From Marhart where Innovation, Money and power Collie in Silicon Valley, NBN.
This is Bloomberg Technology with Caroline Hyde and Ed Loved Love.
And Live from New York and San Francisco. This is Bloomberg Technology coming up. Apple iPhone confidence but regulatory risks.
Details ahead, Plus Business Week's definitive story on Rivian's ev turnaround plan, and.
A look at Neuralink and its competitors as Musk tease up a new implant.
The first.
Let's check in on the broader tech index right now, Ed, I'm afraid that soothing of concerns around inflation has not driven up the tech stocks.
Bond markets.
Yes, they are on fire, but today the NASAC is off by one point two percent. Some key players on the downside in video being one, but you're looking at us the key names that are currently under pressure.
Yeah, Apple, and Apple is a big points drag. There are so many headlines out in the first instance, with the stock at one point in the session on track for its biggest drop since March. Bank of America up raising its price target to two hundred and fifty six dollars a share from two hundred and thirty, seeing confidence in a refresh cycle for the iPhone. Then there's the Bloomberg reporting that Apple is said to its suppliers, we
want to boost iPhone shipments by ten percent. There's some growing momentum around the iPhone story, up eighteen percent or so year to date, but by no means one of the best performers on the Nasdaq one hundred. And then there's that that you talked about regulatory risk Apple avoiding sanctioned in the EU.
Give me the details.
Yeah, I really think though at the moment, we are seeing this Apple concern at the moment, and the fact that EU regulators are basically forcing them to open up the wallets situation, the fact that we're seeing fintech being our eyes on the prize may be a boost to PayPal, but ultimately this is the way in which regulators have decided that big techniques stop opening up their walled gardens.
And Anna rag Rana is exactly the person we should speak to about this bingleg intelligence and just I set for us Apple under pressure big tech more broadly on the day. But as that articulates, there's some good moon music around iPhone supply and demand, but at the same time there are the these regulatory risks that are forcing business model change.
Yeah.
You know, Apple's performed really well over the last few months, and you know, if you go back in April, I mean I think it's up what thirty five forty percent since then, it's you know, the rebound has been driven a lot by Apple's AI story, which I think has
resonated well with investors. Now, yesterday was probably the first big time news we got in terms of iPhone shipment improvement, and I don't remember in the last several years really looking at that kind of a news, and I think that really says that there is a lot of you know, if you could say, hype slash expectations about the iPhone sixteen and what it could do to Apple's top line.
And the other big story is that Apple has avoided a fine from the EU because it's opened up it's mobile wallets technology to others. It's made a concession. How do you think that impacts the iOS ecosystem?
Yeah, you know, the the Apple CFO commented a few quarters ago that the app store revenue form EU you know, accounts for about seven percent of that particular radio's sales, so it's really not that big of a deal. Frankly, now this is nothing new. We are seeing EU really cracking down on all big US firms. I don't think it's going to stop anytime soon. I don't think these
cases are going to go away. But frankly, speaking from a financial point of view, it's not going to hurt them as much as you know.
The headline suggest.
Anirag Rana or Bloomberg Intelligence. Thank you very much. I mentioned there were many headlines about Apple. Apple and Microsoft have dropped plans to take board roles at open Ai in a surprise decision amid growing regularly regulatory screws. Me here in San Francisco, Bloomberg Technology Senior executive edit said Tom Giles, give us the details of this Bloomberg reporting. Microsoft's investment in open Ai as well known. But Apple
was due to get a board observer role. Now neither of those are going to have a board and solve observer role.
Yeah ed.
Open AI's board was starting to get really crowded with big powerful tech company, the most powerful tech companies in the world. That's a bad look when you are under regulatory scrutiny, when everybody is worried about a concentration of power and money around open ai. The basically one of the biggest, if not the biggest LM biggest generative AI companies, was just getting too chummy with Microsoft and Apple.
That was the concern, a concern that actually is global.
Tom.
We were just talking how the EU has been focused in on Apple. They were focused in on Microsoft sort of ultimately doing a form of M and A here by stealth. Now without the board seats, does that drive home?
That isn't the case.
