Bitcoin Tops $30,000 and the Pentagon's Leaked Intelligence

of the biggest US intelligence leaks in recent history. More details on the breach ahead, and we'll be all across the race for artificial intelligence dominance capital g Anous is one hundred million dollar funding round for an AI research platform, Alpha Sense. But first let's check in on these public markets, because actually tech is feeling little less love than the rest of the benchmarks. Today we're up by four ten percent on the NASAC all important data point. You heard

it from Alex Guy just earlier. The CPI print tomorrow. A little bit of nervousness therefore around owning big tech. Some of the key tech names as will drill into a little bit later, But All Country World Index interesting me on the higher side. Europe came back after the Easter holiday, the extended break and managed to put a little bit of fuel under that fire. Two year yield though, just rises up some five basis points. As we all attention on CPI and what it means for the federals

EVE move it on. What's happening in terms of crypto thirty thousand dollars well above Now we managed to break three of that trading range at the twenty eight thousand. We were generally languishing around for the past few weeks, and what does it mean some really psychological levels being hit? Now? Are we going back to eclipsing the prices where we saw the three hours capital disintegration where you saw Terra Luna de marcle. We're now up seven percent over the

last two days. Yeah, the big question is still why. But the what is playing out in equity markets as well? You look at crypto related stocks, we're markedly higher in a number of actually want to go to micro Strategy because the four billion dollar bet that it made on bitcoin. That company is now back in the black because bitcoin is trading above the average transaction price. There's so much out there today about well, what happens if the FED

brings rates back down? What does that mean for Bitcoin? What happens if we enter a recession? Then you look at the relative performance of Bitcoin to other I guess risk assets, you know, in terms of the best performance of the year. I still don't have a great sense on what is happening. Luckily, we've got a couple of guests, so go be perfectly placed to discuss it all as well as the upgrade as soon as tomorrow. But in begs, Katie Greifeld kicks us off, Katie, what are you seeing

around the world of crypto at the moment? What don't you There are so many narratives as to what could be pushing bitcoin higher. In particular, there's a lot of narratives. There's no satisfying answer other than the one that this is a macro asset. It tends to follow sort of the macro narrative that's of the day and of the day. Of the past few weeks, the narrative has been that the FED is going to be forced to cut rates

at some point this year. That would obviously be good news for the likes of tech, for the likes of crypto. When you think about that low interest rate environment that really pushed investors out the risk spectrum. What's been interesting over the past few days is that you've seen bitcoin sort of break apart from tech. Today is a great example of Bitcoin up what almost four percent. Then you look at the NAZAC one hundred down about half a percent or so, so maybe those correlations coming apart a

bit to the benefit of bitcoin. I would say, though, that liquidity in this space is still very, very low despite this rebound. I think it's also a question of who is in this market, who is buying right where the thirty thousand US dollar potoken mark for the first time since June of last year, but still significantly far from the November twenty twenty one high. What are the big forces in terms of institutions names driving this market, Katie, None to speak of, really, and that's part of the

reason why you have liquidity so low right now. According to some measures, bitcoin equidity hovering near a ten month low. You haven't really seen a big institutional push with this rebound, and if you look at some of the retail flows I like to track exchange traded products both in the US and Europe, you really haven't seen any meaningful influence to speak of. So the tourists are gone from this market,

the institutions are gone from this market. You're left with sort of the crypto believers who are pushing the price higher again in very low liquidity, which has helped to the upside. But if we get some sort of upset, perhaps in the form of a more hawkish FED than expected, that low liquidity could exacerbate things to the downside as well. All right, bloom bows, Katie Greyfeld, thank you very much. Welcome now Spencive bog At Blockchain Capital or general partner

here with me in San Francisco. You are essentially a fundamental investment analysts. You lead research. What did the fundamentals tell you about what on earth is happening with bitcoin right now? So most the fundamentals that we deal with are early stage, But which fundamentals are there any fundamentals point? So, most of the fundamentals we work with for early stage startups are related to all the things you'd see in

