Bloomberg Businessweek Weekend-January 23, 2021

where US virus cases topping four hundred thousand, Tim and counting. Wow, a grim milestone, Carol, and it certainly shows that front and center for the Biden administration on day one is the virus and the recovery. This is the main backdrop for this week's magazine, the Year Ahead issue, covering the major trends, disruptions, breakthrough products, innovations and movements to watch for this year. I feel like there's so much to

watch this year. We'll have a few highlights from the magazine and also from our daily radio show, including former Obama campaign consultant Spencer Critchley. He's also the author of Patriots of two nations where Trump was inevitable and what happens next. You and I love this conversation. We do. I love talking to Spencer and Carol. We're also gonna have the latest on COVID nineteen vaccinations. They are not happening fast enough. There's still a lot of bureaucracy and

red tape. Go to voice on the front line, Surgical Solution CEO ALYSSA wrap. All right, so all of that to come. We're going to begin with this week's cover story. Well, the kind of story is really all about the year ahead, but kind of tying it together for us was our Peter Coy. He talked about more vaccinations, more stimulus, more sanity. He gave us kind of the guide toe and Tim I got to say, I love the tagline for this one. The economic outlook is starting to brighten, but the world

well it still needs a shot in the arm. Yeah. I certainly need that shot in the arm. We've got more on that with Bloomberg business Week Economics editor Peter Coy and Bloomberg business Week Editor Joel Weber. We tried to be slightly lighthearted and go with this tabloid look, which really just started with us asking a bunch of questions. And as we kept asking questions, I kept adding exclamation marks. I think the big debate on the staff is whether one is the year of the exclamation mark or the

year of the question mark. UM. Right now it feels more like the latter. Just tons of questions. And as we started UM asking those questions, though we we did. I mean, it's the tabloid thing is fun, but we we take this very seriously and we tried to just pack it full of as much useful information as we can. That's where Peter came in with the intro obviously, and

you know that. I think the real takeaway Peter is, you know, our economic outlook is basically UM wedded to the number of vaccinations that the US is able to do, and that goes for the rest of the world as well. So what does that outlook sort of look like? UM from your reporting. If you look at the GDP forecasts for the world and and the US and many other countries, they look pretty good. You would think, wow, nice, that's healthy growth for example for the world five, for the

US three. But you have to keep in mind does ASK off a very low base. So what's happened is that was an awful year, and we're getting a rebound, So it looks good, but we're not even rebounding all the way back to the trajector we were on. Uh, you know, it's it's like the I don't know, maybe I'm just glass is half empty kind of guy, but I'm not super happy about this. Oh, come on, maybe you're just a realist, Peter. Yeah, okay, Well, is there any I mean, is there any good news? Did you

find anything to be optimistic about in your reporting? No? I mean, the obvious thing is that the vaccines were developed far faster than you know, a lot of scientists have been expecting. That's a huge positive. It is taking a while to get them distributed, but the US is actually, even though if you're living in the US it feels kind of slow, the US has has done a higher percentage of its population getting vaccines than most other countries.

And I do believe that we're going to get our act together eventually, and that this will end up being um the year when the tide really does turn on the vaccine the second half is going to look better in the first half, and so it also looks different elsewhere in the world, Peter Um. In one place that it looks completely different is China, which even though they haven't really done mass vaccinations yet, the economy remains to you know, it didn't skip a beat last year. Only uh,

you know, major economy that didn't have a contraction. And you know, here here we are projecting that you know, they will become the world's largest economy in just a couple more years. Um. What from an economy standpoint, Just how how legit are those Chinese numbers? You know, you never know whether to trust any given year, but it's certainly true that relatively speaking, they did better than the

rest of the world. I mean, it's just obvious just walking around the streets of Beijing or Shanghai that people are going to restaurants, are going to theaters there, kids are going to school just as normal people are going to work, just as normal traveling. Um, that's just evidence that they've got the virus under control through you know, blocking and tackling, doing the basics right. So they had, as Joel said, positive growth last year, and they expected

to have a strong growth this year. When you when you look in your intro, you had a couple of other countries that that stood out to you. What are the other ones that that you feel are gonna you know, the ones that will continue to talk about this year. Well, the UK had a terrible They did much worse than the US. US probably had about a three point six decline in GDP UK over ten decline in g d

p UM. So uh Boris Johnson has his hands full trying to fix that and now looking so good so far with more lockdowns to try to suppress the virus um. Germany is done somewhat better. Germany has a bad habit of exporting its way out of its problems, building up huge trade surpluses that other countries resent, and that looks like that's going to continue in If a company does have a good chance of succeeding in the new environment,

it makes sense to keep it alive. If it's business models fundamentally flawed because of the changes caused by COVID, then maybe it's better let it go. That pieced him really laying out the top themes for the year and how we may see a recovery from a time like no other. As we've talked about so much, Caroll, the recovery inextricably linked to the vaccine rollout. It cannot happen

soon enough. That was, of course, Bloomberg business Week Economics editor Peter Coy and Bloomberg Business Week Editor Joel Weber coming up the year ahead when it comes to politics and government, Well, will the divisions continue to dominate? We'll check in with one Washington insider. He's also the author of Patriots of Two Nations, Why Trump was Inevitable and what happens next. You're listening to Bloomberg Business Week. This is Bloomberg. This is Bloomberg Business Week with Carol Messer

and Bloomberg Quick Takes Tim Stinovich from Bloomberg Radio. Safe to say that one year ago this time we really had no idea of what would come on the political front. Fast forward to this year. We've got a new president, a Democratic Congress by a slim margin, and an administration to him with a year ahead to do list that's long and wide in a Washington that's still wheeling from the capital riot at the start of the year. And you know, Carol, this is really the reason that we

wanted to talk with Spencer Critchley. He's managing partner at the marketing agency Boots Road Group. He's also an award winning journalist, a communications consultant who has worked for both of Barack Obama's presidential campaigns as well. He's a modern day renaissance man because he's also a digital media producer. He's worked with David Bowie, Moby Santana, Britney Spears, a bunch of others. He's also author of Patriots of Two Nations.

