From Mahard where Innovation, Money and power Collie in Silicon Valley, NBN. This is Bloomberg Technology with Caroline Hyde and Ed lud Love.
I'm Caroline Heine and Bloomberg's weeldead quarters in New.
York, and I'm Ed Ludlow in San Francisco. This is Bloomberg Technology coming.
Up full coverage on Tesla's release of the cyber truck, of the years of development delayser manufacturing snags. Will bring you the details on the long awaited and rather expensive electric vehicles.
An open AI is sticking with a plan to let employees sell shares in the company through a tender offer. We'll have more on the company's plans. Amid the tumult over Altman.
Plus ex CEO Linda Jacarino is backing her boss after his insults to brands backing.
Away from the platform.
We'll bring you the memo to start so much more throughout this hour, Let's look at what's happening in the markets. Because first day of the new month, and where I'm mentioning two up to tens of a percent nothing to be sniff. That's certainly nowhere near the ten percent rally that we saw throughout the month of November one of the best months that we've had in at least years. It's the summer of twenty twenty two two year yield.
Though.
The fact that we've got bonds and stocks rallying at the same time fed J. Powell of course speaking out talking about AI in particular how everyone's trying to fathom it, but also, of course the leader of the Federal Reserve is also largely talking about how they're on pace potentially just to be equal balanced in terms of where the infratiory pressures are going. So everyone anticipating that we're on hold for the rest of this year and maybe we see great cuts as soon as the second half of
next year. Bloomberg Dollar Index therefore falls on the back of this two we're off by three tens percent. Let's have a look at what is rallying though, and I'm looking at what's happening in the world or crypto up three percent on the day thirty eighty eight hundred and thirty about is where we're training, but one point eclipsing what has been a nineteen month high. So if you have to go all the way back to summer of
twenty twenty two. When you last all these sorts of lefeves, A thirty eight thousand some now ed calling for that forty thousand dollars level to be eclipsed by the end of the year.
But if you've got on the micro.
Well, our top story and that is Tesla finally launching the cyber truck. Shares down one percent and off session lows. The news is the pricing. Really we get three variants of the cyber truck, and these are the details of what it looks like. A rear wheel drive, all wheel drive, and then I can't believe it's called this cyberbeast version. And I guess that the main takeaway if we start with the rear wheel drive is just the case study.
At the low end, the price is about fifty percent above what Tesla marketed it at in twenty nineteen when they first unveiled it. I was there in Hawthorne. You'll remember on stage the glass smash window six nine hundred and ninety dollars before incentives, before gas savings, two hundred and fifty miles range. But here's the kicker. This low end variant is not available until twenty twenty five. The two higher end available next year twenty twenty four. We've
got a really fantastic guest joining us right now. Sandy row is the CEO of monro In Associates, also known as the Teardown Titan, and Sandy, you have been on the ground in Austin for the last three days. You've been driving cyber truck, you've been in the factory, you've been speaking to executives. Let's start with the price points. What's the conclusion that you draw on the pricing that Tesla released.
Well, I got a chance to drive the Beast and that that was the vehicle that they gave me to fool around with. It Definitely, it's wicket fast, It's unbelievably comfortable. I would put it in with other one hundred thousand dollars vehicles. Now I don't know the other two products at all because I didn't really get a chance to test those, but the one that I had, the cyber truck, Beast, definitely as quick. I Don'll scare the daylights out of
most people. And if you've got it there, there's a video of the cyber truck and a portion nine to eleven taken off from the line doing a quarter mile and the Tesla wins, but it's towing another nine to eleven beat the nine to eleven towing a nine to eleven. It's fast. It's extremely it's extremely fast.
It's very very Sandy. Sandy. I called you at the top of the show the tear down Tight, and I just want to explain to audience your principally be an automotive engineer, right, and you kind of rose to prominence because you take new vehicles, tear them apart, right down to the individual nuts and bolts, and assess what they're
made of, assess their efficiency. You have been in the factory, and I wanted to ask you, based on the design of this vehicle and what you saw down in Austin Giga, how many do you think they're going to be able to build initially this year or the remainder of this year next year.