any traditional software startup. Right We're looking at user growth, we're looking at transaction activity depending on the particular company. Now here for bitcoin, when we're trying to describe or explain the price action. We always want to come back to one reason, but the reality is that there's a wide variety of market participants in crypto, and so I think that there's myriad factors at play simultaneously. You already touched on a few of those, but one of them

is the lingering inflation. Say, I want to channel my inner Katie Greifeld, Sure, because she lives bitcoin second by second. Yeah, and she basically points out no earnings, no cash flow, no underlying business for you to analyze. You actually just pointed out the opposite. Those are exactly the sort of criteria looking at when assessing bitcoins. Push higher. Sure, So I mean for a lot of people looking at this, I think they're seeing there's still some concerns about inflation.

So the idea of a scarce asset with a fixed supply has appeal. There's still some lingering banking concerns, even though the peak of the concerns have died down. But that increases demand for an asset that people can securely self custody as owners. Right. So those are two of maybe the four reasons I'd say that are driving bitcoin higher. Hey, Caro, In the technology sector, whether it's equities, whether it's crypto. If in doubt go back to inflation in the FED.

I mean that was always the argument. Was it an inflation hedge that didn't seem to bear out from the numbers when we saw inflation spencer. But we do see it more of a buffeted about by the Federal Reserve and risk tolerance. What about institutional players we're talking to Katie about that, are they starting to be tempted to

come end back in when we see a thirty thousand level. Absolutely, I think for the institutional players, I mean, listen, we run a venture capital fund that invest in early stage companies. A lot of our limited partners in our fund are large institutional allocators, endowments and pension funds in an increasing number of them own cryptodirectly, primarily bitcoin and or ether, but then they also want additional exposure via venture capital funds.

They're invested in the space, so there is absolutely an appetite from them, But overall, I would say that most of them allocated over the past couple of years and have not been adding more recently. Go to eighth for us, because we are looking towards what is the continuation of the upgrade to more of a proof of state concept. We're having the Shanghai upgrade tomorrow. In Layman's terms, what does that mean? Do you expect there to be more

volatility around the space. I don't expect a lot of volatility, but in Layman's terms, what's going on here is that the way that the Ethereum network is secured is by people providing or staking their capital their ether into the protocol itself. They're rewarded for doing so financially. And what happens tomorrow is people are now able to withdraw the

ether that they have stated. So this only started a little over a year ago when we had the merge, that of stake really came into into being, and now we're about to see is that people can withdraw the assets that they have staked. That said, from our conversations around the market, we're not seen a lot of demand for people to unstake their assets, so we mostly think

that this will be a non event tomorrow. Yes, when so many have been saying it feels as though the players who stake there, if they're long term committed to the space, but ed whether or not vench capital remains long term committed to the space amid some of the debacles of last year. That's still the key question, particularly as they know much more nervous to write checks. Yeah,

and that's where I would go to Spencer next. Because we've been distracted by artificial intelligence, we've looked at volatility. I mean, as an asset class, bitcoin still carries a lot of volatility. Spenser. The root of my question is have any of the sort of psychological drivers in this market change so far in twenty twenty three when you think about the SVB fallout, or has the cryptoc community

kind of just got on with it. Mostly people have just gotten on with it, right, I mean, there are some new headwinds I think from FTX collapse that are presenting regulatory headwinds, but overall, the industry is just pushing forward. It is much more organized than it has been historically, at least in terms of tackling some of these regulatory

and political issues. So overall, what we're seeing is for venture capital firms, they're following the talent and they're watching there continues to be a flow of high quality talent into cryptocompanies and crypto markets. Spencie, you just mentioned that though that got on with it amid the collapse of signature of Silva Silva Gate. I'm interested in the banking rails though, and how much that has impacted liquidity. It's

certainly been an impact. I mean, several of the largest banks that were servicing crypto companies provided critical infrastructure for all of those companies to be able to exchange capital on a twenty four seven basis. That's particularly important for crypto markets that operate twenty four seven three sixty five. Now some of those banks have been put out of business, and there is an open opportunity for someone to recreate

the infrastruct the previously existed. All Right, Spencer Boga blockchain capital with bitcoin and around thirty thousand, two hundred and fifty nine dollars per token. The US is facing tough questions from allies after a trove of classified documents were leaked online to the global public. Former US National security advisor that's John Bolton spoke about the league earlier on

