Speaker 1: From Marhard where Innovation, Money and power Collie in Silicon
Speaker 1: Vallet NBN.
Speaker 2: This is Bloomberg Technology with Caroline Hyde and Ed.
Speaker 3: Ludlove live from New York and San Francisco. This is
Speaker 3: Bloomberg Technology Coming up. Apollo offers a multi billion dollar
Speaker 3: investment in Intel after Qualcomm's takeover approach.
Speaker 4: We discuss the reports.
Speaker 5: More US curbs and more potential trouble for China evs, and.
Speaker 3: A deep dive into the CEO Palenteer and his love
Speaker 3: hate relationship with Wall Street as he enters the S
Speaker 3: and P five hundred. For first, we go straight to
Speaker 3: the key, chip and M and a story ed.
Speaker 5: Apollo is offered to make a multi billion dollar investment
Speaker 5: in Intel, according to sources, with the asset manager indicating
Speaker 5: it would be willing to make an ect like investment
Speaker 5: of as much as five billion dollars. According to one
Speaker 5: of the sources Bloomberg spoke to that follows shock news
Speaker 5: on Friday that Intel have been approached by Qualcomm in
Speaker 5: recent days about a quote friendly takeover. This following Intel
Speaker 5: announcing its own strategic rethink just one week ago. Bloomberg's
Speaker 5: Ian King joins us here in San Francisco. Let's start
Speaker 5: with the latest, which is Apollo considering an equity like investment.
Speaker 5: What do we know about that? And why would Intel
Speaker 5: want capital from an asset manager like Apollo?
Speaker 6: Yeah, I mean Apollo has already we need to point
Speaker 6: out apollow has already invested partially in Intel, taking a
Speaker 6: part of a stake in a factory in Ireland. So
Speaker 6: what Intel has been doing is is this smart capital
Speaker 6: strategy to either that it calls it, which is basically
Speaker 6: bringing in money as co investments to kind of like
Speaker 6: bridge loans for a lot of these investments that it's
Speaker 6: making to build this factory network. So this might be
Speaker 6: kind of an extension of that and an a broader
Speaker 6: sense to sort of sponsor this general turnaround of the.
Speaker 3: Company, a turnaround that has eroded its market capitalization and
Speaker 3: made it a potential target for someone like a Qualcomm
Speaker 3: in extraordinary reporting coming over the weekend, and it would
Speaker 3: be a massive tech deal, it would.
Speaker 6: And you know, there are so many caveats that need
Speaker 6: to be thrown into the mix here. What exactly does
Speaker 6: qual does Qualcom want the whole of Intel? Is it
Speaker 6: an actual firm offer? Is anything on the table yet?
Speaker 6: A lot of these things are unknowns at this point,
Speaker 6: and you've seen already a reaction towards this potential alliance
Speaker 6: saying that regulators would never allow this to happen. It
Speaker 6: doesn't make sense in terms of what Qualcom does, but
Speaker 6: as far as we understand, there is at least a
Speaker 6: consideration of something going on here.
Speaker 5: We called it a friendly takeover offer, which I think
Speaker 5: with time we'll learn about. There's a technology story which
Speaker 5: Qualcomm has tried to diversify away from it its legacy business,
Speaker 5: which is smartphone handsets, and it's made some progress in
Speaker 5: the PC market on on based processors. So then you
Speaker 5: look at what would they gain on the product side
Speaker 5: of going after Intel, which a xady six based processor,
Speaker 5: and forget the fab part for one minute. Explain explain
Speaker 5: that technology field to us.
Speaker 6: Yeah, I mean Intel's technology, as we know, has been
Speaker 6: dominant in PCs pretty much since the PC came into existence.
Speaker 6: Quadcom has over the last few years tried to get
Speaker 6: into that with its smartphone technology. Hasn't really happened yet,
Speaker 6: but more recently it's showing more promise, it's showing signs
Speaker 6: of actually making a dent in that. If it were
Speaker 6: to take on Intel's xady six business. It would have
Speaker 6: actively been throwing that business away. There would be mixed signs,
Speaker 6: what's it going to do? Which technology is a fundamental
Speaker 6: one that's going to go forward? Lots and lots of
Speaker 6: questions there, but certainly would be getting hold of still
Speaker 6: the dominant brand in PCs.
Speaker 3: In King reporting this throughout, and we must add companies
Speaker 3: thus far have not commented to us about the story.
Speaker 3: Let's go now to an investor at least in Qualcom.
Speaker 3: Johan Feeney, partner and portfolio manager at Advisors Capital Management.
Speaker 3: You hold shares in Qualcom. If it could possibly go
Speaker 3: through regulators, would it be a good deal from your perspective?
Speaker 7: Well, you know, Carolina, I think, if anything, the interest
Speaker 7: that Qualcom might have an Intel would be strictly on
Speaker 7: the design side, on.
Speaker 8: The chip designs for PCs.
Speaker 7: That's still a huge market and just Intel and AMD
Speaker 7: or players there, and it's likely to remain the dominant
Speaker 7: form of technology.
Speaker 8: For the PCCPU.
Speaker 7: So I mean, I could see Qualcom being interested, but
Speaker 7: I would think that the regulators would have a hard
Speaker 7: time because as Ian just pointed out, it would suggest
Speaker 7: that Qualcom would be ready to throw away its approach
Speaker 7: to PC chips that it's arm based, and that would
Speaker 7: definitely reduce competition.
Speaker 8: But on the other hand, for Intel, if something like
Speaker 8: Qualcom were to buy the design side.
Speaker 7: It would give into a huge infusion of capital which
Speaker 7: it desperately needs to shore up the manufacturing side, to
Speaker 7: give Intel the time it needs to fix the manufacturing process,
Speaker 7: and potentially, and this is a stretch I think, for
Speaker 7: Intel to get into the foundry business, which it ultimately
Speaker 7: would like to do, to diversify.
Speaker 3: On that fab business. That's why the relationship already lies
Speaker 3: with Apollo that they've gone in with a deal in Ireland.