That's kind of a tough question because there's a lot that determines whether or not you're going to be able to push out those products. A lot of it has to do with the supply chain, and there's a lot of things that of push you in different directions as far as launch is concerned. What I saw was running at sixty jumps per hour, and that's kind of normal. The rest of the factories that I've seen, the breast of the tessel factories are running at forty three forty two,
forty three seconds per cit or per station. That's FAST's that's really fast. So if they could keep that momentum up in twelve months, they should be able to do easily two hundred and fifty. It depends on how many you know, how many shifts you've got and whatnot, but they should easily be able to do two hundred and fifty thousand a year at that rate, two hundred and fifty to five hundred thousand, depending on how many shifts.
Yeah, and certainly muff saying that two hundred and fifty thousand units possible by twenty twenty five.
I'm interested, Sandy.
And ultimately, how does this disrupt the pickup truck market at large? You keep on showing the sort of f one fifty in particular the ev competitor there, and how the price point is a lot cheaper that even though E La Musk himself said, look, it looked expensive at the time, how do you think it compares to the rest of the market.
Well, everybody's been trying to say that they're all pickup trucks, but really and truly, there's a distinct user difference between the Rivian, the lightning, the cyber truck, and say something like the like the hummer. They they're they're not really tuned to attack the same market. They all can do pickup truck kind of work. But I think that the average person who's got a construction company is probably going
to be going for a lightning. The guy who wants to go to the grocery store and every once in a while pick up a two by four, that's probably the Rivian kind of story. The hummer, I don't know who that is, but I can tell you for me, I I'm going to be brutally frank here. I'm trying to get a hold of two of them, and and one is going to be my drive because for me, if you're an outdoorsman, you've got quads, you got hunting on your mind, hunting or fishing or whatever, this is
the This is the truck for you. This this, this is what I'm truly looking for. I have a lightning at the at the office. My wife owns a ribbean, uh like I say, I don't know an awful lot about Jim has never never offered me one of their hummers for driving. But but for me, what I want is the I want a sober truck.
Okay, you want it Sunday Brand.
What is any criticism then? What is it that might be a slight worry when you go and take that pick up?
Yeah? The I drove it for a few hours and the only time, the only time that I had a problem with the thing was it was when I had to try and still here. Yeah. So anyways, the only the only thing that I had that was an issue was was when I was going up and I took it into a parking garage. And that's scared the living lights out of me because it's a very big vehicle and it was very difficult for me to determine where the corners of the car. And I really didn't want
to smash I didn't want to smash Tesla's car. So I I made the suggestion to the guys and I said, hey, you know what, really and truly I need I I can't see out of the I can't see where the corners are. How about you put up you know, utilize the cameras at the front of the vehicle and uh, and make it so I can see where the corners are with relationship to the walls of the of the what do you call it parking garage? That it was going on right, and the said, oh, no problem, just
a software thing. Well, we can probably make that as a running change.
That was the only Sandy. Yes, I'm sorry to interrupt your Sandy. I just want to make sure we get to this. I guess you haven't had a chance yet to do a teardown of the cyber truck for obvious reasons. Now, I guess will you do a teardown? But also I think the materials here are so important. This is your expertise, right, the reinforced steel, the forty eight vault architecture, the wire driving all of these things. What's your assessment of that design and material.
Drive by wire is long. I'm going to do that one first because that is the thing that is the biggest differentiator. Drive by wire. I wouldn't really want to do that unless it was forty eight volts system. Going from twelve to forty eight volts is huge, I mean a gigantic advantage. The system that they've got is a
double and triple redundancy. So all those naysayers in Washington Initiative folks even they had to kind of like nod their head and say, Okay, the fact that you've got both front steering and rear steering, you've got ten degrees of rear steering, means that you can spin this thing around like a top. It's really really, really easy to drive, especially in parking lot or tight corner type of applications. It's spectacular in that respect. The yes, the uh, the
maneuverability is wonderful. The fact that I've got the ability now to have lock to lock at three hundred and twenty degrees means that I never have to take my hands off the string wheel. It's basically three hundred and twenty degrees, you're never you're never going in a complete circle. So that makes the uh, that makes the string wheel a thing of the past, and everybody's going to be going to a yoke.
Now, Sandy, there's a specific I'm sorry to interrupt you saying there's a specific material we have to get to. So Elon Musk is talking about how bullet well the windows because Elon Musk is talking about how bulletproof it is, and he demoed firing a machine gun at it and Joe Rogan with a steelhead arrow at it. It makes dentse is bulletproof. But what about the glass right that I saw Franz do a demo of the window. It didn't smash this.
