From Marhard.
We're Innovation of Money and Power Collie in Silicon Valley, NBN. This is Bloomberg Technology with Caroline Hyde and Ed loved Love.
I'm carolinehide A Bloomberg's World Headquarters in New York, and I'm Ed Lovelow in San Francisco.
This is Bloomberg Technology.
Coming up divest oor ban legislation. It clears the House and it heads to the Senate. That's this week.
Tik Target prepares to take this to the courts and exhaust all legal fights.
Will have full coverage ahead.
Plus, we take a deep dive into Tesla as chaos erupts internally and Elon must shifts the company's focus from a cheaper model to the ROBOTAX will bring you the findings from our Bloomberg Big.
Take and salesforce's talks with Informatica. They fizzle as a company struggle to agree on terms of a deal, all according to Sources'll discuss that and so much more throughout this sabb At.
First, the other big story we're tracking is the passage of the ban or divest TikTok bill on the hill. We passed the House over the weekend. The expectation is it will pass the Senate in the coming days. Bloomberg Intelligence and This are in house researchers saying there's a ninety percent chance it will go through the Senate and be passed into law. These are the publicly traded social media names. Some downward pressure on names like Meta and Snap,
alphabet pair and a Google a little higher. But I'm thinking, of course about YouTube. The landscape for social media in this country is front and center this week, Caroline.
And also what's happening abroad, the EU opening a new investigation into TikTok as well. We're reporting all of this as you just really focus on what's happening in the US.
Said.
In the coming days, the Senate expected to vote on that legislation requiring TikTok's Chinese parent company, bike Dance to divest its ownership stake in the app.
President Joe Biden has said, look, design that legislation pretty promptly.
If we gets through for more, let's bring in Bloomberg's Alex Barinka.
It's been a busy.
Weekend, so this is kind of a Dondale law.
It does.
This bill passing seems almost inevitable. The Senate is expected to take it up this week. President Joe Biden has said he will sign it immediately, and TikTok inside is already scrambling over the weekend.
After the bill passage.
On Saturday, we broke the news that the General Council in the US for TikTok and Byte Dance, Eric Anderson, who's been in charge of convincing the National Security Interagency Committee that TikTok is doing enough to prevent any user data from getting to China, is actually being pushed out of his role. So the changes are happening internally. The company is also sending memos to its employees promising that if this bill passes this week, that will not be
the end of the story. By Dance and TikTok both intend to fight this to every extent of the legal battles possible before considering any kind of divestitor or separation from TikTok Chinese parent company.
By Dance, I to Alkeds.
At the beginning of the show about the BI or Bloomberg Intelligence assessed of whether or not this will pass through the Senate and be passing to law ninety percent. There are other piece of analysis is that if there were to be a legal challenge by TikTok and its US users, they assign a seventy percent chance that the US government would be successful in court. Over the weekend, we also had a lot of kind of internal news at TikTok. What else have you reported, Alex.
Well, those pressures on the legal side, you know, it's interesting to see those numbers. There are a number of kind of legal avenues that TikTok might take. We saw them when the state of Montana looked to ban the app. Stand behind a number of users who actually sued, there might also be folks like small businesses or other organizations who feel like they're being harmed. So certainly the pressure
is on here in the US. And then just this morning ed as Caroline mentioned, the European Union opened a new probe into whether byte Dance violated the block new Content law when it launched an app called TikTok lights app in France and Spain without providing a full risk assessment. So if you're internal at TikTok right now, you are not only dealing with this inevitable passage of the bill
that bi Bloodberg Intelligence puts at ninety percent passage. You're also having to fend off continued pushes for find scrutiny over privacy, and again just the intense, unprecedented attention that this move by US Congress has made, and perhaps has got lawmakers and other geographies thinking, if the US is doing something like this, should we be taking a closer look?
Bloomberg Zalx Brinka literally minute by minute reporting on this. It's been a busy weekend, it will be a busy week for you. Let's keep a conversation going. Bring in Rachel Tippograph, the founder and CEO of mick Mac, an e commerce marketing platform for multi channel brands. You understand the entire lens here, the user's interest in TikTok, the potential of TikTok in this country in the e commerce context, and the competition out there. I talked about the chances
of this bill passing. I believe you see it passing as well.