Why Trump was Inevitable and what happens next? Top of mind for us right tim the inauguration and division in Washington. We have to have hope. I think today it's been so inspiring what's been going on, and I think that President Biden has followed exactly the right course here. You know,

when he's talking about restoring the soul of America. I know people have probably assumed that that was standard campaign rhetoric, because politicians tend to talk in these you know, sweeping historic terms to try to motivate voters in this grand mission of their campaign. But I am confident that Joe Biden means that from his heart, and I think what he's referring to is the set of core moral values that are at the heart of democracy, and that make

it possible. You know, we're a civic nation, the first one in history to not have a state religion and not have an official ethnic identity defining us. But instead we're really defined by the idea of America has embodied in the Constitution. And those shared moral values are values like freedom and equality and the rule of law and

democracy itself. And that's what Biden has talking about. It goes way beyond the partisan differences and the other differences that have divided us so much and for so long, and really calls on all of us to renew our support for democracy itself. So, how does if you were advising President Biden, if you're advising him right now, how does he bring a nation together that is so divided.

I think that that's where he needs to start, is appealing to people's hearts, because as I you know, as I say in the title of my book, the people who are divided consider themselves as patriots. Even if they hate the people on the other side of the divide and see the people on the other side as threats to the United States, they see themselves as patriots. And if you have a situation where two groups divided so deeply, both see themselves as patriots. The issue is they're seeing

different nations. They're patriotic to different visions of what the nation is. And I think what Biden needs to do and will do is show people, in fact, we're united by one nation that's defined by these values that we do all share. If we don't share these core values and affect our civic religion of equality, freedom, rule of law, etcetera, then we don't support democracy. So if you're going to be in the circle of democracy, you must share those values.

And I think you know most people believe in those values and want to be appealed to on that level. And so if he does, I think that goes much farther than any particular policy position. All right, Spencer, don't hate me, but I'm gonna I think I said this last time you were on because it was a line that in your in your book that just stayed with me, and you said, Um, how you think you understand what has happened here? And that is that this has been

coming since the founding of the country. America's two nations occupying the same land, but seeing everything very differently, even including truth itself. And what's interesting is we do look at this division. I think one of the things Tim and I have thought was really important and our reporters Bloomberg News are are writing on it is talking to those right ers understanding why they did what they did.

And I think we have forgotten Americans that we need to understand why they feel like they're not represented in this government or that they needed to overtake this government. Yes, although there is a certain point at which everybody has a choice, and um, I think we make a mistake

if we see everything in terms of ideas. I've been working hard, including with this book, to try to help people understand each other, especially people on my side of the divide, which is the democratic liberal side of the divide, to help them understand why good people would support President

Trump for example. Um, However, when you are offered the choice to storm the capital, to smash the windows, to attack police officers, to threaten the lives of elected officials, we don't need to understand that at that point, Um, you just need to be stopped and you need to be held to account. And this also is part of really understanding and defending the moral values that is not a partisan position. If we believe intomocracy you must not and cannot be allowed to do those sorts of things.

So for the people, you know, think about it this way. We think about understanding, you know, what democracy is about, and all this sort of stuff, But think about the developmentally disabled, for the intellectually disabled, for example, there are no morally worse than anybody else. It doesn't require advanced intelligence or high education to understand that it's wrong to destroy things and to hurt people. And the people who participated in that attack, that is what they did and

that is just wrong. Um. I think coming out of this, because things have gotten so bad, we're actually going to have to follow a truth and reconciliation process, as was followed in post apartheid South Africa, post World War two Germany, post troubles in Northern Ireland. We first of all must establish we must re establish truth, especially because autocrats always attack the truth. Uh an attack history. History is the

enemy of tyrants and it's the friend of freedom. So we must establish truth and we must have accountability, and then we can work towards reconciliation. The first thing we have to do is re established this sense of shared values. I think that if we think too much at the tactical level. We won't get there because we're kind of lost. Our dispute really takes place over tactics and policy details and charges and counter charges, and and it ends up

deepening the division and increasing the loss of trust. And when you're as divided as UM so many Americans are right now, the first thing to do is re established shared values, to re establish trust, because people really only listen to people that they trust. And if you've lost trust in each other, it doesn't really matter what you say, how valid it is, it's just not going to be heard or you know, given any any weight with the

lack of trust. And this is one reason why I think Joe Biden was quite possibly the best choice the Democrats could have come up with for this time in history, because it's such a strength of his UM. I wrote a or a piece about this at Spencer criticley dot com just called a good man because aside from his other qualifications, and I think he's actually one of the

most highly qualified on paper presidents in our history. UM, perhaps his most important quality is who's a thoroughly good person, As everybody who's been around him for any length of time knows and will tell you. And leadership is not about what you can impose on people. Ultimately, it's about what you can summon from them. And I think that

we're already seeing. I don't think I'm dreaming. I think we're already starting to feel how different it's going to be when we have a leader who is summoning the best from us. It's always great to have Spencer Critchley join us. He is again the author of Patriots of Two Nations, Why Trump Was Inevitable and What Happens Next, also managing partner for Boots Road Group. I gotta say one of my favorite conversations this week, Tim still ahead Washington.

We know the inauguration politics, as we said top of mine this week. So too were those troubling COVID headlines. How one healthcare ceo is supporting frontline workers and healthcare systems. This is Bloomberg. This is Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes. Tim Stinovich from Bloomberg Radio. Your head will look a lot like unless we get Carol. Oh, sorry was a terrible year. I'm really sorry, but it's

a reality. I mean, listen, we're getting out vaccines. We know that, but if you take a look at the headlines and still the obstacles, it's pretty dark and dismal. Yeah, that's true. US coronavirus deaths topped four hundred thousand this week. It is a staggering number. Each one of those people

leaving behind a family, leaving behind friends. Follows on the heels of global death Carol hitting two million just about a week ago, and on the front lines of it all, Alyssa Rapp, whos CEO of the healthcare solutions company Surgical Solutions, I am absolutely seeing more vaccine availability and our frontline healthcare workers in places like Houston and New York City are getting access to getting the vaccine, which is great.