So Microsoft is the biggest investor in open ai, to the tune of thirteen billion dollars. It's a massive investment. Microsoft is weaving open AI's technology into a lot of its own products. Apple is doing the very same thing. It's not an investor to that degree, but it is using open ais technology throughout its software to make it basically to get people to spend more time on their iPhone,
to make the iPhone more useful. Both of these things are basically showing how important open ai is and how important the relationship is with big tech companies that want to get a piece of the hottest generative AI property in the world. And that's where regulators are having a hard time. They're worried about competition. They're worried about other companies getting access to this technology. They're worried about concentration. And this is where you're seeing it start to come unraveled.
Removing those board observer rules for both of them, and.
Even that might not be enough. Sources telling Bloomberg that you know, regulators here in the s will still look at Microsoft because they're like, you didn't notify us in advance about this deal. Bloomboks Tom Giles, who leads our technology coverage around the world, thank you so much sticking with big tech. We're also watching shares of Google and HubSpot. Google down, Alphabet the parent company of two percent, HubSpot up nine ten percent. The reporting the Alphabet has shelved
this interest in HubSpot. A story of beIN tracking here across the newsroom, Caro, what's up next in the show?
Oh, a story that is beautifully written by Nana Man and yourself. We're talking Rivian's race against Tesla more and how the company is taking an alternative route to woo those Tesla customers.
As a Bloomberg Technology.
It's time for talking tech and first up, Leap Motors makes a deal to go global Stalantis has partnered with the little known Chinese EV maker, investing one point six billion dollars for a twenty one percent stake. The joint venture would allow Stilantis to access Leap motors advanced tech features while allowing Leap Motors to build and sell their cars. Installance's global network plus Lucid Motors says they're still continuing
to raise cash. Bloomberg spoke with CEO Peter Rawlinson earlier today.
This is a capital invents intensive business and we do need to raise more money.
And we will at opportune moments in time on the future. Our vision is to be a major player here.
The company has license deals with the likes of Aston Martin and said they're in discussions with others and auto plants get a lifeline. The Biden administrations awarding one point seven billion dollars to retool at risk or show to manufacturing and assembly plants across eight states, converting them to support EV manufacturing. The funding is being made available through the Inflation Reduction Act and is subject to negotiations and other reviews before becoming final.
Character Look, we are going to stick on this EV train ed yourself and mister Max Traffkin are out with a really in depth piece on Rivian and VW's partnership. What sparked it, how the ev maker is basically banking on the anti Tesla crowd, and Ed just walks through.
Who you first spoke to.
There's this particular well sort of person we hear from who sums up how a lot of Tesla people and owners feel right now.
As we spoke to many of them. There's like this great body of former Tesla fans, fanboys, owners, you know, that community online that's basically defected to Rivian for lots of reasons. And I think Max would agree it's not very difficult to find them, is it, Max? You know, this was one case study. We spoke to several of them, the point being that that was Rivian's original audience. Is that audience now and they got a lot to do.
Right Yeah.
And what you see when you talk to a lot of Rivian owners, it's it's kind of it's interesting because it tells you a lot about the where the ev industry is going and maybe also where Tesla's going or where Tesla has at times gone wrong. It's not that these people are necessarily big Tesla haters. They're not the folks on X who are you know, you know, talking
talking about shorting the stock or anything. They are just often just car people who are interested in EV's, much more interested in evs, say than in robotaxis or wild promises about brain implants or whatever, and also interested in
new models. I mean, and when you when you look at where Tesla has has arguably made some mistakes and where Rivian has done well, I mean, I think if Tesla comes out with a cyber truck that looks something like the Rivian R one t, which is their pickup truck, I think it would have been a much more successful launch. And so it's it's an interesting sort of cross road situation.
I really wanted to do this story, Caroline, because I've covered Rivian for many years and I've never had an experience in my career where a company has gone from like such ethoric highs to like really down in the doldrums. Right, this was the sixth biggest IPO in US history, you know, the biggest since Facebook, and now the stock would make you think that it's like a Fiscal or Elucid, but to their credit, like Rivian's a different beast Carrot.
They actually make evs.
What we wanted to do is explain how they're going to get to that next stage, which is to get nearer to Tesla.
I like that they actually make evs a max to that point, though they haven't been producing them at the rapid clip. The many thought, and well, they have got a new prototype that actually is just a prototype.