Absolutely, it'll be the big news headline this week that the band will likely happen. But we at Mickmac don't believe that this is.
The end of the story.
TikTok has become one of the most powerful platforms in the world. At mickmac on any given day. We now see TikTok as our second most traffic platform, Meta being number one, TikTok being number two. We have to remember TikTok didn't enter the cultural zeitgeist until twenty nineteen, and fast forward today it is leap frogged YouTube, Snap, Pinterest, and of course X in terms of brand investment and traffic. So we don't believe this will be the end of TikTok.
TikTok will absolutely fight this the way that they did with Trump and twenty twenty and Montana last year. That will then create some time for a divestiture to really come to life. And why wouldn't Salesforce or Microsoft or Adobe or Walmart, Amazon or Meta make a lane and grab for.
This because percent of Americans youth TikTok.
Well, the reason they might not is because China won't let them.
We've also got a factory. Of course it might not sell it, or indeed they wouldn't.
Let the access to the technology, but let's go with the fact that maybe they are able to buy it here in the US. I'm just interested amidst this uncertainty because they still got a year if this goes past the Senate, they then got a year to sell themselves. Do any of your twelve hundred brands that use you, that come through you start to pull back on their investment and tiktoks you think at all?
You know this has been a part of the dialogue for the past year that a ban could happen, and for some of the advertisers we've seen a slight pause. That being said, TikTok traffic at Mickmac has grown forty percent year every year. So by and large, we continue to see fortune one thousand brands invest in the platform. And not only are they investing it from an advertising standpoint, they're starting to invest in it in terms of a standalone com channel now with the advent of TikTok shops.
So we're not seeing brands pull back. But the reality is with advertising it's very easy to turn on and off. We saw this happen with Meta, with YouTube with x and so brands have options. If they choose not to invest in TikTok, they're going to reallocate spend to other social channels as well as programmatic like the Tride Desk or.
CTV like Roku.
So I'm not overly worried in terms of what will happen in the advertising landscape. There's plenty of options for brands to drive reach, awareness and conversion.
There's the advertising side of the equation, there's the eyeballs. And it was interesting that over the weekend Elon Mosk, the CEO of X, the platform formerly known as Twitter, gave his opinion that TikTok should not be banned in the USA, even though such a band may benefit his own platform X therein lies the value of it. You talk to the e commerce side, But for me, the thing we never talk about that much is fifty percent
or most of all Americans use TikTok. That is scale that many other platforms don't have.
Absolutely.
I mean, it's why TikTok is now our second most traffic channel at mickback Meta is number one. There's very few places for you to reach all US American households, and so to reach fifty percent of them with essentially one ad by on TikTok is extremely powerful and per Musk, I mean, we're talking about setting a precedent that really interferes with the First Amendment, which is why at MCMAC we believe that if things can play out, a divestiture
is most likely the best outcome for everyone. Bite Dance might not see it that way, but in terms of the US government, if I were them.
I would be pushing for a divestiture.
I don't think by Dance we would see it that way. No, a second, guy, I actually misspoke. I said that Elon Musk was the CEO of X. He's not Lindy acarino is. But given the last seven days that I've had and the number of companies that Elon Musk is CEO of, I think the world will forgive me. Rachel tippograph of Mick mac Thank you very much for your analysis. Now coming up internal chaos at Tesla, where Elon Musk is CEO and he's shifting his focus from a cheaper model
to the ROBOTAXI. We put a really important piece out last night in the Bloomberg Big Take, and that's coming up next.
Karen, so well read brilliant reporting.
Meanwhile, let's just dig into what was also happening on Friday. Remember when in Video was down ten percent, it lost woman to billion dollars in market capitalization. Today it's up, but only one point three percent. We're actually fading some of that rally in this big tech in a AI play.
This is a Bloomberg Technology.