Bags of Valence Taken Listen. I would also caution at this point that we not draw too many conclusions that this could be an influence operation by somebody we don't know who And once you get into the world of counter intelligence, it makes being in a whole mirrors look easy. It's very complicated. Let's try and break down some of the complexities with our own. Nick Wadhams, he's Bloomberg News National Security editor, just how big a trove of information

is this ening? Well, it's pretty darn and it really confirms in a lot of ways what we had known and what US officials had been telling us publicly about what their really biggest fears are. And the big one there is Ukraine and specifically the possibility that Ukraine will run out of ammunition in the fight against Russia, both

artillery shells but also air defenses. So it seems to be we're really peeling back the veneer a bit and getting into the real nitty gritty of just how worried US officials are about how Ukraine's going to be able to defend itself against Russia. Nick, when we look over history at leaks of this kind, the questions quickly become where the documents originated from and they're authenticity? Right? What

have officials I'd said on that? Well, this is really the big question that we're all trying to figure out, So how authentic are they and in what ways were these documents potentially manipulated. You had John Bolton on saying, you know, this could have been a counter intelligence operation itself, and you know, so there is a big question about how authentic these documents are and what the reason was

for their leak. So if this is someone on the inside saying this has to get out to expose what's really going on behind the scenes, well that's one thing, sort of an Edward Snowden Chelsea Manning type of situation. Or if this is Russia that got those documents and then manipulated some of the numbers in there to create a false impression, you know, I mean this is again

that hall of mirrors at John Bolton referenced Nick. So, actually, when we're sitting here as technology consumers of information, is this a cyber threatened hack or actually is when will we understand whether this is something that the US could have protected. Well, it's a great question because it's it's going to again run us up against what US officials tell us and what the truth may actually be. So we know there is an investigation going on right now.

The big question will be Okay, it was this a leak? Was this some on the inside who got this? Else? Was this a hack? Was this some sort of counterintelligence operation? There's so much we don't know, and so much likely they're not going to tell us because to tell us what exactly happened here is in turn going to expose US sources and methods. So we're still trying to sift

through all of that stuff. My suspicion is, given the gravity of this and what US officials have been willing to say about how grave this leak is, that it was in fact a leak or a hack and not some sort of influence operation. All right, our thanks to Bloomberg Nick quadens out of DC on Bloomberg Technology here now Over in the UK, m I five, which is Britain's domestic intelligence service, is appointing its first female head

of its cyber spying agency GCHQ. Ankist Butler, the current Deputy Director General, will take up her new posts in May. The change in leadership comes at a pretty sensitive time is the US and its allies, as we've just discussed, continue to deal with the fallout of the series of intelligence leaks have emerged online in recent days. She will replace the outgoing director Sir Jeremy Fleming, who's held that

position for the last six years. Caroline, stick with Cybersecurity for a moment, because we're going to look at shares of Acami right now after being upgraded by Papisanla to overweight,

managing to tick up two and a half percent. The analyst sighting and recent Paul black and shares the offering an opportunity to get into the stock as the company is likely to refocus its profit strategy and speaking to some analyst calls, look at NASDAK the company Nazdac Inc. The shares of you know, the stock exchange operator is downgraded to equal weight from overweight over Morgan Stanley. The analyst sees risks to growth for the outlook of Nasdac Solutions.

It's the business that makes up actually seventy percent of the company's revenue. Nevertheless, trading flat on the day coming up, and we'll wonder how banks stack up when it comes to well how they use artificial intelligence. We'll speak with Evidence CEO about all the firm's recent report analyzing AI in financial services. Even got a shout out from the one I know need, Jamie Diamond it's bring back. This

is a incredibly disruptive new technology. I think we're seeing opportunity and potential platform shift that we haven't seen in a long time. Regulation can put us where we need to be if we have the strength to put it in place. I do think it's just impossible to regulate. All the leading AI lebs know they're creating something dangerous, but none of them really want to stop it. The way that Chinese companies go about the AI space is different.

