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This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.
I'm Caroline hide A Bloomberg's World headquarters in New York, and I'm Ed Ludlow in San Francisco.
This is Bloomberg Technology.
Coming up you know it. Full coverage on Nvidio as its sales forecast lives up to those very high expectations.
Plus, the Department of Justice takes aim to break up Live Nation.
Details to come, but.
First let's check in on these markets and more broadly on these two singular names. If we want to highlight for you front and center, we focus in on Live Nation and down more than five percent. The US Justice Department and almost thirty states suing Live Nation Entertainment that they want to force the company to sell off the
ticketing giant ticket Master. In response, Live Nations saying once again that it is not them, but is the artist teams that set prices, not Ticketmaster, and they dispute the fact that they are in any way a monopoly. Power will have so much more as we go live to the DOJ. Meanwhile, in video up more than nine percent, extraordinary and eclipsing one thousand dollars. We therefore have a of course share split that will be music to retail
investors ears. But what is music to investors is, more broadly, is the fact that they do post more than two hundred and sixty percent jump in revenue year on year growth. Now, wonder therefore, the share price is up in excess of that over the last twelve months, as well ed so much to digest in terms of revenue future revenue potential fact that they're going to double yet again twenty eight billion dollars in the next quarter.
Look at this chart.
This chart shows the market value or market capitalization of Nvidia. It's currently at almost two zero point six trillion US dollars. What that chart on your screen on the Bloomberg terminal is showing you is that Nvidia's value is more than Tesla an Amazon combined. Interesting in light of the fact that Tesla and Amazon are both customers of Nvidia, and it sells h one hundreds to both of them in this session alone. As you just pointed out, we're up
more than nine percent. We've added almost two hundred and twenty billion dollars of market cap in a single session, or in other words, Nvidia has added almost two Intel's worth of market cap in a single session. Let's get the reaction to the numbers from Bloomberg Intelligence analyst Conngensabani here in San Francisco.
The story is pretty clear.
They're selling to the hyperscalers to a lesser extent, but the growth is that they've moved beyond the hyperscalers. That seems to be the read.
Exactly and something really like we have been pointing on for a while, view want the enterprise piece to grow.
It did grow fast for.
The very first time in the last many quarters, because enterprise is much more diversified and.
Sticky when we're thinking about the stickiness when we're thinking about the ultimate value longer term. Many were worried about this so called air pocket, the shift to the more the Blackwell architecture. Is that something that we saw any hint of how are we going to see companies replacing their technology?
Yeah, there's two aspects to it.
If we were in a normal cycle, you would think these h one hundreds to last about four to eight years and replaced on that cycle. But what we are seeing is right now, the biggest customers are racing. I would want to use the analogy of a pit stop in a racing where if you want to go cheap and hire a less prominent crew less technology lower parts, you can't afford to spend few seconds when you're fighting
for milliseconds. That's what's happening with its customers. They can't afford to slow down and not purchase the most greatest and latest new product that puts out because everyone's competing against each other.
The certainly are, but for now we know where the market share is ending up country in Savanni. We thank you for the latest from Blouemberg Intelligence. For more from a portfolio manager perspective, Franklin Equity Group Senior vice president and portfolio manager Jp Scandalios, who oversees three point nine billion dollar Franklin Small MidCap Growth fund, you oversee a holding an Nvidia.
It has been a.
Wise choice, friend, Jp, talk to us about what was the most important line coming from executives yesterday?
Certainly, and good morning and thank you for having me. And just to be clear, we don't We no longer own Nvidia in my MidCap fund.
I don't think it would qualify as a MidCap.
The most important thing we heard, I think is that cadence that you refer to that Hopper is doing quite nicely, and Hopper two hundred is coming, has started shipping, and then before the end of the year we'll see Blackwell one hundred and Grace Blackwell soon they're following in twenty five.
And so they have.
They are putting up such velocity and product introduction that they're making it very difficult for challengers to keep up with them, especially since you heard Jensen say it yesterday.
