Speaker 1: From the heart of where innovation, money and power collive
Speaker 1: in Silicon Vallet and beyond. This is Bloomberg Technology with
Speaker 1: Emily Jay. I'm Emily Track in San Francisco, and this
Speaker 1: is Bloomberg Technology. Coming up the next hour. A tumultuous
Speaker 1: may for markets ended almost exactly where it started. What
Speaker 1: does it mean to tech valuations in summer months to come?
Speaker 1: We will discuss and could online dating be the one
Speaker 1: market that will be spared. We'll talk to an analyst
Speaker 1: who says companies like Bumble, Tinder, and Hinge our recession proof.
Speaker 1: Plus from where the next COVID wave will hit, to
Speaker 1: just how high inflation will go to the winners of
Speaker 1: the Grammys. A new predictions market lets you bet on
Speaker 1: just about anything. We're going to bet a controversial exchange
Speaker 1: that's actually legal for now. And finally, the Supreme Court
Speaker 1: just blocked a Texas law that could transform Twitter and Meta.
Speaker 1: We'll have a report live from Washington. All of that
Speaker 1: in a moment, But first, let's get a look at
Speaker 1: the markets and stocks in particular, Tech ending may almost
Speaker 1: exactly where they started this month. I want to stick
Speaker 1: with the markets now and specifically talk tech with Michael
Speaker 1: Wolfe of Activate. Michael, always good to have you back
Speaker 1: here with us. So look, what do you think all
Speaker 1: the fuss was about. We saw the ups, we saw
Speaker 1: the downs, and then at the end of the month
Speaker 1: we're back right where we started. Well, I mean, part
Speaker 1: of this it reflects that investors are concerned that the
Speaker 1: growth rates are slowing down. It's not as if these
Speaker 1: businesses aren't growing quickly. And yes they're concerned about rates,
Speaker 1: but to a large extent, it's it's all this is.
Speaker 1: This is a correction. It's not a bubble bursting. And
Speaker 1: in fact, when you people keep making this comparison to
Speaker 1: thousand and they're saying, oh, it's it's another wave of this.
Speaker 1: But in reality, though that we have companies that have
Speaker 1: real profits, that have real businesses and um and in
Speaker 1: the tech bubble in the in the early two thousands,
Speaker 1: what we had was business plans and not a lot
Speaker 1: of revenue and certainly not earnings. Here's a question is
Speaker 1: it overvalued or not? And if so, what is overvalued?
Speaker 1: I mean, I think we we saw right and left
Speaker 1: the market caps of these companies being driven up, not
Speaker 1: almost almost illogically because they were looking at at tremendous
Speaker 1: growth rates. So if you look at company like Netflix,
Speaker 1: which is down over sixty like Netflix has over two
Speaker 1: fifty million paying subscribers. So it's yes, we've seen a
Speaker 1: we're seeing a correction in the value, but this is
Speaker 1: a substantial business and we're going to expect it to
Speaker 1: see it continue to grow. Michael, you've been around a
Speaker 1: long time. You've got folks they're comparing this to the
Speaker 1: dot com bust. Do you think then that is totally overblown.
Speaker 1: I think it's totally overblown. It. The reality is that
Speaker 1: these are substantial companies. They've had substantial growth, they are
Speaker 1: leading in a lot of case, they're having modes around
Speaker 1: their business which makes it very difficult to compete against them.
Speaker 1: It's a totally different situation. Now. If you look at
Speaker 1: the two thousand and eight two thousand nine, you see
Speaker 1: a number of companies that were started in those days,
Speaker 1: and it gives you a sense there's likely to be
Speaker 1: So if you looked at Benmo and Square and and others,
Speaker 1: and Airbnb and Uber, they were started in that period
Speaker 1: during the last recession. So we should see a lot
Speaker 1: more innovation and a lot more activity. But but these
Speaker 1: these companies are substantial and they're going to stay substantial.
Speaker 1: What do you think about the M and A market?
Speaker 1: Obviously we've seen this massive Broadcom vm Ware deal. I
Speaker 1: wonder if that is in a league of its own
Speaker 1: on the heels of you know, maybe Twitter, which is
Speaker 1: also a unique situation. And then of course there was
Speaker 1: Microsoft in activision. But are we going to see more
Speaker 1: big time M and A through this tumultuous period. To
Speaker 1: a large extent, it's going to be different. There's gonna
Speaker 1: be different buyers. So one of the places where we
Speaker 1: should see a lot of M and A is in
Speaker 1: enterprise software. So if you look at the take private
Speaker 1: of McAfee, if you look at Salesforce and Slack, those
Speaker 1: are the kinds of acquisitions that we should continue to see. Now.
Speaker 1: One of the things that's also different is we're likely
Speaker 1: to see um more private equity deals. So if you
Speaker 1: look at we have Nielsen's take private at sixteen billion,
Speaker 1: we have UM, we have other businesses like Toma, Bravo's
Speaker 1: purchase of Proofpoint. We're going to see a lot more
Speaker 1: because the market is we're seeing some capitulation in terms
Speaker 1: of pricing, and this is a moment when private equity
Speaker 1: firms can rush in and they can find businesses that
Speaker 1: are that we're way over valued versus a year ago.