Time, no, but it would tell you about a shot.
Well exactly, I made that observation on X because last time it was a metal ball bearing, this time it was a baseball. But here's my point in my question to conclude, what did they tell you there on site that they failed to mention during the presentation because they didn't talk about the range extender during the presentation and they didn't confirm if the glass is bulletproof too.
Okay, so the glass being bulletproof, the glass that's in a normal vehicle, I'm pretty sure it's going to be a good temperate glass. And yeah, you could throw rocks or snowballs or something like that earlier, but an iron ball or a bullet not so much. The thing is, though you can buy glass that is bulletproof and you can put it in it adds an awful lot of extra weight and a huge amount of costs. Let's get back to the steel. The stainless steel that they're using
is a three hundred series stainless steel. For those folks that are into technology, it's austenitic, and which means that it's non magnetic, and it's quite a bit tougher and it won't everything does break down eventually, but it would be classified as a true stainless steel. The thing that makes it even more impressive or important is that when they cold form it, they move it from oustinite to
Martin site. It probably doesn't mean anything to most people, but if you know anything about material science, a Martin Cidic structure means that you're moving into something that's really hard. So normal steel is not even measured on a rock well S scale. But the body structure, the body panels, the reason that they can contain bullets of multiple calibers and quite frankly, multiple velocities. The reason that it can do that is because it's Martin cidic and Martin's site
is pretty dramatic. You can't you can't believe how tough that is, and so that's kind of like what's happening. So the steel comes in relatively strong, then it goes through cold forming, which basically strengthens it even more. Then it goes into one more a little like the air bending and whatnot that they do for some of those linear lines, like you're showing it right now, you've got that line that goes straight across the vehicle. That is
absolutely something that makes it a whole lot stronger. So anytime you can put a bend or a rainkle in a piece of sheet metal, that's great. I had no idea how they were doing that, but I did get a chance to. I did have a chance to look at the assembly line. I saw the machines that are that are manufacturing it's the Trump machine. It's actually, I mean it's it's quite simple, a lot simpler than I than I thought. So, yeah, it's it's it's really well engineered.
And then of course, yeah, the illuminance for the castings and whatnot. Also, again, they created their own their own material science. It flows incredibly well, like, yeah, we're.
Gonna have to we're gonna have to leave it there, Sally, But I cannot tell you how much you are preaching to the right choir here in terms of the intricacies of the material science the technology that really goes into these tiles and these pick up Sanny Monroe, We thank you, CEO. A. Monroe and Associates. Open Ai is tender offer, it's on and it can value the AI company at eighty six
billion dollars. Open Ai is sticking with its plan to let employees sell shares and giving them atually little bit of extra time a month in fact, to decide whether to take part in it. That's been in Bloemberg's Max Chraffkin for more because this was the ongoing question, wasn't it after all of the termill would ultimately be the demand And clearly there is enough demand right well.
And during the upheaval there was this big question of is this company valuable anymore? Is this company even really a company? Now we've seen you know, reinstitution of Sam Altman and Greg Brockman the president, this newly reconstituted board. Clearly Microsoft is on board with this whole business. They're going to have an observer seat on the new board. And yes, and the tender offer is moving forward, which
will be really great obviously for employees. I mean it's going to be primarily a way for people who own shares to cash out, which is going to mean employees, but is also of course a sign of healthiness for the company.
Overall. We're just showing the makeup of the new transitional board. And just to note to our audience, Marry Summers is a paid contributor to Bloomberg's Wall Street Week. For me, this story does put the spotlight on Microsoft right partly because all the staff were going to defect Microsoft had Sam Outman not come back, but the non voting observice. When I posted that we'd broken that story, Max, everyone asked me, what does that even mean? And remember Satir de Nadella said surprises are bad.
Well, okay, I mean a non voting board, see doesn't mean much. I guess in theory what it means is what happened the last time is would not happen again in the sense that they wouldn't be as surprised as they were. So Microsoft had only a couple of minutes of notice when Sam Altman was fired the last time, so this time one assumes they would have a little bit more notice.
Beyond that, I think it's more of.