They're a platform company.
All the software, all the firmware, all the APIs around that GPU, all the networking, and so they're really semiconductor analysts such as myself, we don't see a lot of these, and that's why you're seeing unprecedented numbers and growth rates because this artificial intelligence opportunity is really a secular one
and perhaps one of the largest in our lifetime. The only person I can think over the last two or three years who's had as much competitive success as someone like Patrick Mahomes for the chiefs, This is just incredible and unprecedented.
JP Franklin across all of its properties and all the funds has a lot of exposures in video. Right, And I know a lot of people at your firm. They call you, mister Nvidia. You know your brain focused and you're probably going to keep your job for the time being. You've done a good job so far. Jensen one's getting a lot of airtime. Right, He's got a lot of momentum. He has an answer for everything, and just bear with me because I want to be accurate on this that
he's also a little bit inconsistent. Right, So the cadence of new product cycles is one new generation of accelerator per year. And he talks about how the H one hundred generation is designed such that you can just swap it out when the new generation comes along, and that all the customers have great visibility. But the data center
guys are lowering exposure. At some point, we have to ask when this slows down, right, We have to ask when the competition comes, give your sort of most objective assessment of that timing.
Certainly, and you make extremely important and our points. And a Franklin equity group, we try to maintain discipline and don't let my youthful looks surprise you. I've been aronounced to the nineties. I've seen these booms and busts, and tech, the tech sector is known for this. Correct, And you're absolutely right for those of us who've been doing this for twenty eight thirty years, in Vidia through no fault
of their own semiconductors. In general, it's a cyclical business and you do get these boom busts, and people do miss quarters. And if I were to wager, I'd be on your side that there will be a quarter or maybe two quarters where these cloud guys decide, oh, you know what, we have enough GPUs right now, we have enough dgx's.
We're going to pause for now. And so you're absolutely right.
There will be you know, it's not going to be linear and up to the right, which Wall Street loves. So there will be a time where shares get hit, where an air pocket does happen. And so, yes, you have to remain disciplined. You have to do your DCF, you have to do your modeling, you have to talk to the customers, you talk to competitors, and be very disciplined.
JP for sure, stick with us JAP scandalios of frankline equity groups.
So it's got out to Bloom based Lucas in New York City. Lucas leads our screen time coverage, that's our coverage of the entertainment industry. And something that the Attorney General said Lucas was about illegal actions trying to protect a dominant market position. But what is it that the DOJ is accusing Live Nation of actually doing to keep the competition down.
Well, that's some of what we'll have to see as as the case continues. You know, I don't think anyone in the music business would question that Live Nation is the most dominant player in the business right It's the number one promoter. Ticket Master is the number one ticket seller. What the government seems to be arguing is that Live Nation has used those two businesses to sort of self
reinforce each other and strengthen its position. So, for example, you know, it would tell a venue that if you want to book a certain artist that Live Nation promotes, you need to use ticket Master as your ticket seller, or vice versa. You also heard in those Merrick Garland comments that it believes it's gone and acquired any potential competitors, granted much smaller competitors, but done so to consolidate control
in certain markets. It also has issues with these exclusive deals that Live Nation and Ticketmasters strike with venues that sort of lock in a relationship for a long period of time. They believe that there should be multiple ticket sellers at certain venues. You know, people have made claims like these in the past, and it'll be really interesting to see whether a court.
Is open to them.
There has been a response from Live Nations saying the DOJ's lawsuit won't solve the issues that fans care about relating to ticket prices, service fees, and access in demand shows. And they're calling ticket master monopoly. Maybe a pr win for the DOJ in the short term, but it will lose in court. A sentiment that some analysts are agreeing with that this is going to be a very high bar to having originally signed off on a deal to then unwind it in this horizontal manner.
Yeah.