Speaker 1: All right, Michael Wolf of Activate, always good to have
Speaker 1: you on the show. Michael, thank you for giving us
Speaker 1: uh the silver lining on some of this stuff. Meantime,
Speaker 1: Taiwan based iPhone maker Han Hi expects supply chain disruptions
Speaker 1: to gradually clear up. At Shanghai slowly opens to trade
Speaker 1: after months of COVID lockdowns, Han high chair Young Lieu
Speaker 1: told shareholders the company is more upbeat now about it
Speaker 1: sales outlook than before. On High, of course, is Apple's
Speaker 1: largest assembly partner, from the outcome of the Grammys to
Speaker 1: the next COVID wave to future SEC commissioners. You can
Speaker 1: now bet on all of these things with call sheet,
Speaker 1: a controversial new type of financial exchange where people can
Speaker 1: play wagers tied to outcomes of real world events. Joining
Speaker 1: me now, Lauana Lopez Laura, Founder and CEO of College Lauana,
Speaker 1: thank you so much for joining us. So first of all,
Speaker 1: some some folks have been trying to push forward these
Speaker 1: kinds of financial markets for years, but it never happened.
Speaker 1: You know, how did you make this work. Yeah, so
Speaker 1: we get this question actually, uh fairly often, and the
Speaker 1: answer isn't what most people expect. It's really about we
Speaker 1: just had I guess, more patience and more resilience and
Speaker 1: we just push through longer. It's a it's a regulatory process.
Speaker 1: It takes a long time innovation, especially in the derivative space.
Speaker 1: It's it's there's a lot of new things, new risks
Speaker 1: that we need to look to and the regulators are
Speaker 1: looking for um and we were diligent through work with
Speaker 1: all of them. For the CFTC, you can think about surveillance,
Speaker 1: customer protection, the contracts themselves, rules, a lot of different
Speaker 1: things that we had to work through and iterate through
Speaker 1: two years. And we really worked hard for two years
Speaker 1: and didn't give up to get to get it for
Speaker 1: the finish line, uh and launch the exchange last year. So,
Speaker 1: for example, the FED has another decision coming up, and
Speaker 1: via cal she you can make a bet on what
Speaker 1: you think the Fed will do. What are your markets
Speaker 1: showing about the fed next move? Yeah, I guess to
Speaker 1: back track and just explain a little bit how the
Speaker 1: markets work, so you can buy yes or no positions
Speaker 1: on whether the market will have something will happen or not,
Speaker 1: and the price goes from zero to one uh selling
Speaker 1: to one if the if the market is correct, if
Speaker 1: your position is correct, um and because the price is
Speaker 1: from zero to one, the price so so like for example,
Speaker 1: sixty cents means there's a six and something will happen,
Speaker 1: So you can really directly translate the price to the
Speaker 1: probability of wou say that price is truth. With the
Speaker 1: FED markets, we have um different markets for every f
Speaker 1: o MC meeting. So for fifty or seventy five basis
Speaker 1: points hikes UM, our markets are saying that for the
Speaker 1: June fo m C meeting we will be seeing fifty
Speaker 1: basis point hyke with chance. The markets are also saying
Speaker 1: that the July meeting will see another fifty basis point
Speaker 1: hype with ninety percentians UM. And across the whole year,
Speaker 1: the markets are expecting ten UM FED FED hikes versus
Speaker 1: I think a couple of months ago it was predicting
Speaker 1: around seven UM, so so definitely a lot of hikes coming.
Speaker 1: So President Biden just you know, unveiled this whole plan
Speaker 1: to keep inflation down. What are your markets say inflation
Speaker 1: is actually gonna do? Right? We also have markets on
Speaker 1: inflation from zero percent to one point two and every
Speaker 1: month of the year, the markets are saying that the
Speaker 1: next inflation print coming out next week will be around
Speaker 1: zero point sixty five percent month over month or over
Speaker 1: the whole year eight point two percent inflation um our.
Speaker 1: Actual markets have have predicted seven out of the eight
Speaker 1: pass inflation prints correctly. Uh so, our our traders have
Speaker 1: not been surprised at all to see the high high
Speaker 1: inflation numbers, um But it's import to say that for
Speaker 1: the rest of the year um SO annualize. For the
Speaker 1: rest of the year, the markets are expecting of around
Speaker 1: four percent annualized in December around three which really is
Speaker 1: around um normal levels, so really expecting inflation to go
Speaker 1: back to normal. Now regulators initially said no to an
Speaker 1: exchange like this, but but recently changed course. Isn't this gambling?
Speaker 1: Why should this be legal? That is a great question,
Speaker 1: um our. We're in exchange the same way that the
Speaker 1: CIME or the New York Stock Exchange are exchanges, and
Speaker 1: you trade events on our exchange the same way you
Speaker 1: trade stocks or futures on CIMME or the New York
Speaker 1: Stock Exchange. We are basically just a trade matching engine
Speaker 1: that matches different people trying to take different positions. So
Speaker 1: if you take our FED markets for example, right, um,
Speaker 1: our markets are a way to trade hedge or get
Speaker 1: exposure to feed events the same way interest rate swaps
Speaker 1: are defined are designed to do, but hours are made
Speaker 1: in an exchange in an accessible and simple way. Um
Speaker 1: we really think that that bringing it to two. People
Speaker 1: have actual risk associated to this, Like if you have
Speaker 1: a student loan tied to the ten year treasury, or
Speaker 1: if you're trying to refinance your home, you have real
Speaker 1: risk associated to the FED raising rates and you should
Speaker 1: have access to the same types of benefits that Wall
Speaker 1: Street does. This isn't gambling. This is finance at it's best.