Bloomberg big take, Tesla consumed by chaos amid CEO Elon Musk shift of a focus from new cheaper models to clearly a Robotaxi in Caroline. What we tried to do is clarify what's going on. And my understanding is this is Elon Musk. He's come back in and said, yes, Robotaxi is the focus. A cheaper EV is not completely scrapped, but it is confusing. You've read the Big Take. I don't know. Did we give you some clarity and where we stand you?
Did you really just highlighted how much perhaps we've seen a re orientation of Elon Musk back on the Tesla business, back in demon mode for all the pros and the cons that gives. I mean, in particular, you articulate so well some of the negatives that have been felt by people.
Let go at the company.
I think one really clear thing is that loads of executives at Tesla said Elon, please do the twenty five thousand dollars EV do it cheap. Elon said, no, we are doing Robotaxi, and there's a difference of philosophy. But the cheap part is misunderstood. It's not canceled or scrapped. It just looks different to what we thought. So a lots to discuss.
Yeah, the fact that basically it can be wrong. Doubt this is a cheaper model for other purposes, a more broadly, more wide reaching company that ultimate investors are trying to get their hands around, and share prices reflect that. Craig Traudell, who has been helping edit this beautiful creation that Ed Ludlow and Anna Halla put together.
Over this weekend.
Craig, your key takeaway, and I think for many investors is right now, what are the priorities?
And that's it.
The priority right now is Robotaxi, but for a greater good, for a broader, cheaper offering.
Yeah, you know, I was talking with some of our colleagues at bn F and I think, you know the idea that maybe what Elon may make the case to Wall Street tomorrow is we already have a twenty five thousand dollar car. He will be spinning when he says that. But when you sort of take into account gas savings
and tax credits and so on and so forth. You know, the Model three, after the price cuts of the last year plus, is getting pretty darn close to that and so, you know, I think that what we'll see from Tesla in the months to come is this attempt to kind of, you know, further emphasize the value that they're offering with the Model three and the Model Y per Ed's reporting, you know, apply some of the work that's going into the platform that they want to use to underpin the
robo taxi to bring the Model three and Model Y costs down even further. I think the real question is whether or not that's going to cut it for Wall Street, because they want to see some new product.
You know, we tried to give some clarity on that. We try to give some clarity on the layoffs. And the way that one source put it to me is deliveries were down twenty percent sequentially in the first quarter. So must turn around to the other bosses and said, if deliveries are down twenty percent, let's just cut headcount twenty percent. Not for any reason to do with cost saving necessarily, but this is like the Elon Musk playbook,
Craig right, and when you edited the Big take. I hope that you got the sense that this is Elon Musk pulling the strings on this.
Yeah, you know, and it takes me back a little bit to the Walter Isaacson biography, where you know, I feel like the word delete was in that book, you know, at least fifty times in terms of you know, whenever you know Tesla or SpaceX or these various companies that he runs, you know, run into trouble. He just comes in and wants to cut everything and get rid of everything and question why, you know, companies are doing things, building things, Why do we need that part or component
or why are we doing this process? I think the question is, you know, whether he's sort of cut to the bone here, and you know, we're even sort of seeing some questioning of whether or not he's effectively doing that in these price cuts over the weekend, whether there are going to be any earnings left in China, you know, in terms of how far they've gone with the Model three and the Model hy in that market.
I mean, the key point here, Craig is we all think about this bigger picture and then look ahead to the micro Let's a little over twenty four hours and we get the earnings.
Yeah, I mean just shout out to Craig and to Donna. In twenty four hours we will have earnings FINGO again and we'll find out on what I would say is probably one of the most important earning statements and calls in Tesla's history, because investors just want some clarity on what the strategy is. Craig, in one word or one sentence, what are you watching for.
Just as much hype around AI and for self driving as we can possibly imagine. I think that's the expectation because there aren't many other cards to play.
Crochedel brilliant editing throughout this weekend on so much important reporting.
Thank you.
Let's get into those earnings and more broadly across the tech sector.
Megan Horneman, CIO.
Verdant's Capital Advisors, I understand Vernin's Capital Advisors does have some exposure to Tesla, and more broadly, have you feeling have you felt that the market is priced in some of the worst here for a business like Tesla, for some of the less than magnificent magnificent seven.