And I've known from personal anecdotes that family members seventy and up we're also getting their first shot this weeknnext,

which is across many states. However, there's still a lot of bureaucracy and red tape, and what we've seen even at a couple of our hospital sites is even if you're a credential employee or contractor, even if you have a vaccine appointment, now there's a third database that people are expected to be tracked in when their vaccines are given and if any technical difficulties like we just had occur and a database doesn't map from the employee contractor

database to the separate vaccine tracking database, even if you have an appointment in our bona fide employee or contractor, you can't always get the shot. And so there's just a lot of bureaucracy and there's got to be a streamlined way we continue to immunize or we will never achieve a hunter million in a hundred days. Oh, that's just disconcerting to hear their places, um, where your frontline

staff are that are better than others. You know, I think that we've seen it be rolled out to accessfully in all places, and we've seen bureaucracy in all places. We have three employees in nine states, so it's really a facility by a facility or system by system question to be fair. But I will say the places I am most optimistic about having a partner to our federal government and our our our people on our American public.

If we can partner with CBS, Walmart, Costco, Walgreen, name that tune and go to places where people are used to getting food shots, where they're used to shopping on a regular basis, leverage the notary like you read Business Week magazine MELSSA, because they have a story that's just specifically about that that maybe you know, the success in terms of getting that vaccine rollout is contented on relying on the big pharmacies, but even your local pharmacy, like

they need to be the place to go. Absolutely. I I even read recently this week that the governor of Washington State is going to partner with Starbucks. I mean, anything we can do to leverage existing infrastructure, because when we create new infrastructure, even in health care facilities, let alone anywhere, if it's expensive, bureaucratic, encumbersome, leverage what we have, keep things moving as quickly as possible, and get it done.

Herd immunity being obviously the goal here. Um, you know it, It really raises the question a list of why we didn't see earlier on public private partnerships when it comes to a widespread vaccine rollout um to be discussed on a different day. Isn't that important? Like, well, it's interesting that forgive me because I just want to jump in because you know, you talk about the bureaucracy and the logistical problems, and I know what maybe Kansas needs versus

what New York needs is going to be different. But nonetheless, do you think those are quick fixes? And I don't say quick and then it's easy, but do you think that this new administration, approaching it differently, can get this quickly under control so that we are seeing the bureaucracy taken out of the systems and the logistical snaff oos

ALYSSA taken out as well. I'm very hopeful. I'm very very hopeful there is an opportunity to hit reset and start sprinting, and if this administration is able to do so, we're going to be much better off. So listen, you mentioned that you have hundreds of employees and in nine states I believe um are what's the portion of them that have been vaccinated thus far? Because these are frontline workers,

it's an excellent question. We have about twenty three percent that have been vaccinated to date, and there's a huge one, now, you know. I was I was expecting that's a really small number. And here I got an email this morning at one of our biggest facilities were one of our frustrated team members on the COVID list serves said, I'm registered. What I articulated earlier, I'm registered, I'm credentialed, and they don't have me in the third vaccine database. And it's

very frustrating. Yes, not for lack of desire. It's it's got to cut through the red tape. Yeah, all right, Um, so if we can cut through the red I mean so okay, So how do you see this playing out? I mean, I'm just tim and I constantly are like, all right, so when do we get back to normal? Whenever we're talking to somebody who's at healthcare professional or head of a company like you are that are are seeing everything play out firsthand, Um, what's your expectations based

on what we're seeing so far? What's your expectation if things can dramatically change in a positive way. If things can dramatically change in a positive way, I see seventy five and up having their second shots by President's Day.

I'm hopeful that teachers and other essential frontline workers such as grocery store workers, etcetera, will be having their first, if not second, vaccine by the end of Q one, by the end of March, and I'm really hopeful that Tier two and Tier three let alone Tier four, like healthy people in their thirties and forties can start getting vaccinated and complete that April May June, and we can

get back to normal come July August. The scientists are so brilliant in this country, and we have just done such an extraordinary job coming with a protein based solved in this particular vaccine that I am actually cautiously optimistic. That was one of our go to voices when it comes to COVID nineteen Surgical Solutions CEO, Allissa Rapp, you're listening to Bloomberg Business Week coming up next. It's it's been pretty challenging the story of how COVID is pushing

a city block to the brain. This is an interesting story that was in Bloomberg Business Week magazine. We're gonna take you through a must read story. It's from our one Year, One Neighborhood series that's coming up next to him. This is Bloomberg. This is Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes Tim Stinovy from Bloomberg Radio. Hard to say with the year ahead holds for the real estate industry and the many businesses that occupy the

commercial real estate landscape. But I will say Tim, this is one of the things that we have consistently and constantly talked about stories across the Bloomberg every day about what the future is of commercial and residential real estate. Yeah, there are a lot of unknowns, and if we think back to what happened, it was a real surprise to see residential real estate bounce back so quickly in some areas of the country and be left behind in other areas.

So far, the pandemic hasn't triggered a real estate meltdown on Main Street, but his business week uncovered time is running out for one Seattle landlord and her tenants. Yeah, Tim, it's a personal story that's being told over and over again, Tim around the country because of the pandemic. And we got more from the writer of it, Mberg News finance reporter no Bu Hire. He joined us along with the Seattle landlord he wrote about was done. She's founder of

Doune in Hobbs. It's a small business and both were in Seattle. Noah starts off by talking about how he connected with the subject of the story. Liz and I actually started chatting several months ago. Um. I think it was in April or May of last year, UM for a project that I'm doing for Business Week, UM following small businesses in one neighborhood here in Seattle through the

COVID crisis and UM over the months. UH, in several conversations with Liz, I was just struck by all of the sort of financial um and business bonds that she had created and UM developing this really uh several properties on this really cool block and Seattle just how how COVID was was really putting a lot of those relationships

under strain. And what I wanted to do was tell a story about real estate and small business and all of these links between people and how they got through the first ten months of the pandemic and what it might take to get them through the next time. So Liz, come on in on this. First of all, how's your year been, Oh, Carol Um, It's it's been pretty challenging.