Speaker 1: It's about hedging risk and getting exposure to to what
Speaker 1: you you have your face risk in your everyday life. Now,
Speaker 1: I'd love to learn a little more about your personal story.
Speaker 1: I know you're from Brazil and you studied bullshoy ballet,
Speaker 1: which I assume was hours a day. How do you
Speaker 1: go from you know, potentially becoming a professional ballerina to
Speaker 1: going to M I T and launching a market startup? Well,
Speaker 1: that is a great question. I definitely have an unconventional
Speaker 1: uh path. Um. Yeah. So I used to be a
Speaker 1: professional ballerina. I used to train, as you said, eight
Speaker 1: hours a day uh in at the Bolshoi Ballet and
Speaker 1: I worked professionally in Austria for a bid and I
Speaker 1: think that really changed and mark how I am as
Speaker 1: a person. I think a lot of discipline and a
Speaker 1: lot of you know, sacrifice and looking two more longer
Speaker 1: term UM payouts versus very short term payouts. I think
Speaker 1: definitely helped with with starting chol ship. But I was
Speaker 1: always fascinated by math and science. Uh So I went
Speaker 1: to m I teach studies CS and math and at
Speaker 1: the very beginning of fascinated by the finest world history
Speaker 1: of markets market structure um. And from then it was
Speaker 1: worked out a couple of hedge funds, but I really
Speaker 1: wanted to make a mark of my own. So UM
Speaker 1: encounter the cow sheet the couchip problem, which for us
Speaker 1: video is people should have the same access people everyday
Speaker 1: business and should have the same access that institutions have
Speaker 1: to hedge risk they have associated to events. Most trading
Speaker 1: is based on events you think rates are going to have,
Speaker 1: like go up. You do this in the stock market.
Speaker 1: We want to bring this to everyday people and let
Speaker 1: them do the same and have the same benefits. UM So, yeah,
Speaker 1: definitely a convoluted story, but but I think it all
Speaker 1: adds up in the end. Last quick question, what's your
Speaker 1: position on crypto? Then? You know, isn't that you know
Speaker 1: a market that's already pretty well established, where you've got
Speaker 1: high risk, high reward. You know, why not put your
Speaker 1: money in crypto instead? That is a great question. I
Speaker 1: think crypto has wiped out a lot of people in
Speaker 1: the past couple of months. You can take the lunar example.
Speaker 1: I think that it needs more regulation. I think a
Speaker 1: very small portion of crypto markets are regulated nowadays, and
Speaker 1: you see a lot of scams just going around of
Speaker 1: like easy twenty yield or something like that, and in
Speaker 1: the end they just use your money and it's really
Speaker 1: people savings. There's like actual victims to this. So I
Speaker 1: really think it needs more regulation and it needs to
Speaker 1: to be brought up, brought into the regulatory oversight in
Speaker 1: the US. UM. I guess that with US, As you said,
Speaker 1: it's like you can also make money and lose money,
Speaker 1: but the difference that we regulated that this won't be
Speaker 1: a systemic risk that older is to explained to people,
Speaker 1: and and regulation brings this fantastic thing which is customer protection.
Speaker 1: All right, I want to love as Laura founder and
Speaker 1: Cello of Calci will keep watching. Thank you well. The U. S.
Speaker 1: Supreme Court has blocked a Texas law that critics say
Speaker 1: would fundamentally transform Twitter and Meta's business by requiring them
Speaker 1: to allow hate speech and extremism. Greg Storm, who covers
Speaker 1: the Supreme Court for Bloomberg, joins us. Now, so, Greg,
Speaker 1: first of all, give us the context on this Texas law,
Speaker 1: which has been moving through the courts, went into effect
Speaker 1: in Texas earlier this month. It did, and the social
Speaker 1: media industry had been very worried about it. The appeals
Speaker 1: court didn't give any explanation for letting the law take
Speaker 1: effect in The social media company said the impact and
Speaker 1: them would be tremendous. They would have to radically change
Speaker 1: their operations uh to remove the ability or to make
Speaker 1: it such that they could no longer essentially moderate content.
Speaker 1: The Supreme Court let that ruling that lower court orders
Speaker 1: stay in effect for a couple of weeks, and now
Speaker 1: finally the Court has intervened and said yes, we're going
Speaker 1: to block that law again. Is there reasoning as to
Speaker 1: why they're blocking a law and what does it mean?
Speaker 1: Not from the full court, we did get a dissenting
Speaker 1: opinion from free conservative justices and interestingly one of the
Speaker 1: liberal justices the second without getting any explanation at all.
Speaker 1: Those three dissenters said they saw this as an affront
Speaker 1: of state sovereignty blocking the law, they would let it
Speaker 1: stay in effect. But from the court as a whole, no,
Speaker 1: we didn't get any explanation. Is this the end of
Speaker 1: the road for this law or does it still have
Speaker 1: you know, an opportunity for for another life. Now it
Speaker 1: still has an opportunity. This just blocks the law while
Speaker 1: the litigation goes forward, and that litigation will go forward
Speaker 1: before that federal appeals court that said the law could
Speaker 1: take effect. So there may be still be some some
Speaker 1: serious fights on the hands of the social media companies
Speaker 1: and their trade groups, which were the ones that that
Speaker 1: suit to challenge into this law. Um. One other thing
Speaker 1: to note here is that there's another law a lot
Speaker 1: like this in Florida. That one was also blocked by
Speaker 1: a federal appeals court last week. So give us some
Speaker 1: examples if this law is upheld, give us some examples
Speaker 1: of what Twitter and Facebook would not be able to
Speaker 1: do that they do. Now, Well, the law says you
Speaker 1: can't engage in what's known as viewpoint discrimination. And what
Speaker 1: that means is you can't say, oh, that's hate speech,
Speaker 1: and because it's hate speech, we're gonna we're gonna take
Speaker 1: that down, We're going to block it. Uh. So the
Speaker 1: social media companies say, we would have to allow neo
Speaker 1: Nazis screeds, we would have to allow anti gay screeds.