Speaker 3: What do you think about a capsule infusion, What sort
Speaker 3: of form you'd like that to take if we did
Speaker 3: get one from Apollo into Intel.
Speaker 7: Yeah, I mean five billion dollars would help. It's just
Speaker 7: going to take patients of investors though, because five billion,
Speaker 7: when you look at the cost of a new fab
Speaker 7: is really almost a drop in the bucket. So Intel
Speaker 7: does need a lot more capital to give it the
Speaker 7: time it needs to fix the manufacturing recipe, which has
Speaker 7: really suffered over the last five years, and then to
Speaker 7: be able to build the kind of libraries. It would
Speaker 7: need to become a foundry player like TSMC, and we
Speaker 7: know Intel has tried in the past and failed under
Speaker 7: previous leadership. Now Pat Galsinger has more experience and you know,
Speaker 7: I think as the right person to try to make
Speaker 7: this happen.
Speaker 8: But five billion will help, But it really is.
Speaker 7: Going to take patient investors, potentially more infusion of capital
Speaker 7: get that job done.
Speaker 5: As he points it out, Juan Apollo has an existing
Speaker 5: relationship with Intel, and when we spoke to them earlier
Speaker 5: in the summer, they did hint that there could be
Speaker 5: an expansion of that.
Speaker 4: Listen to this clip from June.
Speaker 9: These type of blue chip large cap companies, they're not
Speaker 9: talking about one hundred million or five hundred million, They're
Speaker 9: talking two billion, five billion, ten billion plus, And so
Speaker 9: the ability to really come up with those creative solutions
Speaker 9: in scale is really really critical. But I think you're
Speaker 9: going to see more and more of this from absolutely
Speaker 9: more from Apollow, but in general, just the need for
Speaker 9: this type of capital is insatiable.
Speaker 5: So based on that from Apollo co President Scott Kleiman,
Speaker 5: not such a surprise that this has come up. On
Speaker 5: the other hand, this is a firm that started as
Speaker 5: a distressed investor in the nineties. When you see a
Speaker 5: name like Apollo circling Intel, given the news headlines of
Speaker 5: late what does that make you think about.
Speaker 7: Well, you think about the difficult situation Intel is in
Speaker 7: and something like Apollo coming in to help.
Speaker 8: It reminds me of how AMD's.
Speaker 7: Manufacturing site was ultimately rescued through investments by Abu Dhabi
Speaker 7: and silver Lake, and that allowed AMD to spin off
Speaker 7: manufacturing and really be able to focus its attentions on
Speaker 7: the design side, which ultimately led to its current successes.
Speaker 8: So, you know, we could see more.
Speaker 7: Of private capital coming into Intel, and that would really help.
Speaker 7: There's a huge potential there obviously, but they have some
Speaker 7: work to do to fix that manufacturing recipe. So I
Speaker 7: think it's a positive sign for the ultimate recovery of
Speaker 7: Intel that we're seeing this kind of investment being potentially
Speaker 7: made by Apollo, and I suspect it wouldn't surprise me
Speaker 7: if others came in as well.
Speaker 5: Joanne at a dinner the other night with another semiconductor
Speaker 5: CEO was not Intel. This person said that Intel is
Speaker 5: too big to fail in the context of its footprint
Speaker 5: in the United States, is that sort of territory we're
Speaker 5: talking about right now.
Speaker 7: You know, that's an interesting take, and I think that's
Speaker 7: a fair way to look at it. Clearly, you know,
Speaker 7: the US government is interested in making sure that we
Speaker 7: have manufacturing capabilities for the most advanced chips in this
Speaker 7: country for obvious reasons. The vulnerability to the political up people,
Speaker 7: you know, that might be possible.
Speaker 8: Down the line. So I think that that's a fair
Speaker 8: view of things.
Speaker 7: And so that's why I think Intel has a better
Speaker 7: chance of recovering then if we weren't in this kind
Speaker 7: of a world where geopolitical risks were becoming more prominent.
Speaker 3: And of course this is why it's American names that
Speaker 3: I an American company, giants such as Intel. Meanwhile, we
Speaker 3: think about who else could potentially have skin in the game.
Speaker 3: There was a report that Broadcom will not be following
Speaker 3: Qualcom in terms of eyeing a bid. What of other
Speaker 3: companies you think could look at parts of Intel?
Speaker 7: Yeah, you know, Caroline, I think when you look at
Speaker 7: a company like Broadcom, they've been really careful about the
Speaker 7: sorts of acquisitions they make. Companies that already have a
Speaker 7: leadership position that are succeeding that perhaps need some fine
Speaker 7: tuning where they can extract, you know, remove costs and
Speaker 7: make them even more profitable. So I can see why
Speaker 7: Broadcom would not be interested in this kind of a situation.
Speaker 8: You know, other companies.
Speaker 7: I think you just have to think about the regulatory challenges. Yes,
Speaker 7: it has to be an American company. I think Qualcomm
Speaker 7: is probably the most likely suitor. But again I think
Speaker 7: just for the design side. I think the manufacturing side
Speaker 7: would probably in this kind of a situation be spun off,
Speaker 7: and that cash infusion from a Qualcom could really help
Speaker 7: lead to more success down the line for Intel.
Speaker 5: And again, neither Intel nor Qualcom has commented on any
Speaker 5: of the reporting at this stage. Joann Feenie, partner of
Speaker 5: portfolio manager Duradvisors Capital Management, someone that's covered this industry
Speaker 5: for a very long time as well. There's another story
Speaker 5: re tracking meanwhile, TSMC and sam Sum have discussed building
Speaker 5: major new factories in the UAE in the coming years
Speaker 5: to help satisfy soaring demand for AI computing. That's according
Speaker 5: to a report in the Wall Street Journal, citing sources.
Speaker 5: The journal says the discussions are in early phases and
Speaker 5: the projects might not pan out, given the array of
Speaker 5: technical and other hurdles that they face.