I think, from broadly speaking, I still think there's some downside, specifically because these some of these stacks Tesla included have been really driven by momentum. It's been a pretty big decline that we've seen in Tesla, But the clarity's not there. From a broadly speaking from the Magnificent seven this earning season, they've got a lot, they have a lot to prove.
Valuations are very elevated.
And if we don't see this come through from an earnings perspective, I think there's more downside and a little bit more of evaluation correction.
What I love about your notes your analysis, Megan, is just how deep you go into sort of ultimately how powerful and encompassing those Magnificent seven players have been. I'm reading your note that in fact five with the Magnificent seven companies, so you're talking in video, Amazon, Meta, Alphabet, and Microsoft have expected to be the top five contributors to.
Urin your earnings growth for the S and P.
Basically, if they don't give us what we need, earnings more broadly going to fall across the rest of the S and P.
They'll definitely be I think a lot weaker than the anticipation right now, and the anticipation is only for about er point five percent year of ver year earnings growth, So there's a lot writing on these Magnificent seven. I think that's also why you're seeing the markets. They're kind of moving. They're up a little bit today, but moving sideways.
They're going to wait for They're waiting for earnings. They're also waiting from an economics standpoint, the PCE that we get later this week, personal income and spending.
And then that first read on GDP for the first quarter.
Megan good Morning is ed in San Francisco. There's a UBS note this morning doing the rounds. A lot of people are talking about it, and they've cut their view on the Big six to neutral from overweight. But they're basically saying tough comps this quarter. And I think that they're kind of suggesting that if you go away from the Big six or mag seven, what if you want to call it, there is some other technology out there. There are other corners of the market to play in. Do you share that thesis?
Yes, absolutely, And you know these stocks have had a great run, but they have to now. As we mentioned, the valuations are very high and people are looking for outside of that to make money, not just in the large cap space, but I think if you look in the small and MiGCAP space. I think there's a little
bit more of value there. They haven't participated in this rally in the large cap space, and if you look from a long term perspective, from a valuation standpoint, they're historically cheap versus the S and P five hundred, they're in the same both though from an earnings perspective that there's a lot of uncertainty around earnings in the next couple quarters. But if you can withstand that volatility and look longer term, these may be some opportunities in the market.
Megan, there is quite a lot riding on earnings, I feel like this season, and lots of people say, well, if earnings don't deliver for us, particularly on the Big six mag seven, then tech will fall away and the market will go with it. We like drama on the show, okay, but realistically, how worried are you about the stakes in the coming weeks.
I'm quite worried.
We had a little bit more than a five percent correction in the market over the past couple of weeks.
That was not enough, in my opinion.
To really warrant these to look at these elevated evaluations and then also take all of these mountings that we have from an economics standpoint, from a geopolitical standpoint, from a federal reserve standpoint, I think there still is a little bit too much optimism about what the Federal Reserve can do.
And our bigger risk here is what is inflation going to do?
Are we really in the midst of a reignition? I guess you could say of inflation. If that's the case, these stocks and these earnings expectations and these valuations are just not sustainable.
Megan Hornman, Vernet's Capital Advisor, is really appreciate your time on the show.
I'm now been talking tech.
First up, calls are growing for a crackdown on X in Australia after two knife attacks have occurred in Sydney over the past ten days alone. Now, graphic content from the stabbings as well as misinformation spread quickly as both attacks unfolded, and that's now prompted five government ministers to consider bringing in.
Tougher laws for social media companies.
Plus ten Cent shares well, they've staged big rally since December, and now we know that China's biggest internet firm has just nailed down an earlier then anticipated debut of its mobile game Dungeon and Fighter Mobile. It's a marquee title expected to refresh and aging pipeline and drawing new users, so shares, tick tire that much more. And Japan's UNTI Trust regulator has its eyes on Google this after it says the tech giant used tactics that limited Yahoo Japan's
ability to compete in targeted search ads. Now, the watchdog says that Google's parent Alphabet changed its conduct as soon as they flagged the practice. That will keep on monitoring this US firm.
