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This is Bloomberg Technology with Caroline Hyde and Ed.
Loved Love.
Live from New York and San Francisco. This is Bloomberg Technology coming up full coverage of the massive IT failure that is grounded flights and upended businesses and markets.
And Netflix gets its mojo back strong, so subscriber growth extends its lead on streaming rivals.
And in an exclusive interview, Mark Zuckerberg calls Trump a badass without endorsing him for president. More on politics and take ahead, but first the market ramifications of the eight issues that have hit across from Asia to Europe to the US. And it was during European and Asian training that we hit the hardest. I'm looking the NASDAK futures therefore ed because actually we're only trading off by about three tens percent on the major benchmarks, but we did
hit our loads at about four five am. That was when we really started to worry about the global ramifications of one key company ed that you're watching.
Yeah, and it's CrowdStrike, and CrowdStrike is down big a market leader in endpoint ransomware security, put out a faulty patch or update and that impacted Windows hosts around the world, didn't impact mac os, didn't impact Linux if you're in that camp. But separately, coincidentally, there was also a Microsoft asu're outage, both of those contributing to the downside in Microsoft stock.
We have a number of updates.
There have been fixes issued, but so many of you have reached out to Karen I on social media to say, yeah, turning the computer on and off fifteen times seems to have worked.
Blue Screen of death as it was no throughout any airport that you're unfortunately stuck at.
But we want to take a closer look.
At what is seemingly a botch CrowdStrike update that has caused this massive IT outage, as Ed says, disrupting Microsoft Global airlines, banks, healthcare systems were hit hard by what is said to be one of the few outages of this scale.
It's global in nature.
Who do we bring on our own Tom Giles for the team leading perspective here. I mean, we had a very busy set of teams across Asia and Europe today.
It's great to be here.
Thanks for having me. Yeah, massive outage, unprecedented in its scale in many many ways. As ed so succinctly summarized, there was this upgrade to CrowdStrike software. This is a cybersecurity team that many companies around the world, many businesses, many government agencies rely upon to monitor their systems and keep the intrusions out. There was an upgrade and it affected our Windows systems around the world and chaos has ensued.
Okay, so Windows is the operating system design and operated by Microsoft. Separately, there was a Microsoft Azure or cloud outage, which is confused things. This is the latest from Microsoft three sixty five, basically saying that they that it appears Microsoft three sixty apps normal services have recovered again, there.
Is ongoing issues.
I mean, all you have to do tomm is go on social media and see the images of the dreaded blue screen that Caroline brought up. What also is interesting is is how widespread industries were hit. Airlines, banks, what's our coverage telling us about that?
The global nature of the disruption.
Banks ups so deliveries are disrupted, flights around the world. What this shows is the fragility of our global systems that are so reliant upon single vendors and one particular patch can just go consent things awry. And when you combine that with the ubiquity of Windows machines, they run something to the tune of seventy percent of the of
the computers around the world. And then you, on top of that add Azure, this cloud computing system that many companies, many businesses around the world rely upon for their cloud systems. This really put together a toxic cocktail of it. Of it outages everywhere, and it just shows how vulnerable our systems are to these single vendors.
Both Tom Giles, senior executive editor leading our global coverage of technology. Later in the show, I promise we're actually going to get a little deeper on what endpoint security is. We have a brilliant technical guest, but the market reaction, let's talk about that and bring in Jordan Klein tech media and telecom analysts and Mizuo desk analysts, and my goodness, your phone must have been ringing off the hook this morning.
What have investors basically been telling you about their concern or lack of concern?
Oh good, good afternoon, Ed, Thanks for having me. I think clearly people are reacting this way because CrowdStrike is probably one of the most owned and liked companies in the software sector. It's up one of you know, almost thirty five forty percent this year. There's very few companies in software that are up that much. And when you have one of these events, which thankfully wasn't a hack, it was an outage, and there's a huge difference, you know, reputationally for the company.
But when you have.
Two weeks left in your quarter, they're a July ending second quarter, it makes people extra nervous that any disruption or problems closing business with new customers to make their estimates.