Speaker 3: Caroen so much coming up ed for one, more curbs
Speaker 3: could be on the way for China's auto tech. What
Speaker 3: this means the EV sector and well beyond that. Meanwhile,
Speaker 3: look we've got to just check in on these markets
Speaker 3: more broadly. We are having another positive day after two
Speaker 3: positive weeks on the now's that one hundred were opera
Speaker 3: only about a quarter of percent, But we know some
Speaker 3: of the chip naykers that are on the move today.
Speaker 3: This is Bloomberg technology. Now more potential trouble for China evs.
Speaker 3: US officials are set to unveil a proposal to bam
Speaker 3: the use, the importing, the testing of Chinese and Russian technology,
Speaker 3: in fact in automated driving and vehicle communication systems. It's
Speaker 3: according to sources or please to welcome very late from
Speaker 3: Hong Kong one Danny Lee who has been reporting this
Speaker 3: out and it feels as though this is getting ever
Speaker 3: more expansive, not just the hardware but the software as well.
Speaker 10: Yeah. Absolutely, I mean after we saw this quadrupling on
Speaker 10: tariffs on Chinese evs to over one hundred percent, now
Speaker 10: is the targeting of the China and Russian made kind
Speaker 10: of software and hardware that's tied to these kind of connected, autonomous,
Speaker 10: driverless kind of systems. We will hear more from US
Speaker 10: officials and particularly the Commerce Department, But all of this
Speaker 10: is just to try and defend and strength in the
Speaker 10: US auto industry, which has really struggled against the Chinese
Speaker 10: EV makers. And it's just fascinating when you look at
Speaker 10: China's biggest EV maker right now. Now it has a
Speaker 10: market cap that is combining the size of Forward and
Speaker 10: General Motors, and so you see just how much in
Speaker 10: terms of leaps and bounds these Chinese eed makers have
Speaker 10: come on, and so how the US have had to
Speaker 10: try and kind of step in here. And you know,
Speaker 10: when we do see the US taking action, there is
Speaker 10: legitimate concern when it comes to data privacy, data management,
Speaker 10: transferring of data, and also hacking. But this really does
Speaker 10: set the stage for more kind of tensions in this
Speaker 10: kind of strained US China geopolitical relationship.
Speaker 5: This is interesting because for our Bliembo technology audience around
Speaker 5: the world, tariffs on a physical product like an electric
Speaker 5: vehicle are hard to are easier to understand. What's harder
Speaker 5: to understand, Danny is what is a software curve. What
Speaker 5: would that mechanism look like.
Speaker 10: Yeah, I think it's more the software that's contained inside
Speaker 10: some of these products and making these systems runs particularly
Speaker 10: around the cars and ticket as we see a bigger
Speaker 10: proliferation of electric vehicles, for example, which are preinstalled Chinese
Speaker 10: software and particularly hardware, even for example, Lieder a key
Speaker 10: part of this autonomous drivers systems. And so we are
Speaker 10: seeing that, you know, there is this this kind of
Speaker 10: reaction that we will wait and see for what China
Speaker 10: says and once these plans are laid out by Washington.
Speaker 10: But it's interesting that, you know, the first time we
Speaker 10: saw these tariffs being hyped by the US, even US
Speaker 10: Secretary Treasury Secretary Janet Yellen was hopeful that China wouldn't retaliate.
Speaker 10: But they're clearly that expectation that China would and some
Speaker 10: analysts we had oken to today, I think that this
Speaker 10: raises the likelihood that this could be the case. But
Speaker 10: it is also fascinating because and Tesla is in the
Speaker 10: middle of this. They need China to approve its drivers
Speaker 10: SYS system to be rolled out and be approved by
Speaker 10: net and it seems like if Chinese software and hardware
Speaker 10: is blocked from.
Speaker 4: The US market.
Speaker 10: US tech could benefit in somewhere like China.
Speaker 5: Bloomberg's Danny Lee terrific reporting from Hong Kong, Thank you
Speaker 5: very much. Sticking with evs, a new trend is gaining
Speaker 5: steam among thieves hunting for copper, vandalizing EV chargers. Charging
Speaker 5: companies are catching more and more people on camera, cutting
Speaker 5: cords across the entire stations, typically to strip out the copper.
Speaker 4: And sell it for a profit.
Speaker 5: This year, through June, nearly one in five US public
Speaker 5: charging attempts ended in failure. According to Jdpower, roughly ten
Speaker 5: percent of those aborted sessions were due to a damaged
Speaker 5: or even missing cable garrot extraordinary.
Speaker 3: Meanwhile, we go back to the political discussion right now,
Speaker 3: because Vice President Harris says that she will help grow
Speaker 3: investment into official intelligence and digital assets, her first comment
Speaker 3: on the crypto space since running for president. Let's discussed
Speaker 3: all of this a Boomberg's Mike Shephard in DC. Finally
Speaker 3: she starts to talk of crypto.
Speaker 1: It feels like, well, you're right, this is in some
Speaker 1: ways an olive branch from Kamala Harris, a Democratic nominee
Speaker 1: who will be facing off against Donald Trump in November
Speaker 1: for the presidency. This is an olive branch to an
Speaker 1: industry that has been highly skeptical and critical of the
Speaker 1: Biden administration, which they see as taking a much more
Speaker 1: burdensome approach when it comes to regulation and to oversight.
Speaker 1: And this is a sentiment that Donald Trump has seized
Speaker 1: on in trying to court some of these depocketed crypto investors,
Speaker 1: a number of whom hail from Silicon Valley.
Speaker 5: What I find interesting about this, Mike is it was
Speaker 5: in the context of a fundraiser, kind of a calendar
Speaker 5: date on the campaign trail. Do we know who was
Speaker 5: in the room who she was appealing to with the
Speaker 5: AI crypto message.