Apple's next big thing is a push into on device large language models. Apple's been working on several major projects for years, including home robots, foldable iPads, and augmented reality glasses, but the biggest and most important project coming this year is a push into generative AI. Apple's approach will be a little bit different than the competition like Google, OpenAI and Meta. Instead of powering Jenai on cloud based servers, the functions will work on the iPhone itself, using the
on device software processors and other chips. That makes it quicker, more secure, and Apple believes more functional and more accurate. With iOS eighteen coming in September after being introduced in June at the Worldwide Developers Conference, Apple plans to include a slew of new AI features that will help users in their daily lives.
I'm Mark German. This is power on. Okay, let's get a check in on the market and one asset I guess we haven't to us much about is bitcoin. We sent the headline five pm Pacific on eight point nineteen. The halving has occurred and as such it cuts in half the rewards. The paid to mine is twenty four to seven. We trade in bitcoin, so we're at sixty five thousand, sixty six thousand US dots partocon right now.
Where we're seeing a more pronounced, delayed suppose reaction to the harving is in those assets that do not trade twenty four to seven. In other words, the US traded equities or stocks to the crypto links coinbases off its session highs but have been up seven percent. Riot another block chambered platform up nine percent. Some names moving to the downside Marathon Digital Holdings down three point nine percent.
There was a headline on the term or Caroline that the harving was a bit of a limp, but as you know, I think we should be excited about it. I think there's still a lot to discuss there.
We're still parties virtual or in real life.
I want to know how many of those invites you went to ed But one person hosting one of those halving parties was Chris Klein, Bitcoin Ira COO and co founder. For this and so much more so, you watched it happen when it occurred on Friday night. But now the reality and what's interesting is, you know, maybe there are some players miners out there now that don't get rewarded as much.
Maybe we've see an impact on the shared price.
But ultimately this is meant to drive the increase of bitcoins.
Will it?
Yes?
Absolutely, thanks for having me, and yeah, we had some good parties last week for the having You're right, it does punish the producers of the asset class.
You will see.
Salce headlines this morning that it came off with a whimper. That's pretty typical for having events. It's usually three to six months where you start seeing some impacts of that supply constraint that takes place.
Supply constraint has not yet taken place. I actually want to focus on that for a minute, because I think you guys had a pretty good quarter, and actually since the start of the year, whether you are focused on the underlying technology or you're participant in the marketplace for crypto related assets, things have been quite cheery. Put that into context for us, as everyone was bracing for the harving, they were also doing business and carrying on with it.
Yes, absolutely, it's kind of interesting. You expect this like big time square event where everything changes, like the year has turned over, and in reality it's just we've hit another block, the next two hundred and ten thousandth block in which it's in our code, it's in our DNA to cut or cut the rewards and then limit that supply. This is not happening in a vacuum either, so you've got ets that are taking a line line's share of
those of these things. Right now, we have a few billion dollars of assets clients or client assets under custody inside of our platform, and there'll be more and more when less and less is available, which is really in contrast to the Almighty dollar and the way the US dollar works today. We actually reward producers of currency every four years with things called reelections, right.
That I get the parallel of we have a big part of our audience that are focused on largely the blockchain, right, they probably don't care about any given direction of the movement in bitcoin or or its current price. But there is now a big market of people that does. And many of them argue because of the finite supply, and I'm repeating myself to audience. We always talk about this, but bitcoin can only ever go up in price because of that limited because that's actually yeah. The other story
of the first quarter was liquidity. This is quite a liquid market, yes, where a lot of sounds. How do we square those two?
How do you square that with liquidity is a difficult question. Probably bigger nerds that can handle that for you. But don't forget the divisibility of bitcoin. It you don't trade in one bitcoin. It goes down to the eleventh decimal point, which is known as the satoshi. And as we get further and further down that scarcity, you're going to start seeing the impact where people will be, Wow, you're a one bitcoiner, and that.
Will be a huge deal. I think it.
Also, you can't have this conversation about bitcoin having without talking about inflation.
They're very intertwined. Today.
