Bloomberg Businessweek Weekend - May 7th, 2021 (Podcast)

in our office at Bloomberg Headquarters. We both were in the office again this week. Traffic definitely up in the city streets. Yeah, I'm looking forward to when I am fully vaccinated taking the subway again so I can get off those streets. Whiles the world continued to open up, we saw the gaps between the halves and the have nots in our economy continue to widen. Coming up this hour, two big thinkers tackling the major issues of our time, crises,

technological powerhouses, and more. We're gonna hear from Bloomberg opinion columnist and Senior Fellow at the Hoover Institution at Stanford, Neil Ferguson about his book Doom, The Politics of Catastrophe, plus n y U professor author entrepreneurs Scott Galloway you know him, on breaking up big tech and unlocking value, one of my favorite guests this week. All of that to come. We begin, though, with one of the Bloomberg Big takes this week. It's the Bloomberg exclusives that you

need to be focusing on that only we have. It also turned out to be one of our most read stories on the Bloomberg this week. It's about how the booming US recovery is leaving some communities completely behind. Bloomberg News Federal Reserve and economics reporter Katerina survived of philled

us in Carol on some really interesting data. She gets to, you know something Timmy and I have talked about with Peter Atwater and others about, you know, the recovery or even I was having a conversation with one of my brothers saying for some people the pandemic obviously it impacted We thought about her help, but they were able to work. Some of them made a lot of money if you were invested in the stock market or elsewhere, like it

just didn't impact us all equally. There are other people though, that lost their job completely or just scraping to get by. And I think what's so important about katerina story is it's it's it touches on of course sector and industry, but at the same time geography and thinking about different responses that different cities have had. Atlanta's decision to have a partial reopening earlier than many places, and then Las Vegas, for example, the city heavily reliant on tourism, and what

happens when tourism rise up there. It's a totally different thing than what's playing out in Phoenix, for example, where a booming home building has been really good for many minorities who live there. This is where the granular level really makes a difference. Right. You can see we do it here, We have stories, we have a big headline. But once you start to dig deeper into the data and you have to look at those demographics, you have to look at your geography. You do sometimes have to

look at sector breakdowns. That tells you a much more complete story. Because at the top level it can feel like okay, look we're doing okay, but not necessarily when you dig down, hey, Katerina, talk a little about the geography here, because what's happening in Atlanta is certainly different than than what's happening in Las Vegas. Take us through those two examples that you and the team touch on

in this big take. Yeah. So Las Vegas is really interesting because it is an economy that depends so heavily on that leisure and hospitality sector. Right. It's a big tourism destination. It has a lot of casinos and a lot of kind of you know, fun hotels, restaurants that people know about. Um. So this is a this is a huge component of its economy. And since this sector was so um intensely impacted by the pandemic, UM, the

Las Vegas economy and unemployment there has really suffered. So it's it's kind of continued to to feel those effects, you know. It's it's not recovering as quickly some other parts of the country, like Atlanta, which is seeing a stronger recovery. It's it's not as dependent on tourism. Um it also um you know it, Georgia is a state that reopened very early on, and we're seeing that states that did that, you know, I mean, for which which

could have had a negative implication in terms of COVID cases. Um, it did actually help the economic recovery. Talked us about Houston, your home state. Have a lot of family in Texas throughout the state too. Houston has been one of the better performers Houston. Actually, um, it hasn't been doing super well right now. Um. Actually, when you break it down, there was the energy crisis too. I wasn't thinking exactly, yeah, exactly, and that's really what's kind of a drag on the

Houston economy right now. We look at the different race groups and everyone really is still seeing unemployment in the double digits. And exactly it's that energy impact. It's it's a big sector for the city. Um, a lot of jobs to revolve around that, and you know that is still suffering a lot. But Phoenix has been somewhat of a bright spot, especially when you dig into the data and you look at how communities that have been hardest hit by this pandemic have actually fared relatively well. And

key word, they're relatively well. And it's be as a housing right right, Yeah, it's it's really seeing a housing boom. I mean, of course, a lot of cities in this country are um, but that has really boosted the construction sector and Phoenix and that in turn is helping Latino people there, um with their unemployment rate. You know, it's it's yeah, fairly low, right, like no one that no one has an excellent unemployment rate right now, but um,

but it is, yeah, I mean and Phoenix. You know, Arizona also kind of like Texas, has a lot of people moving into it from places like California, right places where housing is more scared. But it's really important what you say about looking at local unemployment rates. I know you guys include this in your story about especially for more than half of minority groups, local unemployment rates have

not fully recovered to march. We really need to look deeper into this to really understand what's going on overall in the economy and maybe why certain administration programs kind of might make sense going forward. Yeah. Absolutely, And I think this is something we're hearing from policymakers that they want to start, um, you know, looking more at the breakdowns. And this is this is somewhat new at the at the high policy level, so I think it will be

interesting to see how how they do that. Well, that was Katerina survived a Federal Reserve and Economics reporter on an uneven comeback from COVID taking place across the country, doesn't him. We've talked about this so much, we just did with Katerina, But it's just about this k shaped recovery. Peter atwardever, William and Mary I bring him up a lot, but because he was at their front and center very early on, talking about how the recovery off of the

pandemic was different for people, and really starkly different. Some people barely felt it, some people felt all of it. And what was so interesting about Katerina's story was the regional differences when it comes to the recovery. Yeah, really important, right to look around the country and just see those

differences coming up. More on the economic recovery and uneven one as you just heard this time from the CEO of Siemens Us, who has a global snapshot of our world and what's needed specifically to get America back contract. You're listening to Bloomberg Business Week. This is Bloomberg. This is Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes. Tim Stinovik from Bloomberg radio. Our listeners and viewers on YouTube might recall that we recently caught up with the

presidency of siemens Us. She is Barbara Humpton and Tim She talked with us about how work is shifting. It's something you and I talk a lot about because we know whether it's hybrid, do people come back to the office, to people stay at home. I mean things are changing a lot. She is someone who is talking with leaders about making their workplaces safe, making school safe, and planning

for the next crisis. Barbara joined us again this week to talk all about President Biden's recent call to arms to address today's problems, including cementing the USS position on many levels in the future. It includes being self sufficient when it comes to semiconductors and other major infrastructure projects. It seemens we're really deeply engaged with all of the

critical elements of infrastructure you're hearing discussed today. Earlier this year, I actually wrote an open letter to government leaders outlining some suggestions that we have a broader vision for America's infrastructure because this is a moment to to make those investments, and I shared our support in UM investing in manufacturing, enabling a new era of electric vehicles, UM, getting cleaner