When we kind of get the R three.
Yeah, you have sort of two situations going on. One is just their car manufacturing is difficult, and you know it's we've seen this with many of these automotive startups.
It takes them longer than they want.
Rivian also faced a lot of supply chainallenges, especially during the pandemic. The thing is with evs, right, they've they're selling a lot of these very expensive SUVs and pickup trucks. They are getting really good reviews. But the truth is and and R J. Scurringe, the CEO of Rivian, UH spoke to Ed and I about this, but like, there's just a limited number of people who want these things.
What what the industry needs and what climate advocates need is more affordable cars, and and Rivian is trying to get there and get there as quickly as they can. We have the art they're working on the R two, the factory in normal Illinois, that's Central Illinois. They're they're they're really starting to get ready already. Uh you know
when I was out there a few weeks ago. And and the plan, the long term plan is this R three, which is again this kind of like almost mythical at this point, cheap electric car, the electric car that everyone can afford, but it definitely is a long way from being real.
Well, it's also like they're.
Running out of cash. And I think that one of the important points that we make in the story is some of the reasons why they pivoted to write Max, and that is they were running out in money, partly because, according to our sources, the DOE said, if you want some of this money from the Inflation Reduction Act, you have to change your position on unions. And we understand that that's just not happening right now.
Yeah, you had this frantic scramble. I mean, the weird thing is Rivian of course has lots of cash. It's just that the automotive that that making cars is so expensive that they're burning even more. And it was looking you know, you know, as we wrote this story, increasingly unlikely that they were going to be able to open this plan in Georgia, Ed, as you said, looking to the to the Biden administration, to the to the federal government, like many companies, and you know, ultimately.
Not getting there.
As we report in the story, these negotiations are ongoing. It's possible they will reach some sort of deal. But in the meantime, this VW infusion is huge for Rivian. It takes a lot of the pressure that this company is on and of course that's why the stock you know, went way up when when the deal was announced.
And I love how we stock. We started on stock and.
One of the greatest pieces that you have out of there is is how the main owner of Tesla say there's two types of Teslo owners, those who are the stock owners and those who actually own the cars.
All of this is such great reporting from both of you.
Thank you, Max Chafkin and of course Ed Lulo just across the RJ Scarrange story.
Okay, Today for our AI and Action segment, we're joined by Lynn Chow, who's the CEO of Fireworks AI, to discuss the company's latest Series B funding round. Fifty two million dollars, but also their plans for the future of AI. So Fireworks is interesting to me, LeAnn and welcome to the program. You describe yourselves as lightning fast inference platform. So in the first instance, the basics of what a lightning fast inference platform.
Is definitely Thanks for having me here, d and Fireworks we are. We have deliver one of the fastest, the most cost efficient infrast engine using our propriety technology. By that, we want to address the challenge of many applications. They require very low latency to drive responsive product experience and very low costs to deliver viable, sustainable business.
It's very difficult because.
Large language models are big, so deliver all these prec requirements are really challenging, and here we focus on helping those applications to get there.
This is something that is targeted at both developers but also potentially enterprise customers. So if I were one of those two groups, a developer or running a large enterprise, how would I use Fireworks? Give me some examples or case studies.
Yeah, we have many customers ranging from leading startups to fortune five hundred companies using Fireworks to disrupt the status called and the startups using fireworks to drive iterative new creative ideas and native companies using fireworks to deliver new products events, Fortune five hundred companies to use fireworks to drive productivity. We have leading airsrs like Krasna, Cursor, Sourceware, Liner, our Prime.
We've seen some of your clients. Now we're seeing actually some of your investors as well. I mean this is a who's who of not just VC, but of strategic investors in videos, in AMDs, in Mongo dB, is in Lynn. How was the fundraising experience?
Yeah, we are blessed to be supported by so many, like the industry leading investors of Sekoya. We also have investors for Nvidia, MD and Mongo dB joining force. We plan to use this funding to signific investing in following areas. Number One, to expand our influence offering and our ecosystem, to expand into the best and latest hardware provider about Nvidia and MD right and build much tighter integration with
factor database and database management systems. And starting with Mongo dB strategy partnership.
