From Marhart where Innovation, money and power Collie in Silicon Vallet NBN. This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.
Live from New York and San Francisco.
This is Bloomberg Technology coming up and Vidio needs benchmarks in a big week for markets as investors, a weight economic data and a fed Pal speech.
Out of Jackson Hole.
Chinese tech stock sink overnight the latest and why Walmart's three point six billion dollar JD dot com steak sale has put e commerce companies under pressure, and Ford pulls.
Back further from vs scrapping an all electric suv and taking a one point nine billion dollar charge to shift strategies. Again, that's all to come a first as checking on these markets. Some economic data that we are currently digesting is their revisions to the jobs data. And yes they're more than eight hundred thousand, but not enough to really change the
dynamic move of the markets right now. Are still holding onto our gains up a tenth of a percent, yes, and come off the highs, but still managing to cling on to an upcycle when it comes to the technology name stock six hundred over in Europe, also powering ahead, Rock six tens percent. Interestingly, a rebound in Chinese tech
names as well. I shine a light on the Nasdak Golden Dragon, which I know you're going to dig into some individual moves of ED, but yesterday under pressure, today's still some individual names we're going to be shining a light on and just take talk us through what you're watching ED.
Yeah, I mean overnight, a lot of pressure on Hong Kong listed tech shares. Why Walmart made three point six billion dollars selling out of its stake in JD dot Com actually JD confirming through the Hong Kong Exchange that wal might no longer hold a steak.
We're going to hit that.
Story hard throughout the hour with our reporters who are on it. But it's interesting to see, at least with JD dot COM's ADRs. The pressure in videos top of mind. And again we're at like one hundred and twenty nine dollars a share, one hundred and twenty seven dollars a share, not far off that one hundred and thirty five dollars a share record we hit in June. There is a
lot of anticipation ahead of next week's earnings. August twenty eight far after market in whether in video will get back to that record level record heights led the market right in this rebound we've seen since August or the beginning of August, there's a lot of hope where the hope translates to confidence.
Who knows, Carol, Yeah, and let's dig in to one of the key stories being written on the terminal today by our own round Lostellica joining us to already pass through what the market sentiment is around in video whether it can bring this macro level event come August the twenty eighth.
And you talked to some key balls.
Out there, Yes, good morning, thanks for having me. So it does seem like there is growing confidence that the spending on AI, which has been really the central ball thesis behind in video and really a major driver behind overall tech games. People are pretty confident that spending is going to remain pretty consistent. There were some concerns earlier this month about how much ROI are these companies seeing out of their.
AI investments so far.
The general thesis seems to be that even if the ROI is a little bit delayed and it doesn't start showing up in growth and improved efficiency for maybe a few more quarters or even longer than that. There's still going to be a ton of demand for these AI chips and hardware and infrastructure, and that kind of tail one is going to continue supporting Nvidia at least in terms of its growth.
Right.
It's what for counting.
What's happened just in the last couple of weeks sold me through the rally, the rebound in Nvidia shares.
Yeah.
Absolutely so.
We did see some pretty broad based weakness earlier in this month. Some of that was related to the end and just something else, you know, just other factors like that, some concerns about valuation, but we did see a pretty dramatic rebound. We also had the megacap results that we saw out last month. All the major Nvidia customers like Microsoft, Amazon, Alphabet, Metay, we know, really kind of reagread.
That they're going to continue spending on this.
And I think those two things just people looking for a dip to buy and then that sort of spending tailwind. The confluence of those two things really, you know, spurred investors to buy the dip on in video and you've seen the stock just jump up I think about thirty percent or so off that low earlier this month.
It's interesting that chip makers have been what of dictated where.
The nazag one hunter is gone and broad on.
Many on this show call it sort of the poor man's in video, and people have been buying into that name. I'm looking at Texas Instruments today and actually here's a company that's curtailing some of its capital expenditure, which people are worrying about too much of in the hyperscaler's area.
What do you make of TI today, Yeah.
So they are kind of maybe pulling back in their capex. There's some optimism that that's going to lead to some improved free cash flow for them. So a little bit of a different kind of player. They're not as active in AI, certainly not to the extent that in video or AMD or some of these other major players are, but it does seem like people are looking to them just as a way to improve their free cash flow. And that's why we're seeing a little bit of a
lift in that stock today. And we saw that city upgrade of the stock kind of expecting improvement in margins, improvement in cash flow, all related to its capex comments Ran it's.