I've been doing small scale real estate for about twenty years, and I've survived through a couple of previous crises for nine eleven, and then you know the economic meldon that started in two thousand and eight. But boy, this just takes the cake for sure. Well, and to be fair. And what's interesting and it's one of the things we've talked about a lot, Liz, is you know, companies big and small had to learn to pivot. Like I feel like I've used that word a million times over the

past twelve months. You did as well, and you had some things going for you in terms of, you know, where your real estate was located, what kind of tenants you had. Tell us a little bit about that. Well, I kind of operate at a escape l that UM really caters to locally owned small business and so I love to renovate old buildings and then create a bunch of smaller users UM kind of into one project where UM it can create a real critical mass um of of UM you know, interested in terms of retail and

restaurants for the for the customers. And we're in a really great neighborhood called Capitol Hill. It's kind of the you know, the cool, funky alternative neighborhood in Seattle and and um. But you know the problem is that these small family owned businesses are UM super vulnerable. And as Noah and I discussed of my twenty some customer facing businesses on this one block, you know, they were all impacted in various ways by by shutdowns, UM or other

aspects of the pandemic. So, no, as you were doing your reporting and talking with Liz and and unfolding a story, what struck you, well a couple of things. One is just how um, how much the businesses their tenants at liz property were able to pivot and just sort of do what they could to keep revenue in the door. Another thing was just Liz's willingness to do whatever she

could to keep them afloat. So what that meant a lot last year was Liz had to go out and negotiate with with her banks, the folks who have mortgages on her property, and get some sort of relief there so she could turn around and pass um basically give her tenants some wiggle room um and And I think that's like a hugely important and underappreciated aspect of what's

been going on here. And you know, from the outside of this crisis, uh, you know, I spoke with one of Liz's lenders, um, the CEO of Home Street Bank, which is a regional bank here in Seattle, and that their willingness to work with Liz over the last couple of months has just been huge. But I think Liz and Home Street also thought that this pandemic would be over by now. A lot of us did. And so really the point we're at in this crisis now everyone's having to come back to the table now and figure

out what makes sense for the next several months. What's interesting too, And there's a stat Noah, that jumped out at me about the strain that we're seeing in terms of you know, us retail landlords. We've talked a lot about this on air, counting more than fifty billion dollars in miss rent payments last year according to estimates from co star Um, and some of those maybe will never

get paid. But we've been watching so closely, no Uh, the real estate market for looking for signs of strain, and it's big players, smaller players, but we've been watching it very closely, especially as we increasingly see in our communities. We see in New York City a lot of retail restaurants they're not there anymore and they're just boarded up and they're empty places. Yeah, I mean, I think what's

interesting about Lizze's property Um properties is the resilience. I mean, there's been a lot of work that has gone in to keep those businesses afloat. And um, you know, another thing that should be noted is that the block where these properties are was was just really steps from where a lot of the racial justice protests were um in Seattle. And um, there were periods over the last year where um, these businesses had to board up. But UM, you know,

I think Liz worked with her tenants. She could say more about this, I'm sure to just sort of make make it clear that you know, they were open and functioning to the best of their ability. So how crazy was it? Because it sounds like there are a lot of things that made survival possible. It was government programs, it was bank forbearance. Um, there's a lot of things. I mean, just what was it like, you know, in terms of finding the pieces to kind of keep it going? Well,

I think you're right. It was a jigsaw puzzle and it continues to be a jigsaw puzzle. And you know, that's why I really appreciate Noah telling this story because I think the plight of the mom and pop landlord. UM, I think that story is not really getting told as much as it should. But um, yeah, our our tenants, we helped all of our tenants connect with banks if they didn't have one, so they could apply for the

p PP resources. We are once again with this round, coaching them and and connecting them, um if they don't have those relationships. UM. The protest zone was half a block from us, and that made the months of June and July UM really difficult. There was a swarm of bicycle copits um uh road around our block because our area has kind of become a flashpoint for UM protests on various issues, and so that that kind of continues. But you know, I'm so lucky to have relationships with

local banks. And that was intentional after the last down turn, when I realized that these big national banks, uh, you know that they're they're paying no attention to the plight of one little landlord in Seattle. UM. Now I only deal with local banks where I literally, if I needed to, could walk into the office. You know, that is such an important story. It's something actually my husband I were

talking about the importance of like local community banks. UM. Now we've talked about this, you know, the big banks, there's been a lot of pressure even since, of course the financial crisis to you know, work within the smaller business community. UM, think about kind of neighborhoods, and there's been a lot of pressure on them, but we've realized how important it is the local community banks in terms of the relationships and understanding their communities and the needs

of them. Yeah, I think I think that's a good point and something that's very salient And and Liz's story is I mean, really what we're talking about is the difference between what what kind of what the city, what any city really looks like. Um, afterward, through this pandemic, it's, as Liz said, a jig. It's been a jigsaw puzzle and putting together all the pieces in a way that the world resembles something like what it was before the pandemic just requires a lot of action from a lot

of different people. And um, you know, community bankers tend to have their finger on the pulse of what's going on in their backyard. And you know, uh, the loans that Liz has they probably you know, would be a complete rounding air for a large national bank, but they're not trivial for for a smaller bank. So, UM, I just my reporting, you know, what I gathered was there was a lot more willingness to sort of look at the totality of the situation and try and imagine a

way to get through this together. Uh. What's interesting about Mark is that he helped turn around Home Street after the last um uh recession. He came in, I want to say, um maybe twenty nine, two thousand nine and another tough time. Yeah. What what he explained to me is that this this uh, this moment is fundamentally different. Yeah.

Really wide ranging story there. It incorporates, Carol so much of what we continue to discuss on the show, the pandemic of course, real estate and the implications for business. That was Bloomberg News finance reporter Noah bou Hire who joined us along with the Seattle landlord. He wrote about Liz Dunn. She's the founder of Dunne and Hobbes got to say, I love the personal stories. It really gives

you some insight into what's going on. That wraps up our first hour of the weekend edition of Bloomberg Business Week from Bloomberg Radio. I'm Carol Masser and I'm Tim Stenovic more Head. In our next hour, including from cannabis and coles to Hollywood's pay Model and Peloton more from the year Head and the consumer companies to watch. You Love your Peloton, Carol, plus the maker of Folgers and Jeff Peanut Butter on innovating at a nearly one five

year old company. We hear from Smucker President and CEO Mark Smucker. Can I just say the new president loves this peloton too? Also guests who people around the globe trust the most. That from the head of the global communications firm Edelman, and the co founder and CEO of Twilio, Jeff Lawson, on a spectacular year and his new book, Ask Your Developer. This is Bloomberg. This is Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes Tim stenovic

from Bloomberg Radio. I am Carol Messer and I'm Tim Stanovick of Bloomberg Quicktake Clini head in our second hour of the weekend edition of Bloomberg Business Week, including more from the magazines You're a Head issue plus a fifth generation Smucker running the company, what innovation and culture mean at a nearly one old brand. Gotta love your Jeff. Also government or business? Which one do people trust the most? The head of Edelman on the latest trust barometer, and