Speaker 1: Uh and UM really would not have that ability to
Speaker 1: serve as kind of the traffic cop on their platforms. Okay,
Speaker 1: Greg Store, Bloomberg News, thank you, will continue to follow
Speaker 1: that law. Um, and the Supreme Court's next take all right,
Speaker 1: well by now pay later is a popular option for
Speaker 1: the youngest generation, but as the economy takes a tumble,
Speaker 1: many are struggling to repay all these small loans. Joining
Speaker 1: us now. The CFO of a firm, Michael Linford take
Speaker 1: a listen to him earlier with Blue Maction. Ally, Boss,
Speaker 1: I think it's really important that investors, uh the media
Speaker 1: that uses of our product to understand just how different
Speaker 1: firm is We're different from both the traditional financial institutions
Speaker 1: who offer revolving credit products, and we're different than the
Speaker 1: B N p L competitors that I think are being
Speaker 1: poked out in that particular analysis. Mission go ahead. Yeah,
Speaker 1: a lot of those competitors they've never seen a down
Speaker 1: cycle and we're about to experience something of the sort now.
Speaker 1: So do you think that they're going to experience something
Speaker 1: of a wash out there? I think you're already seeing
Speaker 1: pressure on a lot of these players. Um that you
Speaker 1: have people like a firm who takes our mission and
Speaker 1: our mission has created a business model that makes it
Speaker 1: so that we don't charge ladies, we don't allow consumers
Speaker 1: to revolve on dad, we do not allow to fur interest,
Speaker 1: and these kind of consumer oriented positions in our business
Speaker 1: has made it so that we don't have a choice
Speaker 1: but to underwrite very carefully. We have no way in
Speaker 1: our business model to support consumers who don't pay us back.
Speaker 1: And our most recent quarter we posted unit economics of
Speaker 1: four point seven percent of GMB seventy basis points ahead
Speaker 1: of our long term guidance. We stand out amongst all
Speaker 1: the other players. You have some players who are doing
Speaker 1: headcount reductions to try to save costs in order to
Speaker 1: afford these credit losses, and we're in the opposite position.
Speaker 1: We're very front footed. We're adding to our team because
Speaker 1: our unit economics are an exceptionally strong UH position right
Speaker 1: now because of our world class underwriting, and that's not
Speaker 1: an accident. We had to build that based upon how
Speaker 1: our business model was built from the first day and
Speaker 1: how we treat consumers. You know. The other thing you
Speaker 1: had mentioned too is that you're in a position to
Speaker 1: grow from here, even in a tough environment. What kind
Speaker 1: of hiring plans could you have ahead, especially as you're
Speaker 1: seeing that some of your rivals are cutting their workforce. Yeah,
Speaker 1: we really like our position in the market. You saw
Speaker 1: earlier this month we hired a bunch of engineers from
Speaker 1: a payments company that was having a hard time and
Speaker 1: they were winding up operations. We do this as one
Speaker 1: of the better markets for labor right now, where we
Speaker 1: have a strong need to build great products. We're not
Speaker 1: constrained in terms of our opportunity. We help enable the
Speaker 1: world's fastest growing payment method and we're in the very
Speaker 1: early innings of what our category will become, so we
Speaker 1: need a big team of engineers to go tackle that opportunity,
Speaker 1: and so we're very excited to be able to impressively
Speaker 1: grow our business again responsibly a firm CFO, they're much
Speaker 1: more ahead. This is Bloomberg. Welcome back to Bloomber Technology,
Speaker 1: Emily check in San Francisco. Is another day, another delay
Speaker 1: for Elon Musk SpaceX. The Federal Aviation Administration says it
Speaker 1: now expects to complete and environmental review of the rocket
Speaker 1: maker's Texas facility in mid June. Another pushback, which potentially
Speaker 1: doesn't delays the timeline for Starship Musk's Mars Moonshot. This
Speaker 1: is the fifth time in fact, that the f A
Speaker 1: has postponed the release of this report. From what all
Speaker 1: means are ed Ludlow here with me. So is the
Speaker 1: f A a buying time here? What's going on? It's
Speaker 1: impossible to know. You know, today's May thirty one. I
Speaker 1: was waiting for this because it was the day they
Speaker 1: were due to make a decision, and I wrote it
Speaker 1: down on a piece of paper because I'm not embarrassed
Speaker 1: about that. M They have delayed it five times, and
Speaker 1: the last time we were waiting for this was on nine.
Speaker 1: So I sat here waiting, and they delayed it till
Speaker 1: May thirty one. But it's important because spaces cannot make
Speaker 1: any progress on this. Starship planned the testing phase at
Speaker 1: least until they get clearance from the fair. Now, you
Speaker 1: were on the ground in Boca Chica in February, remember
Speaker 1: that vividly and Elon Musk made it sound like Starship
Speaker 1: was just around the corner, right, And at that time
Speaker 1: he basically expected that the regulatory side of things, this
Speaker 1: environmental review would be done in a couple of months,
Speaker 1: a test flight, the hardware would be ready in a
Speaker 1: couple of months, and he had an even bolder prediction
Speaker 1: for what would happen. Take a listen. It might be
Speaker 1: a few bumps along the road, a bit at all work. Um.