and more resilient energy systems, and transforming America's buildings. And I was pleased to see so much of this aligns with where the federal at the Executive Office is going and where the federal government is likely to head UM with the support of our legislators. So you know, here we are at this moment of deciding what shall we invest in? And this week I decided is the right time for me to raise my voice more clearly on

the subject of manufacturing. This idea that manufacturing in and of itself is a key element of our infrastructure and key to developing the workforce of the future. And I'll tell you at SEMENS, we've got this perspective, not only as a manufacturer ourselves with twenty four manufacturing sites across the US and forty people all across the nation, a supply chain with twenty four thousand US suppliers supporting this

backbone of the US economy. But we're also helping of the Fortune five industrial companies with our hardware and software that's helping America really adapt to the new digital revolution that's underway. This is our moment, where do we get it wrong in the United States when it comes to manufacturing. As you said, twenty four manufacturing sites nationwide for semens. So what do we do wrong here in the United States when it comes to manufacturing or making it more

hospitable to more places? You know, I think our incentives have changed. If you had looked back over the last two decades, you would have seen American businesses making decisions on a global scale, where can we find the lowest cost location for the bulk production and the supply side economies of scale that are going to drive costs down by the way, all of those are very useful goals

to have. But what we've seen now, especially due to the coronavirus crisis, is the fact that we need not globalization so much as glocalization, the idea that we need to produce things closer to where they're needed so that we're not dependent on single points of failure in a global supply chain. We have an opportunity to turn that around. And people have been asking me, are we going to

be on shoring or re shoring? And what I keep reminding people is I think what needs to happen for many manufacturers is more of an and than an ore. We do need to serve people around the world close to where they are, but we also need to ring the ability to manufacture right here close to where we need the goods and services. Ultimately, so I'm gonna play Devil's advocate a little bit, but I can see companies

gearing up already to say, but wait a minute. Now, you want us to tax more, but you want us to build plants in the United States and provide jobs. And the present makes the case that a lot of corporations get off easy when it comes to paying corporate taxes. And if you look at the data we've certainly reported on it here at Bloomberg, that is often the case where companies, through you know, various maneuvers and loopholes, are able to pay a pretty low rate. What do you

say to that? What I say to that is, this is a moment when business needs to show that we are responsible. We have to step up and have a mature dialogue about this. Semans. For our own part, we are responsible taxpayers, and we are really advocating that our tax code represent a regiment that will put us on a level playing field with the rest of the world. So we of course are not going to be advocating for off the charts tax rates for corporate rations when

it would actually cause investment to flee the company. But let's say we can work with other nations find tax code levels that are going to be equitable, provide that kind of level playing field, and then also really incentivize investment in the US. At Siemens, we've invested forty billion dollars over the last two decades in America, and what we're finding is that if we make these investments, then

the growth comes, the health, the prosperity comes after. These are good investments for us to be making, particularly in

a time of transformation like this one. So, Barbara, we were talking about the President's American Jobs Plan manufacturing here in the United States, and I'm thinking after a week like we've had so many different earnings and hearing from so many different companies, whether it's Apple, BMW, Ford when it comes to the global chip ter out, and you know, we know specifically that company ease like Apple and Samsung talking about production cuts and lost revenue because of the

global chip shortage. Tell us about the situation in the US. You guys have a great vantage point. How bad is it and how quickly or what will it take for us to ramp up production so that we can address some of these shortages significantly. This is a real issue because, as you know, semiconductors are used in everything, cars, planes, computers, batteries, I mean the toothbrush that use exactly, So there may be a few in me I'm not quite sure. At

any given time. We are highly dependent on this technology. And back in the nineties, the US had about a market share of the worldwide market, but now we're down to a mere twelve percent. So this is one of those areas where this would be a wise investment. It's a matter of national security, and by the way, the US security is key to global security, so an investment

here is critical for all of US. And and so one of the things we're promoting at Siemens is support to the chip set, the idea that there would be incentives for local manufacturing. The Department of Commerce is putting their full weight behind us to to locate key semiconductor manufacturers here. I know there's work already going on in Phoenix. Truly, this digital economy rides on this technology. That was the president and CEO of Siemens US Barbara Humptons. I love

what she said, digital economy rides on this technology. I feel like it's not just the digital economy, it's completely our economy. Some great reporting throughout the week on the Bloomberg and at Bloomberg dot com just about why you're seeing the semiconductor shortage, what it's going to take to ramp up. I mean, it's a global problem. It is, and it's one that might not end anytime soon. Exactly. Still ahead on Bloomberg Business Week, there was though some

optimism from Barbara there. We just heard it. Our next guest, full of doom and glue. He certainly is more specifically doom the politics of catastrophe. It's the title of Neil Ferguson's new book. All Right, everybody, brace yourself, do it,

do it? All right? That's coming up. This is Bloomberg broadcasting from the financial capital of the World, Bloomberg Eleve in Frio in New York to Washington, d C. Bloomberg to Boston, Bloomberg one oh six one to San Francisco, Bloomberg nine sixty to the country Sirius XM Chado one nine team and around the globe. The Bloomberg Business app and Bloomberg Radio dot Com. This is Bloomberg Business Week Tim. Next up, someone who gets to the bigger, broader issues

that are facing our society. We're talking about Neil Ferguson. He's Senior Fellow at the Hoover Institution at Stanford University. He's also Bloomberg Opinion columnist and well known to our Bloomberg audience. Author of many books including Colossus, The Great Degenerations, and The Square and the Tower. He looks at the cracks in the American system how we got there, including his newest book, it's called Doom, The Politics of Catastrophe, and he says, the tragedies of the past year are

ones we should have seen coming. But it was a year like many others, actually, and that's part of the point of the book. It's not like this was the first pandemic to strike humanity, and indeed, if you compare it with other disasters like World Wars, this is not the top twenty catastrophe. So I actually found that this gave me an opportunity to take a step back and

try to contextualize what was happening. There is a strong predisposition in our media today to say that everything is unprecedented, which just means we don't really know the history. The point of writing Doom was to remind people that, for example, the influenza pandemic was far, far worse, killed a far larger share of the world's population. Actually today this one is closer to the influenza pandemic, which not many people remember. And as for world wars, which you know, my grandparents

lived through. This is actually, although it might not seem that way on on TV, this is really getting off lightly by historical standards. What certainly doesn't feel like it right now living through this because I think for a lot of people, and this is our first pandemic, even those who were alive during the one in the nineteen fifties and the very few people who are still around from the one in the you know, a hundred years

ago at this point. But I wonder about the response, especially from governments like the UK in the US, because early on in the book you say it's kind of too simple to to say that populous leaders were early on were the reason why those responses from those countries weren't the right Why isn't the right way to look at it? Because you compare the case with Belgium, and Belgium didn't have a great response either. Right, the excess mortality in Belgium last year was higher than in the