Look, the government approved this deal more than a decade ago with a lot of conditions. Live Nation has been under scrutiny. There's been a consent decree for most of its existence. Since that deal, there's sort of been this looming threat of federal investigation. This is the kind of the first big suit that we've in a while. You know, I think investors will see it as an overhang on the stock because there is uncertainty as to what this
will mean. I think most will probably still air on the side that it's unlikely that it gets broken up, but there will need to be some behavioral remedies, as they say, to Live Nation, to satisfy the government.
It is so good to have one Luca Sure right here in the building in New York. We appreciate him weighing in on this landmark case. Meanwhile, let's get back to what is really driving sentiment in the benchmarks today.
It is AI enthusiasm in is one Nvidia. It is back to portfolio manager Franklin Equity Group's senior vice president as well JP Scandalios and JP just returning to some of the enthusiasm we heard from not just CEO CFO over at Nvidia and some of the concerns that still are about so called air pockets, the shift to the most powerful chips and architecture they offer, but also China. I just want to get to grips with really how much of a concern it is there.
It's been an issue for the whole industry, including equipment, semi connector equipment. So that's largely embedded or understood. The US government restrictions, certainly believe it or not, impeded growth or slowed growth. But in Nvidia and others have chips, and they're making chips the L forty h twenty that are despect if you will, that fall beneath the government restrictions. The unknown for people like me is that the government might move the goal line, if you will, and so
you have to stay on top of that. It's just another variable to consider. But that headwind, if you will, has already been communicated and is understood by the market.
Well, JP, I mean the pushback from Nvidia is that there is unanswered demand all around the world that will make up for the shortfall. I've been just taking a look at Dell, look at the Gainsdell showing, and look at Intel moving to the downside, and I wonder how much they going to be like a disintermediation between Nvidia the people it relies on, like Dell, its rivals, because in Nvidia is a systems vendor now, isn't it, JP?
As I said earlier, right, they consider themselves a platform company if you will, they will sell individual GPUs or GPU cards. But yes, with the software and all the firmware, they do consider themselves a systems or a platform company.
Certainly, we want to thank you so much JP Scandalias for holding over to keep giving us your expertise from the research research angle and indeed the investment angle of Franklin Equity Group. Thank you. Let's just shift our attention to telecoms now, and there's the news out of billionaires Avier Neil. He's exploring a bid to buy out other shareholders the Latin American telecom provider Millicom, which will value
the carried about four point one billion dollars. Neil's holding company that's at this investor estimate, says it is exploring financing options to support an offer price of about twenty four dollars per Minicon common share, though it cannot guarantee and off will materialize, and there's already the bigger shareholder in the company with the twenty nine per cent stake. We want to dive deeper though, into this industry right now. We want to talk about it from the US perspective
and globally. One of the biggest telecom providers here is at and T and I pleased to say that the CEO, John Stankey joins us now fresh off comments from a company's multi year growth strategy over at the JP Morgan Technology Conference, and I just want to weave in the era that we're sitting in at the moment, the fact that we just hear from Johnson, Wang and Ai and
we're talking about open versus clothes. We're talking about infrastructure needs, equipment needs, to talk about energy efficiency, and in many ways you're having a very similar conversation over in the world of telecoms at the moment innovation, the needs for open and in particularly god An Ericsson fourteen billion dollars spend revamp wireless network focus. You want to have an open platform?
Why we do?
And we're pretty excited about what I heard before because the more workloads Jensen produces that you have to go somewhere and we like carrying those around on our networks, whether they're wireless or fix. So it's an exciting time
to be in telecom. And our point of view is if you're going to scale at the level we're talking about, you need to have more cost efficiency and you need to be able to scale more dramatically and so open separating hardware and software and our infrastructure starts to give us that cost curve and that flexibility, and that's going to be critical to have the agility to move forward in this environment.
Agile at a time why wireless demand is plateauing, maybe slowing, No, not at all.