They just don't have the same approach toward the morality around these technologies that we do in the US. The impact on jobs is real, but it doesn't have a super intelligence that will have mine of its own. It's on all of us and particularly investors to think about the questions and the potential falls, you know, as well as of the opportunity and value it creates. The debates are still clear our previous guests. They're weighing in on what are the risks, what are the opportunities that come

when using particularly generative AI in various sectors? How will AI we shape the competitive landscape? In particular? Go focus in on banking right now is to help answer that question. Alexandra musa is Ada. She is a CEO and co founder of Evidence, which tracks AI integration in financial services. Alexandra, you've got a bit of a shout out and JP Morgan's annual letter Jamie Diamonds in particular, what is it that you're doing? How are you measuring what AI is

being adopted by banks? So we are published about eight weeks ago the first public benchmark on AI adoption for banks and what we do it has not been done before in terms of taking outside in view by holding a mirror up to the banks and looking at the

AI capabilities. So what we do is that we go and we measure the banks on the strength of their AI ecosystem and then we rank them according to the scores that they get against their strengths of this ecosystem, which we break down into four areas talent, innovation, leadership, and responsible AI. Okay, so talent bringing on the right people the right parts of the banks you need to build up. What about responsible AI? What are banks doing

about that at the moment? Yeah, it is, I mean on the on the talent and the leadership and innovation side, that's sort of really in the engine room. You know, have you got the right talent AI? You know dev ops and mL ops, and you look at implementation talent and so on and on. The innovation is whether you're sort of following a build or buy approach, whether you're looking at research and patents or what sort of partnerships

you have, also what you're investing in or acquiring. But on the doing all that is great way looking at the raw horsepower, but doing it in a responsible manner is really critical, and especially now given the release of chat GPT and a lot of banks and a lot of other sectors too, but banks looking at how to incorporate large language models. The responsible aid is really important in terms of making sure that your clients customers are comfortable with the handling of all of this data and

with the use of AI tools on that data. And it's really important to show that you're following frameworks of responsible and ethical AI as you use it. Yeah, alexandre I appreciate the depth of the methodology. You know. In recent weeks, Caroline and I have name checked a number of banking ceo is. Brian moynihan first week of March was talking about how they're dabbling. There's work to do when it comes to modernizing banking technology with regards to AI. So,

who are the winners and losers on your index? Who's scores highly, who scores poorly? Yeah, well we have as you know, we have JP Morgan top the index, came out number one in the index. Interestingly, a raw bank of Canada came second, a smaller bank, but predominantly we're seeing the North American banks in the top ten, with the European banks lagging somewhat and the UK banks lagging the European banks. That brings me my next question, which is we learned in the aftermath of Silicon Valley Bank

or relearned how global the banking industry is. How close is the coordination that you see between different geographies and regions in the banking system on how to implement AI across borders. Well, there's there's no real coordination between the banks across. The way that implementation is happening in the European banks is quite different from the way that is

being done in the northern North American banks. The North American banks take an approach much more looking at how big tech is organized, so having R and D centers and being much using AI across the banks, whereas the European banks take more of an engineering approach where they're going in silos and implementing AIM more in a siloed approach.

So you do see differences in the approaches that the banks are taking whether you be in Europe or North America and Amaxandra, does any of that come down to how governments or cross institutional viewpoints are of how to regulate how to ethically build AI, because many would say, actually, when you think of the regulation being developed around it, actually Asia or indeed Europe really leaves the pack in

this way. Yes, I mean the interesting aspect here is actually that the North American Canadian banks were very visible around the guard rails that they're putting in place. And now we have to remember that banks are heavily regulated to begin with, so a lot of this is happening internally. What we're capturing is what is expressed externally in terms of you know, principles around explainability responsible AI in general and the people they're putting in place and the lines

