Transcripts For BLOOMBERG Bloomberg Technology 20240714

Progressive minded solutions to Climate Change using technology. First, to our top story. Saying adam newman is stepping down. He will take on a new role. For more, i want to bring in Bloomberg Technology editor tom. What was the reaction to this . What this shows is that they are serious about salvaging the ipo. We saw it coming. This is something that they had been pushing for for a long time. They said the number two shareholder was also behind it. This sends a signal to investors that we are taking your concerns seriously. He has been very out there. There were concerns about his wife, rebecca. He will have less sway over the board going to three votes per share. Is stepping down and will become a nonexecutive chairman. All this says to shareholders is that we hear you, we are concerned about the governance issues that came from having him so central to this company. Even to its credit, adam newman, any email that he sent to the company, we got a copy of it and posted it on the terminal. He said, i have become the center of the story and i do not that be the case. We are at a good place and i want that to be the focus for investors. Taylor what do we know about the coceo that are taking over . These are people that you really think of. They need an adult in the room. Withlked about it a lot facebook. You really want somebody with Public Company experience who came from amazon, somebody who came from time warner cable. Can really send a signal to the shareholder community, which is what you have to be thinking going wewe are know how to run a company under the circumstances. Thatr is it enough to get ipo . Good question. Bitad already put a little on the shelf until october. Now there is a question. Financing set up. There was going to be an additional 7 billion lined up in funding from banks, in association with the ipl. Now that is on hold, there is a question about where that comes through. We will be trying to break news on the terminal about how that will come together. Taylor i will get i will let you get back to that. Decision stay with his. You and givewith you a victory lap. Hours before he stepped down, he coming in. Ld be what is your reaction . The momentumere was. Happened things that that are very good. There were other things that were not as good. I have to applaud everybody involved. And they haveis already had replacements. The way that adam stepped aside was respectable. Find a a lot of time to replacement. I think that is what surprises me the most. There is the question about the future. About thisy talking ipo and it is unlikely that anything happened in october. Equity investors want to get a handle, we want the Senior Management to have a handle on it. It is probably early next year, if they really want to maximize the valuation. He do something more could be, but Equity Investors with a lower valuation that we talked about. Ll income a good move i think we are still a ways away from an ipo. And i spoke in the last few months after you wrote a smart but scathing report about their financial. What changed for you today with neumanouncement that stepped down . Significant was losses. It made it very difficult to analyze the company. Third is arrogance. Transaction, so a number of things. Bucket asthe third far as arrogance, but for losses, those losses remain. Group, a customer hearingo, i was not anybody saying that he is the problem. This is a new solution. Taylor a Corporate Governance change does not change the top or bottom line fundamental. Is that still the biggest concern . No. Business t this investors do not know that. The leadership piece is critical. Techthink about the companies. Really critical. I do not think it is the critical issue for investors. Clearly, how they spend their money is important. More meaningful. That is why i think it will take longer to go public. We will probably see some departures around this. Me about the big risk about removing that leader, not founder. We talked about elon musk who is associated with tesla, Mark Zuckerberg associated with facebook. What is the risk that you remove neuman and the vision goes with it . That is probably the biggest risk. There needed to be some change, but the best idea is a material risk. Focus onlyst, i always the balance sheet. A private investor, a venture capitalist, it is absolutely critical. Heftyad the responsibility, that would be my number one concern. Taylor you and i have talked a few times about the income statement. The disclosure really did not. Rovide the economics this,were to contrast just beautiful numbers. They made it really clear for investors. At a transition, quickly back, if you were to take this public, i would think that would want to bring one of the most brilliant users with you. Has an impact on twoyear staffing is. If this were just an operating story, it might be easier to get rid of a visionary founder. Tot we do not know, back your question is how much money it really takes from here forward. It looked like it would be worth another nine or 10 million. I think that was our biggest issue. Taylor what is the single most important point that you need to hear from management . How they are going to navigate the culture. Want to see droves of people leaving or being disgruntled that their inspirational leader has left. We just need to be more investor friendly. Be it would go a long way. They are building value after that. A frameworkll need to think about that. They have very capable, but you have a growth story. That is how you can understand. The company did not have a culture problem. It was significant enough that that. Elt like how to keep it intact is important. This is what i think they have to articulate. Taylor thank you for joining me. Coming up, unveiling a new product on wednesday. How the Company Expects to compete, next. This is bloomberg. Releaseamazon is set to new products on wednesday. Amazon is working on alexa health earbuds, a tracker and a domestic robot. You have all of the details. Which are they most excited for . The only one that is a new category would be the home robot. It would be a demonstrable showing of amazons prowess. Modern r2d2 in the home. The interesting thing to me is the headphones. The robot seemed like a way to distinguish themselves. Is that a way that they are trying to compete with competitors . Developmentbeen in for years now. When they worked on it, their goal was to shift by 2019. The person running the project is probably going to retire. Wayour question, this is a to show their innovation. That, on the flipside of when we were at the event a few weeks ago, it was all about your whenwireless devices you take a look