I was reading a study this morning Northwest Musical came out. Average Americans think they need one and a half million dollars in order to retire comfortably, which is.
A pretty large number.
However, what's really staggering is that just three years ago the same report was at nine hundred and fifty thousand. So in just three years, Americans feel like they need fifty three percent more money to retire comfortably. And that's part of why folks are looking at diversification of currency, and bitcoin is a opportunity for that.
But you're looking at what we're saving for our pensions and for our retirement a little bit more. Because you've got in your name bitcoin, IRA, you don't just offer bitcoin, you offer us some other cryptocurrencies. But more broadly, at the moment, this coming of an ETF was meant to tempt in the so called boomers to get them back into allocating to an attempted to illocate into bitcoin. But
what about the rest of the old coins? And how you seeing interest pick up as we start to talk more of an ATHTF two.
Yeah, the ETHTF is starting to get some build up. We should maybe expect that later this year. I don't get excited because I waited seven years for the Bitcoin ETF to get approved, But there are a slew of coins, thousands of them on our platform. There's about sixty five different coins that are available or currencies available today, and they're all served different utilities. Ethereum is really the backbone of the future of the web or Internet as we
can think of it, which is designed for smart contracts. Actually, I wish my ten year old daughter was here. She was on a podcast I think last week, and she has one associations for these Bigcoin is money a theory as contracts ripples banks, and like coin is her favorite shopping.
I actually think that the huge body of our audience get that they appreciate just simplifying things a little bit. Chris Klein, Bigcoin, I ra Aco and co found. It's great to have you on the program here in San Francisco. Thank you. Let's talk about the entertainment industry. I chatted with Kevin May, a former CEO of TikTok and former Disney chairman, and we talked about you Guessed It, TikTok's troubles, but also Disney's leadership, two big stories in that world
of late. He's also the co CEO of Candle Media, which owns Coco Melon creator Moonbug Entertainment, So I had to ask him if we should expect more coming from the company. Smash hit children's series listen to this.
We are planning and movies hasn't been I don't think of officially announcement actually, but there was a movie coming up, hopefully that will be either theatrically released or beyond on a streaming service. I'm thinking it could be theatrically released and that would be great. That's probably in two years we'll have a Cocomelon movie. And you're right about licensing and merchandising when you have the reach and depth of engagement that we have with our properties with kids and
their parents. By the way, there's a huge amount of co viewing of Cocomelon or other properties. Something like forty percent of all views are also seen by a parent, and we've done the work to know that for sure. That does lend itself to developing a whole set of licensed properties that are based on that character. Toys, t shirts, soft lines, bedroom who trends, all the stuff that you'd expect.
We're in all of it, Kevin, You've mentioned it several times. Over the course of the conversation. I'm sure it's come up at Jeffreys and it's a big part of your history and your present. It's Disney. Who do you think should be the next CEO of Disney? And I'll jump in and ask if you'd throw your own hat into that ring.
Well, I have pretty busy I have a tech funder that i've I've that i'm working that, I'm working with them, a co founder of I have Candle Media, I'm doing some other stuff. And Disney has a very very solid set of leaders below Bob, so there they have a great bench. They have people that have been there a long time that really understand the Disney culture, that just be value and prominence and dynamism of brands. And I think most likely they'll go internal and fine, and they
have candidates that I think are are wonderful. So that's where I think it's going to go.
And my hat.
I have not tossed my hat in the ring actually, so you know I'm doing my thing at this point.
There are many streaming platforms to choose from. You kind of summed it there. One of the names you didn't mention, for example, was Paramount Plus and then and Peacock is one that I think about a lot. Is there a world in which all of these survive independently or do
you see some consolidation? And I know you must get asked that all the time by the financial press, or find mental networks like ours, But again I point to the idea, you're sat on the other side of the table, the content creator, and you've got some power and interest in where it's distributed.
Like I don't, I can't. I don't know what the future of Paramount Plus and Peacock are. Obviously I don't have a crystal ball. I do think that there's a scale issue with them. I do believe not every single studio can have an associated streaming service that has the same prospects as a Disney or as a Max or as a Netflix or Amazon for that matter, And I left those out, but that's obviously even a huge player as as Apple TV plus. I do think consolidation is inevitable.