A great story on Nvidia talking to so many money managers on both sides, and indeed, the LATESTU on Texas Instruments, we thank you Ron for SELICA. Now let's dig more into some of the individual names and indeed the broader market with Kevin Welkosh. He's the portfolio manager of it GENS and Investment Management covering tech, AI and chips, who are the perfect sort of person that we need to speak to when many are wondering what the return on
investment of AI is for you? Is infrastructure picks and shovels still the good place to be allocating.
Right when we think about it. So what with GENS in investment management, we're focused on quality investing, We're focused on a long term we think right now sort of the AI attention certainly is more in the short term in terms of CAPEX band and demand for Nvidia chips, but historically that the chip industry is very cyclical and we're looking for sort of those platform players that can kind of continue to monetize consistently over the long term.
So when we think about today, certainly the intensions on Nvidia, but we're really looking more towards the long term, So that would be the Microsoft's really establishing themselves with that massive CAPEC spend. We're also seeing it on alphabet side, the alphabet side where you know, again that investment's building that beachhead for long term monetization.
We also like Accentrire.
We think Accenture from an AI story has sort of been really misunderstood by the market in our opinion. When we look at Accenture right now, we think the mart the market, which we continue to think as a long term investor, we tend to think of it as very short term focused, tends to focus on a little bit of slowdown in it. Spend has sort of, you know, unduly hammered the stock in our opinion, And when we look at Accenture, they've committed to the spending three billion
to tool up for AI. They were a market leader in terms of cloud build significant share when they did a large investment like that as well, and we would expect them as sort of a picks and shovels type company to really benefit in a long term from AI as an implementer in that they don't really have to pick the winner, they just have to continue to be very good at implementing the tech.
Kevin I didn't expect us to jump straight in on an accenture. I'll be honest with you. It's a pretty big week economic data, power speaks and everyone has a lot of anxiety about in Vidia on August twenty eighth, which is the most important for you.
I mean for us.
When we look at Nvidia, it's interesting, but we don't own in video, and when we think about the market, you know, it's been very binary, handful of AI driven stocks and really sort of missing sort of the broader value creation across the market as a whole. So in this case, you know, we certainly acknowledge in VideA. We'll understand how it contextually sort of can impact our portfolio.
What we're sort of keyed in on the short term is just sort of continuation of that sort of trend and migration from a long term perspective towards AI, but also broader tech and seeing how healthy it is in terms of growing.
So that's that's about it.
It's sort of contextually looking at the short term, but really with an eye towards the long term.
I'm really interested in that that you're not in in video, but you are in alphabet, Microsoft TSMC. The likes of Eccentia Texas Instruments, maybe less so on the AI side, but the others are AI names.
Why are you in Nvidia?
So what's interesting about our strategy very inherent in terms of us.
In our sort of quest for.
Long term quality growth businesses, we look for companies that have high returns on capital and consistently, so we're looking for companies that have return and excess of fifteen percent return on equity for ten years. So it's not an average every year as to hit it's supposed to the ten years. It is supposed to denote an all sort of market type environment of high capital returns. And Nvidia had not up until this most recent fiscal year qualified and so in that case it does qualify. Now we
are actually researching it. Our sense when we look at the valuation would be that from a fundamental standpoint, we'll probably like it. But I think from a valuation standpoint for us too rich to sort of enter position.
Right now, Kevin, The nvidious side of the equation on AI is easy to understand. The capex investment on airastructures there if you go back to your accenture example, I find really interesting where people struggle is to see the top line growth coming out the other side, those that are working on AI services and products, do you see it.
It's early days we've seen.
What's interesting is is you look.
At the growth in terms of AI projects and spend for Accenture has been growing dramatically and so but relative to total revenue it's not as large yet. And that's typically what we've see in these sort of early adoptions of new, newer or new technologies. You sort of see small base, large growth, and right now, relative to the picture,
it looks small. And I think the market, you know, from our perspective and we look at it, you know, the market's so focused on short term gains that in essence sort of looking at the trees, and we're trying to look at the forest. And we like the trends, we like the direction, and having been invested in this company for a long time and seeing this sort of play out before in other tech trends, we're incredibly excited about the opportunities that had for Accenture.