of defense across the banks that they're visible about. In Europe, you've got GDPR regulation right, and so there's a different that sits slightly differently in the banks, and they're expressing the guard rails that they're putting around it in slightly different ways. But you could say that there are advanced thinking at the European level with the AI Act in motion right now, but because of the GDPR regulation in place, there is there's a lot of thinking that has been

done in the European banking system. Great house and time with you. We thank you, Alexandra, Thank you a CEO and co founder of Evidence. Welcome actively Meg Technology. I'm Karain Hide in New York, loved in San Francisco. It's just quickly checking on these markets because we had seen broadly technology stocks in the US under pressure. We still remain as that one hundred of the big benchmark that remembers up about ninety percent so far this year, down

half percent six out of seven days trading. That is on the lower side the Fang index. This is about big tech getting sold off today, the Microsoft, the alphabets we see across the board just under pressures. Who worry about that CPI, that inflation print tomorrow? Bitcoin though, shogging off any of the risk asset concerns. Another three percent as we hit some key technical levels thirty thousand swift shot on let's go micro for a moment, individual movers.

Microsoft getting a bit of a analyst concern coming from UBS saying that maybe Azure is going to be more under pressure amid these economic headwinds that we see. And actually you see a lot of these cloud companies on the downside today, Snowflake and Data Dog Ali Baba off by one point four percent. Keep a close eye eye on Barba because plenty of news to come out overnight in terms of its own AI cheap Jack GBT like service being integrated across this products. We're more on that

in a moment. Virgin Orbit. Look, I mean at Penny stock now thirty one percent lower as it filed for bankruptcy and the NASDAK says, look, they're going to have to delist this stockhead Yeah, big driver in that market being AI as well, and the race in AI continues

to heat up. Alphabet doubling down on its own generative AI ambitions, but this time by investing in the startup World Capital g which is Alphabet's venture ARM announced a one hundred million dollar funding round that it led into B to B research platform Alpha Sense that brings Alpha Senses valuation to one point eight billion dollars in the company's CEO co founder Jack Coco joins us. Now, Jack, this is interesting. It's an extension of around you did

last summer. Why why did you need these additional funds? Well, great question and thanks for having me. We weren't actually looking for financing, but we had been talking to Capitology for sir role URIs would certainly viewed them as an amazing potential investor for us, and we just had a catch up conversation a few months ago and that led to a quick meeting of the minds. And while we didn't need the capital, we were looking for the capital. It was such an opportunity we didn't want to pass

it up. Caroline, I find this incredibly interesting in this environment, essentially a flat round interesting some of the other investors, including Goldman Sexes asset management unit. Yeah, and I think a lot of this comes around a market that is deeply energized by all things AI, generative AI, in particular, what is Alpha cens actually doing? What are you currently providing? So our platform is really a market intelligence and search

by a form for enterprise customers. It's basically helping this big company's financial firms and corporations find the right data points and insights to make the big decisions that really matter in the businesses. When if you think about it, for every company that enter enterprise value is a cumulative sumwhere the decisions that they make, and we help them make every one of those better by having the right access to data points and insights so they can make

a little bit better decisions more quickly and confidently. And this was just really hard to do before people were control f searching and still are today out there in the market pdf documents or searching on the web for critical business insights that drive million dollars sometimes billion dollar decisions. So really, what we're bringing to them is thousands of high value sources in one place where you can search across them really powerfully and find the insights that you

can rely on. And you know, that's that's we've found to be really a solution that resonates in the market. More than half of the Fortune five hundred companies are today using this, so yeah, you know that's Google using it, Merkshell, Bank of America, raytheon. There is a lot of debate though when you're thinking about the data trove that you're using to bring this sort of analysis and to speed up hip one's productivity. Is how reliable can the data

be and how is it ethically being used? How much are you feeding into that sort of conversation right now, there's a really really important conversation. It's um. You know, in our case, we've always built our platform in a way that the we're sourcing information from really truly high value content from equity research companies, own disclosures, news media and expert interviews of people in the trenches in business, sharing insights with investment analysts on costs that we transcribe.