We're actually looking at sort of how the system works a little bit right now, just going back to your affordable basically generative AI production platform. That's we see what you are, your production platform. You're helping companies use general to AI. But what I like is the fact that you think the generative AI's future isn't in large language models, not these massive closed source ones, but actually think it's
about open source models, smaller ones, finer tuned. What is the future compound AI systems?
Right, So we.
Started for our large language model because the larger groups model are very powerful and magical, but those single models are now sufficient as we're surrounded by rich content as we're having this interview and conversation, we actually use audio
and the visual information and fireworks. We want to use the new funding to make a big shift towards a compound AIR system that can orchestrate across multiple single models with various different modalities, and then air tools to reach, for example, the latest news from Bloomberg or my personal calendars or personal to do list, and build the totality of a great application experience.
I think it'd be really beneficial to our audience to explain how different it is building on an application, specifically in the inference domain, relative to the training process of a large language model. I think a lot of what Caroline and I have focused on in the last two years or so, is everyone everywhere building large language models or other words training the model on specific data sets. So what's that experience been like for you as you've built fireworks right?
So we are hyper focused on our inference for the following reasons. Because most of the technology they are going to power a consumer facing or developer facing application, and those applications has a lot of users. And when you scale your product, that means you're going to quickly scale your business and your influenced costs will also quickly scale. So scalability, reliability and maintaining very expensive models in production
in a reliable way is very important. So we predict that market is going to create a huge amount of expense and that's where the enterprise is leading into to solve influenced problems.
Minchaw cfi Works AI on the latest funding round and thank you for your time now. Earlier at Back of America Breakthrough Technology Dialogue, Blimba caught up with but Jills Meyer, partner likes being venture partners to discuss look AI and come to markets, take a listen.
What we're obviously seeing and I think we would have anticipated seeing is is API core pricing coming down? Now, I think the most dangerous our perspective is perhaps the most dangerous perspective to have at times like this, when technologies are changing so rapidly, is to think that we know what the answer is going to be. We don't, right, But here's what we believe, which is that in a world in which the volume of calls expands exponentially, which we will is more and we will see as more
and more enterprises adopt generative AI. And now, if you think about an agentic world where each of us may have multiple agents operating on our behalf, and enterprises will have agents operating on their behalf also making calls, well, then the volume of calls that are made on these foundation models is going to be absolutely massive, right, And so while the price per call may come down, the volume of calls will be extremely high, and we expect
compute costs to decline. And so I would argue in that world, these companies at scale will absolutely be able.
To make a profit. It, right, But we don't know. These are things that we don't know.
But I think it's it's dangerous to be too rigid with a particular point of view, and we're remaining open minded about all of these possibilities.
Is there pressure that you put on some of these some of these companies around monetization. Are you getting to that point where you're having those conversations you need to start monetizing some of these products.
Well, look, I think I think these founding teams recognize, given the cost of compute and the capital intensity of these businesses, there's only two ways you can you can manage the capital intensity. One is you will keep raising capital. The other is you've got to you've got to earn revenue. And I think the answer will be both. You can't
rely on the capital markets. The private markets have been have embraced these companies so far, right with these companies raising billions of dollars and most recently Xai raising close to seven billion dollars. So capital is available, but you can't you can't.
Assume that will always be the case.
And I think we're beginning to see companies like open Ai and Anthropic begin to scale revenue very fast.
Okay, interesting in terms of the venture capital world and the structure within that sect. So Lightspeed's done something really interesting, which is looking at this continuation funds, so essentially allowing investors or to take about a billion dollars of stakes in your portfolio company, so freeing up about a billion dollars across a portfolio. It's a P style structure. What is the rationale behind that?
Yeah, the rationale behind that is that companies are staying private for longer, and at the same time we want to be.
Able to support those companies.
Yet recognize that some of our LPs that are investors in the funds that are invested in those companies, it's important to drive liquidity back to them. And so how do we solve both of those problems. Well, it is, for example, to take a set of what are still very healthy companies that are compounding in value and put them into what we call a continuation vehicle where the underlying LP base may change. Right.
That provides liquidity.
To LPs that want it, others may not, and they can roll over, and it enables Lightspeed to continue to steward those positions and continue to be a partner to those companies.