Twilio has been on a tear. Co founder and CEO Jeff Lawson explains why and how to harness the power of software developers and win in the twenty one century that in his latest book, All of That To Come. We begin though with the year ahead. As we mentioned, the magazine is all about what's to come and look out for in one teeing up our Bloomberg Live event

this coming week by the same name. Jim Ellis, though Bloomberg Business Week Assistant Managing it or editor of the Business section of the magazine, caught up with Tim and me to talk about some of the consumer companies and stories to watch check it out well. I tried to think about what are the you know, sort of what's the range of companies and industries that have been sort of hit hard in that we're hit hard in in the consumer sector, and um, you know, how is one

going to be different from them? Obviously a lot of that plays into how all the pandemic affected companies, and that's a range of companies, whether it was um, you know, going from consumer the traditional consumer retailing, but also looking at these sort of people who benefited from those you know, from the pandemic in a way, you know, things like Peloton at home sort of companies, delivery companies, um, all the way to companies that you know now have to

look at ways that their business may be permanently changed, such as retailers who suddenly have discovered that things like the delivery things like um, you know, um, you know, omni channel. In other words, having a big online business suddenly important as well. So we were trying to say what is one really mean and in a lot of ways, you can't talk about that without looking at how changed them look affected. Each company that you look at, very

differently in this issue in the industry is differently. I want to start with with drug stores because there's this fascinating story in here about how drug stores could be pivotal in mass vaccinations. Um, as you explore, they could be the heroes of one, right Jim, Indeed, I mean the thing is that we all know about the bumpy rollout of the vaccine so far. Obviously it's only been weeks, but um, you know, to meet the kind of deadlines that the new administration would like to see, you know,

a hundred million vaccines in a hundred days. That's that's gonna require a lot more than the sort of spotty effort we've seen so far. Inner America's drug stores. They're about sixty thousand pharmacies right now spread across the US. That's a lot of places that are very close to,

you know, the homes of most Americans. The thing that really works in their favor is that a lot of them already have very sort of rich databases of people who shop at their stores, who already get their healthcare you know, needs met at their stores through their pharmacy um you know. And more importantly, they have experienced giving vaccines. I mean, pharmacy is in the US last year gave about a third of all the adult flu shots that

were given. The huge number I mean this is, this is these are people who are suddenly having to learn how to do this. The issue is that they just have to be brought into the system to do it. Hey listen, and you know, listen, it's where I go for vaccines. At this point, it's pretty easy, breezy for me to do that one thing we all were doing. You mentioned at Peloton that was one of the huge stories of full transparency. I have one at home, but they just took off like a rocket. And I think

the question is what's the longer term durability for this company? Right? Yeah, I mean the the the issue with Peloton. What I was sort of what attracted me to that was this the ultimate pandemic play. Is the company that depends on you staying at home doing something that typically you do in groups and so you know, studios or gyms and um. You know a lot of people a year ago thought that this was a small thing that was not going

to take off. What what interested me was that, um, you know, one UM short seller last year it said, oh, this is a company that isn't going that it isn't gonna do much. It's worth about one and a half billion. If you look last week, you saw that has almost a fifty billion dollar market cap. Now that's because so many people have been driven to it. It now has uh what three point six million members it um you know,

is working. It hit ninety million workouts in the three months ended in September, and its busiest day was Thanksgiving. It did fifty thousand people were on doing classes in that single day. This thing is taken off like a rocket. And the thing is though that once you've made this huge investment in a piece of equipment, and once you've gotten into this notion that this is a community of other people which you can connect with digitally, that that

actually gets sort of sticky. That's so in a way, they're trying to at the sort of feel of community that you get inside a a classroom structure within a gym or and and take that into the home. It's successful with it so far. I wouldn't count them out. And I said durability and wrong word, because they're pretty durable. I gotta say that bikes with the longevity of it is in question. Hey, and Joe Biden likes it. Um as well, just quickly. Um. Hollywood getting a new pay model. Um,

that's another big thing. That's another thing. I mean streaming this year was a major major change in the way that people got entertainment. UM. Typically with movies, movies go out, they have theatrical release, and depending on the length of the theatrical release, you know, a lot of times that meant made a blockbuster and a lot of the the people in the trade are paid based on how much came out of the theatrical release. But they also get things like residuals and pieces of the profit for the

after part of that. It goes to home video, you get a piece of that. It goes onto a TV network to get a piece of that. People are getting checks for years. And the big example is Michael excuse me. The big example would be Robert Downey Jr. Who earned what we think it's seventy five million dollars from his salary and to share profit check avengers in game. That's the positive of this. But a lot of people look

lots of money in the movie business. That was Jim Elis Bloomberg Business Week, Assistant Managing editor and editor of the business section of the magazine. You're listening to Bloomberg business Week coming up, speaking of consumer companies to watch. We hear from the CEO of one company that has been around for more than a century and transforming itself to stay around for a hundred more years. This is Bloomberg. This is Bloomberg Business Week with Carol Messer and Bloomberg

Quick Takes. Tim Stinovic from Bloomberg Radio. The yearhead from any companies to him, we know means continuing to innovate, sell off, under performing a non core assets, moved faster We've heard a lot of that in the past year. With that in mind, this week at a Bloomberg Breakaway town hall, I talked about just that with one company that is leaser focused on innovation and its culture. Carol, you caught up with the president and CEO of the JM.