Kevin Welcos great to have some time with you. Thank you, portfolio manager. Thanks and Jensen making investment management. Now we shift gears a little here because Italian divers have now been joined by an underwater robot as the search and rescue efforts resumed for a third day around the sunken yacht off Sicily. A British tech entrepreneur, Mike Lynch will we stand the international chairman, Jonathan Bloomer, and four others
are feared to have died earlier this week. The robot is capable of operating on the seabed at a depth of up to three hundred meters for between six and seven hours as his authorities continue to investigate just how the luxury yacht sank in the early hours of Monday morning. Will keep you up to date on the latest from this tragedy.
Ed okay coming out.
Walmart ends its partnership with JD dot Com in China. Details on how Walmot's refining its strategy in that country.
Next, this is Bloomberg Technology.
Let's return to JD dot Com and the pressure there because Walmart actually sold out, raising about three point six billion dollars by selling its stake in the Chinese e commerce firm, and the move winds down an eight year partnership that appears to be paying diminishing returns and pretty challenging landscape for Chinese tech giants.
Bloomberg's Amy Or has more of the details.
A lot of pressure on the shares of JD dot Com for obvious reasons, but it's really sending slight shot waves across the entire industry group. People are worried about what the signals for JD dot com and its growth.
Yeah, well, especially at a time when Chinese economy is slowing, and also like it's been reflected in e commerce, and also it really shows that US companies can actually go their own way.
It's not like eight years ago.
When the partnership started that you really need a local partnership to really gain popularity among Chinese consumers. And now Sam's Club has actually got really good recognition amound Chinese customers as well.
This is good point.
Amy.
You know, in your reporting you give the backstory of Walmart in China, which is about eight years of partnership with JD dot Com, but their kind of hypermart business is strong.
Sources talk to us about that.
What did you learn, So essentially the partnership in the past, it was great. It started off as trying to get Chinese customers to actually recognize is brands and try to gain shares that it might not have been able to without a Chinese partner. But now that kind of growth has slowed together with the Chinese economy slowing as well. And then Sam's Club essentially is the only one of the top five e commerce platforms in China that recorded growth that really shows that it can actually go alone,
and it probably should go alone. And essentially the three point six billion that it got can actually put to better use.
YEP, that'll help Bloomberg's Amy or who broke the story last night, Thank you. Another one that we're watching Ford recalibrating its EV strategy again. This time you also makers canceling plans for his fully electric suv, a move that could cost the company nearly two billion dollars Bloombos.
Keith Norton is here with more.
Oh, Keith, it feels just like yesterday that you and I were reporting that Ford was going to focus its EV units separate away from everything else, and now it's a change. I think you spoke to the CEO, Jim Farley, what's the rationale here?
Well?
And they are trying to find profitability for that EV unit that they broke off. Two years ago when we reported on that they're expecting that unit known as MODELI to lose as much as five point five billion dollars.
This three row suv that they've canceled.
They said that Jim Farley told me they just couldn't find a way to make it profitable. It requires a very large battery, which is high cost, and they can't put it out there with all the competition in the market requiring price cuts.
On e these, so they canceled it.
And they're looking at perhaps doing an extended range electric vehicle technology on that.
Yeah, Jim Vinie actually saying that we loved our three road crossover. He was so excited to show it to everyone, but they couldn't get it to be profitable. It feels as though once again hybrid is where it's at.
Yes, they're seeing a lot of growth in hybrid, and Farley in particular is really enthused by eravs, this extended range electric vehicle, which is where you have a gas engine that sole purpose is to just recharge the battery. It doesn't drive the wheels, so you're really in electric mode most of the time. He saw those of her in China. He really wants to get them in the Ford lineup, and we may see it as that three row suv eventually.
That's something that's popular in China, and a number of the Chinese domestic manufacturers have a thought about that. I mean, what I don't understand, Keith, is whether this will ever be a place where Ford just does evs. I thought that that was the transition plan, right, profit from pickups funds the transition long term to evs. Now it seems like that's not as clear cut, right it.
Is not ed, and the new plan really is leans on hybrids more, which Ford has been in the business of doing for a long time. In the EV space. They're looking to do smaller evs and they're really looking at advances in battery technology. They have LFP batteries coming out of plant in Michigan that will power a new medium size pickup truck.
Ed pickup truck will have in twenty twenty seven.