Coming up, we discuss in the Brain synchron CEO on how the company's brain computer interface is using open ais tech.
This is Bloomberg Technology.
Welcome back to Bloomberg Technology.
Ed love Low in San Francisco, Parin Hi right here in New York and Ed. We had some big macro data today.
CPI cooling once again, that inflationtory pressure dialing back.
But it is not good news for stocks.
Sure money paus into the bomb market as we start to anticipate could it even be three.
Rate cuts this year?
But we're down one point seven percent on the bigger benchmarkin a's that one hundred. Why, I mean largely because we've got big tech selling off in video, Apple, Alphabeta and who's who of the big tech candidates. Maybe we're seeing profit taking at this moment. Maybe you're questioning valuations. Just remember New Street Research put out a note but yesterday saying maybe we do think that we're fully priced in at these levels in video, for example.
But move on to some of the individual movers.
TSMC actually down almost three and a half percent this after they hit a new record. Remember one trillion dollar company, eighth biggest in the world. Their numbers showed forty percent growth in the previous quarter. But once again, maybe we're seeing some profit taking for TSMC, Netflix. We've got earnings coming up city getting a little cautious ahead of those numbers Tesla of five five ten percent. It had had
almost an eleven day running streak. A Musk has more on his mind, it would see made at the moment too.
Yeah, I mean, it's Musk all the time. Because of all of the companies that ease at the helm of one of them, must's brain computers startup. Neuralink aims to implant its device into a second human patient in about a week and to have devices and a few more patients by the end of this year. It's all according to a video update we got from Elon Musk yesterday.
Joining me on set in San Francisco is Bloomberg Sarah McBride, who does a very good job of keeping across not just Neuralink chaos, but I would say brain implant related technology stories. I mean, that's the news right that they say they're making progress towards a second patient. But what else did you learn in the presentation?
Well, it was very interesting when they implanted the first patient, it went wrong a little bit, some of the threads started retracting from his brain. So to me, the most interesting thing was the steps they said they would take
to mitigate for that. So one of the things they're going to do, for example, is implant the device more aligned with the curvature of the skull, and they're going to try to place the threads that drop down from that device in a more targeted way in the brain tissue, and they're going to implant them deeper.
This was kind of classic. This was it was classic Elon Musk related company stuff where he's like on X the platform he owns, and saying, oh, by the way, we're going to go live in five minutes. And yet this team of people in like a conference room who were some of those people, I guess we're not as familiar with Neuralink as we might be with space X and Tesla on those other important people around.
Him, right, So he had a team of for execs with him. Sitting immediately to his right was doctor Matthew McDougall, the chief surgeon at Neuralink, who kind of i'd say gave most of the updates, and to the rate of him was Djsio, the president of Neuralink. He's recently been promoted to president. They also had the person in charge of software and also in charge of the brain implants in the bases themselves.
Sarah.
There was the mixture, of course of short term practical use cases of brain injury, spinal injuries enabling people to use phones and computers. But then there's the long term and then there's the brash elong coming front and center once again. What do you say is to mitigate the longest civilizational risk of AI? Can you articulate why he thinks neuralink is apart for that?
Well, his ideas that AI could end up being a malevolent force and so our brains will need aug mending to combat that, and if you put implants in our brains, we'll kind of have superhuman powers. He's talked about how we might be able to communicate wordlessly or just download languages essentially into our brains, and he thinks those types of superior functions will help us fight AI if we need.
To, Sarah McBride on the latest and in fact, we now want to talk about the fact that there are competitors in the space, Sara mcgriders. We've been writing about one, of course, when it comes to neurotech and the neuralink rival is Syncrom.
We're going to talk about it's just.
Announcing that it's actually partnering more with AI, tapping open AI's news technology to really help paralyzed patients communicate by using their brain device. Here for more synchron Ceo Tom Oxley, Tom, it's great to have you in the studio, and sometimes I imagine it feels as neuralink takes the oxygen in that out of the room when it comes to these neurotech devices. But you have got ten patients using yours, and how is open AI's integration going to be helping them?
