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Speaker 1: Well, it is International Women's Day and with us a recognized,

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Speaker 1: much talked about, and followed individual, well known investor who

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Speaker 1: also happens to be a woman, and safe to say,

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Speaker 1: the person who ignited the investment thesis around the innovative

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Speaker 1: and disruptive theme and economy just about ten years ago.

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Speaker 1: So let's get to our interview. Great to have back

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Speaker 1: with us. Kathy Woods. She's the founder, CEO and CIO

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Speaker 1: of ARC Investment. She joins us once again from Petersburg, Florida.

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Speaker 2: Hey, Kathy, I'm so great to be talking with you again.

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Speaker 2: How are you?

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Speaker 3: I'm great? How are you doing? Carol?

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Speaker 2: Doing well?

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Speaker 1: Trying to keep up as you know, of the newsflow

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Speaker 1: kind of fast and furious. Let's talk about the economic backdrop.

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Speaker 1: Because your roots, right when you started out, you are

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Speaker 1: an economist and you think about things the macro environment.

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Speaker 1: The jobs report today, some strength, maybe some concerns about

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Speaker 1: things starting to slow down. What does the US economic

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Speaker 1: environment look like to you, the business environment as well,

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Speaker 1: and what it means for some of your investments.

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Speaker 4: Sure like that corporations are losing pricing power and we

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Speaker 4: are now beginning to see the unemployment rate move up.

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Speaker 4: It went up to three point nine percent in this

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Speaker 4: latest report from a low of three point four percent,

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Speaker 4: So undeniably it's on its way up now, and we

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Speaker 4: do think it's because corporations are losing pricing power, their

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Speaker 4: margins are getting hit. It's going to it's going to

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Speaker 4: cause a couple of things. One, the labor hoarding that

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Speaker 4: we've seen since COVID is going to diminish, and that

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Speaker 4: will increase the unemployment rate.

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Speaker 3: But then the second.

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Speaker 4: Thing is it will accelerate the adoption of technologies. Innovation

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Speaker 4: solves problems, and one of the things that it does

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Speaker 4: is increased productivity, increase efficiency, and create new products and services.

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Speaker 4: So we're pretty optimistic about our strategy in this environment

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Speaker 4: because interest rates should come down.

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Speaker 3: I think I think that the FAT, even the FED.

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Speaker 4: Is going to be surprised at how low inflation goes.

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Speaker 4: We think it could be negative this year.

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Speaker 1: Well, so, Kathy, let me ask you. That's interesting. I mean,

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Speaker 1: if the expectations, at least according to traders right now,

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Speaker 1: is that the first rate comes in June, is that

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Speaker 1: too late in your view for the Fed to start

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Speaker 1: cutting rates.

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Speaker 4: Well, I think the twenty fourfold increase in interest rates

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Speaker 4: and little more than a year has shocked the system.

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Speaker 4: We're beginning to see a reverberation of the regional bank issues.

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Speaker 4: We don't think they are going away. Deposits are still

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Speaker 4: outflowing broadly from the banking system. And there are increasing

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Speaker 4: problems with commercial real estate. Most people know about the

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Speaker 4: office problems, but multifamily units, multifamily apartments, We're beginning to

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Speaker 4: see some distressed sales there as well. So I think

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Speaker 4: that's that problem isn't as well understood, I think, and

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Speaker 4: it's going to cause the regional banks even more problems.

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Speaker 5: Kathy, how quickly do you think unemployment can go up

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Speaker 5: this year? What are you forecasting over at ARC?

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Speaker 4: Well, I wouldn't be surprised to see the unemployed employment

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Speaker 4: rate go above five percent. Now, I'm saying that knowing

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Speaker 4: that this is an election year and that this administration

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Speaker 4: probably will try and spend more than is currently in

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Speaker 4: the budgets through executive order or what have you, But

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Speaker 4: above five percent would not surprise us.

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Speaker 1: All right, So above five percent, well, that's interesting, all right,

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Speaker 1: So we have a good idea of your economic and

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Speaker 1: kind of macro backdrop. Having said that, so here we

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Speaker 1: are sitting at a day where we're seeing a little

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Speaker 1: bit of a pullback in stocks, but you're to date

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Speaker 1: the S and P still up more than seven percent.

