed the prospects for startups that we're working towards
Speaker 1: their own I p O s. What does that mean?
Speaker 1: What does the future hold for them? Let's talk about
Speaker 1: all that and more with Henry Wards, CEO of the
Speaker 1: equity management solutions provider Carter. So Carter has some ascinity
Speaker 1: the insights into these pre I p O companies. Henry,
Speaker 1: what's happening inside these companies right now? And what's the
Speaker 1: mood like? Yeah, sure, it's a tailor two stories. Uh Here,
Speaker 1: there's a growth stage uh story where a lot of
Speaker 1: these gross companies are sort of in a frozen capital
Speaker 1: markets uh rang where they can't raise capital right now
Speaker 1: because they can't justify the prices that they raised previous
Speaker 1: rounds at. They're not willing to do down rounds because
Speaker 1: uh these rounds trigger anti dilution provisions for early investors
Speaker 1: and it penalizes management. And so they're kind of stuck
Speaker 1: in limbo with these high prices that they priced, you know,
Speaker 1: six months a year ago, but the public markets won't
Speaker 1: support and they're trying to figure out what to do.
Speaker 1: In the early stage uh markets, there are a lot
Speaker 1: more active prices are resetting quickly. We're seeing investors continue
Speaker 1: to be active. There's a lot of dry powder, and
Speaker 1: so it's it's a very interesting market. We see this
Speaker 1: in our business a lot where early stage ventures still active.
Speaker 1: There's still a lot of deals happening with growth trade
Speaker 1: ventures at a standstill. What seeing happening with hiring and layoffs.
Speaker 1: We had a guest on an investor a few months
Speaker 1: ago who said he was expecting to see two to
Speaker 1: three million job cuts across the tech industry. Is that
Speaker 1: even close to happening? Not even close? You know, it's
Speaker 1: really interesting in in h when we saw the massive
Speaker 1: set of layoffs happening, we saw headcount growth among our
Speaker 1: customer base grow about seven percent this year. In the
Speaker 1: first half of this year, we've seen about twelve percent
Speaker 1: growth rates. So it's not as high as you know,
Speaker 1: the boom boom years of two, eighteen and nineteen, where
Speaker 1: we're growing at fifteen depending on the year, but twelve
Speaker 1: percent somewhere in the middle. It's not as bad as
Speaker 1: twenty it's not as great as eighteen and nineteen. But
Speaker 1: we're still seeing a lot of startups grow, really being
Speaker 1: led by B two B sas business. So if you
Speaker 1: look at other sectors like healthcare biotech, they're suffering a
Speaker 1: little bit more, but B two B SAS continues to
Speaker 1: trend strongly. So how do you square that with we've
Speaker 1: heard from so many big tech companies there you know, freezing,
Speaker 1: hiring slow and hiring down, there being more deliberate. Uh.
Speaker 1: Do the numbers translate? Yeah, So if you look what's
Speaker 1: happening in the public markets that's translating to the private
Speaker 1: markets is there's you know, in earlier this year, there's
Speaker 1: sort of a massive capitulation of investors saying, hey, these
Speaker 1: all these companies are overpriced. We don't know which companies
Speaker 1: are going to survive, which companies are gonna succeed, which
Speaker 1: companies aren't, and so they punish the entire TUCH sector.