A signal of Microsoft's position with respect to open AI.
They have a little bit more leverage now.
So the old board included a couple of board members who I would say were not as aligned with Microsoft's interests. This new board, i'd say is more pro Microsoft, more in the Sachin and camp, and the board seat reflects that, or the board absorb observer seat.
Yeah, many people were trying to sort of say capitalism one. Well, ultimately maybe capitalism was always winning, but we've got more of a focus, perhaps on profit over safety. Dare I say no on that that's going to be in any way perhaps completely backseat. We still got to see what the rest of the board looks like because at the
moment they've noted this is undiverse. Brett Taylor's been trying to talk about that that needs expanding, and so too does Ultimately the recovery process need to be borne out these the competition.
Well, and here's the thing, we still don't know if there are going to be huge differences. We still have many of the same things that led to the last craziness. Right, nonprofit Ostensibly a board that's supposed to still be focused on safety is supposed to still be willing to, you know, shut this thing down if it ever gets two out of hand, and still you have Microsoft, which has this huge interest in the company, you know, more than ten
billion dollars worth of money. Its entire corporate strategy depending on this third party that.
It doesn't control.
So in a lot of ways, we're where we were before, which for Microsoft is going to be fine. They were doing well with this relationship, but there is still a lot of uncertainty and an investigation.
Ed, Yeah, an investigation into what originally happened, led by an independent party. Check out Max Chafkins Bloomberg BusinessWeek's story Microsoft's lack of control of open Ai remains a wild card. Now coming up on the show, ouch Tiger Global's biggest venture fund, racking up an eighteen percent paper loss the end of September. We're going to bring you those details.
Coming up next. This is Bloomberg Technology All right. Time for Talking Tech, And first off, Apple and paramount to reportedly in talks to bundle their streaming services at a discounted rate. The Wall Street Journal says discussions are in the early stages and some operational details are still unclear.
More companies had been resorting to bundling packages to make their offerings more affordable and attractive and Meta says there's no harm done by making its artificial intelligence technology widely available. Metas chief AI scientists Sane lucun It touted the importance of sharing tech while other companies might be more protective. He spoke about advancing AI at a faster rate, saying quote, if you do this in secret, you will fall behind.
Plus ex CEO Lindy Acarino sent a memo to employees showing her support of owner Elon Musk after his comments this week which insulted brands that are backed way from advertising on the platform. She called Musk candid and profound and added quote, no matter how hard they try, we will not be distracted by Sideline critics who don't understand our core mission. Karrot.
I'm going to be discussing that much more a little bit later in the show, but for now, ed we want to dwell on the fact that while stocks are rallied, bonds are rallied in the month of November, not all has been that pretty for some big venture bets of late. Just take Tiger Global Management, biggest venture fund. Get this, It racked up eighteen percent loss at the end of September. That's after slashing valuations for some of the key companies.
In its portfolio.
Bloomberg actually learning that the fund marked down firms ranging from an AI powered email company to a privacy search engine of course tug dot Co, but most notably some of their crypto beets absolutely decimated in terms of original valuation. Of course, Tiger Global did not comment for this story, but we do get some more context from Bloomberg News
Wall Street reporter Shnali Bassak. And I mean, for me what took my breath away was the Bord eight Yacht Club and open see I mean ninety percent marked down from an original valuation.
I mean that kind of feats of hubris.
And you remember also remember Board eight Yacht Club bought in other big investors like Arie Brogard's Lion Try and you have Philip Laflan's Co two coming into open CE as well. There was a time that open C was
an IPO darling. If you remember, they had hired the former cfl Lift who then had left open C subsequently and now is working at Splunk, I believe, but remember open C I had been caught in the caught here is here of the regulatory uncertainties that would surround the rest of the investment industry in crypto, but even more so because NFTs versus token listings and other types of assets were under the ire of the SEC. So yes,
a severe write down. When you look at how Tiger Global has taken this position, We've seen similar at rivals. But as you say, this has not been limited to the crypto industry for these big investment firms.
Snali thirty seconds but a big scoop on Binance vip trade is getting a heads up on recent proceedings.
They did know ahead of time, and of course because we know that cz was in the UAE and they don't have an extradition treaty with the United States, that it was not just about the founder here. This showed you the extent to which the rest of the traders were concerned about how finance would dissolve the settlement and be able to get through it.