Speaker 1: Well, there is obviously the investor message of the people
Speaker 1: who would be in the room, but she is trying
Speaker 1: to signal this more broadly. There are reporters attending all
Speaker 1: of these fundraiser events, so the remarks are calculated from
Speaker 1: more than just who is in the room. She is
Speaker 1: trying to signal that and this hearkens back to her roots,
Speaker 1: going back to her youth in the Bay Area. I mean,
Speaker 1: she is from California. She is somebody who understands and
Speaker 1: embraces the tech culture. She is trying to signal that
Speaker 1: she is much more open to innovation and all that
Speaker 1: would need to go into it. Of course, is not
Speaker 1: walking away from any call for safeguards on industries like
Speaker 1: artificial intelligence or cryptocurrency and digital assets, but she is
Speaker 1: at the same time trying to signal that, hey, we
Speaker 1: want to work with you, we would like to do
Speaker 1: business with you, and not stifle innovation.
Speaker 5: Meg's Mike Sheppet out of Washington, d C. Thank you
Speaker 5: very much.
Speaker 3: Today cloud Flare has announced a first of its kind
Speaker 3: way to help websites analyze and control how their content
Speaker 3: is used by AI companies. Now it's also offering a
Speaker 3: marketplace for pricing content mined by large language models. Let's
Speaker 3: discuss all with this with cloud Flair CEO Matthew Prints.
Speaker 3: Just set the scene for us for a moment. The
Speaker 3: Bloomberg website, any website, how often are we find its
Speaker 3: content is being touched on, used mined by large language
Speaker 3: models on a daily basis?
Speaker 11: Yeah, so for the average website, about half of the
Speaker 11: traffic that it receives is from some sort of automated
Speaker 11: bot and the large language models, the AI bots are
Speaker 11: growing like crazy. They're about twenty five percent of the
Speaker 11: total bot traffic.
Speaker 12: So if you're putting.
Speaker 11: Content online, it's getting scraped as being included these lms.
Speaker 11: And up until cloud Flow launched what we did today,
Speaker 11: you didn't have any control over that.
Speaker 3: And now how technically do you have control over it?
Speaker 3: What are you doing behind the scenes to make sure
Speaker 3: that it's either stopped or at least monitored.
Speaker 11: Yeah, So Klettler has been from its earliest days the
Speaker 11: best in the world at identifying what's a human visitor
Speaker 11: to a site and what's an automated or a bot
Speaker 11: visitor to a site. So what we've done is taken
Speaker 11: that same technology and then classified all of the bots
Speaker 11: that are being used by these AI companies. And then
Speaker 11: the first step is giving anyone with a website, anyone
Speaker 11: with content, visibility into how their content is being.
Speaker 12: Accessed by these bots.
Speaker 11: The second thing we do is we let you pick
Speaker 11: and choose either I don't want any of these bots
Speaker 11: to access my site, or maybe I don't want certain
Speaker 11: of these bots acts at the site.
Speaker 12: Once those two things are.
Speaker 11: In place, the last step, which we've announced today but
Speaker 11: are going to be rolling out over the months ahead,
Speaker 11: especially a content marketplace where we can return the quid
Speaker 11: pro quo, where content creators can get actually paid for
Speaker 11: the content they're creating.
Speaker 12: That's helping train these large language models, Matthew.
Speaker 5: In the first instance, who's signed up for this list,
Speaker 5: who the early customers are well.
Speaker 11: So this is available for free for every single cloud
Speaker 11: Floer customer, and cloud flow sits in front of more
Speaker 11: than twenty percent of the web, so a huge percentage
Speaker 11: of the web is using this.
Speaker 4: What we've heard.
Speaker 11: Though, is from our largest customers, large media companies that
Speaker 11: are creating a large amounts of content that they can't
Speaker 11: keep up with these AI bots, and so cloud Flower
Speaker 11: is in a unique position to be able to say, listen,
Speaker 11: if you're scraping this content, if you're getting value from
Speaker 11: this content, as an AI company, you should be compensating
Speaker 11: the content creators.
Speaker 12: And yes, the large companies like Reddit.
Speaker 11: Are able to get these deals done, but we want
Speaker 11: to bring that to anyone who's creating content anywhere on
Speaker 11: the web.
Speaker 5: Matthew, I want to go to the recent use of
Speaker 5: last week, we covered it from the ground in Brazil
Speaker 5: that X, the platform formerly known as Twitter, used your
Speaker 5: technology to briefly make the service accessible again in that country.
Speaker 5: My specific question is Brazilian authorities have said that cloud Flare,
Speaker 5: your company, have worked with the government to understand how
Speaker 5: they did it. Why did you work with the Brazilian
Speaker 5: authorities and what did that look like.
Speaker 11: To be honest, I don't know what the Brazilian authorities
Speaker 11: are talking about because we didn't specifically work with them
Speaker 11: to block X or to make X available in Brazil.
Speaker 11: What I would analogize this too, is everything that's on
Speaker 11: the web at the end of the day has a
Speaker 11: number associated with it, which is the IP address.
Speaker 12: It's sort of like your telephone number.
Speaker 11: And you can imagine in the days before you could
Speaker 11: port your telephone number. If you switch from one cell
Speaker 11: phone provider to another cell phone provider, your number would switch.
Speaker 12: Same thing happened with X. We want to deal with
Speaker 12: them where they.
Speaker 11: Started using our service, stop using a competitor of ours,
Speaker 11: and in the process the IP address switched.
Speaker 12: Brazil was simply blocking.
Speaker 11: The old IP address that made them temporarily available. Brazil
Speaker 11: was then able to block the new IP address, which
Speaker 11: was accessible. There was nothing that Cloudfler did to facilitate that.
Speaker 11: There was nothing that X did to make that harder
Speaker 11: on Brazil. It was simply a coincidence of us winning
Speaker 11: an enterprise customer.
Speaker 3: The timing is a coincidence, though, Were they one worldwide
Speaker 3: or just in Brazil? How much was this a one
Speaker 3: off transition?