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Speaker 1: We're looking at a Nasdaq one hundred that's also ut

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Speaker 1: more than seven percent. You look at something like the

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Speaker 1: socks is up around twenty percent year today, picking an

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Speaker 1: individual name like an Nvidia more than eighty percent, and

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Speaker 1: I could go on and on and on. There are

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Speaker 1: many who talk about a bubble, some like in it

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Speaker 1: back to ninety nine, two thousand, anything in today's equity

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Speaker 1: trade that says bubble to you.

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Speaker 4: We do not believe we're in a bubble anything like

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Speaker 4: we were in the late nineties. I was there, and

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Speaker 4: the technologies weren't ready, The costs were too high, too

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Speaker 4: much capital chase, too few opportunities, too soon. The seeds

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Speaker 4: for what is happening now were planted during the twenty

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Speaker 4: years that ended in the tech and telecom bubble, and

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Speaker 4: they've been germinating for twenty five or thirty years. So

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Speaker 4: we believe we're ready for primetime. The one place where

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Speaker 4: we could see a correction, and it's just a correction.

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Speaker 4: We're not calling at the end of this at all.

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Speaker 4: Is in the chip space whenever I hear the word shortage,

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Speaker 4: and still started hearing about GPU shortages about this time

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Speaker 4: last year as chat GPT was capturing the imagination of

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Speaker 4: both businesses and consumers. So for about a year we've

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Speaker 4: heard that word and now we're seeing lead times we

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Speaker 4: believe come down for GPUs for nvidians in particular, from

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Speaker 4: the eight to eleven month range to the three to

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Speaker 4: four month range. So that is suggesting that there was

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Speaker 4: probably a lot of double and triple ordering as the

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Speaker 4: word shortage was making the rounds, and that those inventories

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Speaker 4: will have to be digestivele But is that.

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Speaker 1: Also because of an increase in supply in terms of

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Speaker 1: output or is it because you think demand is going down?

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Speaker 2: Which one is it? Oh?

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Speaker 4: I don't think no, No, demand is not going down,

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Speaker 4: though there is something we expect that I don't hear

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Speaker 4: discussion very much. And it harkens back to the early

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Speaker 4: days of the Internet. There was a moment when the

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Speaker 4: Internet was taking off, when Cisco was all the rage,

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Speaker 4: and then enterprises started thinking seriously about the need to

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Speaker 4: spend aggressively on this new thing called the Internet and

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Speaker 4: the backbone, and they paused as a lot of competitions

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Speaker 4: started to make the rounds, and Cisco went down fifty

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Speaker 4: percent plus as.

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Speaker 3: Enterprises were pausing.

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Speaker 4: Now, why are enterprises likely to pause or at least

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Speaker 4: go through an assessment. They have to integrate all of

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Speaker 4: their data first, proprietary data is the secret to AI's success.

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Speaker 3: And they have to map out in.

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Speaker 4: Excruciating detail their workflows internally and with suppliers and customers

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Speaker 4: and so forth. And this is going to take time.

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Speaker 4: So we think this is this movement is real, is

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Speaker 4: going to be massive, but we think there's been a

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Speaker 4: little bit too much too soon.

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Speaker 5: Well, it's interesting to hear you say that, Kathy, because

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Speaker 5: you and at ARC were very early to acknowledge the

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Speaker 5: impact of AI. Yet your flagship Ark Innovation ETF has

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Speaker 5: not held shares of Nvidia in about a year. You

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Speaker 5: do own some of it in your other ETFs. Do

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Speaker 5: you have any regrets about not having held onto the

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Speaker 5: stock or actually increasing your exposure in the last couple

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Speaker 5: of years after more than five hundred and thirty percent

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Speaker 5: gains since twenty twenty two since the end of twenty twenty.

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Speaker 4: Two, Yes, so you're right, we were very early into

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Speaker 4: Nvidia ten years ago when it was five dollars. Now

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Speaker 4: it's roughly eight hundred dollars, and we wrote it most

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Speaker 4: of the way up. But I'll tell you what we did,

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Speaker 4: and this is as a portfolio manager. It's not one action,

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Speaker 4: but what it causes in terms of another act. Last

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Speaker 4: year we sold in the flagship in Vidia and.

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Speaker 3: Put it into Coinbase.

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Speaker 4: Coinbase, I believe is up as at least as much

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Speaker 4: as in VideA, and it is much less well understood.

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Speaker 3: The whole crypto.