So the idea of a BCI is that you can help people who are paralyzed who can't control their bodies to express themselves. So the problem with paralysis is a lack of autonomy, and it's a problem in medicine that hasn't really got many treatment options. If you're paralyzed, you do rehab and there's not many treatment options. So huge unmet need, massive potential for a large market to develop. So it's exciting. I think ALON for focusing on this
field is great. I'm not sure about that future vision around the idea about fighting AI, where I think there's a much more important short term use case to help a massive medical need and so we're very focused on applications that are going to improve patient's autonomy. And so when the Chatchipit four O, the multimodal GPT came out, we realized that there was this was a huge ability for patients who lack the ability to engage in the world to improve both inputs and outputs with the system.
How can you give us explanations of how GPT four is going to enable those that can't as you communicate, interact with what's happening around them in the room for example.
So the multimodal it takes inputs from text, from vision, and from audio, so multimodal inputs, and then it can use all that to generate prompts that enable the users. In our case, we can use our hands to interact with prompts. In patients that are paralyzed, you can't engage with prompts. So we took the opportunity to build into a chat feature, which we just released a demo of today, where the multimodal GPT generates the language prompt for our
users and then so that's the input. The output is the selection of the prompt to then generate a next action. But the BCI sits in the middle. The BCI sits in the middle. The BCI represents your ability to make a true and that's what you lose if you're paralyzed. You lose your ability to engage and make choices. You
become dependent on other people. So the BCI is a digital representation of what you want to do, and the future of the link between BCI and AI is how the direct link from the brain to make selections with prompts lets you engage with the digital world.
Tom, it's good to see you again, Carrie. Tom and I were on stage together a couple of months ago in San Francisco, and you were talking at that time about the progress that could be made with your your different delivery system. Right, So Neurer link is straight into the brain through the skull. You guys do this through the cardiovascular system. What has the LM unlocked in terms of your cadence of putting it into the real world.
You know that was something I was fixated on with you when we were talking.
Yeah, So there are advantages.
So they're really we see two approaches of getting into the brain, cutting open the head and going in with cables or coming in through a blood vessel using a stent based procedure, and so that's how we're differentiated. We think this is going to be the natural solution in medicine. There's many examples of minimally invasive approaches scaling into market stents, pacemakers,
and critically. The infrastructure to deliver its scale already exists, and we think that's going to be the natural progression of this technology. The challenge is that we don't have as much information coming out of the brain. So the key has been how can we use the information out of the brain to deliver navigate and select, which is basically how you control a platform. So we have a
interaction method which delivers navigate and select. We're using that Apple iOS accessibility platform to deliver that, and now we're infusing LM such as Multi Medal Chat GPT to allow our users to make choices interacting with prompts in a
way which is amazing. So Mark, one of our users in Pittsburgh, has been using this system and we just released the demo today of how he's using it, and we're really excited about, you know, using especially our open AI are going to be moving forward with the new programs bringing in video as an endpoint into the RAPI is going to be very exciting for our patients. But that's going to be the future. AI for Knowledge and Selections, BCI for expression of intent.
This is beyond hard, complicated and expensive.
Are you looking to raise funds? Do you have a healthy pipe rune of people interested.
In backing and expanding your project.
We're very lucky to have investors that we're excited about. Kosler and Archventures and Bill Gates and Jeff Bezos.
We have.
We have decent runway for a little while, but we will be We'll be looking to raise shortly.
Saint Chron CEO Tom Oxley, thank you, Caroline. I want to bring you some breaking news from myself and Dana Hole. Tesla plans to delay the unveiling of its Robotaxi or its Robotaxi day until Octo. You remember, Caroline, that it had been scheduled for August eighth. But what I'm hearing from sources, and what Danna's heard from her sources, is that they just want more prototypes. I'm actually also hearing that there's a bit of a rethink on the design and that this is all kind of happened in the
last twenty four hours or so. It's an interesting development. I don't really know what to make of it, other than you see the stock their carrot moving down significantly.
What does that tell you?
Sudden plunge that everyone had started to look at August the eighth.
This was the fixation, wasn't it. When we got the delivery numbers that underwhelmed.
The excuse coming from the street was that no, but everyone wants to think.
About what August the eighth means.
What's the longer term vision ultimately of Teza. Their share price run up ahead of this headline ed has been pretty phenomenal.