Smucker Company, Mark Smucker, a fifth generation member of the Smucker family who's running the company, which is nearly in its year. Wow. That is a lot of years of peanut butter and jelly and folgers. I'm just going to say, put it out there. We talked about a lot, kicked it off, as we do with many of our conversations today,

talking about the impact of the coronavirus. We can't diminish the significance of this humanitarian crisis that we all find ourselves in, but I think we do have to try to look forward to the future and think about how are we as a company helping society. How are we making society a better place. We obviously make food, we make things that are uh, you know, make the consumer happy, but we also have a responsibility to the communities in

which we work as well. So all of the ways that we can support through through volunteerism obviously, UM education, UH feeding America, all of those things. It is a it is a dual role that we have in society today, Is it safe to say a stressful one? Because I'm curious about what your employees might be asking of you today and what you're asking of your leadership to kind

of get everyone through this environment. Well, the first thing that we're asking our leadership is to number one focus, but also in focusing, we have to take care of our employees and that starts with UH mental health. We have made a significant push with our employees to make sure that they know what resources are available to them. It is a trying time, but fundamentally we have to start with keeping our own house in order protecting our employees,

which will in turn allow us to do better in business. Well, it's interesting too, you know, you say to do better in business business Right now, I've talking to Richard Edelman of the PR firm Edelman and they do a trust barometer and they say that right now, business was more trusted than government in eighteen of twenty seven countries. And the expectations are for ceo s to focus on societal engagement with the same rigor thoughtfulness and energy you to

deliver on profits. And I'm curious, do you are you seeing that? Do you see that now? It's kind of extra responsibilities in your role as a company, Carol. We always have taken a view again that that we do

have a responsibility to society. I think what has shifted in the last five to ten years is you do see business leaders being more vocal and taking stances, not necessarily political stances, but fundamentally it's about doing what's right and so what even if we choose not to make a statement publicly, even internally with seven thousand employees, there is an expectation that we stand up for what is right, whether that's condemning violence in any form or what have you.

But we we do see a desire for employees and the society at large to be a bit more vocal on those issues. Well, it's interesting to this whole focus, Mark, you know this multiple stakeholders, right, It's something that's come out come out of the business roundtable. Your history and help me if I've gotten the genealogy right. I think your grandfather and former CEO of the company, Paul Smucker, wrote a letter back in the nineteen eighties, and then

I think it's your great great grandfather JM. Smucker, you know, laid out these core values, these basic beliefs, you know, about ethics and quality and people, and it's just pretty fascinating that it feels like the company in many ways was ahead of its time considering the environment we're now in, and all of a sudden everyone's talking about this. You know, it's really interesting. You said it very well. We have been focused on this for decades, for our entire existence,

even when before the Business round Table came out. We talk about our constituencies, right, and the employees, consumers, customers, suppliers, all of them leading to shareholders, and so philosophically, what we have always said is that if we take care of all of the other constituents, then automatically the shareholder will be taken care of. And that is essentially precisely

what the Business Round Table said. There's no question that social media and technology has allowed consumers access to a variety of different brands and products that they may not have had access to in the past. And so in this time when consumers do want to simplify, we have seen millions of consumers come back to the Folders franchise, and we have actually seen and Folders start growing again,

which has been fantastic. We're helping that along with again the advertising and so forth, but specifically to innovation, it's making sure that we continue to stay relevant. We are on a multi year journey with Folders, which starts with the consumer communication. UM. Consumers want bolder, darker rows, so we are providing those in a new product line called Folders Want No Air. It's constantly paying attention and speaking to our consumers and understanding what they want so that

we can deliver that to them. And I'm very pleased with the process we've made, so more to come. You mentioned advertising a couple of times. I'm curious about social How important is that in kind of reaching a different audience, maybe a younger audience. UM. And I'm also curious about influencers or celebrities, Like, how do you guys think about that? You know, take a you know, a coker, pepsi right, they've often aligned with a celebrity, take you know, sports,

you know gear. UM, So I'm just curious how that plays into it. Sure, so Folgers in particular as it relates to UM, influencers and and social across our portfolio. We have leverage those capabilities. Keeping these consumers in the franchise is largely about targeting. It's knowing which consumers are new and trying to push push messaging to them through the social channels UM. In terms of celebrities, as you know, we are engaged with Rachel ray on Nutrition, which is

our one of our leading dogs brands. UM that has been a very successful partnership with for us. We also do think about whether it's influences or celebrities. Obviously, maybe our pockets aren't as deep as some of our larger competitors, but we will continue to look get those opportunities as well. You know, as we hear from a lot of leaders, change truly does start from the top down. The JM.

Smucker Company President and CEO, Mark Smucker. You can listen to that full conversation where he talked about everything from the revival of Folgers to celebrity influencers. That's our Bloomberg Business Week Extra podcast this week. Could Kim Kardashian be coming to Folgers? Maybe? I don't know. I'm just guessing this isn't a news flash. Alright, find that on our podcast feed still to come on Bloomberg Business Week, Company

culture and Innovation. Yep, they're important, and so too is trust, Carol, when it comes to that, which one fares better business or government. The most important finding in the Edelman Trust Parometer this year is that we've got more on that with the CEO of Edelman that's coming up next. This is Bloomberg. This is Bloomberg Business Week with Carol Messer

and Bloomberg Quick Takes. Tim Steinovich from Bloomberg Radio. I know I've said this already a million times on this broadcast, but it is still really hard to say, Tim, how this year is going to play out with so many factors like the virus, the vaccine, the economy all still unclear.

There's so many unknowns here, and one thing is clear, Carroll, at least according to the latest trust parometer from the Global Communications from Edelman, and that is when it comes to trust in government and business, there's one that really comes out ahead. Yep. We got more on that from the founder and CEO of the Global Communications from Edelman, Richard Edelman. He was back with us. He's someone in

constant contact with corporate leaders. He's also someone who's constantly tracking how the general public feels about the current environment, how they feel about politics, how they feel about business. Look, I think the most important finding in the Edelman Trust Parometer this year is that business is the most trusted institution and that business is supposed to step into the

void left by government. Last we talked, which was about May, government had become the most trusted institution because it was wartime and we were doing lockdowns and big spend to keep people afloat and you know, being in fired in the pandemic. And now we're in a different point. Leaders of government have deeply disappointed and we feel like we've been lied to. UM. There is no really sign that the pandemic is ebbing and UM. So it's been handed