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Speaker 4: Movement, the crypto asset movement, Bitcoin as a new asset

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Speaker 4: class and so forth is not well understood or completely

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Speaker 4: accepted out there. So we prefer to go where others

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Speaker 4: are not traveling as much. And you know, as we

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Speaker 4: were moving out of in Video, we were saying, okay,

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Speaker 4: regulators are trying to crush coinbase here, and we were

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Speaker 4: buying it on every dip.

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Speaker 3: In Vidia happen to be one of the.

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Speaker 4: Sources for that purchase. So it's not just what we

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Speaker 4: do on the cell side, it is what we do

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Speaker 4: on the buy side that you have to look at.

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Speaker 4: And yes, we do hold it in the more specialized funds,

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Speaker 4: but we've been taking profits there as well, for reasons

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Speaker 4: I just described.

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Speaker 1: Yeah, And to be fair, you're right, Coinbase is up

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Speaker 1: about six hundred and twenty percent since the end of

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Speaker 1: twenty twenty two, so that compares with about five hundred

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Speaker 1: and thirty percent gain in nvideo. Is there anything, though,

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Speaker 1: Kathy in the Nvidio story that would make you we

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Speaker 1: think the name and want to become more aggressive on it.

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Speaker 4: Yeah, if the price came down a lot, we would

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Speaker 4: you know, the rate of return expectations or split?

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Speaker 3: Would a split do it?

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Speaker 2: Because I know we've been No, no.

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Speaker 3: No, that wouldn't change. That wouldn't change anything.

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Speaker 4: No, no, split adjusted than the price. So you know,

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Speaker 4: if you look at our portfolio, is what we're trying

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Speaker 4: to capitalize on with a palanteer for example. Are the

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Speaker 4: next stages of this AI revolution? What we're seeing in

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Speaker 4: the GPU side of things is Nvidia All praise to

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Speaker 4: Jensen one. I mean, just unbelievable company execution, vision and

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Speaker 4: so forth.

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Speaker 3: And it's not over.

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Speaker 4: It's going to last a long time, but there are

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Speaker 4: going to be many other companies benefiting from AI. The

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Speaker 4: productivity lift alone is going to be massive, the most

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Speaker 4: massive productivity lift in history. We believe, and so this

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Speaker 4: AI revolution is going to be broad based and is

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Speaker 4: going to benefit a lot of companies. On the GPU side,

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Speaker 4: of course, we have AMD as competition, but many people

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Speaker 4: do not understand that there's a lot of other surreptitious

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Speaker 4: competition evolving out there. Each of the hyperscalers is evolving

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Speaker 4: its own chip strategy.

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Speaker 3: You have a.

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Speaker 4: Tesla that has designed its own chip for AI, chip

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Speaker 4: for the specialized, more specialized autonomous driving opportunity, and I

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Speaker 4: think you're going to see a lot of companies developing

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Speaker 4: more specialized chips. We know that Nvidia, of course will

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Speaker 4: segment the market as well. So we just think that

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Speaker 4: a lot of the assumptions for Invidia, you know that

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Speaker 4: this is in Vidia's market, and it's alone that those

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Speaker 4: are changing.

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Speaker 5: Well, we're speaking with Kathy Wood if you're just joining us.

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Speaker 5: She's the founder and CEO and chief investment officer of

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Speaker 5: ARC invest. She joins us from Saint Petersburg, Florida.

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Speaker 1: So it's interesting, Kathy two to you know, right, everybody

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Speaker 1: seems to be out there making chips, and it's funny.

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Speaker 1: We had a conversation yesterday with Chris Miller, who wrote

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Speaker 1: the book Chip Wars, and we talked about TSMC that

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Speaker 1: everybody can kind of design what they want, but ultimately,

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Speaker 1: right now they've got to come back to TSMC as

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Speaker 1: the fabricator to make them. So as you say that,

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Speaker 1: I mean you guys, and one of your funds I

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Speaker 1: think late last month was selling shares of TSMC. I

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Speaker 1: am curious about then you're thinking around TSMC. There's a

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Speaker 1: story today to about TSMC winning more than five billion

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Speaker 1: in grants for their US chip plant, so money, you know,

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Speaker 1: certainly being devoted to them.

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Speaker 2: Why maybe pull.