You know that is just natural economics one on one and an industry start off and everything's about growth and cost of capital was very inexpensive back when Netflix started the ball rolling, I think that there was very free access to capital and a lot of patients by on
behalf of investors. And I think as the industry is mature, and as you're starting to kind of trade more household and as natural growth starts to level off, always consolidation happens and people then you have to start focusing on costs and cost synergies, and the synergy is inherent and possibly and mergers and the like. And I think that is a natural course for any any growth sector to evolve into. And I think that's what you're saying in streaming. It will happen there too.
Kevin, I'm pushing my luck here. I'm being told we got to go. But I would be remiss if I didn't ask you about TikTok, just your assessment, having been inside and now on the outside, of what you think will happen. I know you don't have a crystal ball, but you know the political will is to divestiture of US ops, and TikTok seems to think that domiciling US user data in US based servers is the answer. It's hard for me to call.
I haven't been in TikTok for several years now, so I'm just observing it the way everyone else is observing it at this point, I will say this about TikTok. It's a great team. It's an independent company, although it Chinese, it is not, you know, as far as I know, run by the government in China or anything else. I don't know. I'm not familiar with all the different security concerns that our government may or may not have. But I do know that the folks that the folks that
I dealt with at TikTok or high quality people. The product is obviously super impressive and engaging and has taken over larger parts of the media and social media landscapes already. I don't know what's going to happen. It does seem to be bipartisan, more so than most issues these days, so it's going to be interesting. I hope that I hope the right thing happens there.
That was Candle Media co CEO Kevin Mayer Caroline.
What a wide ranging conversation, brilliant ed. Meanwhile, though, look, we've got to switch gears because it's Earth Day.
Happy Earth Day.
Let's take this opportunity to look at the latest world of climate tech. In bench Capital, I'm very pleased to bring in sim Capital founder and managing partner Sita Chandremon Class three on today's vcpol sustainability as a service?
What is that?
That as your ethos, that is your underpinning. What does sustainability as a service look like?
It's a great question.
I think I'd probably first dissect the question around sustainability because there's so much public rhetoric right now on what it actually means. So we are trying to tackle how do we produce more or the same with less? And
there's new technologies that are trying to combat this. But the way that we think about it is like, how can we invest in consumption infrastructure, in the picks and shovels, in supply chain software, in new data platforms that really allows us to be much more sustainable in an economic way. So that's sort of why we landed on this coined term, if you will, the new SaaS or sustainability as a service.
You've been raising money and for as someone who's leading it as GP, still a lot of money from the fund to allocate, So tell me fifty million where the priorities to be putting money to you? Where you can make the most impact from how I basically interact with the climate as a capital It's.
A great question.
I you know, we're still investing out of our first fund, but we're actually really focused on our second fund right now.
And the ethos has been happening is that second fund.
Our second fund target is eighty And you know, the thing that I think a lot of consumers struggle with is like, how can you really capitalize on your individual purchases or your activities if you will. And one of the things we always come back to is that sustainable solutions are not really long term sustainable if they're not cost effective and if they don't really if they don't really inhibit the consumer's life that drastically on a day to day because at the end of the day, I mean,
we're sitting in a Bloomberg office. We live in a capitalist society, so we need to focus on investments, and we need to focus on solutions that don't totally change the way that we behave at least not so drastically.
I'm going to kind of a flight still for example, exactly.
And it's a lot of the times as an investor, we're thinking about how do we evaluate businesses that are a lot more practical, that aren't necessarily from the echo chambers of you need to be net zero tomorrow. So that's really where we're sort of leaning our biases these days.
CITA. We've done a lot of reporting on the program about funds new funds that are focused on manufacturing industrial funds, but they have the same thesis, just very specifically, what's the opportunity for you. Is it on something tangible hardware or are you also looking at software application as well.