Speaker 11: No, it was across the across the country. And again,
Speaker 11: you know, sometimes things are just coincidences. But in this case,
Speaker 11: obviously I think they were surprised. We were surprised by
Speaker 11: the attention. And again, there was nothing that X asked
Speaker 11: us to do in terms of eliminating the ability for
Speaker 11: Brazil to block the content inside of Brazil, and there
Speaker 11: was nothing that we did to further facilitate the ability
Speaker 11: for Brazil to block what they what?
Speaker 12: What they were? What are you doing? And today my
Speaker 12: understanding is that X is once again blocked in Brazil.
Speaker 5: Cloud Flair CEO Matthew Prince, thank you for joining us
Speaker 5: here on Bloomberg Technology.
Speaker 4: We appreciate it.
Speaker 3: Welcome back to bluemog Technology, Caroline Hiden, New York, and our.
Speaker 4: Mad Bloodlow in San Francisco. Let's get a quick check.
Speaker 3: On these markets because we are at the moment seeing
Speaker 3: and once again a risk on tone. Look, we're up
Speaker 3: three tens percent on the NAS that one hundred. We've
Speaker 3: had two straight weeks of gains. Large part this is
Speaker 3: a macro field, This is the idea of FED rate cutting,
Speaker 3: and indeed, once again Rafael Bostick speaking up about the
Speaker 3: need to normalize rates. And then of course we have
Speaker 3: a little bit of manufacturing data that just shows we've
Speaker 3: still got a robust, it's slightly slowing economy here in
Speaker 3: the United States. So we're up four tens percent. We
Speaker 3: want some of the individual movers, though, when we're looking
Speaker 3: at the benchmark, because well I'm looking at the florry
Speaker 3: of news surrounding this key name. We dug into it
Speaker 3: deep at the top of the show. We remind you
Speaker 3: once again that Intel is up one and a half percent.
Speaker 3: It really moved on Friday after the reports, of course,
Speaker 3: that maybe it could be being eyed by a competitor
Speaker 3: such as a qual Com that's down by one point
Speaker 3: eight percent. Regulatory discussions abound this morning. Broadcom is not
Speaker 3: eyeing it, we understand from the reporting of Bloomberg. But
Speaker 3: of course there was the news that Apollo Global is
Speaker 3: eyeing perhaps a multi billion dollar investment of some shape
Speaker 3: or form into d TELL they already have a strong relationship,
Speaker 3: and let's just talk about the rebalancing that also happened
Speaker 3: over the weekend and is in played today for the
Speaker 3: S and P five hundred d.
Speaker 5: Today, Palenteer is getting a spot on the S and
Speaker 5: P five hundred and milestone. The data analysis giant has
Speaker 5: long been after and yet Palenteer co founder and CEO
Speaker 5: Alex Carp has had a bit of a love hate
Speaker 5: relationship with Wall Street. Bloomberg's Lazett Chapman took a deep
Speaker 5: dive into the story for Bloomberg Business Week and joins us, Now,
Speaker 5: as you know, I've spent a lot of time with
Speaker 5: doctor Carp. We can get into him as a person,
Speaker 5: we can get into the company. But what was it
Speaker 5: you were trying to do with this profile in the magazine?
Speaker 5: It's a fascinating read, right.
Speaker 13: So, as you said, this has been a long time
Speaker 13: goal of Carps and the companies to join the SMP.
Speaker 13: And what's interesting is the huge split between the way
Speaker 13: traditional Wall Street investors, institutional investors approach the company and
Speaker 13: the retail investors, who he calls Tendy's who have created
Speaker 13: this massive following for a Palenteer and all things Karp,
Speaker 13: including reddits calling him doctor you know, Daddy Karp and
Speaker 13: the like, and this kind of irreverence that he has
Speaker 13: carried through and he promised he would when he went public,
Speaker 13: and he's carried it through to today.
Speaker 3: The best bit is if you scroll all the way
Speaker 3: down to the bottom of your story and the link,
Speaker 3: the YouTube link that just shows us doctor Carp talking
Speaker 3: to his loyal investors in the retail community about being admitted.
Speaker 4: To the s and P five hundred. Let's just watch
Speaker 4: a little.
Speaker 3: Bit that into like Lizette run the tape.
Speaker 2: They do not comprehend how we could have turned a
Speaker 2: switch and gone to gap profitability and gone from what adults,
Speaker 2: professional managers, and some analysts thought was a Frekenstein monster
Speaker 2: powered by a freak show leader me to a dynamic,
Speaker 2: clearly profitable company worthy of admit to the SMP five hundred.
Speaker 3: I'm hoping we'll be able to see him powering his
Speaker 3: way through the woodlands with those poles. Lazette, but that
Speaker 3: speaks a lot to his desire to work against him
Speaker 3: many ways, wool Street, but now he's having to appease
Speaker 3: him at the same time.
Speaker 13: Yeah, that's right, and it's interesting because a number of
Speaker 13: retail investors do back him for the same reason that
Speaker 13: institutional investors don't are not backing him at the same
Speaker 13: pace and fury, And it really breaks down to two things.
Speaker 13: Number one is tech and number two is leadership. Now
Speaker 13: on the tech side, a number of institutional investors simply
Speaker 13: don't believe the Pollenteer's claims that it's AI sales are
Speaker 13: going to hit the traction that they say that they're
Speaker 13: going to, both on the commercial side and also in
Speaker 13: the government. We've got to remember that Taluenteer for the
Speaker 13: first time this year is going to be making more
Speaker 13: money from its commercial customers than it have than it
Speaker 13: has in its government once. Now on the personality side,
Speaker 13: there are some institutional investors and some analysts that simply
Speaker 13: don't like the irreverence that Alex Cart brings to the
Speaker 13: table and have also questioned his management style and some
Speaker 13: of his judgment calls, including the ill fated spac venture
Speaker 13: where that they launched about two years ago, and some
Speaker 13: analysts say that they still haven't completely you know, taken
Speaker 13: their lumps on even though they have you know, you know,
Speaker 13: reconciled it on a financial basis.