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Speaker 1: Back a little bit on TSMC or what is your

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Speaker 1: case for TSMC in the long run.

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Speaker 4: Well, the case for TSMC is, yes, it is the

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Speaker 4: manufacturer of these merchant chips, so very big story there.

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Speaker 4: But this is simply a cyclical call and it has

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Speaker 4: to do with that word shortage and TSMC. For example,

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Speaker 4: Broadcamcom reported last night I listened to that call. In

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Speaker 4: the semiconductor solutions part of their business, they were up

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Speaker 4: only four percent, AI up thirty five percent, but everything

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Speaker 4: else down. So there there are some cyclical phenomenon out there,

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Speaker 4: phenomena out there that we think are not they're not

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Speaker 4: being integrated into the short term expectations a number of stocks.

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Speaker 2: Hey in counting including Yeah.

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Speaker 5: So, Kathy, I want to move on to Tesla because

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Speaker 5: you brought it up a moment ago. You've been a

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Speaker 5: long time bull on Tesla. You have been buying shares

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Speaker 5: recently after selling them for most of twenty twenty three,

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Speaker 5: to stock down about thirty percent so far this year.

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Speaker 5: We covered the news this week that ship beens from

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Speaker 5: Tesla shang High factory sank to the lowest and over

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Speaker 5: a year in February. The challenges facing the EV industry

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Speaker 5: have been well documented. We've talked about those a lot.

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Speaker 5: Why do you still like Tesla considering all of the

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Speaker 5: challenges in the EV space and also what many critics

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Speaker 5: would say are disappointing fundamentals.

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Speaker 3: So, yes, you're right.

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Speaker 4: We were selling last year as it was in the

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Speaker 4: three hundred to four hundred dollars range. It's back to

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Speaker 4: one seventy five. And this is what portfolio managers do.

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Speaker 4: We have a five year investment time horizon for Tesla

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Speaker 4: and our price expectations I'm here.

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Speaker 3: I mean we see roughly.

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Speaker 4: A seven to tenfold increase. I know we're in the

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Speaker 4: process of revising our model. So I'm not at liberty

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Speaker 4: to give you the new number.

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Speaker 5: But would that new number be higher or lower than

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Speaker 5: two thousand.

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Speaker 3: Well, we're pushing it out a year, and.

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Speaker 4: Therefore it will be higher because the autonomous taxi platform

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Speaker 4: opportunity will be.

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Speaker 3: In full force.

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Speaker 4: We think and we believe that Tesla will get the

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Speaker 4: lion's share of that market here in the US, if

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Speaker 4: not elsewhere. Autonomous taxi platforms are sas models. Tesla's current

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Speaker 4: gross margin is well, it's in the teens right now

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Speaker 4: because it's been cutting prices, but we think normalized the

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Speaker 4: ev margin is in the thirty percent range. Sas margins

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Speaker 4: are in the eighty percent range. Most analysts focusing on

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Speaker 4: the stock have nothing in their models little for autonomous.

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Speaker 4: Our confidence that autonomous is going to happen has increased

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Speaker 4: because it has happened. We see way most successful. We

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Speaker 4: see a lot of success and commercial success. That is

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Speaker 4: in China. It can be done. We think Tesla will

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Speaker 4: launch a national service and Tesla this is where AI

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Speaker 4: comes in. Tesla has orders of magnitude more data than

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Speaker 4: all of the other auto and tech company companies going

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Speaker 4: after this market combined. And what's important about that is

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Speaker 4: that it has corner cases that nobody else has, rare,

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Speaker 4: rare occurrences on the roads that it has recorded, and

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Speaker 4: it is prepared for it, but others aren't.

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Speaker 3: Just don't.

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Speaker 5: I just want to jump in. It's kind of like

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Speaker 5: a running joke with the Tesla community because Elon Musk

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Speaker 5: says every year we're going to have this autonomous driving

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Speaker 5: technology in every year since he started saying it, what

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Speaker 5: twenty seventeen, twenty eighteen, it has failed to materialize. Why

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Speaker 5: are you so confident it's going to happen in the

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Speaker 5: near future.

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Speaker 4: Well, because it has happened, as I just said, and

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Speaker 4: so it's not. It's not if it is when that's

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Speaker 4: the most important reason. Interestingly, in his last conference call,

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Speaker 4: Tesla's last conference call, Elon said, yeah, I know I've

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Speaker 4: been wrong about it, so I'm not.