Or their guidance could be at risk.
And right now we're in a position where investors are looking for reason to sell tech and rotate into other lagging areas, and I think they're kind of using this to take risk off and you know, not worry whether this impacts their quarter.
Jordan, I don't know how well us you are in the market for endpoint security, but the IDC data shows that CrowdStrike has about a fifth of the market. Ironically, the number two in that market in terms of individual players is Microsoft.
Both of them under pressure. How do you play that well?
I think there's it's a good question. I don't really think that you play that in the view that one is going to lose a bunch of share or they both will. Because it's a outage and it's not a hack, that to me suggests you're not going to see a bunch of customers moving off of CrowdStrike or even Microsoft. Some people are, you know, bidding up shares of Sentinel One. That's a stock that competes at endpoint with CrowdStrike, but I don't even know where they rank in the top
you know market share listings. Palo Alto is another, you know, big competitor. They don't necessarily do all endpoint, but they do firewalls and security, and that stock is gaining because people, I guess, assume they'll benefit. So at the end of the day, we'll have to wait and see what the implications or ramifications are. But I would advise investors don't make any quick, snap, knee jerk reactions in terms of buying or selling.
And I'm more of a net buyer on.
This weakness, and as it relates to CrowdStrike, I think they'll come through fine in a couple of weeks. People won't even be talking about this.
This is a big market cap impact.
Jordan.
What's interesting in your note is you bring up, look, are they on the hook financially in any way?
How will we understand that.
From CrowdStrike as to whether or not their own clients either put off renewing or say, look, I've lost a lot of business here, where's the money.
Yeah, that's a great question. I've talked to some people. We put out a quick research update from Mizuho Research Analysts. What I think is going to happen is you're not going to hear anything until they report their quarter, and that won't come until the quarter closes after the end of July, so it could be as much as a month until you don't really get an official update as to what they're liable for. If anything, we do not think their contracts are written such that they'll have to
basically pay these companies for lost business or revenue. But what's probably going to happen is to appease companies that were disrupted, they will give credits, meaning they will say you're under contract and you owe us money, but we will give you a credit for business that you owe us under the contract. So it's basically a discount. How much we don't know, But as soon as they can quantify that, I think the markets.
Will like the clarity and they'll be more.
Positively disposed once they can quantify what the impact will be. Wouldn't imagine it's going to be any massive amount.
And to that point, when you've got a six billion dollar move on a market cap, maybe it's not as big as six billion. Maybe you can buy into some of this weakness Jordan that you're speaking of. How many people do you think, though, in this current environment of jitteriness, are willing to go long into a weekend such as this.
We're going to find out as the market, you know, we go into the afternoon and we see how this stock trades, I would say, initially, you know, it's eleven o'clock Eastern, I'm pretty encouraged by the way the stock's acting, given it's well off the lows.
If this was something.
Where people were in an absolute panic and in the market was melting down, I think it would be at the lows, and it's not, so I wouldn't be surprised if it continues to grind a bit higher. But I do think again, the sentiment and tech broadly is people are nervous, the sector is not acting well. It's it's particularly you know, nerve racking for those as we wait for earnings, and I kind of feel like most investors
are going to take a wait and see. You know, our volumes on our trading desk don't suggest panic selling, but it doesn't suggest you're seeing waves of buyers coming in after a few days of weakness either.
Jordan Klein, perfect voice for today. We thank you tech media and telecom analyst at Mizuho.
Appreciate the time.
Now let's just talk about Meta CEO and founder Mark Zuckerberg wing in on the current election landscape in an interview with Bluembgo Original's host Emily Chang for an episode of the Circuit Just take a listen.
The main thing that I hear from people is that they actually want to see less political content on our services because they come to our services to connect with people. So you know, that's what we're going to do where we give people control over this, but we're generally trying to recommend less political content. So I think you're going to see our services play less of a role in this election than they have in the past.
What's the full use of interview with Meta CEO Mark Zuckerberg on the circuit with Emily Chang.