US or the UK. I think the narrative that the excess mortality in the US was Donald Trump's foults, or in Brazil JayR ball Cinaros the UK. Now in India's it's all norandramdes Well. This is a very tempting narrative because we want to kind of pin the blame on the person at the top. But when you look at the global picture, it's not quite so clear cut because there were plenty of countries with non populous leaders that

did disastrously. Peru has had about as bad uh and experience as any country, and the guy who's was in president there was not a populace. He only became president almost by by accident. So I think there's a kind of temptation to simplify this story, and the way I would put it is this, In the U s. Donald Trump made a whole succession of mistakes. It's tedious almost to list them all. He clearly misjudged the problem in multiple ways. There's nothing in my book that says he

did a great job. But if we think it was old Donald Trump's fault that CDC completely screwed up testing in the first months of the pandemic, that we had no contact racing system of the sort that they were able to do in Taiwan and in South Korea, and then we utterly failed to quarantine the people that were

likely to be infected. That can't all be attributed to the President United States, who presides over a huge and conflict of bureaucracy, part of which has more or less one job, which is to deal with the crisis like this. And I think one has to say that the public health bureaucracies on both sides of the Atlantic did very

badly compared with say Taiwan or South Korea. The fact that they managed to contain the pandemic so successfully tells us that there was a much better playbook than the one that we used, and yet we told ourselves that we had very high levels of pandemic preparedness. Well, the other side of this coin is the country that did respond well, Taiwan and South Korea, among others. What ties

down together? Why did they respond well well? One answer is approximate answer they learned the lessons of Stars and Mars, previous outbreaks of a new coronavirus that we kind of didn't pay enough attention to. But I think that's a better answer, which is that these are countries that have good reasons to be generally paranoid. If you're Taiwan, you're right, Nix, the People's Republic of China claims it. You. If your South of Korea, you've got the crazies and the North

to worry about. So I think the lesson that I learned from Doom is that it's better to be generally paranoid and worried about every potential contingency and so have one very detailed plan for a specific crisis that doesn't actually work when the crisis strikes. Thanks to Neil Ferguson for joining us giving us insight into the long term impact of the pandemic on both the population and also

the global power structure. But this whole idea of a lot of this, if you look back in history, kind of gives you clues of maybe some of the things we need to be worried about in the future. Yeah, the explanations for who has fared well and who hasn't fared so well during the pandemic. They're not as simple as everybody thought. No, exactly loved that conversation. You're listening to Bloomberg Business Week. From one big thinker to another.

We're talking Scott Galloway, also a familiar name to the Bloomberg Business Week audience. I'm just gonna put it out there. It's a conversation I've been looking forward to for a long time. He tackles Facebook and Apple both as you know in the news this week, and which of the four need to be broken up to unlock value. You'll find out which war he's talking about. This is Bloomberg. You're listening to Bloomberg Business Week with Carol Messer and

Bloomberg Quick Takes Tim Stinovich from Bloomberg Radio. So this was a conversation Tim that you and I were looking forward to for a long time in our world, and we know this. There are just some folks that need no introduction, and that includes Scott Galloway, author of a bunch of books, including the New York Times bestseller The for the Hidden DNA of Amazon, Apple, Facebook and Google, and most recently Post Corona, From Crisis to opportunity. He

writes a lot he does. He's also, of course, a professor of marketing at n y U Stern School of Business. Some people know him as Prof G. He's also founded several companies, including rent Envelope and Profit He Never Holds Back. Also host of the upcoming The Prop G Show on Bloomberg Quicktake. We had a lot to get to with him, including the news this week of Facebook's oversight board uphold a ban on former President Donald Trump using their platform

at least for now. Anyone who is responsible for a third of misinformation around a specific domain, in this case election interference should be banned from the platform. So this is Facebook's attempt to abdicate responsibility. This oversight board, I think has got the charm of the Legal of Nations, with the effectiveness of the United Nations. I think it's a total abdication of responsibility. And what they said was we're going to hurry up and do nothing. We're going

to make them. It's kind of the mother of all non decisions. I'm glad he's not back on the platform. It's typical Facebook. It's it's kind of just more delay an obcusation. Well, Scott how has it been so easy for Twitter and Snap to make their decisions about President Trump, but it's been so tortured for Facebook and for Google's YouTube. That's a really interesting question. I think Google and Facebook to a certain extent, are still trying to hold onto

this myth that they're just a platform. I think that they aren't niche companies. What's interesting is that there's definitely sort of a purity trade. And what do I mean by that? If you look at pinterestome Snap, they've outperformed their peer group and they're largely seen as having less noxious, toxic content, and Twitter, since kicking Trump off the platform had sort of the strongest run in several years. So it appears there's sort of an immunity trade or a

purity trade. I think Facebook and Google still want to try and cling to the notion that we want all content, all the time, anyone, regardless of the damage it does, and they're still kind of holding to that kind of zeitgeist there. Um, they don't see themselves as niche players. I think they're they're more they're they're less less focused on pleasing anyone audience, just don't want to just they'll

be mildly upsetting to everybody you know. Sarah Fryar Bloomberg News putting out a story saying that maybe Facebook has to provide more options for Donald Trump types, saying that there should be way for Donald Trump, his thoughts and other Trump like figures to exist on social media with out kind of all the amplification that many of these platforms provide. These are sours words to be fair. Um, do you agree with that that there needs to be

another option? If we believe in freedom of speech and I understand your point about misinformation, but how do we treat this? Scott? Yeah, that's a tough problem. But I think we can inflate freedom of speech with freedom of reach, and that is the conversation around anti vac is a worthwhile conversation we should have. There are people who want to have a conversation around white supremacy, and those conversations

should be had. The question is whether for profit entities should have algorithms that purposely seek out that type of controversial, very upsetting content and elevate it exponentially beyond what it would get organically. Because it is so noxious, because it is so heinous, it creates enragement an arrangement equals engagement, which equals more Nissan ads, which means that Facebook gets wealthier.