Last ten days.
We've had forty billion dollars in market capitalization and suddenly we sell off. What an amazing scoot that you've just brought us.
Well, you know, I've asked Elon Musk what's going on. We've asked him to come on the progress and to comment on the story, etc. The big picture here is really interesting because the original thesis was when you buy a vehicle from Tesla, it comes with all the hardware
and software you need for self driving. So when your lease ends, either Tesla takes a vehicle back from you and they put it into a fleet or the middle ground was that you can opt in to put your ev from Tesla into the fleet, much like you might put your home on Airbnb. But the third iteration that was outlined to us at the AGM was that they want to also do a purpose built ROBOTAXI, so you'd have a combinational three on what is a proprietary app,
much like an uber. The stock now down four percent, and I guess it investors to your point are saying, well, this was supposed to be it like we were going to learn what the plan is, and now we might be waiting a little longer.
And we can now bring in one Max Chafkin who races back to set to be discussing that this was the fixation of so many not the Tesla owners, but the Tsla owners, a lot of those that particularly believe in the long term vision is about robotax division.
Yeah, absolutely, And I mean there were huge questions when Elon Musk said they were going to have this launch on August. Dave, you know, there was you know, is it going to be an affordable car and the sense of a car you might want to buy. Is it going to be a ROBOTAXI, is it gonna have a steering wheel? You know, lots of questions like that, and I think investors were sort of just going with it, right because Elon Musk, as we've talked about on this
show many times, has a very good track record. And again, the reaction you're seeing from the stock is a reaction to the uncertainty and like, is it If it's just a few months delay, probably no big deal. But I think there are real questions, profound questions about robotaxis and how real this is in the near term. And then on top of that, you have questions about Tesla's ability.
To market cars.
Right, well, what does this mean for someone who just wants to buy an affordable electric car NX.
I'm just looking at the Bloomberg terminal, you know, a decline of five point five percent for what it's worth is putting tests on track for it biggest drop since April thirtieth, now down more than six percent, So investors are kind of looking at this. I also want to talk with you about the kind of academic approach to
self driving. So Tesla has a vision based platform. It does not use lidar radar, but Karen and I were talking while you're running down the stairs the set about the idea that initially this was if you owned a Tesla, that Tesla would end up in a fleet, much like you put your home on Airbnb, and then to our surprise, they go to a purpose built robotaxi. So what do you make of the purpose built robotaxi bit? And I guess the delay is in part a lack of information about that strategy.
I think there are probably a number of things going on here. I mean, as we know from previous reporting, there has been a lot of tension inside of Tesla over exactly how this should go. I mean Elon Musk as he personally has made clear, you know, believes in robotaxis. I think there are many people inside of Tesla who liked the as a vision, but are are sort of more open to the skeptical arguments.
You know.
The thing that I've thought all along making this a somewhat unrealistic plan is just that you have companies like Cruise and Waimo that have been working very hard and spending billions of dollars and making lots of you know, doing lots of work to negotiate with various local partners and so on, and they haven't gotten that far right, Like like waimo is doesn't have that many vehicles, it isn't in that many locations. It's going to be very
hard for Elon Musk to just switch this on. And I think if you're talking about like the trade offs between a personal vehicle and a robotaxi vehicle, that creates an additional complication.
As we point out, you know, he often doesn't get it in the timeline he says he will, but he often gets there in the end with those products. Max traffickin thank.
You so much.
Heusing so Europeans thought up developing AI software for just raised rather mammoth three hundred and eighty seven million dollars. It plans to use this new funding to expand its presence in European nations bordering Russia.
And what are you looking at?
I'm looking at all the things a Bloomberg anchor is expected to look at, Caroline, global inflation, interest rates, macro uncertainty, because they've all pulled down global VC deal making. But in US at least, it's an oil doom and gloom with deal activity increasing on account basis for each of the past three quarters a positive sign that deals are getting done. Speaking all downward, Carl Stanford, lead VC analyst
at Pitchburg. You know, the data is so important, even if it's backward looking, Kyle, because you know, we get a lot of the reporting each quarter about deals that are done, but then you see it in aggregate after the fact. Those three macro points. Why in the US is there less pressure from them?