Speaker 1: I feel at this point highly confident that we will
Speaker 1: get to orbit this year classic mask orbital test flight
Speaker 1: by the end of this year. But we don't know
Speaker 1: where we stand now because this key beast keeps getting delayed. Well,
Speaker 1: so that was my next question, what do we know
Speaker 1: about where we stand with Starship? So you've seen the video,
Speaker 1: I think if the Mr Director will play it again,
Speaker 1: the explosions, the kind of successful test they've only really
Speaker 1: done hops off the ground, and what Starship needs to
Speaker 1: do is an orbital test flight. That's kind of the
Speaker 1: big milestone moment where it breaches as atmosphere, comes back
Speaker 1: down and lands again. That's we're waiting for Gwin shot. Well,
Speaker 1: who's the president CEO said it could happen in June.
Speaker 1: Doesn't seem like that if the f A decisions not
Speaker 1: Dune now until June. Meantime, of course, you've got SpaceX
Speaker 1: generally going from straight to strength, pulling off you know,
Speaker 1: a lot of successes. So as of Friday, Starlink there
Speaker 1: space satellite constellation based internet service is available in all
Speaker 1: seven continents. He expanded to Africa as of Friday. That's
Speaker 1: quite an achievement. And today this may first really important
Speaker 1: date ten years ago, first unmanned Dragon missions I s S,
Speaker 1: two years ago, first man one. They're dominating you know,
Speaker 1: this industry. But we really care about Starship because it's
Speaker 1: like you said, it's the Mars shot of the moon
Speaker 1: shot all right, at Law, thank you, well, keep watchally,
Speaker 1: you'll keep us posted. Well. Today mark the first day
Speaker 1: on the job for the new CEO of match Coupernard Kimp.
Speaker 1: He is leaving Zinger, where he's been president. Since he's
Speaker 1: taking over for Shardubi, who has been at the company
Speaker 1: for the last sixteen years. It is a pivotal time
Speaker 1: for dating apps, especially as we are heard from the
Speaker 1: pandemic and much of the world faces inflation. I am
Speaker 1: joined now by Sea Kajuria and analyst at Evercres, who
Speaker 1: just published a deep dive on not only Match but
Speaker 1: also Bumble. So, so what do you make of this
Speaker 1: new leadership and also coming from the gaming space to
Speaker 1: online dating. Is that a good thing? Well, we'll have
Speaker 1: to see. I Uh, he's done a good job at Zinga.
Speaker 1: Matches slightly different but also similar in a lot of ways. Uh.
Speaker 1: There are two things that are good I think are
Speaker 1: one that there are some similarities between what he did
Speaker 1: at Zinga and at Match portfolio of assets and a
Speaker 1: global business, both in favor of what matches strategy is.
Speaker 1: The other thing that's good is that shar is not
Speaker 1: really leaving. She is going to be part of the
Speaker 1: board and she will be working UM as an advisor
Speaker 1: to UM to Bernard. And also it's not the CEO
Speaker 1: change is not uh a turnaround story. It's not like
Speaker 1: Peloton where you have to rework everything. This is a
Speaker 1: functioning business. It's a strong leader in online dating and
Speaker 1: its category of global business. And he's going to come
Speaker 1: in and it's going to be business for usual at
Speaker 1: least for the near term. And then as he settled in,
Speaker 1: he will throw in his own strategy as he gets comfortable.
Speaker 1: So I don't think there will be huge turbulence in
Speaker 1: the in the business as he comes on board. So
Speaker 1: let's talk about your new report, because you're basically saying
Speaker 1: that you think online dating and as we go through
Speaker 1: all of this market folatility using online dating is recession proof. Why, well,
Speaker 1: largely recession proof. The the beauty of UH or the
Speaker 1: challenge of being in consumer internet, is that none of
Speaker 1: our names are recession proof. Really, so they're they're certainly
Speaker 1: impacted by inflation, but when it compared to the rest
Speaker 1: of our coverage, yes, they're largely resilient. Um And our
Speaker 1: survey shows that almost eighty percent of those who are
Speaker 1: actively looking for a relate reationship are going to use
Speaker 1: the online dating apps just as much or even more
Speaker 1: over the next call it six months to twelve months.
Speaker 1: And so that tells me that usage is not going
Speaker 1: to change um. The second read through was that if
Speaker 1: there is inflationary pressure and there is a recession in
Speaker 1: the next six months, most of them, of our survey respondents,
Speaker 1: so that they would be willing to pay about seventeen
Speaker 1: dollars a month on average for an online dating app,
Speaker 1: and that's where we are today, So it's not that
Speaker 1: they would pay any less. Now, the question is, well,
Speaker 1: Bumble is slightly more expensive, so would that come from Bumble?
Speaker 1: And I don't think so. I don't think that may
Speaker 1: be the case either, because Bumble has several different tail ones.