over to business to fix and UM. In particular, CEOs have to speak up and stand up and talk not just about COVID but about systemic racism and about sustainability and UM. You know, it's really adults in the room. And whether it's Jamie Diamond or or or or Scott Kirby of United Airlines, everybody has to talk about how we get back to travel and how we get back to uh normal. Well, so let's talk about, as you say, business leaders now the most trusted institution here, uh, and

certainly not government leaders here. And we have seen members of the business community backing off on political contributions, you know, being very outspoken about President Trump uh and what happened in the nation's capital. Where were they though, although I will say many members of the business community were pretty critical of President Trump as well through over throughout the

past four years. But I think some would say, well, why don't why didn't business leader speak up even more um strongly to say that these things weren't right early on? You know, it's it's a new learned behavior for ceo

s to be public figures. They're they're normally, you know, trying to serve Wall Street and serve their employees, and all of a sudden, with this leadership vacuum, we we have a necessity of decency and of making sure Carol, the biggest stat that's fascinating is my employer is the most trusted institution, even fifteen points higher than business in general. So and it's my employer. CEO is trusted in my employer. UM media in fact, is more trusted than mainstream media.

So therefore, people who are employees are looking desperately for quality information and that's what we're lacking in society. Now that's a new deal for companies. They're not used to being information purveyors. But that's the demand, that's the necessity right now. Richard, What how did the pandemic help create that? Because I do feel like you know individuals you know who were able to keep their jobs and stay employed, like the lifeline and the communication between the employee, especially

working from home, it had to change, UM. And I do wonder how the pandemic impacted the employer employee relationship. It became, as you say, um, in a way, the normalizing force UM was the connection to the office, UM, even if you weren't in the office, and that you were getting better facts from the company about return to work or the opportunity to get vaccinated from the company,

not from the government. I mean early on the government did this well, Governor Cuomo, others regular briefings and and at this have paid it over the summer and it hasn't returned. And the magic cures hyde ruxy chlora queene, all that just deeply, deeply hurt any credibility that government leaders had and Beyond that, the media has all of a sudden been categorized as politicized, biased, um, you know, be boring thought bubbles, and media has been crippled as

a source of information. So again, government and media typically in a crisis period are the reliable sources. Not now it's business is turned. Hey, I want to get back to your Edleman trust barometer that you put out the Richard What I want to ask you, because you do you're constantly talking with CEOs from all different industries. What are the conversations you've been having. Well, one is about

the position of America in the world. Our trust barometer found that the US is actually a third from the bottom in terms of how its owned um residents feel about its institutions. So we're just ahead of Russia and Japan. Japan still reeling from Fukushima and the nuclear accident in Russia, as it is, UM and trusting brand America and trusting the American government has really eroded. It's only globally, and it's just above China. You know, we're we're down there

with Italy and Spain. We're not up there with Germany, Canada, etcetera. So that's a big concern. I'm also hearing from CEOs about how we're going to work with government. That's the founder and CEO of the global communications firm Edelman, Richard Edelman. And check out that full conversation. It's on our Bloomberg Business Week podcast feed. You're listening to Bloomberg Business Week coming up. One of the fifty companies to watch that's next.

This is Bloomberg. This is Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes Tim Stinovik from Bloomberg Radio. So in the year I had issue. This week, we've got a list of fifty companies to watch, which includes a stock that was one of last year's tim high flyers.

We're talking about Twilio, which saw its stock store two hundred and forty last year and at a time of robust demand for its communication software sales carroll up fifty two percent for the most recent quarter, blockbuster year, no doubt. I caught up with Jeff Lawson. He's chairman, CEO and co founder of Twilio. He's also got a new book out, Ask Your Developer, how to Harness the power of software

developers and When. In the twenty one century, we talked about the year that was in the year ahead, really excited to get this book out there because I started writing this book about the power of software developers and of innovation and the power that software is playing in

so many businesses and so many industries. Started writing this book actually you know before COVID, and I think the last year has just shown even more so how important digital innovation, digital communications, but agility essentially in business is when factors outside of our control are changing constantly. Well, I think that is spot on, and I want to dig into the book specifically, but I do want to

ask you about this past year. Like some companies, your business to Reilio benefited as we were all working from home and companies needed more than ever before really to communicate with their customers and they needed you know, your infrastruction infrastructure software. Um, what was the year like for you? How would you sum it up? And when did you all of a sudden see that it was going to turn out to be a strong year for you financially? Well,

you know Tolios product. We are a platform that enables companies who are building things in software to be able to communicate digitally using digital communication channels like voice, text, messaging, chat, video, email, and more. And so you know what we have always provided to the world even before covid was first digital customer engagement ability to connect people together using digital technologies.

Number two software agility because we enable software developers to build communications into all the apps and experiences that we have every day. And third is cloud scale. When somebody builds something on tolio, it just works everywhere in the world that works at any scale. You have to worry about racking and stacking servers and all this kind of stuff.

That's why many of the best companies in the world have been using Toilio to build these amazing customer experiences, you know like Uber and Lift and Shopify and amazing companies that are leading the edge. But now, which are the companies we know about right as consumers, But we don't understand kind of how it all works or how it gets to us exactly. Too is behind the scenes.

And if you think about those three things that I just mentioned like digital engagement, uh, cloud scale and software agility. While the world needed those even more because as we had to reconfigure our world to get rid of human to human face to face interactions replace them with digital equivalents, and we needed to red factor the whole world in

real time with these changing conditions. While the things Atilio brought to our customers was incredibly valuable, were you surprised though, at how strong the demand ultimately and how it played out for you guys? You know, not rely. I had an early sentence. I'll tell you that when the when the pandemic began um in, you know, early to mid March of last year, we saw a really quick influx

of customers all realizing that they needed to build. You know, there were say needs time to build, like we've never dealt with a global pandemic before. We need to reinvent our customer experience. We need to contact list delivery, we

need to accelerate our online ordering abilities. We need to see patients remotely for for health telehealth, like there are all these use cases coming to prominence that in a very like in the course of a week, so many customers reaching out and saying, our roadmap has changed, our priorties all just changed, and Tolios be a big part of how we're gonna respond to the pandemic. And so I think we got a pretty early view into the

importance of it. That's why we leaned in. We said, we're here to serve our customers during this time, to make them successful the pandemic and build even tighter customer relationships during this period of time. That's going to be so successful for our customers and for the world. Jeff, I want to talk more about the book. I do want to ask you what is one look like for

you guys in terms of what kind of visibility. Well, we see twenty as having been an acceleration of the trends that have long gone on of the world moving to digital, of every industry becoming a software industry, and every company having to really up their digital game. And pandemic accelerated those plans, often times in companies by six years that road maps got accelerated. But one is going

to be no different. That acceleration is a one way path, and every industry and every company who expects to win in this digital economy is going to have to keep up the pace of invention and agility in using software to serve their customers. And so I think we're going to continue to help companies unlock these amazing digital experiences. Forgive me Jeff, and we love talking with you because you've got to go a lot of places with us.