So the question is, should we have business models that purposely link profits to the enragement, division and polarization of our society. Should there be some sort of tax but there's notions somehow that everybody deserves voice. These firms have,

these individuals have massive voice. The question is, should we the most profitable companies in the world be engaged in a business model with end up being handmads this edition or where a capital police officer is bludgeon to death with a fire extinguisher because these algorithms are amplifying the most controversial content. Let's talk about Apple versus Epic and really a lot of big app developers and even small

ones too. It's playing out in court Epic Games accusing Apple in the App Store of cheating developers and consumers with fees and onerous rules. Scott Galloway, Um, is Apple taking too much? Does Does Epic have a point here? Because at the end of the day, you know, Apple's argument is, Hey, we are giving you access to the customers, and we're making this a safe place for our customers

to to access your apps. Yeah. I think that's the argument that they've made a staggering investment to ensure safety, and they've made a huge investment in laying down the rails, and they should be able to charge what they want

to access those rails. The question is if you start seeing everything that's being transported on those rails, and you see that certain goods are going to a certain area, and you decide wow, based on that inside, we'd like to start a competitive business Apple Music, and we're going to tax our competitor and maybe promote our own products. Are you, in fact in a monopoly position? The app Store really is their regulatory achilles heel. I think they're

gonna lose on this one. I would have gone further than this, but this is it's very difficult to argue that they're not imposing or not taking advantage of the fact they own the rails to compete with the with the other products that access those rails. So if in fact there's monopoly power here at the scale, and an argument that they need to have one player and that size is good for everybody, then there a utility and

their prices should be regulated. I think they're all wet on this one, all right, play a little bit of Devil's Advocate, and maybe it's not Apples to Apple, Scott, But what about a Walmart that you know how it squeezes its suppliers or an Amazon where it gets a piece of everything that's sold on its platform. Um, I know it's not, like I said, maybe an equal comparison,

but is it that much different? Yeah? I think it is, Carroll, because I think Walmart is about eight or nine percent of retail and the app store on iOS is about eight of all dollar volume that goes through apps. So if you want to be a player in the app economy, there really is only one place, an iOS is where the majority of people go to actually spend money on apps. So if Walmart gets market share of all retail, then it's Apples to Apples, all right? So listen, one thing

you know. I wanted to ask you, Tim and I both wanted to We were thinking about coming off of Warren Buffett and Brickshire Hathaway's annual meeting this past weekend, and Warren Buffett put up a slide. It was the top twenty market cap global companies in it was named like Toyota, General Motors, x on, IBM, six u S companies,

fourteen from other countries. He pointed out Scott that none of the twenty are on today's list of the top twenty market cap companies, and he says it's a reminder of extraordinary things that happen in nine not the dark Age. Is not a backward time. So I'm curious, how do you think about today's top me market cap companies, whether it's Apple, Google, Amazon, you wrote about them in the four Should we think in twenty years from now or I don't know, ten years they're not going to be

the juggernauts that they are. Well, look, a basic truism is that everything everywhere eventually ends, and at some point these companies will be dethroned. The question is what kind of damage do they do between here and now by not returning to our proud legacy of anti trust? And that is a T and T eventually would have been unseated, but we went in and broke it up into seven companies and we on unleash tremendous innovation, Cell Data five or each of those seven companies ended up being worth

more than the original within ten years. So my argument is sure at some point, everyone is dethroned. But between now and then, is there an opportunity to oxygen eight the economy, to increase job growth, increased taxation, increase M and A by doing what we have always done, and that is when a company becomes an invasive species, we go in and we break it up. It's overdue. Anti trust is absolutely overdue. Here which companies need to be broken up right now? The answer is yes, But like

I mean, well, except for Apple. Apple would be hard to break up because elegant anti trust means you unlock value. It's not a punishment, it's a liberation for all stakeholders. All stakeholders except the CEO who wants to sit on the iron throne of Olive westro It's not just the king of the North. Apple would be tough because who would get rights to the brand? So Apple ends up. You regulate the app store. But Amazon gets broken up,

as does Facebook and Google. And by the way, I owned shares and all those companies except Facebook, and we're all going to make money on the day of their breakups. Talk about that, though, is it? Because you know a w S by itself is more more than a w S as part of Amazon. That's exactly the correct question. In two the most valuable company in the world will be an AWS. It was prophylactically the fastest growing, largest player, and the most profitable, most fastest growing sector in history.

The cloud will be the stock that every hedge fund manager, every girl who gets her bombits that gets as a gift, everyone will own a w stock. Most valuable company in the world in four years is AWS. It'll be an n f T though right it's not going to be an actual certificate. We's back at it, Carroll. I know, I know, well, you know you wrote about these four companies. I mean, who are the companies? Who? Who are there? What's the technologies that you think are going to be

kind of the replacement for the Apples and Google? Today you talked about the cloud. I get that. Are there other things on your radar that you're thinking Listen, we're just not talking about it enough. But these are the ones that are going to be the big market cap companies of the future. There's a lot of incredible companies an incredible technology is The unfortunate thing is it's usually the same players that we're the biggest unlock coming out

of the pandemic is we might have an opportunity. Virtual visits to doctors went from less than one percent. There's an incredible opportunity to start pushing out primary healthcare to hundreds of millions Americans and take healthcare from the disease driven, defensive industry to a sense of health driven industry. That's a good news. It's going to create trillions of dollars in value. The bad news, the company that will be the fastest ground healthcare company in the world will be Amazon.

The voice is the most exciting technology. Who dominates that? Amazon? The cloud? Who dominates that? Microsoft? Amazon? And oh e a Google. So there's some incredible companies just off the list. The shopifies, the rope wus, the salesforces, the Ali Baba. But these companies continue to outpace all the rest. A lot of big numbers doesn't seem to apply to these guys.

I don't know. If we've watched Apple's earnings up fifty plus per cent, the revenues the iPhone of sixty plus percent sales in China, when they increase their margins and their services revenue, it's just it's just staggering. That's got Galloway and why you professor, best selling author. If you missed any of our conversation, you can find it on our podcast feed at Bloomberg dot com. That wraps up the first hour of the weekend edition of Bloomberg Business

Week from Bloomberg Radio. I'm Tim Stanovic and I'm Carol Masser. Ahead in our next hour, we're gonna continue kind of our focus on big tech, including the cover story this week, it's on Jeff Bezos because it's all about a new book by our own Bradstone. Yeah. This is a good one, just chock full of amazing anecdotes and nuggets. Plus, as we just heard from Scott Galloway, Apple locked in a

legal battle with Epic Games, the maker of Fortnite. Why a once close corporate relationship has turned into a battleground? It certainly has. This is Bloomberg. This is Bloomberg Business Week inside from the reporters and editors who bring you America's most trusted business magazine, plus global business, finance and tech news as it happened. Sloomberg Business Week with Carol

Messer and Bloomberg Quick Takes. Tim Stinovic on Bloomberg Radio. Hi, I'm Carol Masser and I'm Tim Stanovic Plennyhead in our second hour of the weekend edition of Bloomberg Business Week, including how the world's richest man beat the tabloids. We've got the story behind the National Enquirers failed the tempt to get the best of Jeff Bezos. It's from an exclusive excerpt in a new book that's coming out next week, but there is a sneak peek in this edition of