Speaker 1: What's happening now is the emergence of investors deciding, well,
Speaker 1: they're they're all companies aren't created equal. Some are more, Uh,
Speaker 1: will will grow better and and and and survive through
Speaker 1: this period, and others won't. And we have to sift
Speaker 1: through these companies and decide which ones are gonna be
Speaker 1: the winners and which ones aren't. And what you're seeing
Speaker 1: is the bigger companies and even the smaller Companies that
Speaker 1: are transactional revenue based where the revenue can be volatile,
Speaker 1: are punished more more by investors than recurring revenue contractual
Speaker 1: revenue businesses. So when you look at like the great
Speaker 1: you know, software business like Salesforce and Snowflake, where they
Speaker 1: have contractual, recurring revenue and high net dollar retention and
Speaker 1: high growth rates. Uh, they're doing quite well, they're starting
Speaker 1: to recover. But you see other transactional businesses or business
Speaker 1: bad on based on media or other types of revenue models,
Speaker 1: They're being punished more more severely. And so you're starting
Speaker 1: to see a sector or sick rotation between the high
Speaker 1: quality companies and the lower quality companies. And that's that's
Speaker 1: trickling into the to the venture world, where you're starting
Speaker 1: to see investors just be more selective in the business
Speaker 1: models that they're willing to support, rather than just support
Speaker 1: anything that seems like a great idea. Meantime, Carter is
Speaker 1: expanding internationally. I understand you've bought three companies since June.
Speaker 1: How are you expanding uh so quickly in the middle
Speaker 1: of a downturn or is it that you're seeing, um,
Speaker 1: you know, some potentially opportunistic valuations out there and taking
Speaker 1: advantage or taking those opportunities as you see them. Yeah,
Speaker 1: So last year we decided as a board and a
Speaker 1: company that we were going to get more aggressive internationally.
Speaker 1: You we've always believed that are the problem we're solving.
Speaker 1: Its ownership in company is in ownerships to global UH phenomenon,
Speaker 1: a global problem that we can solve across the world. Obviously,
Speaker 1: every region has his own um nuances and regulatory requirements,
Speaker 1: and we're not experts outside the United States UM. And
Speaker 1: so what we've seen over the last few years, which
Speaker 1: has been really exciting for me personally as a founder UH,
Speaker 1: is all these CARDAU startups in different regions. So we
Speaker 1: found the card of UK, we found the CARDA of China,
Speaker 1: we found the car to South Korea. We've found the
Speaker 1: car to of India. We've been been found the card
Speaker 1: of Africa. We've found CARDA in all all regions and
Speaker 1: I would say almost every developed country now we have
Speaker 1: some version of a card to Some founder has started
Speaker 1: a CARDAM for that country, and we've been we've been
Speaker 1: talking all these founders, and some of these founders we've
Speaker 1: invested in their rounds um UH to help support them
Speaker 1: in their region and then others including the three that
Speaker 1: you mentioned like cap Desk in Europe, Velbon in London,
Speaker 1: and then Zen Equity in India. We've actually bought the
Speaker 1: companies UM after getting to the all the founders and
Speaker 1: falling in love with the team and the product, and
Speaker 1: really their goal is to build out what we've built
Speaker 1: in the United States and build it out, build out
Speaker 1: for their region and their local market structure, and then
Speaker 1: start connect these things so that we have a global
Speaker 1: platform for for equity management. It's an amazing time right
Speaker 1: now to do M and A. As prices are resetting,
Speaker 1: capital becomes more scarce, founders are more willing to look
Speaker 1: at opportunities to join larger companies. UM. We have a
Speaker 1: superactive CORPV team. Obviously, as you mentioned, we've done three
Speaker 1: deals just in the last two quarters which we're really
Speaker 1: excited about. Nothing to announce yet, but we've got more
Speaker 1: in the pipe as we look look across the world
Speaker 1: and try to find the cart is for every every
Speaker 1: country in all right, Henry A Ward, CEO of Carter,
Speaker 1: good to have you back with us. Henry, thank you
Speaker 1: for stopping by coming up. Code n f T S
Speaker 1: mean the end of the password era for good. Unstoppable
Speaker 1: Domains is next. This is Bloomberg time Now for our
Speaker 1: Crypto reporter, we're taking a look at diversity in Web
Speaker 1: three with the leading Web three identity platform, Unstoppable Domains,
Speaker 1: which just announced a new goal to provide online courses
Speaker 1: on crypto and Web three and distribute millions in n
Speaker 1: f t S domains to five million latinos to help
Speaker 1: them build and control their digital identity. Senior Vice president
Speaker 1: and channel chief Sandy Carter joins us Now for more
Speaker 1: on this, We're gonna talk about that, but first I
Speaker 1: want to talk about the whole password and user name
Speaker 1: issue which we've been using ever since the Internet's been around.