Jim Farley told me that the total cost of owner of that truck with those lower cost batteries will actually be cheaper than traditional vehicles.
He called us a tremendous pivot. Is this an embarrassment, Keith?
Is this something that Jim's worried about investor reactions one Tim.
Well, so far investors have reacted positively. The stock is up today.
I guess there's a couple of ways to look at it.
It's certainly embarrassing that everyone got so caught up in the hype that they started building plants and building battery factories everywhere and now have to scale back.
But for it at least has acknowledge the need to do that.
They've been sort of out front saying no, we need to change, and they've been sort of chipping away at it, and now they've done this whole plan that he says he thinks will be the final move.
We'll see.
It's a big cost to have to sucker once again, Keith Norton quite importing me. Thank you so much for joining us on.
It time for AI in Action, and today we're looking at the rising risks of AI in cybersecurity and how one company aims to fight fire with fire in combating the threats. Joining us now is Evan Reiser, Abnormal Security CEO. A Normal recently hit a five point one billion dollar valuation and it's latest Series D fundraise, and I think that the story here is actually pretty clear that the tools available to your industry in defense are also available
to the threat actors. Right that AI has given them something to work with, and that's kind of what you're trying to combat.
Evan, That's absolutely right. You know, AI is an extremely powerful technology. Like all technology, it's a tool, and tool could be used for good or evil. Unfortunately, you know, criminals are faster adopting technology, and they're using new AI technologies to do more bad things.
You've got twenty four hundred plus customers. How are they using you?
Because ultimately you're trying to predict me, the human and when I start to act in a strange way, right.
Yeah, in an abnormal way. So that that's correct.
So you know, if you look, you know, decade ago, criminals are very focused on attach infrastructure. Now they've moved on to the more vulnerable target, which is people, and we see you know, social enduring, fraud, fishing, those are the biggest forms of cyber attacks, number one cause of breaches. Just like you said, abnormals focused on understanding human behavior, you know, better than humans, so we can protect humans.
What I understand Evan is you've got a really impressive annual revenue run rate two hundred million dollars. Right, Why is it such a vacuum for you to jump into? It seems like we've been talking about the AI story for a few years, let's say two or three years, and now everyone's like, Okay, I need to think about the threat before me.
Why not do it earlier?
Yeah?
I think there's two reasons. One is that with the rise of these new technologies, it's very easy and accessible for criminals to you know, supercharge their attacks. We've seen this rise of social enduring and fishing over the last couple of years. As Ano there's still the number one cybercrime, but now any petty criminal can use chat GBT. They can send emails in perfect English, with perfect grammar, with
context about their victims. And these new technologies allow criminals to personalize at scale, and that is very hard to defend against. The reason it's really hard is that conventional cybersecurits focus on threat intelligence, kind of studying all the
known bad attacks blocking the existing attacks. And so this is why it requires a new technology that's not focused on known bad but instead of really good at understanding known good, understanding human behavior and then looking for those anomalies and abbormalities the basis for threat detection.
Can you explain a little bit of the underlying technology of how you're working that, So, what are you applying and ultimately why just raising more money help you.
Beef that up.
Yeah.
So at the core, you know, we're really an artificial intelligence company that builds cybersecurity products, and the core technology is focused on really understanding human behavior. By integrating all kinds of enterprise technology systems, we understand the baseline activity, who talks to who about what types of things, what business processes. We can map out the supply chain all thesing artificial intelligence. We then take that behavioral baseline it
like for anomalies. And so that's a very's very effective at stopping these personalized social engineering phishing attacks I've never been seen before, and so it's a kind of a really new paradigm.
For how to do cybersecurity.
And then I think that the final reason is that conventional cybersecurity is very reliant on you know, kind of a human powered paradigm, right, lots of human analytic analyzing, lots of data. Obviously, machine learning and AI is you know, far superior, faster and more effective at doing that, and so AI allows us to make you know, superhuman judgments,
you know, faster than faster than conventional security operations. So not only is it a bigger need in the market, but new tools allow you know, organizations like us to you know, become way, you know, an order magnitude more effective at stopping these cyber attacks.
So to become ever more effective, do you need more people, more talent, or do you need more compute more money for that?