Bloomberg Business Week. It is a good one reading the excerpt, I just want more. Plus Andy Rackliffe, the CEO at Wealth Front, on the launch of some new products in the robo Advisor. We're talking fintech disruption. First up this hour, Silicon Valley once again in the news this week. It involved the beginning of a court case, and one that's considered to be one of the biggest threats to Apple in years. It's a trial that pits the makers of the iPhone in Fortnite against one another, and it's in

the current issue of Bloomberg Business Week magazine. We got more from Business Week editor Joe Webber and Bloomberg News technology reporter Mark German. The battle could be a new video game, I'm thinking, or like a series or a series. Listen up, everyone, Let's go back to two thousand eleven, about a month after Tim Cook became CEO, taking over for Steve Jobs. In his first announcement, it was time to announce the iPhone for us. This was at the

height of the beginning of the App Store. This is at the top of the Apple versus Google rivalry, and the big new feature besides Sirie for the iPhone for US that year was this more powerful processor focused on gaming. So what better developer to have on stage to prove why you should buy the iPhone for us tim Cook's first product, Well, at the Games they came on stage to show their new game, Infinity Blade two, to show the power of both the App Store and that new processor.

And now today, obviously circumstances between the two companies are much much different. Mark, where did things go south? So you started to go south around two thousand seventeen, two thousand eighteen at the beginning of Fortnite. Fortnite was this

new key game coming from Epic. It quickly became extraordinarily popular and Epic was really, you know, minting cash from this game and they were making close to part actually a billion dollars a year, or they projected they would be making a billion dollars a year from from the app store on Fortnite. And when you're making that kind of money, you're starting to give Apple commissions well north

of potentially two to three hundred million dollars a year. Now, Epic is a big company, but even for a company of the size of Apple, I think to pay out of pocket three hundred billion dollars sorry, three hundred million dollars before attack for that, for that income, that's pretty significant. And that's really where the relationship began. Interrupture, Mark, who's got the tougher case here to prove? Oh, for sure, Epic.

I think this is an uphill battle for epic Um, not because of you know, my opinion or because of what consumers might believe, because of legal paperwork and signatures.

You know, I learned very early on contracts are important, signatures are important, And your opinion of how horrible Apple might be in this situation if you have signatures on paper, if it's a legal document in the eyes of the court, right in the eyes of this judge, doesn't really matter, you know, for all intentsive purposes, is Apple probably charging developers too much. Yes, is Apple probably going a little too far by requiring people to use its payment system

and blocking alternative app stores. Yes, some more open platform like Android whilst stelf preserving privacy and a good user experience would be wonderful, But all that is not really relevant for this particular case. I still think though, that Apple will have to make some changes to really appease developers and users alike into the future. You know, what are you going to be watching for in this case?

Obviously there's going to be the outcome, but along the way, there might be some other things that, um, we'll catch everyone's attention. What what could some of those end up

looking like? Yeah, so, actually have been going through some of the filings a different discovery and pieces of evidence, And one that I'm actually working on a story right now about is that Phil Schiller, who now runs the app Store and was previously Apple's marketing chief course firing about a year ago, sent an email to Eddie q who's head of the App Store ten years ago in two eleven, sort of floating the idea of needing to reduce the app store commission. Now, this was in two

thousand eleven. If they wanted. They were talking about reducing the commission from because they were getting super profitable. Well, Apple didn't really make any real change to the commission structure until a few months ago in stating a fift reduction for developers who generate under a million and revenue, which, of course, as we all know, it's not relevant to ethics because they don't make under a million a year.

You make feel over a billion a year potentially. So what are the repercussions if if Apple ends up winning this Because it's not just Epic that wants to Apple to take a smaller cut and wants more freedom to do what they want to do within the App store and on their own apps. Who else would would benefit if if Apple ends up losing this case. Yeah, if a Apple ends up losing the this case, You're going to see the floodgates open. You're gonna see Spotify wanting

a very similar deal to Epic. You'll probably see that motion for that nearly immediately. Other big developers to generate that kind of money, you know, Netflix, Spotify, Pandora, all these big players. They would be using Apple's payment system for sure, because it's a so much better user experience if they didn't have to give that commission to Apple. So that's really what all the big guns want. They want the ability to use, you know, a built in

payment network without giving Apple a commission. If Apple wins the lawsuit, you're going to see a lot of developers up in arms that you might be you know, a stronger regulatory push from you know, antitrust officials. I really think that even if Apple, you know, wins this war, right, there's so much more to come, I know, exactly get ready. Hey, is Tim cooking to testify? Should we anticipate that at all? Mark?

You should? Yeah? Tim Cook is likely to testify. Well, that was our guru for all things Apple, Mark German and a business We get it to Joel Webber. Really interesting to see, Carol, all of this play out in court as Apple's dominance gets put to the test. And remember it's his wide ranging implications that go beyond Epic, the maker of Fortnite, could affect companies like Spotify and even smaller apps. Yeah, and really the first test of Apple's dominance when it comes to their own app store.

You're listening to Bloomberg Business Week coming up, We're staying with technology. We're moving from Apple to Amazon and the man behind it all, Jeff Bezos, who seems tim to win just about everything. Yeah, he really does. It's the cover story in the magazine this week, all about a new book, Amazon Unbound, Jeff Bezos and the Invention of a Global Empire. This is Bloomberg. This is Bloomberg Business Week with Carol Masser and Bloomberg Quick Takes Tim Stinnoby

from Bloomberg Radio. So Bloomberg's Bradstone is no doubt about the go to voice when it comes to Amazon. Wrote a book about the company, you might recall the Everything Store. Lucky for us, he went back to do more, resulting in his new book, Uh just coming out, Amazon on Bound, Geff Bezos and the Invention of a Global Empire. Let's get more from Bradstone, Senior Executive Editor up Global Technology

here at Bloomberg News. He is with us from our bureau in San Francisco, along with Bloomberg Business Week editor Joel Weber. And I gotta tell you you guys, I think we're just gonna do this for ten hours because I just want to talk about everything Jeff Bezos and everything. Brad's book I'm just gonna put that out there. Job. I don't know if we can have Brad. I don't know if we can have Brad for ten hours, but but we'll take them for what we get. Isn't isn't

this a family program? I don't know if we're we're really able to talk about for ten hours. Yeah, it might be a little much. So this story, um, Brad, that that you know, we excerpted from your book is one that kind of broke the internet when it happened,