Speaker 4: Team in New York. Let's just play it again, Alex Carp.
Speaker 5: Walking through the woods, because it is him, It is
Speaker 5: absolutely him. He's unusual, he doesn't behave like a typical
Speaker 5: S and P five hundred CEO.
Speaker 4: He's very outdoorsy.
Speaker 5: He has moved himself and the company to a certain
Speaker 5: extent away from California to Colorado, but he still delivers.
Speaker 5: You know, he's combative. Just explain more to me about
Speaker 5: him as a leader, as a person, and why we care,
Speaker 5: why we've written a business Week piece, right.
Speaker 13: The interesting thing about well, there's so many things that's
Speaker 13: interesting about about doctor cart or Alex Kart, but one
Speaker 13: of the big ones that really is important to focus
Speaker 13: on is the fact that he, along with his two
Speaker 13: co founders of Palenteer, Stephen Cohen and Peter Teel, have
Speaker 13: structured the ownership of this company so that they have
Speaker 13: super voting rights and perpetuity. They did this as they
Speaker 13: when they structured the company to go public, and when
Speaker 13: the S and P relaxed the standards allowing for multi
Speaker 13: structure shares to be accepted. Palenteer was admitted to the
Speaker 13: S and P with that. So we do care about
Speaker 13: him because he will continue to control it.
Speaker 3: And co found of Pizza Teo President Stephen Kuhn getting
Speaker 3: pretty style treatment in that way? Is that Chapman is
Speaker 3: a beautiful read. Thanks for coming on to describe it,
Speaker 3: all En. What have we got coming up?
Speaker 5: The other news headlines in Talking Tech and First Up,
Speaker 5: the US and India have agreed to work together in
Speaker 5: setting up a semiconductor fabrication plant in the South Asian nation.
Speaker 5: The proposed plan with bolster manufacturing in the country and
Speaker 5: will be enabled by India's Semiconductor Mission and Strategic Partnerships plus.
Speaker 5: Right Move said it will contemplate in eight point one
Speaker 5: billion dollar sweetened bid from Murdoch's Area Group, its third
Speaker 5: proposal in less than three weeks. The offer values Right
Speaker 5: Move two point eight percent higher than its previous bid.
Speaker 5: In a statement, the Right Move says it will carefully
Speaker 5: consider the increased proposal. And Thailand's virtual banking race heats up.
Speaker 5: The Bank of Thailand says they received five applications but
Speaker 5: plans to grant no more than three licenses. The central
Speaker 5: Bank expects to announce the winners by mid twenty twenty five,
Speaker 5: but did not name any of the applicants.
Speaker 3: Character coming up a big fundraise from Headline eight hundred
Speaker 3: and sixty five million dollars in its latest fund. We're
Speaker 3: going to be speaking with partner that's coming up next.
Speaker 3: Bloomberg Technology.
Speaker 5: Headline announced that it's raised eight hundred and sixty five
Speaker 5: million dollars to invest in growth stage companies and has
Speaker 5: hired a new head of Growth to lead the fund.
Speaker 5: Here to discuss this Headline Growth Partner Nancy Ziao. Welcome
Speaker 5: to Bloomberg Technology Big Fund Growth stage goods. We've been
Speaker 5: doing a lot of early stage. This is an interesting development.
Speaker 5: What is the mission statement of the fund and what
Speaker 5: do you want to be doing with the money?
Speaker 14: First off, thank you so much Ed for having me.
Speaker 14: I'm really excited to talk about our new global growth
Speaker 14: fund and strategy. Headline broadly has been around for almost
Speaker 14: three decades and this growth fund represents a new step
Speaker 14: in continuing to back great founders generationally across all countries
Speaker 14: and be able to support them in all parts of
Speaker 14: their journey. So I do think in terms of Headlines
Speaker 14: overall growth strategy. In the past, they've been focused on
Speaker 14: doubling down on existing winners in their portfolio. This new
Speaker 14: growth strategy is brought on a new team, so myself included.
Speaker 14: We've all come from various different institutions, bringing lots of
Speaker 14: learnings from all of the great people we've worked with
Speaker 14: and the great track records and resources and networks that
Speaker 14: we have, and we're really trying to find the best
Speaker 14: founders and support them to the ends of the earth
Speaker 14: using the great back end that Headlines already build.
Speaker 5: But finding them can also be challenging, right, I think
Speaker 5: you know, the firm has experience, but the environment's different.
Speaker 5: You know, you're seeing series as now where the round
Speaker 5: size is so ginormous it is sort of reminiscent of
Speaker 5: a growth stage round even three or four years ago.
Speaker 4: How do you play that?
Speaker 14: I'm glad you mentioned that. So, just backing up a
Speaker 14: little bit to what you said in terms of finding
Speaker 14: them can be challenging. Headline's got three really unique aspects.
Speaker 14: I would call it the people, the global multilocal presence,
Speaker 14: and the proprietary tech and process. So in terms of
Speaker 14: this proprietary tech and process, the Headline team has really
Speaker 14: invested in a ton of back end infrastructure and they
Speaker 14: actually walk the walk when it comes to that. I
Speaker 14: think as vcs we often invest in great tech and
Speaker 14: do we incorporated ourselves into our workflows, Well, Headline actually does.
Speaker 14: We've got a great sourcing tool called Searchlight, which basically
Speaker 14: our CTO calls Advanced Signal Processing, and we look at
Speaker 14: all sort of eight million entities of companies that there
Speaker 14: are globally. We process all sort of public, proprietary and
Speaker 14: third party data sources and use our own in house
Speaker 14: algorithms that have been fine tuned over the last few
Speaker 14: decades and now we've got time series data spanning over
Speaker 14: it acade and then we surface the right signal for
Speaker 14: our global, multilocal footprint of brilliant investors around the world
Speaker 14: to then go meet and we've got fuel on the
Speaker 14: ground you're meeting.