It's a bit of everything, right, you know, we just raised this big ground. As you mentioned, there's really kind of three ways we're planning on doing what you're planning on growing the business. One is just you know, growing into new markets where you're very West based focus. We're explading international in Asia and Europe. The second is we do need to grow our team. We want to go get the world's best you know leaders in technology and beyond.
And the third is you know, making more investments in that core end platform and then using that to build you know, expand our product based beyond you know email security, which are known for it protect other surface areas across the organization.
I'm a riser.
Great to have some time with you I'm Normal Security CEO. Welcome back to Bloomberg Technology. I'm Carolin Hyde in New York and I'm.
Ed Ludlow in San Francisco.
Quick check on the sentiment of these markets right now, ed, because we are coming off of what have been a slightly stronger rally prior to the jobs revisions data that we eventually got more than eight hundred thousand jobs, fewer than we had previously been seeing. Yes, we knew that revisions were to come, but this is being seen as a soft data point. The Federal Reserve therefore probably can
still cut into this. I'm looking at to is our sentiment gage, and we're up four tens percent, but we're down of our hives. Some interesting stories also around a pretty crowded trade and trade in derivatives, basically showing that maybe we're going to could get a short squeeze if we've got any more volatility in this market as people do go short the asset. Let's move on to some
of the individual movers in the stocks perspective. Microship Technology individual mover here on the back of a cyber attack, the microchip company, which basically supplies the US defense interestry, saying they were hit. The servers were hit by a cyber attack. City saying, look, this is only gonna be temporary. Nature are actually up more than two percent. Intuitive Machines. This was up more than forty percent yesterday. Remember the
rover that they had been sending to the moon. This space based company is currently down, just as we perhaps see a bit of profit taking. I'm looking at dd Global as well, just up two and a half percent in the moment.
Well, they come out and finally turn a profit.
It's small, one hundred ninety six million dollars, but better as revenue climbs more than four percent end.
But we got more on China.
Yeah, as we said, tech stock slumped after Walmarts sold its stake in JD dot Com.
Also, some key.
Tech players in China have posted port earnings of late Let's get the details with Bloomberg's Isabelle Lee. And it was interesting when the Bloomberg reporting hit on the Walmart JD steak because actually ripples were felt very quickly across Chinese or at least Hong Kong listed equity markets for China.
Tech.
Good morning, what did you see?
We have shares of Jada dot com slumping and it's not a surprise because this is an eight year partnership between Walmart and JD dot Com, and when Walmart's sold, it's roughly three point six billion steak that's at an eleven percent discounts, so it seems to be paying diminishing returns.
This began in twenty sixteen when we have JDA dot Com taking over one of Walmart's online marketplace, so this focused on selling groceries to hire end shoppers, mostly female in major Chinese cities, and Citygroup said this was a surprise. We have Bloomberg Intelligence saying that even if they renew this eight year non compete contract that is existing right now and it ends in twenty twenty four, the terms
for JD dot Com may not be as favorable. And Jeffries also said that you see the drop in JD dot Com mainly because of the unexpected of it all. And to your point, it's really been a tough year or few years for China tech because mostly all of them, I don't want to say all of them, most of them are really struggling, and particularly.
When those are exposed to consumption in China. Whip Shop, for example, rebounds today yesterday sunk hard on the back of its earnings.
Yes, exactly because it as a broader economy.
China is still struggling. We have job.
Prospects, especially for the youth, still uncertain, the property crisis day in and day out, it's still there. And we also have just the economy. It's not doing well. And so this all affects consumer consumption. And we had a slew of earnings from Ali Baba, JD dot Com and even PDD. And I must know that last week Ali Baba, which is long seen as a barometer for Chinese health, it's a price investors, when it said its main business, commerce shrunk last quarter. So what does that tell you?
And it really shows the divergence between what we see in the US and what we see in China. And Walmart in a statement, said that they want to focus on their own business and want to reallocate the other to other funds, likely the Sam's Club franchise they have, which is doing well in China. But Walmart did call the partnership with JD dot Com pressure, so there's that, and it said it will continue to cooperate.
I mean, is weel you know me? I love a chart.
I think that chart on your screen is one of the stories, at least for this sort of second quarter of this calendar year. Look at the Nasdaq and then look at Hanseng Tech. Just go a bit deeper into into the outperformance of US listed technology shares and some of the struggles of China or at least Hong Kong listed tech.