So it's it's really higher value business information. So grounding the information that our search engine finds in those high value sources is really important, and then we're able to deliver really the the value back to the content providers. When somebody's content is being used more, they also get paid more as a content provider. So it's really important debate around whether that's happening appropriately with large language models.

As we add language model capabilities on top off this high valul content, we kind of built a system in a way that content owner is actually good paid as they should, and it really feels that this debate will run and run. But I like the way in which we're starting to really try and see the application. We keep questioning what layer of AI is going to be the most valuable? Is it or the infrastructure that sort of Jack is building. Is it The companies that own

some of the data troths as well. And as Jack would point out, you know, the inputs for the large language model, the data set you're relying on is important. It leads me to Alphabet. Jack and Google. You know, Capital G would kind of point out they run independently as the growth venture arm. But I wonder how close this does bring you to Alphabet into Google, What partnerships you can explore, what advantage from access to data that

might give you as you work on your own product. Well, certainly a big part of the motivation of partnering with Capital G is the opportunity partner with the broader Alphabet umbrella. They have a really large portion of the world's AI scientists and developers working for the business, and this certainly does give us opportunities to partner with them, have conversations with them, and also have conversations with people where we

can just advance our business and go to market. So that was certainly a big part of the motivation of inviting them in as an investor. At a moment where we were looking for the capital, Jack, many might then think, oh, there might be a quite useful owner. What is your view, your direction to travel for the business? You want to

remain independent on IPO. We really see this as a huge market opportunity and we're building this with the timescale of the next ten years, twenty years and to gain the resources to really build the kind of company that we're building. We see IPO as an inevitable step along the way. So that's the path that we're on. I'm sure the hundred million satisfies you for the time may make Jack's great to have some time with you, Jack coco In, CEO of Alpha sense there and you've got

some more techniws. Yeah, time now for talking tech. Billionaire twins Tyler and Camera winkle Voss made a one hundred million dollar loan to support their crypto exchange Gemini. This comes after Gemini had sought funding from outside investors in recent months but didn't come to any agreement that According to sources, Elizabeth Holmes has to report to prison as scheduled later this month after a judge rejected her request to remain free on bail as she appeals a fraud conviction.

And finally, Twitter has stopped being an independent company after merging with the newly formed shell firm called X Corp. It's unclear what the change means for Twitter, though Elon Musk has in the past suggested that Twitter could lead to X, which he dubbed as an everything app. Caroline, let's ta Coelo, Well, let's stick on things he owns, because for a moment, we also want to think about

where he's taking his other company, Tesla. In fact, we saw shares of Tesla sort of in an interesting move today. We're up about a percentage point coming off of those highs and new proposal. We understand. Federal class action sued against the company says Tesla employees viewed and shared videos and images of car owners in violation with its privacy promises and of California state laws and the state constitution.

Tesla has not responded immediately to request the comment. But we are coming off of those highs that we've got a little bit earlier coming up let's talk about investing even more in cybersecurity. What a hot topic on the day, and what kind of new risks are there to be considered at the moment, particularly with the raise and rise and rise of AI. More on that with Ballistic Ventures,

Go mac Meftter, that's next. This is blue. Let's continued to talk about cybersecurity, the space of course booming the last few years. Just think about the focus that we had during the pandemic. Just think about today's newsflow as we worry that maybe the lead documents that pose a serious national security threat to the United States according to the Pentagon, is that in some way related to a hack or cyber attack. Let's talk about way you can invest as well. Is it the right time to be

investing in all these sorts of companies. So we can turn to our next m a guest who perhaps has a bit of skin in the game. Palmac Mefter is with us insight on today's VC spotlight. He's co founder general partner of at Ballistic Ventures. And but Mac, you have a life dedication to cyber in particular working over an eight and T for years. What now you're seeing in smaller companies areas that you can invest in making sure that the cyber threats can be defeated. Yeah, thank

you very much for having you guys. By the way, let's see, one of the great things about cybersecurity that we've enjoyed is it's very resilient to economic upturns and down turns. So, in fact, if you take a look at couple of the CIOs surveys that have come up, cybers one of the areas that is actually increasing in span during economic downturns because everybody's worried about risk. That's kind of one thread which is which always makes cyber