Wireless demands up thirty percent a year and it's not slowing down. And I think as you start to look at where we are with what's occurring from a usage perspective, you start getting workloads that come out of AI, it's going to continue to fuel that. And really it's one of the key things that this country needs to deal with is if you're going to continue to see usage go up thirty thirty five percent a year, you've got
to build bigger highways to take that. And that all comes on the foundation of spectrum, and we need to make sure we got policy right in this country to get more spectrum out there to deal with the rise workloads. So, yeah, a handset demand might be coming down a little bit, we're not seeing quite the growth we saw ten years ago, but the utility of connected devices, how people are using those handsets and the demand for the traffic that they generate isn't coming down at all.
John, Good Morning, is ED in San Francisco. Look, my head is often outside the bounds of our atmosphere and up in space, and I was really interested to see your deal with AST. You know, Starlink is doing a lot with the other carriers. I just wondered, in the first sense, if you have a really clear view of what the addressable market is for Constellation Direct to sell.
I think we have a view of it, Ed. I don't know whether or not we're going to all understand exactly how consumers are going to use this, but we've done a lot of work to not only understand who's the segment of the population that truly needs always on connectivity. I mean, that's really what we want to do here. Most people wake up in the morning they say, I
can't for to be off the Internet. And some folks have a lifestyle that take them to places where they do, unfortunately get to the bottom of the Grand Canyon on a rafting trip and can't continue to post to their website about what's going on with their family and it's really important to them, or they have an important business call. There's others who do it incidentally. Maybe they're on a road trip and they're out on an interstate somewhere and they drive off the network and they need it for
a day. So we know those kind of behaviors in our customer base because we run the networks and we know what our customers are doing. We think there's a good application for this, just like when somebody leaves the United States and needs to roam on a network outside the US to make sure that they're connected when they're in Europe or Asia or wherever they're going. So this is just the next step and simplifying connectivity and ensuring customers be connected wherever they.
Go, John YaST and not STYLINGK and SpaceX well.
As you pointed out at it's a nascent area where the technology is starting to develop. We think AST has done a remarkable job of getting the technology right where it's consumer centric. The customer doesn't have to change any equipment and doesn't have to change anything they're doing with their handset, and they can still avail themselves of the service.
That's really important in our view, and so what we have going on in other parts of the industry is we're kind of taking satellites and services that we're fit for fixed wireless connections or fixed satellite connections and now trying to make the mobile and it's a little more clunky as a result of that. So I think what we're looking at is cost performance, how do we make it easy for the consumer? And I don't think there's
going to be one winner. I think there's going to be multiple opportunities going forward or providers, and we think that's good for us, especially when we have partnerships that ultimately we can have the right kind of relationships to satisfy the needs of our customers.
Satisfying the needs of a customer, you articulate it very well why we as customer is going to need more and more data, more and more wallas, but the actual business of selling wallness has kind of been slowing for you and competitors. How do you stand apart, how do you make sure people reach the AT and T versus Verizon T Mobile when you have had some hits, perhaps to worries about data security for example.
First of all, despite the fact that customer net ads are slowing, utility and use is continuing to grow, and so we had a very good year. When you think about what happened from a service revenue growth perspective, we led the industry. We're still seeing healthy growth. It's a bit higher than what the GDP levels are and an infrastructure business like ours, that's kind of what you want to see happen, and so it's not a bad thing. But in terms of what we do going forward on
this is it's what I just talked about. Customers want to be connected everywhere. Customers want to make a simple decision of how they get on the internet. They don't wake up in the morning relishing having two or three relationships to be able to use my phone when I'm on the go, or my phone at home or my computer at home. They want to call somebody say just get me on the internet. And I think our position at AT and T is about doing that better than
anybody else. And our focus is on making sure we take our great fiber assets, we take our wireless business, bring it together, start to do things like add value to a customer to ensure that their privacy is protected, their traffic is secure. They only have to call one place to get it done at a great value. They can use it in the grand Canyon, they can use it at home. That's the race we're on right now, and that's what we're focused on doing at AT and T.
John Sanker, I wish we had more time. Thank you so much for talking us through the focus and of course some of those commitments to the financial goals that were reinstated yesterday and restated at the JP Morgan event. We thank him so much. John Stanking of AT and T, ed what have you got?