We have the Chinese Golden Dragon Index down twelve percent year today, down fourteen percent in the past twelve months, and compare that with the Nasdaq and the S and p's double digit game this year. Whether it's seventeen percent twenty percent, it's really a story of how US technology companies are outperforming the rest of the world. And I think it's not even a China story where China is
stuck in their doll drums, although that's one thing. It's just really how this is a US story at the end of the day, even Europe can't compete, even Asia, it's US, and guest companies in the world are in the US. Whether that rally will continue as we know that the AI halo is fading sort of for a while now, but still you cannot deny that US is really the bright spot in the rest of the world, at least the tech companies.
It's WELLI great to have you on. We thank you.
We're gonna look at China in a different perspective right now because we're looking at the release of China's biggest PC game to date, Black Myth Wukong, the game about by ten Cent Remember, has become a bit of a sensation, more than two million players trying out the game in the first day alone in its global launch. It's called
in to stream dB. It's a strong first day performance and of course it could shore up expectations for China's forty billion dollar plus gaming arena after years of regulatory scrutiny. Let's bring in Nissa Christmas Hansen, CEO of Nico Partners for more you really understand and deep dive on the China element of gaming. What is the China consumer showing you when it comes to a desire to get into gaming.
They don't seem to be reticent there.
Hi, Yeah, the Chinese consumer has always been.
Avid for gaming. They are They find that gaming.
Is an inexpensive form of digital entertainment. It's very social and the higher the quality of the games, the more these high demanding gamers will throw themselves into them and spend a lot of money, and Black Myth Wukong is just a perfect example of that.
It's a perfect example.
Of lots of things like Chinese game development prowess, how Chinese game developers are really world class, and how a relatively unknown company like Game Science.
Which is the developer of Black Myth Wukong.
Backed by Tencent, backed by Hero Entertainment, how it could just have developed this game for years on end and then have it come out at the top of.
Every chart, Okay, well every chart.
The other data set I was tracking was Sony PlayStation five sales on Ali Barba the seven days through August twentieth, and it was top of the consumer Electronics tree playerborn PS five and PC. What does that tell us about the Chinese game player right now, the Chinese consumer that loves video games, Lisa, Well, it.
Tells us that they are discerning.
It tells us that they have money to spend when they want to spend it, and it tells us that they will spend that money on things that.
Are high quality.
So I think that for other game developers worldwide looking to tackle this.
Market, there is opportunity there right now.
Blackmith Wukong does have one of the coveted government issued ISBN licenses permitting it to have domestic distribution, but its primary source of distribution in China today is Steam International, and for Steam International, the ISBN is not really relevant, so this is still a way for game companies to distribute games in China.
Therefore, is a government going to assess what seems to be a phenomenal first day.
Well, I think the government will assess this as a victory for a Chinese based developer and one that is going to certainly be a leader among the expul pack of games that are being exported from China to the rest of the world. This is a single player PC offline game, meaning it's a premium game. You pay for it up front and there are no in game purchases. So this is something really amazing because most of the success of games in China has.
Been for free to play or with in app.
Purchases this type of thing, and most of the hits have been on mobile. This is a PC based single player game, and just to give you some point of reference, by the NIQUE China Games and Streaming Tracker, one of the tools that we use to measure the market.
It's our proprietary tool.
We track streams on dou Huya and Billy Billy and there were twenty nine million viewers by Nico's algorithmic approximation of viewers of this game out of one hundred and thirty million viewers of all streamed games on those platforms on August twentieth, So that was really remarkable. You know, almost twenty five percent of all gamers who are watching streams of games are watching this.
Game, Lisa, developed by Game Science and Hung Joe. I got so much marketing for this, particularly through the PS app. Do you think, just to extend Caroline's question, this is going to be a national champion for China that they'll say, what a success you've got here on our hands?
Yeah?
Sure.
I think this is one of the big successes not only of China but of PC offline games kind of globally, and it happens to be from China, and it happens to be from a relatively unknown studio called Game Science.
And similarly, Genchin Impact.
Had been released by Mijoyo a couple of years back, and it, too, Blue Doors passed everyone's expectations and was a national you know, big hit that went global and lots of people love the game. Genshin Impact, so Mijoyo also came out with that game as their first big hit. And now we see game Science doing the same thing. We've seen lots of tencent games do this. We've seen lots of Netti's games do this. And speaking of Nettie's, their big long standing hit of twenty years is Fantasy
Westward Journey. And Fantasy Westward Journey is a cultural mythical history based game about you know, journey to the West and legend of.