Speaker 1: So when you look at the online dating landscape and
Speaker 1: the options out there, is you know, Bumble, our Tinder,
Speaker 1: hinge Match, Are they all more or less equal in
Speaker 1: your view? Or do some stand out over others? I
Speaker 1: think some stand out over others. What our survey also
Speaker 1: showed is that Bumble is really gaining market share. And
Speaker 1: the one of the biggest investor questions into the key
Speaker 1: one print was what where's where's the market share shift?
Speaker 1: Is it is Bumble gaining share from Tinder? Is it
Speaker 1: something else? Our survey shows that really Tinder continues to
Speaker 1: be the leader in the market, but Bumble is gaining
Speaker 1: share from plenty of fisient e harmony, so other apps
Speaker 1: that have been around but may not be as powerful
Speaker 1: as a bumble and so in the United States, our
Speaker 1: survey shows it's Tinder as number one, Bumble as a
Speaker 1: clear number two, and Hinge is also gaining ground to
Speaker 1: now number four, back from number seven last year. So
Speaker 1: not all apps are created equal, even though the target
Speaker 1: target market may be slightly different depending on your background
Speaker 1: or one's background. But more Match and Bumble are doing
Speaker 1: with the product is certainly superior to some of the
Speaker 1: other apps out there. Well, engagement is one thing, but
Speaker 1: getting people to pay for it is the other. You know,
Speaker 1: which of these do you think is the best at
Speaker 1: at generating that that revenue and getting users to pay
Speaker 1: up for something that that that many of the big
Speaker 1: should be free. Yeah, the great question. All of Almost
Speaker 1: all of these are freemium models at different prices at
Speaker 1: different price points, but our survey shows that most users
Speaker 1: are willing to pay for Tender, e Harmony, Match, Bumble,
Speaker 1: and Hinge. These are the top five paid four apps.
Speaker 1: And some of the reasons for e Harmony and matches
Speaker 1: also because of the demographics their older uh older age
Speaker 1: folks who may have greater savings and are more serious
Speaker 1: about relationship and that's where the fair conversion is slightly
Speaker 1: greater in those apps. Um. But at the same time,
Speaker 1: on average, our survey shows it's about conversion, which maybe
Speaker 1: is a little skewed because I know that Bumble's conversion
Speaker 1: rate is slightly lower, But there's the point still holds
Speaker 1: that there's long runway for growth in terms of how
Speaker 1: many users they are that used for free and then
Speaker 1: how many the potential there is that they can convert.
Speaker 1: And the other thing I'll add is it's not only
Speaker 1: subscription there now also adding all our card services, you
Speaker 1: get buy a feature, uh instead of just paying for
Speaker 1: a monthly subscription, and you can just pay as you
Speaker 1: go as you use more features. And that's also gaining share.
Speaker 1: So what are the the risks to the online dating sector. Well,
Speaker 1: the risk is that the reopening across geographies is not
Speaker 1: the same. So for example, Japan is number two market
Speaker 1: for Match and that has been very slow in terms
Speaker 1: of seeing the reopening and people actually meeting in person,
Speaker 1: and that has been a drag on their growth rate.
Speaker 1: Because uh, Bumble pairs and pump Pairs and Tender are
Speaker 1: both really big in Japan. So one of the biggest
Speaker 1: risk is is the is the reopening curve across different geographies.
Speaker 1: The second risk is that not all demographics are the same,
Speaker 1: and so if there is inflationary pressure, it is possible
Speaker 1: that some apps may lose share over others um and
Speaker 1: that will be the question of which once people decide
Speaker 1: a compete versus let's go Alright Cajuria, analyst at ever Core,
Speaker 1: thanks so much. What to time now for our crypto
Speaker 1: report and Bitcoin higher for a fourth day, the big
Speaker 1: bouncing back above thirty dollars and then some as it
Speaker 1: recovers from a sharp decline in the past three weeks.
Speaker 1: But it is still down in May. Our crypto contributor
Speaker 1: Snale bossi here with more so Shanale. When you look
Speaker 1: at the broader equities picture, we're kind of back where
Speaker 1: we started here at the end of May, but with
Speaker 1: Bitcoin still significantly down. Yes, what goes around keeps going around, Emily,
Speaker 1: it goes around and around. So when we talk about
Speaker 1: bitcoin here, yeah, it's I mean the price movements here
Speaker 1: on On one hand, you have a lot of people saying, okay,
Speaker 1: it's time to build this, time to put our heads
Speaker 1: down in a down market and and really, you know,
Speaker 1: make projects that will last for long term. So what
Speaker 1: where are we? Bitcoin has really risen in the last week.
Speaker 1: It has not risen past thirty two thousand, but it
Speaker 1: is above that thirty thousand level. We are down meaningfully
Speaker 1: on the month, as you said, about sixteen percent, while
Speaker 1: the SMP has not moved much at all. The questions
Speaker 1: moving forward will be about correlations. I also want to
Speaker 1: draw attention Emily here to Ethereum. Why because Ethereum is
Speaker 1: also down not just on the month, but on the
Speaker 1: week as well. So you have seen a divergence in
Speaker 1: the last week between the two large cryptocurrencies. The questions
Speaker 1: moving forward here, well, how will they react in relation
Speaker 1: to each other and react to the rest of the
Speaker 1: crypto universe and in reaction to a lot of the
Speaker 1: macro environment that we've been watching so closely this month.
Speaker 1: And you know we've been talking about those venture funds.
Speaker 1: How will they deploy money in this continuously down market?