At the end of the day, which of course have.
Been cryptos has sweet spot. Welcome back to Bluemo Technology. I'm Caline Heid in.
New York and I'm Ed Ludlow in San Francisco. Look, Caro, I don't want to put a downer on things, but final day of the week, and this is what markets look like on a weekly basis, and as that one hundred, Okay, it's basically flat, actually zero point zero two percent on the week. But I guess we are headed potentially halfway
through the trading day through a down week. There's been a bunch of FED speak out their earnings are having a real impact on the trajectory of the NASDAK one hundred in the last twenty four to forty eight hours, which of course is made up of some of those higher multiple software names that have reported earnings. Dell also a big impact on markets this Friday. An important piece of news that I want to bring our audience look at some of the EV makers, including the legacy automakers
transitioning to EV. The Biden administration has set the limits for a foreign entity of concern. Basically, the rule is that if a company involved in the battery supply chain has more than twenty five percent foreign ownership in the context of China, than any car that includes a component or a material tied to that company, an FEOC will not be eligible for the seventy five hundred dollars federal
tax credit. Really important when you consider the supply chains of all of these US automakers who are sourcing not just the battery packing component but the raw materials with some association with Chinese companies.
Ashley.
This really dovetails into ultimately the conversations that are going on in the release at the moment, because all world leaders have kicked off the COP twenty eight Climate Summit, and it's over in the UAE to buy in particular with pledges to boost investment in green solutions and calls for more decisive action to cut queenhouse gases.
Let's just get the latest on the ground.
Day two of COP twenty eight started with an early win for developing nations. An agreement was reached for a Last and Damage Fund designed to help vulnerable countries deal with more extreme weather stoked by global warming. A number of leaders, from King Charles to President Norrendramodi and President Da Silva, and also you and Secretary General Antonio Guterrez address the plenary, delivering an urgent message on fighting climate change.
The climate challenge is not just another issue in your inbox. Protecting about climates is the world's greatest test of leadership.
Other key areas we're still watching out for on the agenda are potentially in agreement to expand renewable investment and potentially a plan to phase out fossil fuels. Jennifer's Abasaja from COP twenty eight Bloomberg News Dubai.
Thanks Jennifer, Saveasaga. They're reporting on the ground ed. What if you've got well.
Let's stick with the COP twenty eight climates Summit the discussion and bring in Avenge Capitalists is investing in that space. Joining us now is Andrew b Managing director at Obvious Ventures and Obvious Ventures, a VC firm that invests exclusively in startups addressing climate, health and finances. I always ask this question. In the Middle East there is a really important meeting of world leaders going on and business leaders, and at the other end of the chain, you're investing.
How much attention do you pay to what's going on in Dubai right now?
Yeah? I think all eyes are on Dubai right now. For sure. They're trying to solve the biggest challenge of our generation, climate change, and when we try to tie it together, what I'm focused on is watching how many founders are headed over this year. That's very different than in the past. We're seeing entrepreneurs from around the world deciding this is the place to be right now, and that's exciting.
I moderated a panel at T Economy Climate right at the start of the year, and we were considering a lot of these big picture items, and the panel was split on whether you go for a startup whose future is dependent on public subsidy policy but also government money paving the way for their future. How do you approach that.
We look at those as tailwinds. We try to find companies that are going to build the future we all existed in the world. We do that in fintech, we do that in healthcare, we do it a lot in climate. But when we think about subsidies, whether it's in healthcare, whether it's in climate, those are add ons. We don't rely on them as the sole business model.
Of course, there's much handwringing at the moment Andrew about ultimately what events such as COP twenty eight can ultimately achieve in terms of agreement and indeed policy. But then in terms of incentivizing corporate and corporate America at that how are you seeing companies still marching towards a focus on climate change, even though perhaps the political environments changed somewhat on it.
Look, we've been doing this a long time. I was an entrepreneur in the solar space in two thousand and two. Climate change was like a thermostat setting at that point. Right, we've come a long long way. We've seen two orders of magnitude cost reductions in solar and wind, and these
are now the cheapest solutions out there. So not only are we seeing corporations show up looking for solutions and I think showing up in mass in Dubai looking for solutions and asking each other almost Davos like trying to find the answer, trying to solve the puzzle. But we see founders in Silicon Valley and around the world showing up with incredible ideas to help transform our global economy.