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Speaker 3: Even going to make a projection.

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Speaker 4: I actually thought that was good and maybe I have

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Speaker 4: a better shot now. And we're looking at some of

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Speaker 4: their hiring and their job postings and seeing rumblings in

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Speaker 4: different cities that they're starting to get ready.

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Speaker 1: Hey, Kathy something, I know I've brought up this with

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Speaker 1: you before, but I think back to are you and

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Speaker 1: my first interview back in May of twenty fourteen, so

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Speaker 1: almost ten years ago. But you brought up Elon Musk

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Speaker 1: when he wasn't a household name or what his company

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Speaker 1: was doing, and you likened him to Thomas Edison. And

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Speaker 1: I guess what I want to ask you. You know

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Speaker 1: this individual, you talk with him, you followed him obviously

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Speaker 1: for a long time.

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Speaker 2: Do you ever feel, you know, do you.

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Speaker 1: Feel that way still about him in terms of likening

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Speaker 1: to someone like Thomas Edison? And how do you find

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Speaker 1: clarity and feel comfort in some of the questionable and

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Speaker 1: controversial things that that Elon comments on or that he says.

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Speaker 4: Yes, well, we we're focused on the technology and we're

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Speaker 4: as is he. He is the inventor of our age.

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Speaker 4: And this age is a very special age because the

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Speaker 4: five major innovation platforms around which we have centered our

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Speaker 4: research are converging, and three of them he is helping

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Speaker 4: to converge. This autonomous taxi platform opportunity is the convergence

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Speaker 4: of robotics. Autonomous vehicles are robots, energy storage they will

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Speaker 4: be electric right, and artificial intelligence. Where those are three

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Speaker 4: steps brit es curves feeding each other and should lead

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Speaker 4: to super exponential growth. He has understood this idea that

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Speaker 4: technologies are going to converge with one another, and that

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Speaker 4: is the way he's been thinking his first principles research.

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Speaker 3: Just because something's.

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Speaker 4: Been done one way for a very long time, think autos,

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Speaker 4: doesn't mean it's going to remain that way.

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Speaker 3: And that's why he's going to win.

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Speaker 2: Do you ever feel though that he gets distracted or

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Speaker 2: or candidate to it.

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Speaker 4: Yeah, he is so laser focused on technology and and

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Speaker 4: he in the case of Tesla, the electric vehicle side

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Speaker 4: that is on automatic pilot. They are just scaling, and

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Speaker 4: what he is doing is becoming, you know, the manufacturer

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Speaker 4: of factories. He's trying to figure out how to automate

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Speaker 4: and continue to drive down the costs there. His focus

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Speaker 4: is on autonomous now certainly, and of course you can

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Speaker 4: say on X he's distracted, but he's really more focused

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Speaker 4: on the innovation. How can I go back to the

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Speaker 4: future where I started, which was in the payments app

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Speaker 4: Space sold to PayPal. How can I turn this into

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Speaker 4: not only a payments app, but an everything app? And

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Speaker 4: I think he's hard at work doing that in ways.

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Speaker 3: That we don't know yet.

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Speaker 2: We are, of course talking with Kathy Woods.

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Speaker 1: She's the CEO, CIO and of course founder of ARC

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Speaker 1: invest joining us from Florida.

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Speaker 5: Hey, Kathy, you're talking about the future of transportation, we

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Speaker 5: got to talk about Archer Aviation. One of the most

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Speaker 5: read stories today is about the company that you've been

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Speaker 5: buying up. It's a developer of air taxis Archer Aviation.

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Speaker 5: Your stake around ten percent across several of your ETFs.

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Speaker 5: You're the third largest investor in the name. We should

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Speaker 5: note shares down roughly thirty percent so far this year.

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Speaker 5: As our own Sam Potter writes today, you are once

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Speaker 5: again on the other side of a short call made

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Speaker 5: by Grizzly Research. Last time you were in a similar

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Speaker 5: spot regarding a different name, Too Simple. You lost a

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Speaker 5: lot and eventually sold most of your position. So talk

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Speaker 5: to us about why you believe in Archer and does

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Speaker 5: it ever worry you to go against the short sellers.

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Speaker 4: So our investment process is centered around research and original research.