Speaker 1: All right, Shanali, thanks much. We're gonna hear more on
Speaker 1: this from Alice Kaleen, founder managing partner at the bitcoin
Speaker 1: focused venture firm still Mark, who talked about all of
Speaker 1: this and more with my colleagues Matt Miller and Kaylee Lines.
Speaker 1: Take a listen. Bitcoin companies historically have really thrived in
Speaker 1: crypto winters. It's the time to build, it's the time
Speaker 1: to be focused on sound tech and bitcoin. Is that so?
Speaker 1: I mean, we've seen Bitcoin moving back towards the lion
Speaker 1: share of market cap. It's so fascinating that bitcoin can be.
Speaker 1: I think right now forty five percent of the market
Speaker 1: cap of all crypto and we're talking about twenty thousand
Speaker 1: um some coins. Is this not an existential crisis for crypto,
Speaker 1: for bitcoins, for bitcoin, for bitcoin. So I think that
Speaker 1: bitcoint so Bitcoin's masscot is the honey badger. And what
Speaker 1: that represents to the community is that bitcoin as a
Speaker 1: sound tech sort of hasn't cared about what's happening around it.
Speaker 1: It operates very independently, and in fact, that's the purpose
Speaker 1: of the protocol. Bitcoin was invented. It was emergent of
Speaker 1: two decades of work on how to build an open
Speaker 1: and fair financial system that served the underbanked and the
Speaker 1: unbanked in the same way that it served the wealthy
Speaker 1: and privileged. And so bitcoin and bitcoin builders are generally
Speaker 1: really heads down. Now. I think something interesting that's happening
Speaker 1: today that you see reflected in the markets, in the
Speaker 1: crypto markets and in the bitcoin market as well as
Speaker 1: in the Broado macro environment, is that there's a collision
Speaker 1: of two things. Bitcoin is cyclical, It's cycles have been
Speaker 1: historically driven by having se affect miners, and so we
Speaker 1: see about a three to four year cycle for bitcoin,
Speaker 1: which has an impact on the rest of crypto of course,
Speaker 1: But now we've also seen a macro economic downturn and
Speaker 1: bitcoin trades as a risk on asset currently. I think
Speaker 1: that over the long term that will change, but today
Speaker 1: that's the case, and so these forces are at play
Speaker 1: and how we see um what we see happening with
Speaker 1: bitcoin's volatility. However, if we look back historically to two
Speaker 1: thousand and eight and another example of acrow a challenging
Speaker 1: macro environment, what we saw then was that new paradigms
Speaker 1: introduced by cloud and mobile were really powerful tail winds
Speaker 1: for fledgling company. Are we going to see, by the way,
Speaker 1: at least um any new way of is proof of
Speaker 1: work going to be a thing of the past, or
Speaker 1: is it still the only trustworthy way to maintain the blockchain.
Speaker 1: Proof of work is a thing of the future, so
Speaker 1: it's it's the only trustworthy way to maintain a decentralized
Speaker 1: and fair payments and financial system. And that's that's bitcoin.
Speaker 1: But the economics of mining, economics of proof of work
Speaker 1: incentivized investment major investment in sustainable energy. We know that
Speaker 1: today the sustainable energy represents about fifty eight percent of
Speaker 1: all energy used for mining. And that's the sixty year
Speaker 1: of your growth, So increase from Q one. Now. The
Speaker 1: fact a bitcoin mining has been able to so quickly
Speaker 1: transition to a sustainable energy source as the dominant source,
Speaker 1: I hope will be an example for other sectors to follow.
Speaker 1: At last, Colleen their founder and managing partner at still Mark,
Speaker 1: coming up the future of a cloud growth. Going to
Speaker 1: talk about how market volatility is impacting the cloud and
Speaker 1: the next big trends in cloud and software ahead with
Speaker 1: Greylock partner Jerry Chen. This is Bloomberg. We're seeing that
Speaker 1: the market is entering valat has some volatility in different
Speaker 1: parts of the world, but technology is seen as helping
Speaker 1: organizations no address supply chain shortages of customers better get
Speaker 1: online digitally and so demand for cloud remains very strong.
Speaker 1: For US, Google Cloud chief Thomas carrying their forecasting clouds
Speaker 1: growth in the midst of chopp eat market conditions. Was
Speaker 1: certainly a banner year for cloud investing, with total VC
Speaker 1: funding hitting fifty point three billion dollars. Our next guest
Speaker 1: has a forecast on where all that funding will go.
Speaker 1: In this week's Teconomics, I want to bring in Jerry
Speaker 1: chen Now from Graylock Partners, So Jerry share your forecast
Speaker 1: with us. Hey, I'm like, thanks for having me back. Look,
Speaker 1: I think Tom's is right. In a volatile market and
Speaker 1: a commuracy right now, cloud actually is going to see
Speaker 1: increased boat in a market revenue rights two hundred billion
Speaker 1: run rate through all the big three or four cloud providers,
Speaker 1: but also from startups. We're seeing fifty billion plus last
Speaker 1: year in cloud investment by vcs Graylock included. But think
Speaker 1: the emphasises see going forward is a lot around two areas.
Speaker 1: Security continues to be a big deal in the cloud.