Let's dig into those ideas. Because you're someone who's led change a big business. I think how you're leading distributed generation over at what is I mean the largest clean energy develop here in America. But when you're looking at the startups Andrew, where is the innovation coming? What problems are we not seeing that are avaiable to be fixed?
Silicon Valley spent the last twenty years digitizing the global economy now we're going to decarbonize it, and I think we're sort of in early innings, even though it's been about a decade of huge growth. I think McKenzie and Goldman are talking about a trillion to a trillion and a half dollars of new investment every year just to decarbonize the energy sector. And we feel that well underway. Solar and wind are now much more cost effective than coal and natural gas in most of the world. For
new generation. You guys have had a lot of discussion already this morning on electric vehicles and we're seeing that transformation really start to take hold. Those are areas that we're very excited about. I would just mention three things. Mobility. We love the electrification of everything. There's a lot more to do to electrify every form of transportation around the world.
We're very interested in scale finding ways that we can get past all of the bottlenecks, particularly on the electricity grid. There's a lot of startup work going on in software and hardware to blow past a lot of the bottlenecks that we're facing. And then of course, AI, AI and climate there's a really exciting well intersect.
Let me jump in here we discussed a generative AI tool, or at least the underpinnings of a large language model, is an accelerant in the healthcare or biotech space. The use cases are obvious. Less obvious is how AI actually accelerates climate tech, makes it come to market quicker or otherwise.
That's right. I mean we've been early on in using AI in different fields. We were early in recursion pharmaceuticals and they did that in the healthcare space. I think you're going to see a lot of companies show up in client with some similar ideas. There'll be deep tech concepts how we use AI to help and generative AI
to help us think through things like battery chemistry. But I also think there's a lot in the information sector that will be very exciting, crossing AI and all of the things like Bloomberg New Energy Finance and Bloomberg and Green. There'll be AI attached to that because big companies are looking to AI for solutions and we're not ready yet, but we will have some announcements soon about an investment in that space.
And when you have those announcements, you know where to find us here at Bloombay Technology. Come Back Andrew Beebe of Obvious ventsis thank you so much for your time. Now sticking with technology that addresses climate and climate change. A cutting edge AI named Athena has been enlisted in the battle against bushfires in Australia as it braces for an escalating fire hazard this summer. I have listened to this.
It went down in history as Australia's Black Summer, a nineteen week period in late twenty nineteen and early twenty twenty when twenty four million hectares of the country burned. That's an area half the sign of California or the entire United Kingdom. The smoke circled the globe. Now the stage is set for a possible repeat. This map from the National Council for Fire and Emergency Services showing large
areas of Australia facing increased fire risk. Bloomberg Economics is forecasting property and casualty insurance costs in Australia to the year ending June twenty twenty four could be well above the ten year average of three billion dollars.
So this FIA season, we've seen a significant drying out of the landscape following three years of above average rainfall.
That's particularly that bive.
Average rainfall has promoted grass growth and an obviously increase in fuel, and then we've started to see really dry spring went through there into spring, so we're seeing an elevated risk.
To help combat that risk, the Fire Service has commissioned Athena, a world first firefighting AI. Athena analyzes data from weather forecasts, wind direction, terrain structures, populated areas and even social media feeds to predict the fire's next move and what's at risk.
It takes a map of those fires and it then predicts what they'll do over two hours, four hours, twelve hours, and it will also tell us what structures or assets will come into threat. That we can have more than one hundred fires burning at any one time and this stops us potentially making any mistakes or missing something.
Pathena's modeling is also supported by data provided by the Pyrotron, a bush fire simulator built after Black Summer by government research body the CSIRO. The Fire Service is also outed Australia's largest firefighting helicopter for the coming summer, hoping history doesn't repeat, but ready in case it does.
Paul Out on Bloomberg, Sydney Now coming up more on AI, but chutch Ept's version it was made of course accessible to the general public a year and a day ago, and the AI praise it hasn't phased out since we're going to discuss all of that next.
This is Bloombo Technology.
Time now for our VC roundup and Louis Bacon's more Capital Management and the publisher of the British tabloid Daily Mail, when they're launching a new venture fund called Renowned Capital Partners.