Okay, So coming up on the show, we're going to check back in on in video. We have to and discuss the outlet for AI accelerators. Also an AI to AIPC Lenovo softer nine tenths. We percent third successive quarter of profit beating, and again we talk about the Asian OEMs really moving quickly on the AIPC. Dell came out this week, so did Asus. This is heating up, so we'll keep tracking it. From SF and New York. This is Bloomberg.
Welcome back to me Meg Technology.
I'm Caroline Hide in New York and I.
Med Ludlow in San Francisco. Nvidia is the top story of the day. It's been the top story for quite a long time, so let's look at the markets in the moment. The stock is up almost ten percent, more than ten percent now, But there are other names impacted here, right, so we talk about AI accelerators, GPUs. The reality is that Dell is higher because it's a beneficiary of what we're seeing. You know, they need Dell for literally the
boxing up of the server. But also Dell has a lot of experience in the sales channels that Nvidia does not if Video's never had to sell to enterprises or smaller customers, and so it seems like there's some feel good association between those two names. How long it lasts, anyone's guess. And to the downside, Intel's down more than three percent. That might be AI accelerator related, right, It might just be that the market sees in Video pulling even further ahead.
But there was some.
Commentary about in Video moving into other products, namely PCCPUS, which is Intel's everything. Could we see competition there. Let's go back to that market cap chart just one more time, humanly carriage, just once once more, because I feel like this might not happen again for a long time. The combined value of or in Vidia's market value, total market cap is greater than Tesla and Amazon combined. Again, both
Tesla and Amazon are customers of Nvidia. It's just an illustrative example of what's happened the run up in value that Nvidia has had, but also it's kind of leaked everyone and the technology side of things as well. It is the market for AI, as several said this week, but.
It's helped float many boats that demand and exuberance around AI. Let's get the broader market implications and bring in Blue Bag Intelligence Chief Ecuty Starts Tinette, Martin Adams, and wmon'to stock specific. We all go industry specific. Have you got to be all in on tech right now?
I think there are other opportunities bubbling up in the index outside of technology, and we're seeing sort of that play out real time. When the course of twenty twenty four, we look at thirty different themes in our bi thematic library and we look at stocks exposed to those themes. What we find is, of all the stocks exposted themes in Navidia is not even the most the best performing stock. We're actually seeing themes in physical environments start to outperform
themes of tech. Semen's energy is the best performing sort of multi theme stock in our overall library. And I think this is evidence of what's happening in the broader market, and that is Tech was the story, without a doubt, it was the only story of twenty twenty three that resulted in a lot of attention, a lot of capital flowing into tech. Navidia of course at the center of that story. But as we move through twenty twenty four, we're starting to see other.
Earnings grow of the merge.
We're starting to see commodity prices hopping again. We're starting to see growth prospects improved for financials as well as industrials companies. Even consumer and healthcare companies are on the
growth board for this year. So while tech is still important and certainly essential to the broader market, given it still is the largest sector, these are still the largest stocks in the S and P five hundred, we're starting to see interest spread reflecting fundamental conditions improving in the rest of the market.
Right now, we went into this saying this would be a macro level event right largely because of the waiting of Nvidia relative to the major indices S and P five hundred, for example. But if you say it's a macro level event. You have to acknowledge that something bigger is happening around the world. Like I was interested to read that Bloomberg Intelligence has kind of moved on from the Magnificent seven and you're now looking at a basket of I think it's eight.
Names in China. What is kind of the thesis there, Yeah.
I mean we're just acknowledging what's actually happening in the market. Yes, these are the biggest stocks and they've commanded the vast majority of our attention. But over the last three months, these biggest Magnificent seven stocks in the United States are getting out performed by the biggest eight stocks in China. As just a representative example of there's a lot more happening in the world today. Again, a year ago, this was all we had. We had very little earnings growth.
The rest of the S and P five hundred was in recession. Navidia came out and told us, gave us a nugget of optimism that then exploded into some real tangible economic outcomes. Now we're starting to see improvement in some of the other segments of the world where growth prospects just suddenly start to look a little bit better.