We're definitely looking across both areas, but our personal biases towards the latter, I mean, to be very frank, the genesis of the fund really started because we felt like, wow, there was a lot of capital being deployed into the broad climate crisis or the sustainability transition. From a sheer volume standpoint, the vast majority of this capital was going into hard assets, long duration if you will, slightly risk
your bets. And while that's a super noble ambition, if you will, and I'm so happy to know funding is out there for those initiatives, at the end of the day, this transition is not going to happen just because we have these decade defining technologies. We also need the picks and shovels. Sort of the point I was making earlier around really software that will actually connect the dots between the new technologies that exist and the end user, be
it the consumer businesses. So we have a strong bias towards really investing in these slightly more scalable, slightly more asset light, much more software focused opportunities.
What is the pitch then to LPs very quickly, just how do you sell it to them?
The vision I'm probably I'm probably going to say away from that, just because we know we try to keep those conversations in private, but also more so, it really depends on what your perspective is on the transition. But our stance is very much that you know, over our lifetime, one of the greatest transitions, or one of the greatest problems,
if you will, is this sustainability transition. But as a function of that, it's also one of the greatest wealth creation opportunit unities, and we need to be able to find ways in which we can invest in that transition in a much more asset light way, in a way that is a little bit more tangible. Sort of to go back to her thesis a little bit, or to
answer Caroline's first question as well around consumers. You know, in the US where we sit, and this is also pretty akin to a lot of developed countries, the biggest shareholder of the economy or the biggest stakeholders or consumers, we hold over seventy percent of the GDP so on aggregate.
This is a massive moving power mechanism and consumers. If we're forced to change every facet of our lives, what we do, how we spend our time, how we move, it forces businesses to also change the way they do business. And that really is the essence of how we think about the space.
I'm talking about, how you move, That's why you're in companies like Cowboy, Tomorrow Farms, How we eat, how we consume?
Sime Capital, founder and managing Ponda. Great to have you with us. Thank you so much, Seeta s Tremun classroy Ed.
If you got coming up another big story and they keep coming. Salesforce talks with Informatica fizzle out. In fact, there ain't no talks at all. We'll talk about those details next. This is Bloomberg Technology Data management company. Informatica said it's not engaged in takeover talks following reports that discussions with sales Force had call let's get the analysis with Anna rag Rana of Bloomberg Intelligence. So that was
the chronology, right. Bloomberger reported there were talks. Then Bloomberger reported that they had called specifically over price. It's the sticking point. And now Informatica has been forced I guess to come out and say no talks, but I don't think many people really understood the deal anyway, Ana rag Yeah, I don't know.
We are happy that there's no deal for salesforce sake.
I mean, Informatica is not growing at that seam readers salesforces, and you know, we're happy with the way what Salesforce has down over the last twelve to twenty four months, stayed away from deals, focused on margins, focus on organic growth rate, and I hope for their sake they stick to that at least for the near term, because as as you remember, this was the biggest criticism for Salesforce for several years, that they move into slightly profitable territory
and then they'll go out and buy something big and then you know, shareholders don't get the benefit of the leverage that comes from a SaaS model.
To that end.
Well, this was going to be the biggest deal since all the way back to Slack being bought for twenty.
Seven billion dollars.
I'm interested there for what is it that they just wanted to add and what would you like them to add organically if not inorganically.
Yeah.
See, one of the things is Salesforce has no shortage of i would say opportunities in the long run. They have a massive customer base on sales, automation and customer service a lot of that. What they have to do is make sure these products work well. Now, when they were looking at buying Informatica, they actually bought a company called Mutsoft a few years ago that does some stuff that's very similar to Informatica. Informatica is slightly larger than
mule Soft when it comes to that. But honestly, they just reported Salesforce reported that MuleSoft grew twenty two percent the last time we had their numbers. That's a massive growth rate for a company internally what they're doing on data management. Informatica, on the other hand, if you look at Consensus is growing at six seven percent. So from our side, I was surprised that they are even you know, considering at this point, given all the opportunities they have organically and.
RAG so great to always get your perspective and why perhaps you like the idea that EM and A isn't going thick and fast over over at CRM and Ran Ran and we thank you.
Bloomberg Intelligence, all.
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