but we we only really knew. Um the part that came out at the moment, and what you brought to the book and to the pages of Business Week is a lot of color behind the scenes and and the great untold story of how Jeff Bezos basically took probably what was a low moment in his life and used it to turn the tables. And we're talking about the the National enquir National Choir story that was basically about his affair. Um, so, so how did you approach a writing this this story and then like how did you

how does that tie into the book itself? Right? Yeah,

thanks Joel. Well, first of all, just to put it into a little bit of context, I was about a year into writing this book, as Carol said, a sequel to The Everything Store, which I thought was gonna be a nice, boring business book about the last ten years and the rise of the continued rise and domination of Amazon, with a little you know, ominous antitrust specter hanging over it, and you know, and then Jeff tweets his divorce from Mackenzie and the Medium Post and the National enquire package

and what was left from you know, that moment Jill, where you which you described as kind of breaking the internet was a little bit of a sense of ambiguity. It was like, well, wait, did the brother do it? Did MBS do it? Who? How did the Inquiry get the story? Is Trump involved? And Bezos and his his advocates were very clever, I think, in in casting sort of political aspersions, wrapping themselves up in the mantle of

the Washington Post and the journalistic mission. And so my goal as I got into it was, you know, to try to avoid I guess some of the sensationalism and and but but described you know what happened, How did Bezos really come out on top? As the cover says, Jeff wins he always seems to win, UM, and what

does it say about his kind of tactics? And so you know, I just tried to talk to everyone, get close to the investigation into the whole thing by the FBI and the Southern District of New York and figure out, Okay, you know what what happened and and UM, you know, as as Jeff maneuvered through it, what can we learn from that? So? What did happen? Did it? It didn't actually have anything to do with Saudi Arabia or or

or President Trump, Right, that is the question. And what I say in the book is and it's represented in the in the Business Week story this week, is that based on the evidence that we have at the current moment, and based on the conclusions of federal prosecutors in New York, that it seems like Acam's razor applies here. The simplest solution was the was the right one? Which is that UM, you know, the brother Michael Sanchez gave the story to

the National Enquirer, UM. And there's really no evidence, um, to suggest that there were any political motives involved, UM, or that any any international conspiracy was involved. There there is. I wouldn't say there's evidence. I would say there's circumstantial evidence that MBS hacked bezos phone. Um, but there are a lot of questions about the f t i UH, the the agency that did that investigation, that Bezos is Camp hired to do that investigation. The spyware that was

involved is very very hard to detect. So really they were looking at the increase in data that came from his phone and at the time, and there's no evidence and there's a lot of evidence to the contrary their sworn statements that were filed in part of these cases, and there was evidence email evidence that shows the inquiry getting the story from from Michael Sanchez and trying to

piece together the mystery. Who was he even talking about discovering it was Jeff Bezos And so you know where I net it out again, may maybe something comes out

that this story so bizarre. Who knows what could happen, But from the evidence we have, it really doesn't seem like, you know, there were there were political winds blowing around this thing at all, other than the fear that a m I had that because of its UH you know, the resolution of of the Michael Cohen case and it's a peace treaty with the Southern District of New York.

They worried about being accused of having political motives, and that did play a role because it forced him into into trying to negotiate a settlement which Bezos and accused him of of extorting him. But other than that, I think all that stuff was just noise. I think it's remarkable is that I can just imagine the PR team behind it saying no, Jeff, don't anything, or whatever denied it, and like he just comes out, you know, fighting really hard,

and as the cover says, he wins. Like it's just remarkable. And the question, Carol is is like, was it And I don't know the answer to this, but was he deliberately manipulating kind of the world, wrapping himself up, as I said in the Mantle of Them Washington Post imputing political motives to the Inquirer. Was that a deliberate and somewhat disingenuous defensive shield or did they really think that

there could have been this political or international conspiracy. I tend to think that they genuinely thought that maybe you know that maybe his enemies and he does have enemies, and the Washington Post, particularly during the age of Trump made a lot of enemies. Um. I think they genuinely thought that there might be more to it. Um, But you have to look back and not your head. You know, it was super effective, right we all when you think about sort of what he did and the personal sort

of trajectory there, people ended up sympathizing with him. He took a stand and he brought down the editor Dylan Howard of the National Choir. So it was it was super effective. Brad, what is this episode? What do you feel like it illuminates about Jeff Bezos as a as a business person, Joel, I just quickly go back to when the Everything Store came out, and do you remember they didn't like the book and they gave me a bunch of one star reviews and and and mackenzie left

one at the time. And what struck me there is, Wow, he found a totally unique way, thinking outside the box to try to throw an asterix next to next to that work. And I, you know, frankly, I don't think it was effective, but that's also what he did in this case. He thought outside the box, outmaneuvered everyone. Um, you know, came up with this this direct medium post um One, the Sympathist came out on top. He's retiring

now as an icon of business. He the thing that you learned from this is he always does things a little bit differently, and often it is ingenious. That's brad Stone on his new tewel Amazon Unbound, along with the editor of the magazine, Joel Webber. Brad's laid his book on the e commerce Giant goes on sale May eleven, and you've got a special coming up this week on Quick Take with him. Yeah, we're going to do a

deep dive into the book. You do not want to miss it, all right, looking forward to that coming up. One of the early fintech companies that turned upside down the way we invest but the environment, there's more competition. You've got robin Hood, You've got so much more out there that are going after younger investors. The world is changing. Yeah, it really is. I mean the mantra of said it

and forget it. It doesn't really resonate with the robin Hood crowd exactly, which is probably why the co founder and CEO Well Front, which stopped by. They're introducing new programs for their users. That conversation that's coming up next.

This is Bloomberg broadcasting from the financial capital of the world, Bloomberg eleven Frio in New York to Washington, d C. Bloomberg to Boston, Bloomberg one oh six one to San Francisco, Bloomberg nine sixty to the country Sirius XM Chado one nine team and around the globe the Bloomberg Business app and Bloomberg Radio dot Com. This is Bloomberg Business Week. Robin Hood founded seven years ago. Can we know this? It's exploded in popularity millions of Americans looking to make

some money during a pandemic that has sent stock prices swinging. Listen, this was the year, the past year that we all started talking about robin Hood. Yeah, it's it's disrupting the financial industry. It's a huge fintech player. But but one of the earlier fintech firms to really change the way that people thought about investing was Wealth Front. It changed how investors managed their investment and thought about retirement by taking it online. It introduced the word robo advisor to

our world. I remember we all of a sudden, we're talking about, well, what's a robo advisor? We caught up with Andy rack Left, co founder and CEO of Wealth Front, he had some news to tell us about and talked about the changing demands of young investors. So what we trust them now is the ability to customize our portfolios.