The Monkey King.
And that is the same theme that we see here in Black Myth Wukong. And this theme has been very popular among Chinese gamers forever and now we see that again. It doesn't get tired that the game gamers don't get tied of it.
This is something that they love to play.
If I can find just a couple of hours this week, I will play. Lisa Costmas Hansen, CEO NICO Partners, thank you so much for coming back. Barck and Michelle Obama made their appearance on the second night of the Democratic National Convention, blasting Republican nominee Donald Trump while painting Vice President Kamala Harris is the heir of their historic political legacy. I want to bring in Bloombose Kadie Liones for more.
And no matter which social media platform you looked on the clips were shared, a lot of people had a lot of comments. Is there any summary of what was said on stage?
Well, we have to keep in mind here ed that the Obamas, both of them, are some of the most popular figures in modern democratic politics. Their approval reading among those in the Democratic Party is north of ninety percent.
Michelle Obama, in Particulkiller is kind of more so even a cultural figure than she was a former First Lady, given the resonance of her book that published a few years ago, in the tour that came along with thousands of people, she certainly has an ability to kind of resonate with the American populace, and of course as a hometown girl in Chicago, her speech was very much one that seemed targeted at getting people to actually.
Turn out to vote.
Both she and her husband, the former President Barack Obama, kind of warned about these ideas of complacency, essentially saying that this is going to be a tough fight. Michelle Obama, calling on voters to do something, while Barack Obama, for his part, talked more about his relationship with Joe Biden. Of course, has Biden kind of gave his farewell address on night one of the convention that went acknowledge and
Biden also. Obama rather had some pretty sharp attacks for Donald Trump, talking about what he dubbed his weird obsession with crowd size, talking about how he's been whining for years and that it's getting stale for American voters. So certainly it was fiery, And of course the Obamas have had this kind of social media power that we have seen.
They really were the first kind of internet campaign, if you will, back in two thousand and eight, and so some of these resonating moments on social media we've certainly seen playing out. And keeping in mind as well that in that convention hall there are hundreds of social media influencers, some of which have gotten actual speaking slots at this convention.
Katie lyones this like tech nuance on what was a big night for the DNC. Now, let's discuss the impact of the election on the tech landscape on bench capital in particular, Marlin Nichols is with US Managing General partner at mac Bench Capital, one of the signatories of VC's for Kamala, and I mean just quickly to start us off with the DNC and the energy there at the moment, what are you seeing? How is it you hearing anything from a policy perspective that speaks to your industry.
Yeah, I think there's still a lot to be said and disclose on the actual policy. But my perspective is Kamala is from the Bay Area, she was Aga California. She knows tech. She's been an advocate and a supporter of tech for a long time, and I'll expect that to change anytime soon.
Modern A lot has been made of the idea that Kamala Harris is from from the Bay We also had a lot of people on the show that that say, well, jd Vance was a bench Capitalist. You know, here's the experience of backing entrepreneurs. Therefore might be better for a startup leader for for an entrepreneurial environment.
How would you respond to that?
I'll say, this election to me is it's it's about more than just you know, what's going to happen for tech. I think tech is going to be okay, right. This election to me is about human rights and freedom in unifying the country, and I feel like Kamala is a better choice in that respect. I also think she's the
most qualified candidate running, right. I mentioned she was an ag she's part of the Senate, and she's been vice president in a you know, in an administration that had to do a lot of tournaments from a lot of harm that was done from the administration prior. So that's why I was I'm supportive of Kamala and why I was a signer of the petition.
That human rights element speaks a lot to ultimately what the work you've been doing within MAC Venture Capital because you are backing founders from diverse backgrounds, you are doing the work to not only be a majority black led team, but also then put your money to work there too. What sort of outside performance do you therefore get from that?
As you speak to you're putting your money and vote behind Kamala not just because of what she looks like and how she identifies, but also the experience she has.
Yeah.
I mean, for us, we've always tried to build a fund that was one hundred percent meritocratic, right, and I think that's the way that the world should work. Right, despite your skin color, your gender, et cetera. If you are the most capable and you're building the thing that matters the most for the majority of the world, then you should get the funding. You should have the opportunity to build that company.