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Speaker 4: I'll start with Too Simple. We sold Too Simple after

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Speaker 4: the CEO who was the technology visionary, left and so

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Speaker 4: Grizzly got that right. I don't think for the right reasons.

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Speaker 4: Although we were in the teeth of a massive bear

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Speaker 4: market as well. If that CEO had not left, I

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Speaker 4: don't think we would have sold that stock. In the

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Speaker 4: case of Archer, we have a high degree of confidence

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Speaker 4: in Archer. One thing to understand about ARC is we

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Speaker 4: are the closest ARC is the closest you'll find to

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Speaker 4: a venture capital company in the public equity markets, and

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Speaker 4: we tread where others in the traditional asset management world

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Speaker 4: will not go, at least on the public side, when

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Speaker 4: we see a real opportunity. As we're doing our work

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Speaker 4: on autonomous vehicles, we concluded that the cost is going

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Speaker 4: to drop so much that roads are going to become

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Speaker 4: very congested in the future, much more congested if you

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Speaker 4: can imagine New York City, and so we then started

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Speaker 4: doing work about transportation in the skies. Is it possible, Yes,

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Speaker 4: it is possible. The FAA is the gating factor from

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Speaker 4: a regulatory point of view. There are two companies the

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Speaker 4: FAA is working very closely with, and I think because

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Speaker 4: of successes elsewhere in the world other companies are having

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Speaker 4: success where regulators have not been as strict, I think

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Speaker 4: there's been a little more pressure on the FAA to

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Speaker 4: pay close attention here.

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Speaker 3: The two are Archer and Jobi.

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Speaker 4: Our confidence went up when Boeing, which was suing it

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Speaker 4: for patent infringement, settled the case and actually took an

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Speaker 4: ownership position in Archers, as has Stilantis and United Airlines.

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Speaker 4: So three very deep pocketed partners who are also trying

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Speaker 4: to figure out the future of transportation, and we know

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Speaker 4: that they're on their way. Both Jobi and Archer two

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Speaker 4: FAA certification. Seems like the process is in motion and

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Speaker 4: we haven't had a hiccup. And it has an MoU

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Speaker 4: with Abu Dhabi to launch an air taxi service in

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Speaker 4: twenty six and pending regulation, it has an MoU with

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Speaker 4: inter Globe to launch an air taxi service in India.

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Speaker 4: Both of those have been much better for from a

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Speaker 4: regulatory point of view.

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Speaker 5: But how big of a concern is it to you

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Speaker 5: that regulators here in the US could drag their feet.

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Speaker 5: We did speak with an airline executive recently who is

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Speaker 5: concerned that the FA is moving slower than other regulatory

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Speaker 5: bodies when it comes to this type of technology.

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Speaker 4: Yes, and that is why we paid a lot of

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Speaker 4: attention to regulatory arbitrage. We've seen innovation move abroad to

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Speaker 4: other countries, even Amazon. The FAA wouldn't let Amazon fly

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Speaker 4: its drones ninth generation nearly ten years ago on its

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Speaker 4: own property outside, so it went to India and elsewhere.

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Speaker 4: I think the pressures on the FAA now. And I

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Speaker 4: also think that the bear market of twenty one and

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Speaker 4: twenty two eliminated a lot of other competition that was

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Speaker 4: brewing just the funding markets were closed. And so I

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Speaker 4: think this market is much more is that both Jobie

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Speaker 4: and Archer are going to have much more share than

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Speaker 4: otherwise would have been the case. So we're pretty excited

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Speaker 4: about the possibilities here.

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Speaker 1: Hey, Kathy, as you said, you know, one of the

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Speaker 1: things about ARC it certainly and it's the DNA, is

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Speaker 1: that you go places and take positions that other people

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Speaker 1: maybe don't do. And one of the things though that

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Speaker 1: increasingly I feel like the financial establishment again is interested

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Speaker 1: very much so is in crypto. And I want to

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Speaker 1: talk about your spot bitcoin ETF if I may the

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Speaker 1: RC twenty one shares Bitcoin ETF. What can you tell

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Speaker 1: us about institutional interest in it?

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Speaker 2: Is there or is it.

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Speaker 1: Mostly the funds that are going into it are mostly

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Speaker 1: from the retail side.