So traditionally, what we offered was a diversified and rebalanced portfolio of low cost index funds, but we specified what those index funds would be based on your particular level of risk. Now, what we allow you to do is to add and subtract ets based index funds, or you can even build your own portfolio from scratch. So we're starting with dozens of etf well, seeing Nick row that too, hundreds our et s even include socially responsible et F

so that you can express your values. And we hope later this year to be able to add cryptocurrencies to that divers spike portfolio as well. Andy, you founded this back. I think it was like just around it was at two thousand eight, just around the financial crisis, two thousand eleven. Actually we launched our first product in December of eleven.

How has things changed in terms of what investors, maybe a younger investor, maybe all investors, in terms of what they're looking in terms of how they manage their investments in their portfolio, especially in an arrow where it's not like my dad who had investments of pension, sencier security VA benefits. It's going to be very different for people. Well, let's see. On the positive side, I think that index investing or passive investing has grown to become much much

more popular. I think in two thousand and nineteen over half the funds in mutual funds were passively managed. When we started, that was not apparent. So that's a really big positive change. Every ten years or so, there's a day trading crates, and it happens whenever the market goes up by a very large amount in a short period of time. It happened in the Internet bubble, it happened

around the financial crisis, and it happened last year. And so that drives people who have not lost money through day trading to try it, which means people so And you don't think this one is different, because there is the access to apps, commission free trading. You can do it like playing a game on your iPhone. You don't think this one is different, Well, I don't because everyone loses money when they day trade, and so ultimately they realize it's like putting touching our hand to a burner.

When you get burned on a stove, you don't do it again. So everyone, I think wants to try that, and then they're probably going to move away from it. And then the other biggest difference is the explosion in the value of bitcoin and other andy what what what do you give us an update on the on wealth fronts business? Because I'm there. Fintech is so hot right now. As I mentioned earlier in the show, Um, what's the plan for the company? Are you guys are going to

I p O? Are you gonna get acquired? Well? I was in the venture capital business for over twenty five years. I co founded a very well known firm called Benchmark Capital. And one of the things that made Benchmark so successful was a focus on companies that had a good chance of building a large independent company, which requires you that you go public. So that's been the desire from day one,

and unfortunately we're growing very rapidly. We have over billion dollars of ussets now under management, and March was our biggest month ever in terms of investment net deposits. What's the demo is it still kind of skewing younger, Yes, while it's intentionally skewing younger, we focus on millennials and Gen Z, so people forty and under. And the reason that we appeal to them is that everything that we do is delivered via software rather than through an advisor.

Our clients literally tell us, we pay you not to talk to us, so we don't appeal to baby boomers who have been conditioned to want to talk to someone. We're fantastic if you want everything delivered via your app. Do you think that this is the right approach for everybody? Well, I don't think it's a function of the amount of money you have, because the academic research is incredibly clear that that attempting to outperform the market through active management

is a fool's area. That net of fees that you are going to underperform and the only three things that you can control or diversification, fees and taxes, which are software is really really good at that's Andy Ratcliffe of Wealth Front look as a venture capitalist. It was so interesting to hear him, with his background in venture capital, talk about how the company is going to ultimately I

p O Yeah, exactly right. We kind of pushed him like So where are you going with this because the company has been around for its quite a while and your in Silicon Valley startup terms, right, yeah, exact, exactly. It's all perspective. You're listening to Bloomberg Business Week, coming up from staying up on your finances to dressing down for the pandemic, or at least wearing a lot of sweats,

yoga pants, and as it turns out, joggers. We've got the lowdown on the Jogger Juggernaut at Vori from the co founder and CEO. This is Bloomberg. You wearing joggers? Not right now, you're listening to Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes. Tim Stinovich from Bloomberg Radio. All right, everyone, hands up, Tim, you took. His hand is up in the air. Who has been living in sweats, leggings, yoga pants, you know, those comfy clothes in the past year?

Up my hand, my hand up. I mean, obviously not when I'm at work, and we've been coming to the office for the last few months, but as soon as I get home, I throw on those comfy paths. Well, there's one company that is a maker of the types of clothes we've all been living in. It's the active where at leisure company. Viori, which sales skyrocket in the past year, is founder and CEO Viory. We began our chat like we often do, with a look back to March. Well,

it's been a roller coaster. I will never forget March thirteenth, we gathered our leadership team together and we decided we needed to close our stores. We had five retail stores at the time. UM. We were getting calls from a lot of our wholesale partners saying hold shipments, don't send us any any more inventory. And by the way, we don't think we can pay our bills. Um. And so it was a rough time. You know. We made some

tough decisions. You know. At the time, we decided to keep all of our We had over fifty retail employees. We decided to keep them fully employed with the company and reinvest in training. UM. But I was so proud with how our team came together in that time and we got really creative and we thought about how can we make this business better during this momentary pause. And what we found out was that there was a big gravitation towards comfortable clothing, and we we were very fortunate

to benefit from that. UM. So it was it was a bit of a rollercoaster at the beginning, a lot of worry, a lot of doubt about what was going to happen, and then we we learned quickly that our customer was coming to us. They trusted us for delivering really comfortable clothes during a pretty tough and traumatic time. I'm guilty for those comfortable clothes working from home for I don't know, eight months for me, are so a lot of yoga ware and the like. UM, tell me

about some of the metrics. I had read somewhere that you guys nearly tripled your revenue last year. Is that right? Or give me some idea of the metrics you saw. Yeah,

we did. We we came in in the year to UM with a plan to double the business, and before we were really close to writing it to zero, as we're a lot of folks, you know, in that early March timeframe, but we learned that there was again that big gravitation towards our our category, and we ended up tripling our business, with a large majority of that being direct to consumer and so hats off to our team, Hats off to our supply chain for being able to

react so quickly to meet the demand. What was your supply chain like, because that's something that we've had a lot of conversations about over the past year, where we know when it came to certainly some of those essentials. Um, it was difficult. But what was your supply chain like during the pandemic. Well, we're fortunate to have great partners,

so I'll first say that, but it was challenged, you know. Um, you know, one day we called our factory partners and we said, look, guys, we need to hold um all new production until we get a better picture of what was going to happen. And literally two weeks later we called them and asked them to triple the volume of production. And so, you know, we were working with everybody from our text all mills all the way through to our cut and sow factories to manage capacity and kind of

an ever changing environment. You know, one minute we thought we were on one trajectory, and then the next minute we would get more data, putting more demand and pressure on supply chain. But we were able to rise to the occasion. And I think part of that was because we had adopted nimble um supply chain models that um, we're where we where. We partner with some of our vendors to manage inventory and to meet that that kind

of fluctuation in demand. So Joe, a friend of mine, when I saw that we were having you on to like really cool guest, I hear their joggers are the best, tell me what's going on with jogger sales? Because this has been a big momentum play for you guys. The jogger has been an incredible product across all channel, the distribution. But yeah, we've become famous for the jogger, and I think it's a combination of great fit and comfort. Comfort

being king this past year. Um, we have a famous fabric called the dream Knit and our dream Knit extile. It's a technical fabric. It's brushed very uniquely to give it this incredibly soft hand and once you put them on, you have a hard time taking them off. So where do you go with all of this? And I think about I've been doing yoga for twenty years and yoga clothes have gone from you know, ty tyed yoga pants too.