But if I'm not a person who's into software, am I going to be like, Okay, why do I need to read this book? And it sounds like we all need to read this book in terms of understanding, especially in an increasingly high tech world. You know, we've certainly seen that over the last year. Why did you write it? Who are you addressing and what's the message you want to get out here? This book is written actionally for people who aren't the developers and aren't the software people.

It's written for the wide variety of business executives who know that software in many ways represents the future of their company, because every company is in the Starwinian struggle to build great digital products and experiences to serve their customers in this era where the interface that we have with our customers is now oftentimes an app on a phone or a website. Therefore, it's the companies that build great software experiences. Those are the companies who win the

hearts and minds and wallets of their customers. And so so much has been said about this, you know, and the software is eating the world and so many industries have been challenged by the nature of software and how software is changing the industries, but not a lot has been said about how the business people who aren't software developers, who aren't technologists, how do they partner with the technical talent in their company or the t people talent they

want to bring into their company to actually successfully build those great digital products and experiences. Because at the end of the day, the technical people and the business executives are all aligned in what they want. They want to build amazing products and experiences that millions or billions of customers are gonna love that will drive business growth. Yet oftentimes there's this invisible divide between the business executives and

the technical talent because they speak different languages. Right, And the interesting thing is that I'm the CEO of a

public company, I'm also a software developers. I've have a foot in both of these worlds, and so I wrote the book to try to build that bridge, to talk to business executives and tell them what goes on in the world of software and what their developers are actually doing, and how they can work with those developers to unlock innovation and build great software that will differentiate their company in the eyes of their customers, because that is how you win in this digital right Well, and I feel

like in many ways, it's like after the financial crisis, Um, we looked at CFOs very differently because CFOs how to figure out financially, how to get their companies through a really difficult crisis. And it wasn't just you know, accounting guys, you know, checking out the numbers. They became really key and implement you know, and and strategical to companies. And I feel like that's what we see now with C

T O S and I T departments. Increasingly it's not just like hey, I need a new mouse pad, you know, it's a lot more strategic. Um, you know, especially as almost every company has become a tech company. Well, first, I do need a new mouse Okay, I'll get I'll get right on it. You're absolutely right. Twenty years ago, You're right. I T was a cost center. It was about you know, laptops for the employees and printers and you know, maybe uh, you know, the financial system that

customers never knew about or cared about. But nowadays, when companies their interface with their customers is a digital one. Customers suddenly care about the quality of your software. Are you using a software to differentiate? So software has moved from the back office and cost center to the revenue driver of so many companies, and it actually it's something that customers care about. Think about your bank, you know.

It used to be that your bank was a bricks and mortar store that you walked into, and if it was well decorated, well lit, the teller was friendly and they gave your kid a lollipop, you'd say, well, I like my bank. Nowadays your bank is a software app on your phone, and you like your bank if the app is fast, if it doesn't crash, and if it

makes you like easier. And the act of achieving those things is really the act of companies listening to their customers and answering the problems that their customers need solved with all that software. And that's fundamentally an act of building. And that's why so many Silicon Valley companies, who oftentimes higher developers as the first thing they do, that's why

they end up challenging so many different industries. But every company is starting to adopt that methodology if they want to compete and win in this era and That's what this book is really about. It's the playbook for how to do that well and your customer line up, whether it's Uber, what's app, whether it's Left, whether it's Nordstrom,

whether it's Nike. I mean you really kind of look into so many different areas of the corporate world based on what you're seeing from some of your customers and where they're spending money. What does it tell you maybe about our environment, our broader market environment. Well, I think that it's it's just it's just a truism that in the digital economy, of the companies with the best digital experiences are going to win the heart spinds of walts

of customers. It's as simple as that, right, Yeah, And I look at you know, it's not just about the startups, and it's not just about certain companies. It's really every company. In the book, I talked about the story about Domino's Pizza actually, which has been a huge, like look at their stock place over the last decade. It's an amazing story of a company that transformed from a pizza company

to a technology company. Well, there you have it. Tuilio chairman, CEO and co founder Jeff Lawson, his book Ask your Developer, how to harness the power of software developers and win in the twenty century. And be sure to check out the full list of fifty companies to watch that's in the magazine, online and on the Bloomberg and Tim. That wraps up the weekend edition of Bloomberg Business Week from Bloomberg Radio. Thanks so much for joining us. I'm Carol

Masser and I'm Tim Stanovk. Be sure to tune into our Bloomberg Business Week Daily show Monday through Friday, starting at two pm Wall Street Time on Bloomberg Radio. You can also watch our daily broadcast on YouTube. Just search Bloomberg Global News and check out to our Bloomberg Business Week podcast. Find that at Bloomberg dot com, Apple or wherever you get your podcasts, and that's where you also

find our extra podcast. This week, we'll hear more of that conversation with jam Smucker Company President and CEO Mark Smucker, fifth generation of the family running the company known for those iconic brands, and one that's made it through war, segregation, the financial crisis, and now the pandemic. And you can also see me on Bloomberg Quicktake, available on Bloomberg dot com, slash QT, and streaming platforms like Roku, Apple TV, Samsung TV and more. You can find us everywhere. Also, don't

forget Bloomberg Business Week. We're available on newstands now, at Bloomberg dot com and on the Bloomberg terminal. Head there for more of the yearhead stories and economics, politics, batteries, yes, batteries, technolog do, finance, and luxury. It's an incredible issue. Have a great weekend everyone. This is Bloomberg m