So I don't I don't think that there is less pressure when you actually died deep into the data. What we're seeing now is companies coming back to market that haven't raised since twenty twenty one or early twenty twenty two, and so the time that they spent you know, kind of kicking the can down the road for financing, through layoffs, through slower growth, through extending their run their can. Now
they're coming back to market to raise. There's still a huge amount of dry powder in the in the US as well. We're talking about two hundred ninety five billion in dry powder then needs to be put to work. So there is equity deals getting done, which is a positive sign from an interest standpoint, But many of those companies are just now coming back to market and kind of inflating the number of companies raising at the.
Moment, So they've white knuckled it. They managed to get through. How many of them have had to make themselves an AI related play as well.
But we're seeing about twenty six percent of deals being completed into AI companies, whether they are you know, foundational true foundational models with llms or kind of vertical applications using open AI to do some sort of their business model, you know, fifty percent of deal value as well. I think everything is pointing toward AI. If you're an LP, you want to get into an AI fund, If you're an investor, you want to get into an AI company. If you're a company you want to somehow pivot to
an AI business model. I think it's kind of the big talk of the market right now.
So we're showing us VC deal activity by quarter backward looking and then two Q extrapolate out about what you see for the rest of the year.
Kyle, Sure.
The first thing I want to point out is that of that fifty five point six billion, about fifteen billion of it is from two deals, the core Weave, you know, eight point five billion dollar deal and then the open AI or XAI I'm sorry, six billion dollar deal, right,
So that's really inflating the top line value. Where we see the rest of the year going is obviously going to be driven by any large deals that happen, but it's going to be continued to be relatively slow for the middle of the pack to the lower quality companies. I think what we're seeing now is high quality companies getting those deals done. If you look in the data,
valuations look really high compared to really any year. But what is again what is happening is was companies are raised on high valuations in the past are coming and raising again now. And if they're higher quality that it's boosting up that median value or pre money valuation they were seen. It's not necessarily the market strength that it would actually portray from just looking at the data.
Carl Stanfan always bringing us the latest and greatest in VC.
We thank you from pitchbook. This is meg Technology.
President Biden is steadily losing support from a part of the country that knows image and stagecraft the best Hollywood. Since the debate, heavy hitters including George Clooney, Super Agent, Aria Manual, Netflix's read Hastings in Airess, Abigail Disney have all called on Biden to drop his re election bid. Clooney is a lifelong Democrat who helped raise thirty million dollars for the president at an event last month and said Democrats can pray for a miracle in November, or
they can speak the truth. Some in Hollywood are now even turning against media mogul Jeffrey Katzenberg, who serves as a co chair of Biden's reelection campaign, and it's one of the president's top donors who they say has intentionally shielded Biden's decline until now.
Karen and onto the other candidate in the presidential race, Donald Trump. He's going to speak at Bitcoin twenty twenty four conference. It's this month and it's all according to the events organizers, and it's going to be an address that would highlight well his growing embrace at the crypto industry.
That's discussed with Bluemotion, Shinali Bassak and Wes got all of crypto Twitter talking that he's going to be at this event, and it does seem to be more and more of the Republican viewpoint that this is something to win on that has.
Been a massive debate and that is seemingly where things are coming off, especially when you've had such serious pushback year, not only from the Securities and Exchange Commission, but President Biden himself when it comes to certain aspects here the Biden Ministry's approach to how legislation has been crossing the
lines in Congress. And so remember we're sending here at a moment where such little progress has been made on key stable coin bills, for example, and there's a hope here that perhaps a change in an administration will really start to dilute some of the influence some of the stronger voiced ancher crypto members of Congress have had, think Shared Brown, think Elizabeth Warren.
The idea here that a more.
Republican president, but also more Republican lawmakers in Congress overall will really start to cause a dent in how the industry has been approached in the last four years.
Italies, with the reporting that we had that Vivek Ramaswami mask Trump and Crypto is the common point for the emotion. Ali Bassett, thank you, good.
Show character, what a thick of fass show, great reporting on Rivian and has great breaking news on Tesla from you as well.
That does it from this edition of Being Bag.
Technology recapital in the podcast, we missed a few shows this week, but we are back of New York and San Francisco. This is Bloomberg Technology