They actually look pretty nice with the jacket and it's pretty amazing how like this stuff has evolved and has infiltrated kind of our regular wardrobe. How do you continue to see the evolution of your brand and the type of offerings that you put out there. Yeah, that's a great question, you know. I really feel that part of the reason Jory has been successful is we've intentionally tried to blur the lines between fitness clothing and everyday life clothing.

And I really feel that the term at leisure is just going to evolve into clothing. I think some of the best sportswear everyday clothing, whether you're wearing it around the house or you're traveling, or you're going to the office. I think a lot of that product is being made and conceived today by activewear brand. And I think that a lot of our offering, you know, is extending beyond product you're just going to take to the gym, but it's a product that you know you'll travel in your

ware to the office. It's it's closed that you'll you'll go hike and be active outdoors in and it's just transitioning into you know, clothing. It's it's the new definition of clothing because it's more comfortable, It moves with your body and it just functions better. How are you and

you guys write about sustainability on your website. That's a big deal and we have been increasingly certainly on our program here looking at the fashion industry and the use of water and you know what it does to our environment. You guys are focusing on recycled and also organic materials. You're committed to sustainability in terms of your materials by two. It's a big part of your ethos. Does it cost more? Tell me about getting there, because we are increasingly seeing

more and more companies doing it. Is it hard to do it? Is it costlier? Tell me about that. Yeah, it costs money, so it requires investment. Um. But we believe that's it's a great r o I. But that's not the reason for doing it. We did it because the natural world was what inspired the brand and we want to make sure we're doing everything we can to

protect it. And so yes, you you mentioned recycled and organic materials by two, we're on path to meet that, um that goal, but we also invested in a lot of different green initiatives talks that of our carbon footprint for the past two years UM, and yeah, those those that requires dollars to do that. We're also investing in in going plastic neutral, so UM we calculate all the plastic that we put into the environment and we take equal if not more plastic out of the ocean. So

all of these require effort and require energy. It required dollars, but we believe it's the right thing to do. And you know, building a brand in alignment with a value system is really important to us and I think it's really important to our customers as well. And where do you mostly manufacture? Well, there we work with a supply chain that's that's mobile at this point, Asia, Cambodia, Vietnam, Sri Lanka, So we're we're diversified globally well. And it's

interesting And I do wonder too about UM. That's certainly part of the E s G kind of framework that we are increasingly looking at when it comes to companies and certainly investments. UM. Are you gearing towards places where workers are treated more equitably and and get a fair wage. We have a whole sourcing team UM that spends a lot of time on our code of conduct UM and and being very clear with the value system that we

expect our factories to operate within. And it's exciting because the more brands that are taking this next step in terms of E s G, the more the supply chain is being responsive because the best factories in the world want to work with the best brand. If the best brands are caring about this stuff, then they are as well. And so the more more energy, the more we vote

with our dollars, the more the factory pay attention. UM. And so we're not only demanding it, but we're also seeing some of the best factories coming to us with really cool new program um. And that's really inspiring to see. Yeah, definitely interesting to hear, and it is inspiring. Hey, one thing I wanted to ask you after a year of many of us being kind of casual, I'm still wearing. Also some genes at work I do change for when

I have to be on air. But um, there is a thing we talked about revenge buying where everybody can't wait to spend money. But there is also something like sweatpant fatigue that you guys are noticing. How is that shifting Maybe some of the things that you want to put up in terms of product offerings in the next few months, especially the world reopens. Yeah, it's a great point. I mean we are already seeing our product UM focus evolved. UM sweatpants are still growing for us as a category,

but it's contribution to the overall businesses shrinking. So we're seeing people move into athletic shorts, you know, our technical sports where for traveling products that you can wear on the golf course or to the office. They're trending really strong right now, and we don't see that slowing down. But I don't think in general the movement towards healthy, active living is going anywhere. And I believe that the clothing that we make UM is very much aligned and

supports that lifestyle. And so while the products that we buy might evolve a little bit out of say kind of sweatpants relying on the couch, UM into other forms of active where I think in general people are still looking for comfort, versatility, UM and performance. Yeah. I think you're right. I think people are whittling down to and and really want kind of a wardrobe that just makes sense with kind of who they are and and their work. Are you guys going to stay private? Do you want

to go public? There's a lot of money out there, there's SPACs. Is that part of the timetable at all in the next year or so. You know, we're paying attention, we're getting we're getting educated on the public market, but you know, we have not made any kind of UM statement, intor or initiative to move in that direction at this point. We're so focused on growing the business. The business is going to double again this year. We're getting to a

pretty sizable scale. We have four hundred and fifty employees UM and so we have our work cut out with for us building kind of a back end engine that can support the front and we're very excited about what we're doing with our product pipeline. We're going to be expanding nationally with our bory retail stores UM and continue to invest in sustainability. So we have our work cut out for us. That's Joe Coodlave, the founder and CEO of Theory Joggers. I do have joggers, Carol their joggers.

I don't have their joggers. My wife got me a pair a few years ago from my birthday. They are comfy and you love them. I do. I gotta put that on my two buy list. 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 Stanovak. Be sure to tune into our Bloomberg Business Week Daily show Monday through Friday. It starts at two pm Wall Street Time on Bloomberg Radio. You can also

watch us on our daily broadcast on YouTube. Just search Bloomberg Global News and check out our Bloomberg Business Week podcast. You can find it at Bloomberg dot com, Apple, or wherever you get your podcasts. You can also find Carol's recent chat with Nancy Wilson of Heart out now with her first solo album, I Loved It, Carol, it was we fund to catch up with her. I gotta say Bloomberg Business Week. It's available on newstands now, at Bloomberg

dot com and on the Bloomberg Terminal. You can also see me at Bloomberg Quick Take available at Bloomberg dot com, slash qt, and streaming platforms like Roku, Apple TV, Samsung TV, and more. Have a great weekend. Stay safe everyone. This is Bloomberg