And that's the.
Philosophy that we've employed at at MAC from the beginning and it served us pretty well.
Marlon and I want to just ask how things are going at the firm to twenty twenty two. You have your sophomore fund double your inaugural fund. You've had two years to invest, go and see what's out there.
How's that gone?
Yeah, I mean I've put our track rocket up against any other fund. You know, we're investing out of our third fund now, all in for managing just around six hundred million, which I think makes us the largest seat seat stage fund in Los Angeles and one of the largest in the country. I think things are going pretty well.
Let's talk a little bit about being in LA and therefore some of the areas you've been allocating and first comes to mind as the entertainment space, and they're like, but I'm sure that you've also been looking at artificial intelligence. What are valuations like when you're taking those two separate areas in industry groups.
Yeah, you know, fortunately at the stage, valuations haven't jumped or or declined too much. It's been pretty steady. You're the range is roughly you know, ten million post money to about twenty five and it's it's pretty it stayed pretty flat there, even if it's an AI company. So so we hadn't we weren't really too affected by the major jumps in valuation that you're seeing at Series A and beyond.
AI is a hot area for.
Everyone right now, and obviously we're we're investing that. We've been investing in that area for over ten years now. I have over ten years now the fund since our inception.
So yeah, you.
Know, markets, uh, you know, rise and fall and we just try to be steady.
Marlon Nichols, Managing general partner at matt Bench Capital. Great to have you here on Bloomberg Technology.
Thank you.
Now. Coming out, Serious XM signs a multi year deal for the cool Her Daddy podcast. Interesting conversation coming out. This is Bloomberg Technology.
Let's just talk about Serious XM after it signed a multi year deal for Alex Cooper's Cooler Daddy podcast and
network of shows. Now it will give the satellite radio company the exclusive rights to sell ads on the audio and the video as you see here versions of her show, as well as bonus content and events, and not only her show, but those of other contributors to the Unwell network like Alex Earl as well Ashley Carmen joins us more for a few and our audience they'll be like, who's Alex Cooper, Who's Alex el What are we talking
about here? This is a really gen z demographic, But it means she's got one of what the seventh most listened to podcast in the US.
Yes, this first quarter she's had a huge show call. Her Daddy's been around for years. She had an exclusive deal with Spotify that had been going on for the past four years, I believe, And recently she took some of the money she made in Spotify and started her own network with a lot of TikTok YouTube stars.
So again, a young demographic.
What I'm fascinated about in the world of podcasts and podcasts is if we use cool her daddy as the example is, who are the power brokers that get the deals done? But how does something like this come together?
Yeah, that's a great question. Well, Alex Cooper's agent is Aren Rosenbaum from UTA. He is definitely one of the power brokers in podcasting. He has signed deals for Alex Cooper, Ashley Flowers of Crime Junkie, also with SYRIASXM, and many many other podcasters like Guy raz of how I built this, so many others who work with UTA, and of course all the agencies have podcast agents as well.
What's wild is that, Yeah, his a one year performers a SYRIXXM. It's down twenty four percent, but yesterday I added basically more than eight hundred million dollars in market capitalization through this one deal. Syrus has been aggressive and also got into smartness another one hundred million dollar amount written.
Is this the new price tag for a successful podcast?
It was really the way the business was operating actually like four years ago, and Spotify got into the space, But recently we haven't seen as many of these splashy deals. Serious XM is really the one out there that's being aggressive, paying these big bills and focusing on the star talent because I think they really see an opportunity where Howard
Stearns's contract is coming up they're losing subscribers. They really need to bring in a younger demographic, and I think the way they see that they're able to do that is through these younger podcast stars.
So these are high profile very quickly.
Actually examples of leaving Spotify is that a worry in exodus, So.
Yeah, some of these folks have left Spotify. Spotify has really just changed its operating mission. I mean, they were very very very aggressive in the podcast space, but since then they've now really focused on efficiency and being profitable and having a better margin, and so we've seen their business actually do very well as they've backed away from some of these high profile podcast deals.
Bloomberg's actually common terrific sporting as always.
Thank you some big deals to finish off this edition of the Bloomberg Technology.
Yet don't forget recap on the podcast. You can find it on the Bloomberg terminal as well as on Apple, Spotify and iHeart that does it.
This is Bloomberg Technology