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Speaker 4: Well, we are we know there's institutional interest because we're

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Speaker 4: talking to a lot of institutions, including state treasures and

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Speaker 4: public pension funds. And why is this Because they're trying

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Speaker 4: to figure out if this truly is a new asset class,

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Speaker 4: and if it is, they must have a point of

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Speaker 4: view as a fiduciary if there's a new asset class

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Speaker 4: which is uncorrelated or shows very low correlation in terms

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Speaker 4: of returns relative to other asset classes, than what an

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Speaker 4: asset allocator does is it will take a position to

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Speaker 4: increase returns per unit of risk. That's what happens with

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Speaker 4: low correlation of returns. So definitely, now are they moving

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Speaker 4: whole hog.

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Speaker 3: Not yet. Nor are the.

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Speaker 4: Big wirehouses like the Morgan, Stanleys and Ubs as wells Fargo,

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Speaker 4: marri Lynch b of A. They are all waiting to

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Speaker 4: see who are the winners in terms of the ETFs

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Speaker 4: because they do not want to commit to an ETF

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Speaker 4: that will close down and make sense and right so

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Speaker 4: and they they they're going to give it from what

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Speaker 4: we're hearing three to six to nine months. So the

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00:26:00,680 --> 00:26:07,639
Speaker 4: net inflows that we've seen and are away from those

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00:26:07,760 --> 00:26:11,919
Speaker 4: two spaces, really it's part of it is our client

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00:26:11,960 --> 00:26:17,280
Speaker 4: base switching from GPTC into and other client basis into

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00:26:17,760 --> 00:26:20,120
Speaker 4: the ETFs, which are much lower fee.

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Speaker 1: All right, but I do want to also then go

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00:26:21,640 --> 00:26:24,280
Speaker 1: to the next level, and that is an ether ETF

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00:26:24,960 --> 00:26:28,040
Speaker 1: being approved maybe in May. Are you optimistic that it's

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00:26:28,040 --> 00:26:31,040
Speaker 1: going to happen by that made deadline or what obstacles

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00:26:31,080 --> 00:26:33,320
Speaker 1: might be still out there that it won't make that deadline?

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00:26:34,160 --> 00:26:39,320
Speaker 4: Yeah, So the biggest obstacle is staking, and I don't

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00:26:39,400 --> 00:26:43,600
Speaker 4: think the regulators will allow staking in this first round

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00:26:43,640 --> 00:26:47,199
Speaker 4: if they allow the first round at all. Now, we

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00:26:47,359 --> 00:26:52,200
Speaker 4: and one other firm are we'll see our final deadline

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00:26:52,440 --> 00:26:57,040
Speaker 4: in May if they reject. If they reject our filings,

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00:26:57,119 --> 00:26:58,920
Speaker 4: then we'll have to refile.

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Speaker 3: But my guess is.

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00:27:01,680 --> 00:27:04,399
Speaker 4: My guess is they will move more now to a

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00:27:04,440 --> 00:27:08,359
Speaker 4: first come, first serve when this next round goes through.

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00:27:08,920 --> 00:27:12,960
Speaker 4: So if it's May, it'll be without staking. If it's later,

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00:27:13,480 --> 00:27:19,879
Speaker 4: there's a better chance for staking. If it's in I

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00:27:19,880 --> 00:27:24,359
Speaker 4: would say twenty twenty five, because I think legislators and

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00:27:24,560 --> 00:27:29,320
Speaker 4: legislation is starting to get involved here and taking it

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00:27:29,359 --> 00:27:32,960
Speaker 4: away from simply the regulators.

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Speaker 1: Hey, Kathy, I don't want to leave without asking you.

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00:27:35,800 --> 00:27:38,600
Speaker 1: It is international Women's Day, and I think about your path.

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00:27:39,320 --> 00:27:40,760
Speaker 1: We Tim and I have been talking a lot to

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00:27:41,840 --> 00:27:45,159
Speaker 1: many women who have made their way in male dominated fields,

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00:27:45,240 --> 00:27:49,480
Speaker 1: and I'm just curious how you think about your trajectory

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00:27:49,520 --> 00:27:52,000
Speaker 1: from where you started and what you've achieved. You started

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00:27:52,000 --> 00:27:54,439
Speaker 1: two firms or have co found one and started your

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00:27:54,440 --> 00:27:58,600
Speaker 1: own firm, how you think about that path and what

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00:27:58,720 --> 00:28:02,560
Speaker 1: is top of mind in terms of those other individuals

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00:28:02,560 --> 00:28:04,080
Speaker 1: and other women that are out there that are maybe

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00:28:04,119 --> 00:28:04,920
Speaker 1: trying to do the same.