That's according to.
Sources, the fund will invest in early and growth stage private companies focused on the world's transition to clean energy. Plus, Pakistan is launching a VC fund for local early stage startups in an effort to lure global investors back, and the government said the firm fund is aiming to allocate as much as ten.
Million dollars annually.
And the Biden administration has forced Prosperity seven. Now that's Saudi a Ramco's VC firm to sell it shares in an AI startup rain Ai. That's of course back by Open Ai and co founder Sam Altman. This exit the kind of broader implications really for Saudi Arabia's growing investments in US technology and its close to ties which.
Ed we have you got an AI well a lot more to talk about and look, Sam Altman, one year of chat GBT being released Open Ai, as you said, Carra released chat GBT to the public a year and a day ago. The AI crise has not stopped. Millions of people, intellectual capital, real capital money has poured into this industry from all over the world in a twelve
month span. Let's keep the conversation going and bringing Dan O'Connell, whose chief artificial intelligence and strategy officer for dial Pad AI Unicorn valued at two point two billion, backed by Indres and Horowitz, Google Ventures and Iconic. I know that you guys would say we were in AI earlier than that. We're an AI company our own right, But I just ask you to reflect on the last twelve months, even if it's through the lens of your own AI company, based on what open ai has done.
Yeah, I think what has happened over the past twelve months is democratization of AI, where I think everybody on the planet suddenly sees the opportunity of it AI can bring and a craft pretty much every piece of software in every industry that's there. So I think the hype is real and we're going to see lifts proliferate over the next you know, in the next couple of years.
Caroline and I always want to approach this from a technology perspective. You have built your own foundation model at ann you call it Dialpad GPT. You did that yourselves. But there's always a choice, you know, go to open AI or another open source platform. Why do it yourself.
Yeah, Fortunately we have been in AI for a number of years. Dell Pad acquired my business, which was one of the first real tends to be trek emission engines called Talkaq in twenty eighteen. So fortunately at that time we sat on this proprietary data set. We had a team that knew about these technologies and how to leverage them, and it became really evident for us that, look, we don't want to have when we talked about AI, we don't want to be a wrapper around a third party API.
We want to control our innovation. We want to control the price and the scalability and the accessibility of that. And so I think AI is a fundamental differentiation in the market and we want to own that piece ourselves because we believe that we can provide a better and enhanced experience to every one of our customers.
And I think a lot of the wrapper companies have perhaps realized the reasoning behind that of laid down.
But what about the competition?
How much more fast and furious has it become for you in the last twelve months.
Absolutely, I think it's a talent war right now out there in terms of finding people that know how to leverage these technologies. You know, when you talk about AI experts and understand natural language processing and speech recognition and large language models, there's probably thousands of them, and that's going to obviously proliferate and step over the course of the next couple of years.
But very much so.
The worry that is out there is, look, do these large language models available as an API suddenly make AI easy for everybody?
And I don't think that's the case.
I think these large language models are good at some very horizontal use cases. But I think what you'll see play out over the course of this next year is proprietary large language models that are going to be industry specific and use case specific. Much of what we've done much similar to our approach and dial pad.
What about big corporates desire to actually build themselves too, and the fact that we now have open source and closed source offerings.
Have you been impressed by the.
Fact that certain CTOs wanted to do themselves? How have you found that sales discussion with some of the companies that you work with.
Yeah, And I don't think there's a right or wrong approach at this moment in time. You know, Fortunately for dial Pad, we had a team of experts and a proprietary data sent then know how to do this. And I think, you know, some startups are going to approach a foundational model today through open AI or anthropic or Inflection or Google Vertex, And I think that the question is going to be whether those foundational models are going to provide use case specific or industry.
Well and the business as well. Right, you know, you start your career at Google two thousand and three. Everyone that I speak to you in ad sales, yep. Everyone I speak to at that time is like, well, we were kicking around the hacky sack and chatting about AI and a bigger pig away, and we're now going to make money from this venture.
Yep.
And I think the case is like when you're talking about the biggest opportunity is I think in contact center in sales organizations to say, look, we can provide instant the ability to instantly infer customer satisfaction from any conversation, never send out a survey. We can guide people through conversations, we can automate the note taking into a system of record, and those are things that every business on a planet in sales and support struggles.