very very exciting as an investment vehicle. The other thread is these threats are ever evolving, so the adversaries don't sit still. They're constantly inventing new threat vectors and as a result, some of the old security controls have to be reinvented on a constant basis. And of course with the emerging new threats, there has to be new innovative companies that are going to emerge to counteract those threats. So, as a result, from a startup perspective, invention perspective is

a very interesting area to invest in. I would argue with the current economic downturn. If you look at some of the public equities today as well, and if you took a look at some of the multiples of revenues multiples of EVA, it'll make cyber very very exciting to invest in. So you know, we like the sector quite a bit. Of course, while MAC we're interested in where

the dulta is in the energy is coming from. When I was at CS in January, which seems like a lifetime ago now, Jen easily the directory of its CISA basically made an appeal to Corporate America saying, do more invest earlier in cybersecurity into great cybersecurity tools. At the moment you design a new product or piece of software, is that where the energy is coming from in the form of your LPs. I'm just curious who's backing you

to make these investments. Yeah, absolutely so. I think one of the things Jen pointed out your pointing out, which is probably the most important thing in cybers cyber has always been thought of as an afterthought. If you take a look at the applications, for instance, applications are developed without security in mind during the software development life cycle. And we're seeing a shift happening, especially with the last

ten to fifteen years. There's an area course shift left you probably have heard, which is equipping software developers so they can build security into the fabric of the application during the assembly process of the application. It's one of the only areas that you can build a critical asset and think of security as an afterthought. It's incredibly inefficient. So to Jen's point, you know, software security, especially insecuting channel, has to be thought of during the assembly process of

any artifact. It's certainly one theme or one area that we see, there are many other themes that we're investing in. When we look at our LP base, they kind of share the same excitement and enthusiasm. You know, they've used cybers very resilient to economic upturns and downturns. We're focused in the early stages of investing, and I would argue during economic downturn is a really good time to create companies and hope you can catch the upturns cycle when

when the equity capital markets come back. And so the LPs share that enthusiasm. They think the stage of our investing is pretty exciting, right, It's pretty exciting. That's hey, by mac, we're looking at your portfolio companies here. Concentrics one name that jumps out. How is artificial intelligence impacting how you invest? Yeah, definitely. So I would argue a couple of areas. One, AI has made the business of threat detection incident response a lot more automated. In the

case of Concentric, they focus on data security. So what they go after is they look at unstructured data that passes through your organization, either through your Slack Channels office through sixty five confluent, and there's an inadvertent risk exposure of that unstructured data to the outside world. Without artificial intelligence, identifying that unstructured data and the risk exposure is almost impossible.

And so you can apply AI to areas of data accessing, governance, You can apply AI to automating threat detection, incident response and removing the scarce human capital resources that are available so they can focus on higher important things. Having said that, though you can't rely on AI to completely automate your business, there's a lot of business context that into understanding, whether your financial services company or an insurance company or healthcare company.

So it can take you eighty percent or eighty five percent there the last ten to fifteen percent it still requires some human touch to sort of apply the business context to what you're trying to go after. You mentioned varied industries that deploy cyber needs. What about the company's building all of this by mac? Are you investing primarily in American built companies? Is this truly gloiville? You know, from a cyber perspective, I still argue the epicenter for

a lot of innovations here in America. I would say Israel has has sort of come up over the last five to seven years, is a new epicenter where it's a lot of innovation that comes out of Israel, partly out of Unit eighty two hundred, which is part of the IDF. And so the vast majority you see between those two areas, Amida and EU specifically is obviously coming

together in the last three to five years. My previous company, Alien Bolt, was a company that was started out of Space Spain and had moved their headquarters to the US. So but I would say in America and Israel are kind of the two main epi centers. All right, Barmacmefter, co founder, general partner of Ballistic Ventures. Thank you. You take two themes. Caroline Cybersecurity and then you match it with the other big theme, AI. So let's stick with AI.