Speaker 3: You're meeting often Nancy at that point in companies that
Speaker 3: aren't just based on the West Coast in the US.
Speaker 3: You're looking at them in Brazil, you're looking at them
Speaker 3: in Berlin, you're looking at them in worldwide. When you
Speaker 3: think about these large valuations that Ed was speaking to,
Speaker 3: where is some of the opportunity that Searchlight and indeed,
Speaker 3: I know you've got other uses of technology within as
Speaker 3: well to be able to then look at ultimately making
Speaker 3: these companies more efficient.
Speaker 4: Yeah.
Speaker 14: Absolutely, we continue to see tremendous opportunity globally, particularly in Europe.
Speaker 14: We've got boots on the ground and great investors and
Speaker 14: partners in Berlin, Paris, London and other places like you mentioned,
Speaker 14: who actually speak the language, understand the local idiosyncrasies of
Speaker 14: all those cultures and companies and incentives, and we try
Speaker 14: to find the best companies there. In fact, in Europe,
Speaker 14: actually two decades ago, only five percent of venture funding
Speaker 14: was flowing there. I think as of twenty twenty four,
Speaker 14: year to date it's something like eighteen percent. And when
Speaker 14: you look at the actual economic value creation globally, there's
Speaker 14: still plenty of opportunity for us to be able to
Speaker 14: appropriately match the funding sources with the great talent density
Speaker 14: and opportunity we're seeing there.
Speaker 3: You've got such an extensive portfolio over a headline, some
Speaker 3: of them perhaps haven't been treated that pleasantly on the
Speaker 3: public market. I think of the success stories that have
Speaker 3: become a little bit beaten up like a bumble. It's
Speaker 3: been in the public market far fetch as well, But
Speaker 3: then you've been in the new really hot names Mistra
Speaker 3: for example, in France, are you going to lean into
Speaker 3: the AI opportunity. Are you going to keep on consumer type?
Speaker 3: Where are you thinking some of your investments are going
Speaker 3: to land?
Speaker 14: A lot you mentioned there, So across all stage is
Speaker 14: you know, I think we have to be aware of
Speaker 14: certain macro trends, but generational technologies, companies and products and
Speaker 14: founders are building as we speak right now and in
Speaker 14: every sort of market cycle, so we'll continue to back them,
Speaker 14: you know. As it relates to AI. Of course, it's
Speaker 14: a huge buzzword and a lot of companies are thinking
Speaker 14: about how they can incorporate the new generational technologies appropriately
Speaker 14: into their workflows and into their products. I want to
Speaker 14: back up a little bit and just think through when
Speaker 14: there are big platform shifts or new technologies, how these
Speaker 14: get adopted. It typically follows this sort of S curve,
Speaker 14: which is to say, the first few years are kind
Speaker 14: of the early adopters that might be more experimental and
Speaker 14: on the front lines of adopting this. And usually let's
Speaker 14: say after like twenty percent market penetration, it really inflects
Speaker 14: and it gets to that early majority and late majority,
Speaker 14: and after that it'll plateau or when the laggards have
Speaker 14: adopted it So I think there's been a lot of
Speaker 14: excitement about these new gen AI technologies and lms. But
Speaker 14: when you're a hammer, everything looks like a nail, right,
Speaker 14: And I think the smart founders are thinking through which
Speaker 14: products are actually appropriate to apply which forms of intelligence.
Speaker 14: And there's a lot of nuance there that I wish
Speaker 14: we had time to cover today.
Speaker 3: I wish we did too. Come back, let's get more nuanced.
Speaker 3: NACI shall headline, we appreciate it.
Speaker 5: Trust in organizations and they're emerging technologies is declining. That's
Speaker 5: one of the insights from Deloitte's latest AI in Technology
Speaker 5: Trust Ethics survey out today, and we're joined by Deloitte's
Speaker 5: Technology Trust Ethics practice leader Bena Amanaf for more. In fact,
Speaker 5: there are several conclusions. For example, if you look at
Speaker 5: the year on year change and you talk to professionals
Speaker 5: technology industry workers, many more recognize the good and the
Speaker 5: use of the technology, but at the same time, the
Speaker 5: extent of concern also increases.
Speaker 4: What are the other findings?
Speaker 15: Yeah, for me, that was the most exciting part that
Speaker 15: everybody's recognizing the value in AI but also recognizing the
Speaker 15: risk part of it. Here's the bottom line, Ed right.
Speaker 15: The biggest risk with AI is not using it at
Speaker 15: all in the organization, and people are kind of level setting.
Speaker 15: The other big finding for me was, you know, eighty
Speaker 15: percent of companies have rolled out ethical tech training or
Speaker 15: AI ethics training, and seventy percent of the employees who
Speaker 15: take it are acknowledging there's a change in their behavior
Speaker 15: on how they approach technology or they think about technology,
Speaker 15: which is a huge turn rate.
Speaker 3: Let's just back up a second, and what are the
Speaker 3: surveys showing that people understand ethical use of AI to be?
Speaker 3: What is ethics in this context?
Speaker 8: There's a few.
Speaker 15: We look at it from quite a few dimensions. The
Speaker 15: one that came up to the top, actually, Caroline, was
Speaker 15: on data privacy, and we have robustness and reliability of
Speaker 15: the algorithm, fairness and bias, whether the AI is safe
Speaker 15: and secure, whether it is being responsible, whether it is
Speaker 15: the right thing to do for society. So it covers
Speaker 15: a broad range but different dimensions. What we saw rise
Speaker 15: to the top Caroline was you know, the need for
Speaker 15: safe and secure AI.
Speaker 5: I want to tap into something you just said. A
Speaker 5: conclusion is you have to be using AI. You would
Speaker 5: be foolish not to, Yes, you know, loads of people
Speaker 5: watching this show will work with Deloitte. Right if you're
Speaker 5: a technology company or a normal company, Deloitte might help
Speaker 5: you bring a new CRM system in something like that.
Speaker 5: How high is the anxiety to rush in AI tech
Speaker 5: right now?