China is a good example of that. China's market is and you're moving higher at an exponential pace, reflecting potential improvement in conditions there, which clearly we didn't have a year ago. We see this kind of in themes, in pockets across different areas of the world where just other opportunities are bubbling up that are not related or.
That TECH adjacent.
You look at utilities on five because of energy demand. We just hadn s thank you of AT and t on and it's all about whiless demand at this moment, Gina. Where else can you be AI adjacent?
Yeah, I think so. On the utilities point, I think this is way overstated. I mean, frankly, when we actually look at utilities earning statements and we look first mentions of AI. Even the Census Bureau does a survey every two weeks of companies across industries, utilities companies are not mentioning AI as a growth prospect. It's really a market phenomenon. In my opinion, the reason utilities outperformed in the last three months was, yes, in part do this speculation, but
also because bond yields rallied. Also because markets across the world corrected, and utilities are a low data sector, so this is not necessarily a tech adjacent story. I think what we look for next is actually the companies that are going to spend on AI need to start to see improvement in productivity and improvement in margins as a reflection of that spend. So this story becomes less about demand for tech that fuels tech sector growth, which I
think is going to persist. But nonetheless that's been the only real leg of the story phone so far, as who's going to buy AI and how's that going to benefit tech and tech adjacent companies going forward, I think will slowly transition to the next leg of the story, which is who's buying and implementing AI strategies that are
ultimately resulting in margin expansion and productivity growth. And there you see a lot of really interesting intel coming out of some of the surveys as well as some of the transcripts analysis that we do, where companies in professional services for example, financials and real estate companies across the border starting to edge their way into this thinking about how it can be used as a productivity enhancer and margin growth engine for them, how it can create operational
efficiencies going forward, and those are the enduring impacts that could help the rest of the sectors that are not tech at all, but tech implementers.
Gina Martin Adams, Bloomberg Intelligeny is great to have you back here.
On Bloomberg Technology. We really appreciate it.
Right coming up on the show, we're going to be joined by Tribe Capital co founder Argent Seti. It's been a while since we've spoken. In fact, I think I'm right in saying Caro, the last time we spoke with Argent was with the SVB crisis, and a lot of the world has changed since then, so I'm very excited.
Stick with us.
We'll be right back. This is Bloomberg Technology.
Okay, we're all keeping our eyes peeled this hour. We are waiting to hear from Elon Musk, who's at Vivtech in Paris, where a key theme being discussed is shock artificial intelligence must being involved in the space through his own artificial intelligence company XAI, in particular focus.
There's a lot to talk.
About, and I'm delighted to say that one investor in XAI, Tribe Capital, an investment firm with more than one point six billion dollars of assets under management, and it's co founder Argent.
Thirty joins us here on set.
I was saying before the commercial break, last time we spoke was the Silicon Valley bank crisis a long time ago, and AI has been the vacuum that's filled the filled the vacuum in that time.
Let's just start with XAI.
You know why you got him, what the merits of it were, your analysis of what Musk's doing.
Yeah, I think the if you think about the culmination of what's been happening in software for the last twenty years, it's another AI has just sprung up. We've gone from machine learning to AGI, and I think that's a part of how to sort of think about the innovation that's happening. The data, warehousing, all the way to infering that data has been sort of the culmination of what we see today.
And so if you take a look at open Ai XAI, I think a way to sort of think about it is that you know, two years ago you have zero people sort of thinking about requests per day around think about what they could do with AI and AGI. Today it's about five hundred million requests with just open AI that takes a certain amount of compute takes a their amount of power. It's almost equivalent to about two percent of power that Google has today in terms of their
data centers. That's just one company. So when you have Xai, Anthropic a couple of other companies that are going to be supporting the next generation.
Of you basically feel like there's enough to go around. But what's interesting question is we know you as an early stage investors. The numbers on the Xai round, which we reported were astronomical, but you still got in.