In China, the government plans to require a security review of chat GPT like bots, providers of the generative artificial intelligence services must ensure content is accurate and neither discriminates nor in dangerous security. Chinese companies, from Ali Barber to Sense Time to Buy do all want to build the definitive next gen AI platform gaming bench capital funding has returned to pre twenty twenty one level. So that's according to Convoy Ventures latest gaming report for the first quarter

of this year, out today. Co founder and managing partner Jason Chapman with us to go over the numbers. It's interesting, we're kind of back to this pre twenty twenty one level. But if you look at the court, are just gone a horse roun court to bump in in venture dollars deployed, but nothing like the court is that we did see in twenty twenty one. What's the main driver right now for backing startups in this industry? Yeah, I think I think generally and thick you for having me is largely

the player data. You know, we look and see that thirty point two billion people across the world continue to play video games. That's nearly forty percent of the global population. And this quarter we saw about seven hundred and sixty one million dollars invested into gaming deals across venture that

is up twenty nine percent. And so I think generally you see investors walk to areas that proved to be resilient during economic difficulties, which gaming has proven during the last two recessions to do so, and during this current phase we expect it will do the same. You, of course, often invest in the infrastructure around gaming. What about the building, the making of gaming and games themselves and how they're being offered because a lot of them are more streaming services. Now, yeah,

so I mean there's a lot there. I mean actually talking about streaming. It's it's ironic given that Google Stadia just closed officially this this actually this quarter in January. You know, we are very excited to back the infrastructure of how you deliver games, how you distribute games, how

you advertise games. Building a game is extremely expensive, you know, looking at Triple A content, it often is north of eighty million dollars to actually produce, and so for us, we think the upside is definitely in the content in the technologies versus the content interesting. So, given Stadia you just mentioned it, do we think there's less desire by some very well capitalized, big tech public companies to invest

in content at this moment. We're seeing a lot of content funding today, a lot of excitement around content because you know, as as we are seeing Hogwarts legacy has has caught the world by storm, and hopefully you have some players. They're actually at Bloomberg. You know, with content, it's incredibly scalable and it can be delivered at ease to the massive And something that is very lurrying about this is that if you find a hit, you find

a huge hit. For us, we are much more comfortable as a firm backing the things that make delivery content possible. So we're betting on a category versus one piece of content. We think it's a more prudent way to approach approach the industry. You're a completely set to focus VC fund. There is a big player in this industry right now, which is Saudi Arabia. You look at the savvy scope lea deal as one example, but also the fund, the war chest they've amassed. What's your take on Saudi coming

in to sort of dominate this sector. Yeah, so you know, the thirty eight billion dollars that have been earmarked for gaming is a significant move. So historically speaking, they have not been very active entertainment, but the government of Saudi Arabia is determined that gaming will be a pillar of entertainment for them going forward. And the acquisition of Scopelely at four point nine billion dollar acquisitions a huge win to for the Scope Lee end Savvy team, So the

whole Convoy team is extremely excited about this partnership. The Savvy group with that acquisition have brought in one hundred million monthly actives across their platform, which is a massive deal in the gaming industry and a massive deal for the Savvy platform. Hey, Jason, real quick, twenty twenty two is all about online a multiplayer. What's twenty twenty three you're going to be about? Twenty twenty three is going to be your user generated content and the wars between

Roadblocks and Fortnite. Looking at the Creator platform just launched and announced by Tim Sweeney a couple of weeks ago, You're going to see a lot of creators be lured to that platform from roadblocks as well as others, and so we're very keen to watch this and it's a trend that Convoy is paying a lot of attention to and also to point a lot of money towards thanks to bringing your trends as you see them. Convoy Ventures co founder managing partner Jason Chapman, Well, that does it

for this edition. And Bloombag Technology, Yeah, real emphasis on cybersecurity and AI in the market right now. Recap with the podcast. You can find it on the terminal, on Apple, Spotify, Hut, wherever you get your podcast. Caroline, I think I think about these markets as well. We're bracin for Wednesday, We're bracin for data and in the technology sector, we're always looking at the FED from SF in New York. This is Bloomberg