Speaker 15: I would say it was high a few months ago,
Speaker 15: but now it's kind of you know that risk factor
Speaker 15: is coming in early on in the conversation and the
Speaker 15: need to be responsible about it to mitigate those risks
Speaker 15: early on going in. You can get the full value
Speaker 15: of AI only if you also proactively some of the
Speaker 15: risks that come with it. The biggest thing that came
Speaker 15: out of the survey, The biggest concern is around reputational
Speaker 15: damage and the financial impact of leveraging AI.
Speaker 3: So being in the takeaway is go slower, be safe,
Speaker 3: or something else.
Speaker 15: Briefly, it is go first, but be aware there are
Speaker 15: risks that come with it, so address it proactively.
Speaker 3: Perfect being AMANA. So nice to have you Deloitte's Technology
Speaker 3: Trust Ethics Practice leader on the survey. Now, one company
Speaker 3: that's really focused on AI is Meta and it's actually
Speaker 3: kicking off it's big developer event and hardware showcase on Wednesday.
Speaker 3: The company is likely to be showing off it's new VR,
Speaker 3: it's mixed reality technology, and let's get a check in
Speaker 3: on what to expect, Kurt Wagner, what are you training
Speaker 3: your eyes on?
Speaker 16: Historically this conference has been all about virtual reality, right,
Speaker 16: So the quest headsets the metaverse with some and we
Speaker 16: heard a lot about a couple of years ago it
Speaker 16: was here where the company renamed Facebook to Meta.
Speaker 12: So I do think we're going to hear a lot
Speaker 12: about that.
Speaker 16: But really, you know, thanks to our good friend Mark German,
Speaker 16: we also know that they're going to be diving into
Speaker 16: some augmented reality glasses and we're going to get to
Speaker 16: see a prototype of these glasses that they've been building
Speaker 16: for years and sort of a glimpse into the future.
Speaker 16: I don't think it's something that's going to be widely
Speaker 16: available to the general consumers, but it is going to
Speaker 16: give us an idea of what they view as the
Speaker 16: future of AR and how they're trying to take some
Speaker 16: of these bigger, bulkier glasses and move them down, scale
Speaker 16: them down to something that's much more manageable on their
Speaker 16: day to day basis for people.
Speaker 4: Kat, you and I will be there together.
Speaker 5: The irony being that stood side by side in real
Speaker 5: life will probably be interacting through the metaverse. It's interesting
Speaker 5: because we've had Google Io, Apple WWDC earlier in the summer.
Speaker 4: How do people feel about Meta Connected?
Speaker 5: Is it like kind of the roaring Festival of technol
Speaker 5: Ology that other companies hope that their annual developer showcase is.
Speaker 16: I don't think it gets quite the reputation, certainly as
Speaker 16: the Apple event. Just so much history there with the iPhone,
Speaker 16: even Google Io. I mean, this is a sort of
Speaker 16: a conference that used to be really focused primarily on
Speaker 16: developer software developers who were building onto the API of
Speaker 16: Facebook or Instagram. Right, it has shifted over the last
Speaker 16: couple years to be more of a hardware showcase, which
Speaker 16: you know, Meta has invested in very aggressively.
Speaker 4: But as you both know, I.
Speaker 16: Don't think we think of Meta as a hardware player
Speaker 16: and the way we think of Apple.
Speaker 14: Right.
Speaker 4: So they're getting there.
Speaker 16: It's growing in popularity, but I don't think it's quite
Speaker 16: on the same level as you know WWTC, for example.
Speaker 3: Although people have been really excited particularly by the glasses,
Speaker 3: by the ray band collection and what does the developer
Speaker 3: ecosystem look like around that? How have they managed to
Speaker 3: build the right application to be served on these hardware.
Speaker 16: Yeah, so the ray bands are the consumer version of
Speaker 16: what these glasses should look like. They're not quite as powerful,
Speaker 16: so there's not quite as much developer stuff happening with
Speaker 16: the ray bands, but there is a ton of developer
Speaker 16: stuff happening on the higher end right with the quest.
Speaker 16: Of course, I think with the ideas with these new
Speaker 16: AR glasses, it's somewhere in between those and that there
Speaker 16: will be a lot of developer interest in building on
Speaker 16: that moving forward.
Speaker 5: Really quick cut, you kind of profile Lee chen Miller,
Speaker 5: somebody at Meta that has a key role here.
Speaker 4: Who is she and why do we need to know
Speaker 4: about her?
Speaker 16: Yeah, the super short version, she is in charge of
Speaker 16: those ray band metas, but she is also the head
Speaker 16: of product for these new AR glasses that they're building.
Speaker 16: These two projects are eventually going to meet in the
Speaker 16: middle someday down the road. So I think she's just
Speaker 16: a really important person to know because if this is
Speaker 16: the future of Mark Zuckerberg envisions that we're all going
Speaker 16: to be wearing these glasses on her head, this is
Speaker 16: the person who's leading that product effort. Right now, you
Speaker 16: can read about her of course at Bloomberg.
Speaker 8: This morning, cow Wagner.
Speaker 3: Let's go read it and have a safe flight over
Speaker 3: to the West coast. We appreciate it, Thank you so much. Meanwhile,
Speaker 3: aren't another thick and fast edition of Bloomberg Technology so
Speaker 3: much to digest both East Coast and West Coast dead.
Speaker 5: Yeah, there's a lot going on in the news cycle.
Speaker 5: I still can't believe that we are doing a story
Speaker 5: about Intel being bought by Qualcomm that I'm sure will
Speaker 5: continue to be a thing recap on the podcast. We
Speaker 5: have great reporting and great guests. You know where to
Speaker 5: find it on Apple, Spotify and iHeart Online always on
Speaker 5: the Bloomberg platforms as well. Caroline's in New York City
Speaker 5: with the team. I'm out here in San Francisco with
Speaker 5: the team. Brace for a busy week. This is Bloomberg Technology.