Speaker 1: Number two cost savers. So as we see kind of
Speaker 1: this next market, governance, developer tools, data tools will all
Speaker 1: continue to grow, but really focus on how to save
Speaker 1: our customers money. So how do you think this market
Speaker 1: volatility will impact the broader cloud landscape. Obviously we heard
Speaker 1: Google Cloud CEO Thomas carry in there, but it's hard
Speaker 1: not to believe that, you know, this isn't going to
Speaker 1: impact how big customers are spending their money. I would
Speaker 1: say big customers the music cloud grows about twenty year
Speaker 1: a year in terms of compound at a growth rate,
Speaker 1: and the big customers will continue to sped. And like
Speaker 1: I said earlier, the two or three errors are seeing
Speaker 1: around our security for sure. For example, I think we
Speaker 1: saw over seven billion dollars in VC funding go into
Speaker 1: security startups. The big cloud customers will, can you span
Speaker 1: on security companies for example, Abnormal Security, one of the
Speaker 1: Grellic Protfoya companies, just raised a ton of money last
Speaker 1: year for email and a security number two. I think
Speaker 1: cloud customers will can you spend money on things like data?
Speaker 1: So we saw like Snowflake continues to do well in
Speaker 1: the public market, data breaks continues to do well in
Speaker 1: the private market. But increasingly startups in the data bricks
Speaker 1: and snowplate ecosystem will be focused on how to save
Speaker 1: customers money around data costs. So I think the big
Speaker 1: three continue to grow. I think security and data and
Speaker 1: AI continue to grow, but increasingly a focus on customer
Speaker 1: spending and enterprise spending and how to reduce costs for
Speaker 1: the next two or three years would be a big focus.
Speaker 1: So how would you characterize VC sentiment? I mean we've
Speaker 1: been hearing from vcs. You know, turl back, batten down
Speaker 1: the hatches. You know, you might have to take evaluation, haircut,
Speaker 1: you might not be able to raise your next round
Speaker 1: when you thought you would. How would you characterize your
Speaker 1: sentiment broadly? And then that sentiment when it comes to cloud. Sure,
Speaker 1: if you look at the data from I think Carter
Speaker 1: and pitch Book and the other data sets out there,
Speaker 1: Series A valuation, you're down from the year ago. I
Speaker 1: think Series C, Serie D financing valuation, you're down from
Speaker 1: a year ago. And for sure, we're seeing a tightening
Speaker 1: of the venture market towards a bunch of ideas. But
Speaker 1: I would say my personal sentiment, graylock sentiment, and the
Speaker 1: center of our companies here is Look, if you have
Speaker 1: a distinct value add like a hard return on investment
Speaker 1: for a cloud company, and that is emily either securing
Speaker 1: the company through like security products, firewall products, UM, improving
Speaker 1: the digital business of the business of the company like
Speaker 1: AI or a machine learning to help transform transform the business,
Speaker 1: or three saving your customers money. So if you can
Speaker 1: reduce cloud spend, reduced storage spend, reduce data spend as
Speaker 1: a startup, you can have a hard or a I
Speaker 1: and you're actually gonna pop to the top of a
Speaker 1: CIOs wish list. So it's saying, in the past two
Speaker 1: or three years, we've seen a lot of great ideas
Speaker 1: thrown out there, but in the next two years, we're
Speaker 1: gonna see a fewer. Your company's really focus on UM,
Speaker 1: saving money, improving the digital economy. Because if you're doing
Speaker 1: wellness market show really hard r o I, Emily, you're
Speaker 1: gonna get more budget and more awareness from your customers.
Speaker 1: So I think you're seeing a separation the market. The
Speaker 1: great companies will get more of the customer said, and
Speaker 1: the tier two tier three companies will struggle to raise
Speaker 1: because they don't have a real hard r o I
Speaker 1: for the customers. So we're saying, look, would you say
Speaker 1: that trend also extends to hiring and and and layoffs
Speaker 1: to me, because we've seen hiring freezes and and layoffs
Speaker 1: kind of across the board. Yeah, I think a lot
Speaker 1: of companies are looking at their burn rates and realizing
Speaker 1: that their economics were just upside down, right, So hey,
Speaker 1: the burn rage not sustainable. Uh. Where the capital markets
Speaker 1: are right now aren't guaranteed they're gonna raise either up
Speaker 1: valuation or even flat valuation. So we're seeing a lot
Speaker 1: of companies say, hey, I'd rather be uh slightly conservative,
Speaker 1: save my money from the next not one year runway,
Speaker 1: but two years of runway until the capital markets and
Speaker 1: vendroom markets get a little bit more predictable, because I
Speaker 1: think just like public stock market hates anscertainty, the private
Speaker 1: markets around vendroom companies and startups also hate anserdity. So
Speaker 1: until we have a lot more aberdainity of what like
Speaker 1: the Series B, Serious C, Series D Financis look like,
Speaker 1: you know, a lot of startups are gonna be a
Speaker 1: little more conservative. But that said, if there's a good
Speaker 1: r o I on their spend on sales and market emily,
Speaker 1: they're gonna continue. Higher sales, reps, continue higher engineers, the
Speaker 1: good comes to do well. But I think we just
Speaker 1: need a little more clarity where the markets going. Jerry Chen,
Speaker 1: Great Luck Partners, Great to have you back with us. Jerry,
Speaker 1: thanks for giving us a view on the cloud ahead.
Speaker 1: And that does it for this edition of Bloomberg Technology
Speaker 1: will be right back here tomorrow. I'll be joined by
Speaker 1: Resta Show, Johnny founder of Girls Who Code, and David
Speaker 1: Kirkpatrick to talk about that new Supreme Court ruling on
Speaker 1: the Texas social media law. That's tomorrow. This is Bloomerk.
Speaker 1: Keep the sat N