It's July twenty third, six thirty.
Pm in New York on Bloomberg Television or stream it eight thirty pm ET on Bloomberg Originals.
In terms of that member growth insurre, I'd say that the kind of outside paid outsized paidin and ads in the quarter was primarily driven by a stronger acquisition, a little stronger than we expected, but also very healthy, continued healthy retention in the quarter. And that's across all regions.
That was the Netflix CFO.
They're talking about the company's member or subscriber growth for retention earning showed strong subscriber editions in the second quarter. I want to bring a Needham senior Entertainment Internet analyst, Laura Martin. It's a situation where after hours stock go down, market open stock go up. Good subscriber numbers. Concerning guidance, which is more important for you, Laura.
I think the subscriber number is in focus in both periods, so they over delivered. They added eight million subscribers that was about twice the consensus. But then they had a very anemic subscriber growth number for the third quarter, and they talked about a tougher second half. So the answer is subscribers matter a lot, but not that subscribers like overall. And also the location of the subscribers is sort of suboptimal.
They're adding subscribers in the lowest RPOO or what they call arm average revenue per user, and so that's actually Wall Street doesn't like that either. And the biggest, biggest problem is they're going to stop giving us subscriber guidance and actually our POO guidance in the first quarter of next year, and they just want to talk about revenue. And that's a really big problem because it's going to add volatility to the stock.
Where the subscribers are I find so interesting as well. So they talked about strength in Asia Pacific and then in terms of context of the guidance, like currency impacts, particularly in Argentina. If you're covering this stock, where do you want to see subscribe a growth sixteen.
Dollars artpoo's in America? You want to see them all there because it's like two p's they pay twice as much in America compared to latam or apath.
Okay, see you one more expensive money being taken in from the more expensive clientele. But ultimately they're going to get out of the Monaaura. We saturated. We're still trying to descend which streaming service I want to be using and which one should be merging.
Yep.
Well, and I really like their going. I think the reason their churn is falling, like in America they're saturated, as you say, is live. I think when they do these live fights and these live roasts and these like exclusive live programming, it keeps people paying for the next month because they really market these things, these exclusive live events. So I really like, like, I think their video game
and advertising is very troubled. Video games troubled, but I think live is a really interesting genre for Netflix to lower turn.
Okay, so they need to be investing basically because that takes a herculean effort from a technology perspective, right.
Yeah, And they're paying for like NFL games, so they're joining the arms race in really expensive live sports programming. So that isn't great for your content budget, you know.
Look ahead, Laura.
We could go on and on about this entire environment, and we didn't even get to some of the discussion around the M and A today as well. Ninham Senior Entertainment and Internet analyst Laura Martin always so spot on
when it comes to this market analysis. Meanwhile, and we just want to turn our attention to another earnings today when we would say at a large fintech American Express at the stock trading well, it's been a bumpy ride today, in fact, currently off by more than four percent as the company sees fiscal year earnings for share between thirteen thirty and thirteen eighty dollars, and it actually was looking pretty strong, but it's warning that it plans to increase
spending on marketing in the coming months. CEO sc Scurry telling me earlier today that they're really committed to marketing to tech investments, particularly in artificial intelligence at the moment that this is a company that has had record revenue overall, but the market's still questioning that's how they continue to be beefing up on the profitability side. Like many other American spects, has also been seeing an impact to the crowd strike outage, saying quote, we.
Had to slow down early on.
All airports were impacted, so our call logs were very high as people tried to change their flights, so CEO telling us that at the moment, though still pretty confident.
Ed what we got coming up.
Another big name in the world of software, Salesforce announced launch of the Einstein Service Agent, their first fully autonomous AI agent for customer support. Salesforce AI CEO Clarashi joining us next.
This is Bluembo Technology.
Okay, it's the growing field of AI.
Salesforce recently announcing the launch of their Einstein Service Agent. This is the company's first fully autonomous AI agent working to transform customer service jobs. That's bringing Clarashi, CEO of Salesforce AI for more. Clara, how can you quantify the difference of a normal, typical chatbot here?