Speaker 1: How is Unstoppable Domains trying to change that? Yeah, thanks
Speaker 1: for having me, Emily. Unstoppable Domains presents a digital identity
Speaker 1: to every user, and that digital identity can be used
Speaker 1: to log into over four are different applications, also be
Speaker 1: used to supplement email, do into an encrypted email, as
Speaker 1: well as build a website. So it completely changes the
Speaker 1: model on its head. Uses one way to get into
Speaker 1: an application, and then that digital identity travels with you
Speaker 1: and that data stays with you, which is such a
Speaker 1: powerful proposition. I believe that digital identity and that ownership
Speaker 1: is not just something that's nice to have, but is
Speaker 1: a human right. So how realistic is this and how
Speaker 1: far off is it? A world where we don't have
Speaker 1: to use use your names and passwords at all? So
Speaker 1: I think we're just beginning our journey. I like to
Speaker 1: say Emily that we're in the dial up phase of
Speaker 1: Web three. There are so many capabilities you can already
Speaker 1: do with your digital identity and log into a set
Speaker 1: of applications, but the field is really limitless. I believe
Speaker 1: in the future will be storing healthcare data, education records, tickets,
Speaker 1: driver's license in there. So I think it's the right
Speaker 1: time to get started playing around and experimenting with your
Speaker 1: digital identity and to own it now. Since you own it,
Speaker 1: you don't rent it. It's very powerful to have that today,
Speaker 1: as we're getting started versus waiting until it's too late.
Speaker 1: I know you've also been incredibly active getting more women
Speaker 1: into Web three. You now have this announcement focused on
Speaker 1: Latin as you know, talk to us about what this
Speaker 1: means and how you're hoping to increase diversity in this world. Uh,
Speaker 1: for you know, you know, an increasingly important population. Yeah, well,
Speaker 1: you know, we just chatted about how we're early, and
Speaker 1: because we are so early in this initiative, I think
Speaker 1: it's really important that we hear all voices. You know,
Speaker 1: based on data from Mackenzie and from Deloitte, we know
Speaker 1: that diversity breeds more innovation. And right now, the population
Speaker 1: inside of Web three and the metaverse is only eight
Speaker 1: percent women. So we're not going to get that powerhouse
Speaker 1: innovation we need if we stay so homogeneous. Back in
Speaker 1: March eighth of this year, um I announced an initiative
Speaker 1: called Unstoppable Women of Web three, whose goal is to
Speaker 1: educate that next generation of women and to help more
Speaker 1: women come into the space. And because Emily I had
Speaker 1: so many women asked me for that education in their
Speaker 1: own native language. That's why we're announcing today that we're
Speaker 1: bringing that education to our Latina population and providing them
Speaker 1: that education in Spanish. Now, you know, we've heard a
Speaker 1: lot of people in Melinda Gates, for example, has expressed
Speaker 1: concerns about women backsliding as a result of the pandemic
Speaker 1: and now a macroeconomic downturn. We've we've heard concerns about
Speaker 1: this within the broader tech industry as well. Do you
Speaker 1: have concerns about women in crypto, women in Web three
Speaker 1: backsliding or losing some of the progress they've made, you know,
Speaker 1: given you know these dreadful economic conditions that we're facing.
Speaker 1: It's interesting. So I met Fortunes Most Powerful Women conference today.
Speaker 1: I actually got to meet Melinda Gates uh and chat
Speaker 1: with her some about this. I think that the um
Speaker 1: the output that's coming out right now in terms of
Speaker 1: the amount of interest in Web three. You know, conferences,
Speaker 1: even this one here, so many questions about what is
Speaker 1: the metaverse? How can we play, how do we get started?
Speaker 1: Conferences around the world are just bringing in so much interest.