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00:28:06,720 --> 00:28:10,520
Speaker 4: Yes, well, I think the most important thing in early

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00:28:10,640 --> 00:28:14,600
Speaker 4: years is to make your own bosses look brilliant because

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00:28:14,960 --> 00:28:19,560
Speaker 4: younger people, younger people coming into the business know so

478
00:28:19,720 --> 00:28:23,240
Speaker 4: much more about technology and where the world is going

479
00:28:23,640 --> 00:28:28,480
Speaker 4: almost innately then shall I say, more seasoned investors. So

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00:28:28,640 --> 00:28:32,920
Speaker 4: just make your bosses look brilliant and educate them and

481
00:28:33,160 --> 00:28:39,400
Speaker 4: you know, generate enthusiasm, enthusiasm, excitement, energy around around ideas

482
00:28:40,280 --> 00:28:42,600
Speaker 4: and make sure you have good mentors.

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00:28:42,600 --> 00:28:44,040
Speaker 3: If they're not giving you a good shot.

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00:28:44,160 --> 00:28:47,000
Speaker 4: After you've made them look brilliant, you know, time to

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00:28:47,080 --> 00:28:50,680
Speaker 4: move on. So that's one thing. As far as starting

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00:28:51,520 --> 00:28:55,760
Speaker 4: a business, I would say, make sure there's an unmet

487
00:28:55,800 --> 00:28:59,480
Speaker 4: need in our case, in the case of ARC. What

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00:28:59,520 --> 00:29:03,560
Speaker 4: we saw was the traditional world going more passive or

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00:29:03,600 --> 00:29:09,600
Speaker 4: benchmark sensitive, when we saw an explosion of innovation thanks

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00:29:09,640 --> 00:29:13,040
Speaker 4: to the five major innovation platforms around which we have

491
00:29:13,120 --> 00:29:17,400
Speaker 4: centered our research and investing. And so I said to myself,

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00:29:17,840 --> 00:29:22,280
Speaker 4: you know, someone has to do this, and so we

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00:29:22,360 --> 00:29:25,200
Speaker 4: went off, and honestly, I think most people thought we

494
00:29:25,240 --> 00:29:28,560
Speaker 4: would fail for a couple of reasons. One, we put

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00:29:28,600 --> 00:29:34,240
Speaker 4: a truly active, fully transparent equity portfolio inside an ETF

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00:29:34,280 --> 00:29:37,400
Speaker 4: wrapper and that had not been done at scale at all,

497
00:29:38,080 --> 00:29:41,640
Speaker 4: and no one it was a passive world that we

498
00:29:41,720 --> 00:29:46,080
Speaker 4: had entered. And then the second was we're benchmark agnostic.

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00:29:47,320 --> 00:29:50,400
Speaker 4: You can put us against any benchmark, and you're going

500
00:29:50,480 --> 00:29:53,680
Speaker 4: to have to give us some time after the massive

501
00:29:53,800 --> 00:29:56,640
Speaker 4: interest rate shock that we went through and now we're

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00:29:56,720 --> 00:30:00,280
Speaker 4: on the other side and you know, performing better as

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00:30:00,280 --> 00:30:04,280
Speaker 4: a result over the last year. But over time, these

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00:30:04,920 --> 00:30:08,960
Speaker 4: innovations are going to transform the world and create massive

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00:30:09,400 --> 00:30:15,600
Speaker 4: wealth with ai ASA back to that topic as the

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00:30:15,680 --> 00:30:19,400
Speaker 4: main catalyst, so we could be more optimistic about innovation.

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00:30:19,760 --> 00:30:20,840
Speaker 2: All right, Gonda, leave it there.

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00:30:20,920 --> 00:30:23,440
Speaker 1: Kathy as always so appreciate all the time that you

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00:30:23,520 --> 00:30:24,080
Speaker 1: do give us.

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00:30:24,120 --> 00:30:24,880
Speaker 2: Have a great weekend.

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00:30:24,960 --> 00:30:28,160
Speaker 1: Kathy would of course, the founder, CEO, and CIO of

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Speaker 1: oar Co Invest, joining us from Florida.

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Speaker 2: Kathy, thank you