How much better is this agent you're offering?
Thank you so much for having me. You know, we've all interacted with customer support chatbots and what they can do is pretty limited. It's it's always obvious that you're talking with a bot. Einstein Service Agent is our new
offering that completely redefines the self service experience. Really feels like you're chatting with a human expert who can answer complex questions and take complicated actions, you know, for example, looking up in order, reviewing a photo that you've chatted in of a damaged product, issuing a return shipping label, sending a replacement multi steps, all in a secure and trusted way. Because Einstein is grounded in your company's trusted data policies and procedures in your salesforce CRM.
There's a multi modal element to this. How much have you been building the large language models yourself depending on others? Where does ultimately this agent come from?
Well, we've been developing large language models since twenty eighteen. We acquired a company called metamind and our Salesforce research group. They are one of the most prolific publishers of Frontier Research. That being said, we believe in an open architecture because we want to give customers choice when it comes to AI models, and we've recently launched our CRM leaderboard. It's the first LM leaderboard specifically for sales, service, marketing and commerce.
And we found something amazing, which is first that small models, in some cases open source models actually outperform the biggest, most expensive models on the market when it comes to a lot of enterprise tasks. The second thing that we learned is that the leaderboard is constantly changing week over weekends. So we really feel as important to support an open, vibrant ecosystem of models.
It's Clark, good morning, It's Ed in Cisco.
Look at our lead story is the global outage CrowdStrike Microsoft. There's some three sixty five integration with different Salesforce platforms and offerings, and you know your role across AI but also cloud. What has the impact been on you and Salesforce and what's the response been.
Please, I have a number of friends who are stuck in the airport right now. You know, I think nearly every industry around the world has been affected. I'm Salesforce included by the crowd strike issue. Our engineers are working with the CD strike team around the clock to restore full access to our services.
And just finally on that topic, you know you've long been in technology. How does this event rank, you know, in sort of technological disruptional outages you've seen in your career.
You know, I think there's you know, that's inevitability when it comes to technology, and it really underscores the importance of working with trusted partners. I mean, trust is Salesforce's number one value, and we very much pride ourselves in our uptime partnering with many customers, specifically an AI you know, Triple A Air India Open Table. These are companies that really help run the world, and so we take that trust, security, reliability, and performance very seriously.
Power there's going to be quite a few friends of yours at airports and many others who are desperately trying to get hold of a real person right now on the phone rather than a chatbot, and I'm wondering how long that will be inevitable You in many ways do transfer conversations with this new AI agent to a human if perhaps just gets out of the capability of the agent.
How often is that likely to happen? Do you think?
Well, I think that it really depends on, you know, the nature of how much knowledge and trusted policies and procedures the companies have been documented inside of their organization, and if they don't have very much, we're going to help them with that AI generated AI drafted knowledge creation. But I think by and large we're going to see more and more, just like when you're talking to a chatbot or talking to chat GPT, sometimes it's hard to
tell that it's not a human. Now, the challenge is that without that contextual data and without those guardrails, these llms can just make things up, they can hallucinate. And so that's really where Salesforce is Einstein trust layer. That's the layer that every single AI interaction goes through before it gets presented to a customer. That's so important to make sure that it's trusted, reliable, and accurate.
Clara, our audience has kind of followed the rollout of what Einstein is doing and what Salesforce has done in the domain of sort of generative AI tool quite closely. You must benchmark against other similar platforms or products. What have you learned about a performance essentially against what else is out there?
Well, it's such a great question. It's something that we're constantly benchmarking. I mentioned our CRM Large Language Model leaderboard earlier and we found that there's really three critical ingredients to success when it comes to enterprise AI. First and foremost is trust. Making sure that you have data privacy, data security, ethical guardrails built in. Again, this is our Einstein trust layer. Everything from citations to audit trails, to observability,
monitoring and data masking. The second ingredient is having the right context. If you don't give the LLM enough context, it'll just make things up. Now you think about our customers. They've been putting their trusted data and their trusted business processes, policies and procedures into Salesforce for the last twenty five years.