Speaker 1: So I think for Web three in the metaverse, I
Speaker 1: believe that if we can provide the right set of education,
Speaker 1: that we can really accelerate the number of women in
Speaker 1: the space. In fact, the number of developers alone in
Speaker 1: the Web three space is increased by sixty six percent
Speaker 1: most recently. So with the interests, I think now is
Speaker 1: that perfect storm, you know that early days where we
Speaker 1: can get more women interested understanding what it is so
Speaker 1: that they can jump in and have a really big impact.
Speaker 1: And I think now is the time given we are
Speaker 1: so early, all right, Sandy Carter of Unstoppable Domain, Sandy,
Speaker 1: thank you for joining us today. Amazon second prime sale
Speaker 1: of the year. But the question on everyone's mind is
Speaker 1: is it still a bargain? New research suggests maybe not.
Speaker 1: One of the professors behind that research is joining me
Speaker 1: now for more on this. Jin Jinhung. She a a
Speaker 1: marketing professor at the University of Florida's Warrington College of Business,
Speaker 1: along with our very own Brad Storren, who has of
Speaker 1: course covered Amazon for for decades. So Jen Han, tell
Speaker 1: us a little bit more about your research. The main
Speaker 1: thesis seems to be that, uh, these aren't the discounts
Speaker 1: aren't as big as you might think. This is the
Speaker 1: research I can backt with my call. Third San Sekapak
Speaker 1: at the University of South Carolina and the manship at
Speaker 1: the Arizona State University UM. We invested the products sold
Speaker 1: on Amazon, and we find this a new pattern of
Speaker 1: pricing you which the seller simentaneously increased price and displays
Speaker 1: this price, and the make announcement of a prices can
Speaker 1: so in this way, a price increase is framed as
Speaker 1: a price lis Cam and seller um Fire saw the discount,
Speaker 1: and they saw that they get a bargain, but actually
Speaker 1: they paid them more than the consumer who bothered before
Speaker 1: the sailor displayed the discount. Okay, so you're potentially actually
Speaker 1: paying more for something that you think you're getting at
Speaker 1: a discount. Brad, Is this, you know, a long time
Speaker 1: Amazon strategy or is this something new our Yeah? I
Speaker 1: might call it probably a long time retail strategy. I
Speaker 1: don't know that it's necessarily unique to Amazon. I I
Speaker 1: think you can see it in department stores and even
Speaker 1: even discount source. The idea of discounting something uh and
Speaker 1: and and making the discount kind of an illusion inflating
Speaker 1: the the actual retail prices is I think a tactic
Speaker 1: across the retail when I think it's probably harder to
Speaker 1: control at Amazon, given that more than half of those
Speaker 1: sales are going to be broken by third party sellers
Speaker 1: who control their own prices. It's probably something that's hard
Speaker 1: for Amazon to oversee. Okay, go ahead. You know, it
Speaker 1: seems like we we saw some lackluster interest this second
Speaker 1: half of the year, and I'm wondering why that is.