Yeah, I think the the we're quant investors at the end of the day, even at the earliest stage. That's our expertise, this culmination of everything that I've done. And so what you're able to do is think about growth and loss. And it's powered by one of the systems that we have called Termina, which is like how' seen you account for usage and interpretation of using a product.
So if you think about growth and loss, you've had a ton of growth and you've been able to see people use these products across not just one product, but multiple products to be able to save for customer service, voice, etc. And so if you think about what we're Xai is today and what it's going to be in the future, or open ayes today and where it's going to be
in the future. You start seeing ten twenty fifty x growth patterns, and that's the type of investments you want to make, even at a late stage, because it's got early stage paradigms of growth.
What about future regulation, Arjen, how do you look at the data for that?
Yeah? I think look AI for us, at least from a high level, is the same way in which we think about crypto or blockchain is to technolog and so how is technology implementing how is it augmenting the software you're already building or the use case that you have. And so when we think about regulatory pressures, I think, one,
we don't know what's happening week to week. It's changing very very quickly from open source to closed source systems, and so when we think about how is regulatory top down structure going to impact AI, I think we look to spend more time thinking about what is it that we did in the late nineties and the internet dot com era, and how is that type of thought process going to help machine learning AI? Software driven innovation actually help drive it rather than sort of inhibit it.
I'm really interested as to where ultimately the money flows because, as we can see from n Video's market capitalization, a lot of been in picks and shovels. Many feel that it can be in the application layer, many feeling that it's going to be ultimately in the large language models. How do you think about where when's the value going forward?
Yeah, cruel of value really means where usage is going to be, So you have to think about the full stack. So you've got a model, people use that model, people are gonna build applications on that model, but that those models consume power, and so the more power that you consume, you're gonna have to start thinking about how's that produced, how's that distributed, what do the data centers look like,
what's the future of those data centers. That's why we're talking about video, and then the next phase is going to be what are the applications that start using it? So that full stack will think about supply and demand paradigms, and those supply and demand paradigms is going to actually
change your flow of capital. Today, most of the capital is happening on the corporate side, not on the venture side, and the corporate side is driving the first parts of the innovation, and then we come up and start thinking about where we're gonna spend time on models and then applications.
Last week, I think it was last week, David Sachs was on the show and he was talking about Glue, his AI startup, and I said, well, we know you as an investor, and he corrected me and said, well, I started in technology, and that's the kind of thinking that I have when I think about Termina. You know, what is your day to day involvement. Are you just kind of hands on? Are you backing them financially? And what prompted you to sort of say I can do this on my own.
So similar to David and other folks in the industry, there's a very small set of people that grew up building products during what I call data one point zero to two point zero, right, And so you build products understanding how to leverage data to be able to have fast iteration. So you think of Facebook, you think of Uber.
What we did is very similar is over the last ten to twenty years, and the culmination of my life and my team's work at Facebook and a couple of other these companies is like, how do you leverage data to build and iterated products? And that's what we do. So sometimes we build and sometimes we invest. If we build, it's because we've got a pattern of growth that we understand how to do well. So we've done that in India,
we've done that in Mexico. We've been here in the United States where we take a large chunk or we'll start zero to one and from there will help propel that with another team. So I actually think that investor in build their mindset. Depending on the stage that you start isn't too different. It's just do you have the expertise to execute it.
After that, Caroline asked about the regulatory environment about AI. A moment ago, you have been through what happened in crypto, largely through a relationship with an exposure to FTX. Reflecting on that experience, you know this is a classic question, but how do you not repeat the same mistakes in this AI cycle?
I think it always comes down to a supplying demand. So right now you could ask the same question of is Nvidia overvalued or undervalue? Right so intrinsically versus options value. In crypto, you've had two or three waves where people spent their time thinking about speculation rather than intrinsic value, and during those pigs and troughs, you started seeing.
More and more intrinsic value.
Adre and Stephanie, we thank you so much. Co founder at Tribe Capital and termin at Ai, an investor in xai