And with the introduction of our data cloud product now where we have that trusted data across the entire enterprise of siloed systems, we're bringing that together and so that context is critical to accuracy, reliability, and really the usefulness of the AI. And then the third ingredient is empowerment and helping bring every employee at an organization along for this AI learning journey which is going to be which is never ending. And I'm really proud of the work
that we've done with Trailhead. We've open sourced all of the courses that we developed for our internal employees Clark Get Smart and AI.
Clara Shi, CEO Salesforce, say, I great to have you back on the show.
Thank you.
Coming up, we're going to get back to that massive IT outage around the world and disruption in all courts of industries with a key name and an expert.
Welcome back to Bluemore Technology. I'm Caroline Heid in New.
York and i med Love Low in San Francisco. It's Friday, but it's kind of red on the screen and a negative vibe actually declines on the NAS that one hundred of kind of accelerated in the last twenty minutes or so. The top story, you know what it is, the global IT outage. Many of you are either at home or in your office trying to deal with the dreaded blue screen. CrowdStrike is down eight and a half percent off session lows. Appoint that Jordan Robinson of Missouri made earlier jorhdan Klin
sorry of Missouri made earlier. Is that in terms of volumes trading, this doesn't suggest panic selling. There aren't buyers coming in either. Carow Microsoft Soft as six tens percent. Windows is a Microsoft product. But separately, separately from the outage, there was some issue in Azure, which they've also resolved, but the timing of which is kind of curious and kind of rule markets as well.
Let's dig into it.
Man keeps seeing perfect person to be with us Bloomberg Intelligence, and look, we were just having John kinem as you host saying, look, but perhaps buy into this weakness.
Rather than sell on cloud Strike. Where do you sit on it?
No, I'm in the camp where I think this is going to linger on for a while, especially because the recovery is not as easy as just rolling back the software. I mean, there are a number of clients who are at an older version of Windows where you can't just roll back the code like this, And that's the biggest risk with cloud software is it gets deployed overnight and it can have a far reaching impact. But in this case, as we can see, the recovery isn't you know, in
a minute or in an hour. So that's where this is going to linger on. And the fact that Microsoft is involved, you know, they are the two biggest rivals when it comes to endpoint security. So in this case, who takes the blame? I mean, I imagine there will be lawsuits, there will be customers asking for indemnification because of the lost business, and who pays who? I mean, I think Croudstrike will have to give a lot of discounts to their customers credits and that will have an
impact on the free cash flow. So I'm just not ready to write it off as an incident that happen and move on.
The IDC data.
I think puts CrowdStrike is holding about one fifth of the endpoint security market. I guess the question, the basic question is whether this hurts their bookings.
Right if there are customers or.
Would be customers that say, nah, I'm not going to go into CrowdStrike, what do you think, Mandy?
I mean, so, think of the endpoints security space. On the enterprise side, it's four companies that dominate, Croudstrike and Microsoft, and then you have Sentinel one and with Security, which Google is rumored to express interest. So clearly, you know you don't have a lot of choices to go to. But I do expect, you know, customers asking CrowdStrike more questions. And that also brings into a question, you know, the
concept around agentalists versus agent based security. I think there will be a growing preference towards agentalist securities where it doesn't change the underlying operating system behavior. So clearly a lot of architectural level questions surface because of this outage, But I still think it's going to hurt CrowdStrike in the near.
Term, Mandy saying of Bloomberg intelligence, busy morning for you. Thank you very much. Let's keep the conversation going. Let's get technical and let's get some expertise with Steve Grobman, executive vice president and chief Technology Officer at McAfee, and Steve bear with me, but just for our audience sake. CrowdStrike founded twenty twelve by alumni essentially of the current form of your business that has a complicated history of
its own. To start with, as anyone from CrowdStrike phoned you or ask you guys for help or advice on what's going on.
Yeah, you know, I know the CrowdStrike team, well, the cybersecurity industry is a close knit bunch.
They're running the response on this.