Speaker 1: Is it because the discounts aren't really discounts. Is it
Speaker 1: because they already did this once this year? Is it
Speaker 1: because we're, you know, going into a recession potentially and
Speaker 1: people just don't have as much money to spend, Jan Hong,
Speaker 1: I do. What I'm talking about is not that you
Speaker 1: didn't get a discount. Is you actually were charged at
Speaker 1: the higher price when you you were told you get
Speaker 1: the discount. So usually the seller is played at least
Speaker 1: price or makeing least by comparison, wouldn't they actually drop
Speaker 1: price because the price promotion. They may not give you
Speaker 1: the discount the claim. But in this case, the seller
Speaker 1: actually increase price and to tell you discount and then
Speaker 1: day or two days later they will remove. This is
Speaker 1: discount the claim and the drop price. So this is
Speaker 1: a very difference. Brad, talk to us about the actual
Speaker 1: interest we saw this time around, and you know this
Speaker 1: this whole idea to split it into prime days. You know,
Speaker 1: the thought was that would drive more interest. But I
Speaker 1: wonder if maybe it didn't. It's not necessarily working. I
Speaker 1: would say, Emily, it's probably a little too soon to
Speaker 1: uh to say that today was a failure. I mean, remember,
Speaker 1: this is not a prime day, this is a prime
Speaker 1: early the sale and it's this new creature. Um, it's
Speaker 1: hard to compare it to the summer sale. It's really
Speaker 1: weird timing, right that no one is holiday shopping gift
Speaker 1: or at least you're not if you're a normal procrastinator
Speaker 1: like me. UM. Other big sales days like Cyber Monday
Speaker 1: and Black Friday are around the corner. The numbers we
Speaker 1: have really don't tell a consistent story. I think we
Speaker 1: can both tell that like Twitter mentions and and chatter
Speaker 1: about this sale or down. Um. There's one research firm
Speaker 1: that's saying that basically sales today clovers the research firm
Speaker 1: were similar to the previous thirty day average. But then
Speaker 1: you have another firm numerator saying that the average order
Speaker 1: size his way up and that the big sales, the
Speaker 1: big sale items are Amazon gift cards and and Echo dots,
Speaker 1: the small Alexa devices. So look, if the purpose of
Speaker 1: this for Amazon is the deep in its relationship with
Speaker 1: the prime customers and get more prime customers before the
Speaker 1: holidays to kind of lock shoppers in, then maybe you
Speaker 1: know they can declare this the success as they move
Speaker 1: into the holidays. Jan, is there something that you think
Speaker 1: needs to happen here based on what you found. You know,
Speaker 1: there has been a lot of scrutiny of the way
Speaker 1: Amazon prices uh, certain goods, but you know, not necessarily
Speaker 1: of the practice that you're talking about in particular, do
Speaker 1: we need some regulation, Uh, we think the attention is
Speaker 1: required to this a new practice because the regulation has
Speaker 1: been focused on the regulation and the self be pricing
Speaker 1: has been books on illegitiment value of a least price,
Speaker 1: you know, whether you use inflated or fake this price.
Speaker 1: But this is a different practice. This is the manipulation
Speaker 1: of the timing of least price introduction. So the seller
Speaker 1: synchronized the pricing increased which a least price introduction and
Speaker 1: the comparison. So that's a new practice and this is
Speaker 1: really misleading for consumer. Brad, what's your take on the
Speaker 1: signals we're seeing about shopping and consumer sentim it right now?
Speaker 1: Heading into the holidays, It's it's tough, Emily, Um, You've
Speaker 1: got um the rising costs of food and fuel inflation.
Speaker 1: Folks are pulling back. There's no question that you know,
Speaker 1: overall you are spending over the holidays is slowing down. Adobe.
Speaker 1: I think that it was going to be about two
Speaker 1: point five previous years, you know, eight nine percent. Um.
Speaker 1: Of course it was even higher because of of sort
Speaker 1: pandemic field fear out of walking into stores and and
Speaker 1: retail has been kind of an anvil for Amazon. You've
Speaker 1: got a very successful advertising business aws of course, um,
Speaker 1: even even some sort of successful business around third party
Speaker 1: sellers and commissions. But retail itself, those online stores are
Speaker 1: they were flat last holiday season. It was down four
Speaker 1: percent in the last quarter. Um. I think you know
Speaker 1: Amazon here, which has gottled up share for years decades,
Speaker 1: is probably not going to be doing that this holiday season.
Speaker 1: All right, Bloomers brad Stone along with professor at the
Speaker 1: University of Florida fascinating research from you. Of course, we're
Speaker 1: gonna keep watching to see how this Prime Day unfolds
Speaker 1: and that doesn't. For this edition of Bloomberg Technology Wednesday,
Speaker 1: we're gonna have Amazon's head of Prime on to talk
Speaker 1: about Prime Day two point out and a holiday shopping sentiment.
Speaker 1: And don't forget to check out our podcast wherever you
Speaker 1: get your podcast time, I wily check in San Francisco.
Speaker 1: This is Bloomberg