With Dan O.
Connell, we thank you for some of those insights and looking back on the past twelve months, looking forward to a chief ourtificial Intelligence and strategy officer over.
At dllpad.
Okay, so news that cross the Bloomberg in the last hour, Walmart says that it isn't advertising on x. That's according to a router's report in which they cite a spokesperson who says Walmart has found better use of other platforms to reach their customers. It comes the day after Linda Yakarimo sent a memo to staff backing Elon Musk on his expletive laden message to advertise. Lets bring in Bloomberg's tech editor Sarah Fryar together we report on this memo. What are the big takeaways?
Well, basically, Linda Yakarino is trying to spin the Yvon Must appearance a deal book in which he told advertisers.
To go f themselves if.
They don't want to spend money on X, and that if the company fails, it will be their fault. And Yakarino speaks to staff calling this this appearance at the conference candid and profound. She said, our principles do not have a price tag. So essentially she is backing Musk and saying, Okay, yeah, advertisers, if you don't like the way we work, go spend your money somewhere else. And Walmart here is so sure we'll do that.
I mean.
The reason the thing you have to remember here is that Twitter ads are not really as effective in many for many businesses as ads on Meta as on Google, because the targeting is just not as specific. They work really well for events, they work really well for say,
if there's the super Bowl. You have all the tension here for big brands, So for a company like Walmart you could see some effectiveness potentially, but when you get down to that specific micro targeting that other companies are able to do, it's kind of easy to knock Twitter out of your budget and decide to go elsewhere, which is why it's more I guess risky for somebody like Lindia Karino to come out and say to dare them essentially to take their money away.
Certainly not afraid of making her own role that much harder, it seems, say we thank you so much for the breaking that down on the memo that, in fact, when had Ludloe had written that. Meanwhile, I mean from concerns about X perhaps a lord that surrounding misinformation on the platform, We're going to talk now about some bloodlines for billions of people when they're seeking facts. When it comes to AI images, they're flooding the web right now, and it's
proving pretty key for Google, isn't it. The Bloomberg opinion writers Pame Olson and laying Hey, they've created this quiz on the Bloomberg using real and AI photos to just show like how hard it is to distinguish that the currently I mean, look at them at the moment, which.
Will hold on, let's try it out. Yeah, float like a butterfly, sting like a b A is definitely the legit one. A.
I would say that one.
Yeah, I'd say a boom next, Oh, I mean Maya Angela had I read at a wedding. I'm going to say B is the real one there.
And one of them is AI generated Oh nice, Okay.
Manage this one's harder Joan of Arc. Now, to be honest, I'm.
Around as you are. Yeah, I wasn't around at the time of Joan of Arc and they're both painting. I would go with A. Let's go with A.
Okay, are you right? Oh, look, we're cleaning up on this one.
And now, okay, Napoleon Bonaparte.
I'm going to go B.
Sure we got it wrong.
Okay, there's our first dud. This one, I think is.
This is hard.
I think it's obvious.
Okay, go ahead, go ahead. I think it's B.
I would be right. But actually that's quite a good one. That is to ultimately, wa guess that one's AI or not.
B is clearly high definition. Let's make this the final one.
One.
Come on, we can do this.
It's hard. B oh, I think that.
Might be right ed.
At least we've got Winston Churchill right, But that actually is showing just ultimately how easy it is to fool to make it difficult. The fact that we already got one wrong in general. I think I went through it and got like eight out of ten. But what's notable is some AI creative photos are becoming the most popular answer on Google now because people are being so confused by them. The peace really leads in particular with the selfie of a main image now that comes up for
tank Man. Now, of course this is meant to be originally a very famous photo that now is an AI selfie that's on there must be proving totally misineeding.
So the point is it's a fantastic tool if you go perfectly to create something, but if you see something in circulation on social media, it's about authenticating it, knowing that it's real, the story that you and I tell on this show every single week.
And ultimately it's down to a companies such as Google that thinks of itself as the AI prowess to be able to tackle the AI issues that are currently being born out for its own platform with a technology. But I mean, that was a fun way to end. What is this edition of BlueBag Technology?
Don't forget and thank you for listening to the podcast wherever you're getting your podcasts from New York City and San Francisco this is Bloomberg Technology,