You know, we're really focused on making sure that our customers are well informed. You know, McAfee is now a pure play consumer company where we're protecting consumers and we're making sure that they understand that even though their devices are protected by McAfee, if they're using services from organizations or businesses that depend on CrowdStrike and we're impacted by this event, that they might see things like banks or transportation having degraded service.
And that's really where we're trying to play a role.
Here is to help our customers, our consumers, the industry navigate this.
Steve a few people in the technology industry with me an email that CrowdStrike Support sent them, and I'm summarizing or paraphrasing, but the email basically says, reboots up to fifteen times and that should do the trick.
What do you make of that?
You know, when there are issues, putting together procedures to get organizations back in business can can have many different forms.
I think one of the things that.
I caution is my understanding in this particular case. There are a wide range of situations that an organization might be in. With the wide range of recovery procedures the one that you're outlining it, It's certainly plausible that it's one of the scenarios. But what I would say is, you know, we as an industry will learn from this.
We always do.
If I reflect back to want to cry back in twenty seventeen, you know, coming out of that, we change the way that we secured our networks, change the way that we secured our environments, and we learned, you know, back into the nineties when we had some of the big worms, we learned, so it's going to happen again.
I'd really stress that cybersecurity defense is a very different industry than most other technology in that bad actors are innovating every single day, creating new attacks every single day, and making it such that in order to defend environments, whether it's McFee defending consumers or croudstrike defending enterprises, requires a very rapid deployment of new technology to stay one step ahead.
Of those bad actors.
So, you know, while we're going to absolutely learn from this, I do think it's important that part of it is due to the nature of the business.
So basically get used to it. Is kind of what you're telling us, Steve.
And I'm wondering whether this, as Clara Shi just told us, a sales will say this is inevitable.
How often is this going to happen to us?
Yeah, I don't know that I would say it's inevitable. I do think that there are some unique characteristics.
I'd put it this way.
If we're going to drive cars at seventy miles per hour on roads like we know that people are going to get injured, and that doesn't mean that we shouldn't focus on auto safety.
I think we're in the exact same world here.
There are technologies like AI that bad actors are using to create more and more lethal attacks, and the cyber defense industry is going to rapidly be releasing new capabilities to mitigate those.
Part of that means we're moving very quickly.
And we need to learn how to do that with the minimal risk possible of introducing technology defects that caused the issue that we saw like that that we saw today. But I'd be careful to predict that the is inevitable.
Okay, then how could we have done this differently?
What do you think will the learning's ultimately be about how with speed you can update and better security without taking down global industry.
So even if you're moving fast, doesn't mean that you need to do everything all at once. So you know, when organizations roll out protection doing it in a phased fashion. I know that that's generally the best known practice, but some of the underlying details of exactly how that's done, those are things that the industry is going to learn, polish,
you know, create some new procedures. I do think it's important that we don't overreact to this, where if we start putting too many controls on the ability to rapidly mitigate defenses and attacks, we could be in a month worse situation. So on a positive side, we understand this issue very well. We understand the guidance that organizations can have to get back in business, and we also understand
even some of the residual impacts. You know, one of the things that McFee is seeing is scammers are taking advantage of the news cycle to try to scam consumers. We're getting calls into our help center where we're getting reports that our customers are getting reports from people pretending to be their bank trying to trick them into giving
them a password or other sensitive data. So like it's even those angles that we need to educate the world that in a complex digital world, we really need to be on our guard across the spectrum of enterprise and consumer.
Steve great perspective, hands on approach. Steve Women, thank you, Executive vice president and chief Technology over at McAfee. I mean, while coming up, we're going to be joined by Lizzie Francis, partner at M thirteen for a discussion on ogygal intelligence impact on the future of streaming, on content creation, digging into that Netflix Soundhill a little bit more. This is Broomberg technology.
I think that AI is a great is going to generate a great set of creator tools, a great way for creators to tell better stories. And one thing that's sure, if you look back over one hundred years of entertainment, you can see how great technology and great entertainment work hand in hand to make to build great, big businesses.
Generator of AI with a Netflix co CEO Ted Surrundus, there is look he take gold and how it's changing.
Up the industry, the streaming industry. Lots to discuss there.
So let's bring in Lizzie Francis, partner at M thirteen for more. And Lizzie, I'm pretty sure you've been focused plenty on how content is being disrupted, the innovations and how does your portfolio companies reflect that.
Where do you think AI is going to make the biggest difference?
Oh, good morning, and thank you so much for having me on today.
Yeah, I'm thirteen.
We really think and see that this paradigm shift with AI is happening today, and it's happening quickly and with great speed. And so what we're seeing is that it's focused mostly on productivity and how we can actually see productivity improvements across all sectors. So we've taken an approach where we are investing in areas that are really changing
underlying infrastructure and phenomenal ways. We recently invested in a company called maven Agi, which is now servicing over ninety percent of inbound customer service for companies like trip Advisor and Row. And what's remarkable about this is it's not just the productivity, but as M thirteen thinks about the few sure of AI, it's really about this paradigm shift of customer personalization, really thinking about how we can think about creating a better customer experience time and time again.
So what you see with someone like maven Agi is that it really is not just about that passive customer service, which is remarkable in itself, it's also about creating these surprise and delight moments for customers. It's surprising them in places like banking with Hi, how can I help you today? Not just on losing your debit card, but do you need help finding alone right? Or is it how can
I schedule a new flight today? Given everything that's happening, as we're seeing so I think we're well start to see this shift in AI over the next ten years where it's not just about productivity, but again it is really about this deep focus on personalization and consumer experience.
So Lizzie M thirteen still has to make sort of discerning calculations on where to put money four hundred million dollar fund three.
You know that sizeable.
Is there a high volume opportunity or is it competitive like mechanically everything you've just told us, How do you put that into practice each day?
Yeah, it's a thoughtful point ed and I think because we're at this paradigm shift, one of the things we're most excited about is we've seen in other cycles is that there is quite a bet of venture dollars actually flowing into the ecosystem now to propel this kind of innovation.
So we're seeing that reflected.
And where venture dollars are actually being allocated. If you look holistically across the board, about fifty percent of VC dollars are going to AI and AI companies. And so when we think about where do we want to actually put our dollars when it comes to AI, we still think about sound business fundamentals, and so across the four areas that we invest in, health, money, finance, and consumer.
What really matters at the end of the day is that when it comes to a company that's either powered by AI or is AI native, there has to be those sound business fundamentals that really drive the business and create a compelling, venture backable business for us to be
excited about, and we're seeing them. I think you're right that it is a competitive market out there, but because we're seeing that people are able to innovate so quickly with AI and leverage this technology in exciting ways, we're actually seeing what we'd hoped AI would actually do at core, which is unlocked creativity, unlock innovation, and give entrepreneurs the power to actually build businesses that are exciting and transformative.
We actually have invested in on the healthcare side and a company called Carognostics, which is actually helping doctors and clinicians diagnose ahead of time previously undiagnosed chronic conditions in patients. Now you can see that doctors and clinicians can actually provide better patient care and think about the actual patient experience.
Lizzie Francis, partner at MTHTE. Thank you very much.
Now more of the conversation with Meta CEO Mark Zuckerberg on The Circuit with Emily Chang, where he commented on the twenty twenty four presidential election and the state of American politics. He even talked about the appeal of former President Trump, though does not endorse a candidate.
Listen to this.
I want to talk about the twenty twenty four presidential election.
Okay.
Facebook has been a flashpoint in many elections around the world, and you personally have been called out, most recently by former President Trump.
This is a big election. What do you think is at stake?
Well, I mean, look, it's obviously a very important and it'll be a historic election.
You know.
I feel like I'm best positioned maybe to talk about what our role will be in in and what we're.
Going to do.
And look, I mean the main thing that I hear.
From people is that they actually want to see less political content on our services because they come to our services to connect with people. So you know, that's what we're going to do, where we give people control over this, but we're generally trying to recommend less political content. So I think you're going to see our services play less of a role in this election than they have in the past. And personally, I'm also planning on playing a
not playing a significant role in the election. I've done some stuff personally in the past. I'm not planning on doing that this time. And that includes, you know, not endorsing either of the candidates. Now, there's obviously a lot
of crazy stuff going on in the world. I mean the historic events over the last like over the weekend, and I mean a personal note, it's yeah, I mean, seeing Donald Trump get get up after getting shot in the face and pump his fist in the air with the American flag is one of the most badass things I've ever seen in my life. But and I think look at some level as an American, it's like hard to not get kind of emotional about that spirit in that fight. And I think that that's why a lot
of people like the guy. But look, I mean, it's we're living in a pretty crazy time, and I view our role here is to make it so everyone can express their their views on this stuff, but we're going to try to manage it so that way the politics doesn't drown out the human connection and the community, which is I think the main thing that people come to our services for and you know, we're not always going to get that right, but that's what we're going to
try to do, and I think that that's probably the best role that we can play.
Met a CEO co founder Mark Zuckerberg along with our Bluemego originals Emily Chang. What's the exclusive interview on the circuit with Emini Chang on Tuesday, July twenty third at six thirty pm ET in New York on bluemeg Television or look, you can stream it to eighth thirty pm on Blue meg Originals. But someone else was in the
room listening. It was Kurt Wagner. We go to him for some more on the interview, and it felt as though there was a very clear signal that don't expect from Mark Zuckerberg at least any endorsement, even though we might hear it from others in Silicon Valley and beyond.
Yeah, I don't.
I don't think there's any upside to him endorsing someone at this point, right. I mean, it's it's sort of like that old Michael Jordan quote, you know, Republicans by sneakers too. It's like he's got a global platform, he's got you know, partners on both sides of the aisle.
He's got advertisers on both sides of the aisle, and I think or someone in his position, you know, there's just not really I think what we saw on that clip is about as close as he's going to come to, you know, saying something that sounds like an endorsement for either one of these guys.
Well, it's still fascinating. This is what Trump said on True Social in March. I know you're familiar with this, Kurt, but it was in the context of whether or not he would get rid of TikTok, Facebook and zucker Schmarck will double their business.
So Zuckbert said something nice about Trump.
I don't know that Trump shares the sentiment, but this is an issue in this cycle, TikTok, social media, big tech.
Yeah, absolutely, And I think there's some political savvy in what Mark Zuckerberg said yesterday, right, I mean, if the wins are indeed changing, obviously we talked about a lot over the last week plus that it feels like Donald Trump is really taking sort of this election lead here. You know, it's in Mark Zuckerberg's best interest to say something flattering or nice to the guy who may be president and who has threatened him in his company, right, And so I don't think that this was you know,
off the cuff comment. I'm sure this was somewhat calculated in that regard. And this is going to continue to be a contentious relationship. I don't think, you know, because Mark Zuckerberg said one nice thing about Trump, suddenly these two are going to be buddies. But you know, he's staring down the idea four more years of a Trump presidency, and so I think he's sort of, you know, starting to set a new maybe that we hadn't heard over the last couple of years.
Well, things can change.
As we discussed on the show this week, Kat, President Trump is now pretty close with mister Elon Musk. These people matter. They have influence in Silicon Valley globally they do.
I mean not only do they have the money, right, we talked about what Elon's doing in terms of his political donations and how impactful that can be, but they just have such a cultural influence over you know, they have fans, right, These are celebrity CEOs, and when they come out and say, you know, in Elon's case, I endorse Trump, I'm giving money to Trump. That has a ripple effect to a lot of people who admire and
respect what Elon says. And I think Mark Zuckerberg is the same way with a different audience.
Right, So these.
Guys have such influence. That's why we care about what they say when it comes to politics.
Bloomberg's Kurt Wagner in the room for a seriously important interview.
Character. Yeah, And meanwhile, that does it for this edition of BlueBag Technology.
What a week it has been ed.
Yeah, in a moment in tech history. Recap on the pod. You know where to find it. This is Bloomberg Technology.