at amazon and their earbuds, is this what gets you excited . Know it is the competition. Just having a real competitor on the market, it could push apple to make their product better. Look for amazon to come in at 100. Watch howwith is amazon trying to implement it into their Hardware Devices as well . This would be a wellness device that would have a bigger focus on understanding your emotion. Taylor any privacy concerns . It will be interesting to see if they have it. Taylor thank you for joining me on all things amazon. Some would say that facebook already exerts might control over its users. That is next. This is bloomberg. Taylor controlling your computer with your mind . Facebook is looking into it. They have agreed to buy a Technology Startup Building Software to let people control a digital avatar using only their thoughts. It uses a bracelet to measure neuron activity. To discuss, kurt wagoner, how does this work . The idea being that when you think about moving your hand, arms or whatever, you send some neural signals through your body to tell your muscles to move. Thathad taken a bracelet can actually measure the neuron activity and translate that to Actual Movement on a computer screen. If you are thinking about making five fingers with your hand that of a fist, if youre thinking about doing it, you can control a digital hand on the screen. You can simply control it with your mind. The company has said that they want to build ar glasses. If you imagine a world where you do not have a phone anymore, your face is your computer. You need a way to control that. Those, controlling controlling the computer you are wearing but with your mind. Taylor it sounds pretty futuristic. Have we been given a timeline for when this will rollout . We do not. In 2017 they announced a isputer brain interface, it as spooky as it sounds. You could think about words that you wanted to say and those would be translated into text on the screen. Facebook was working on the text version of this and have acquired a company that does more of the physical movement. The idea is, can you translate your thoughts without having invasive wires to do it . Taylor what does this mean for facebook . Is limitless in some ways. If you can control what happens without having to do anything it. Think about ar glasses are one. , theyer the next thing is missed out on the smartphone. That is probably the biggest opportunity. Taylor there has to be other competitors entering this space. These are companies that have the budgets to work on this kind of stuff. There were other Tech Companies that had identified this technology as being of interest, so facebook may have hired them, but they are not the only company thinking about this. Taylor kurt wegner, thank you. Coming up, google gets a court wind win in europe. That is next. This is bloomberg. Devices are like doorways that could allow hackers into your home. And like all doors, theyre safer when locked. Thats why you need xfinity xfi. With the xfi gateway, devices connected to your homes wifi are protected. Which helps keep people outside from accessing your passwords, credit cards and cameras. And people inside from accidentally visiting sites that arent secure. And if someone trys well let you know. Xfi advanced security. If its connected, its protected. Call, click, or visit a store today. Taylor this is Bloomberg Technology. Big win onred a tuesday centering around whether users had a right to be forgotten online. Not required. Filing this report from brussels. Highest court agreed with the company that there is no such thing. Frenches back to a regulator. Detrimental. R this should only be restricted to europe and it should not change the way they operate globally. They did not want to be a referee. They also raised concerns about potential censorship. Also, many had campaigned in favor of edom of speech online. Taylor how much of a win is this for google . Despite the issues that they ofe had, they have a lot political muscle and they can pick up these big wins. They talked about the issue and thethey can basically scrub internet. They had been working at these. This is a big win for them. Taylor you also do not talk about google winning privacy laws and the eu because they have been much stricter than the u. S. When it comes some of these laws. What does this mean for the eu and googles expansion there . Passed lastcy law year, there are people on both sides of the issue. At the same time, Companies Like google and facebook have enough Legal Resources to deal with privacy in a way that a lot of startups have not been able to do. People have made the argument that it solidifies their position in the primary market. Taylor by not scrubbing some of big data, advertising is for the bottom line. Any sense of what this means for google . It has been an issue. If you have this balance between privacy and freedom of expression, google is saying this is freedom of expression. In this case, they won. It has big implications for their business. They can use that momentum. Taylor is really heating up in the u. S. Californiasis privacy bill. There is repercussions that are having an effect. Puts pressure on companies theseave been operating businesses for a long time. Putting a lot more privacy controls we will see a lot more of that with the california bill. Taylor they were the only member of the consortium to vote against expanding the power. Walk me through that. Firefox, google, a lot of the companies are involved. If a website decides not to follow the rules, my colleague did a great story about this proposal around privacy. Intention had this where they have been talking about privacy, but their primary cookies. Depends on the taylor mark, thank you for joining me. Making aear about commitment to fight Climate Change. Our conversation is next. This is bloomberg. Taylor time now for a look at some of the top tech movers. Snap, the Parent Company of snapchat, is upgraded to a buy by guggenheim who established the price target of 22. Snap more than tripled off its december low, jumping more than 200 . A stark contract to netflix which has fallen for a fifth straight session. This comes as the streaming service is facing increased competition from apple and disney, both launching their Respective Services soon. With the fiveday slump, netflix has shed 30 of its value so far this quarter. That puts it on track for the biggest three month slump since 2012. Alphabet is feeling the love from rbc thanks to google maps. Analyst mark mahaney says google maps is one of the greatest under and on monetized platforms. Maps could generate up to 3. 6 billion in incremental revenue 2021. Now, australian tech entrepreneur up Mike Cannonbrookes is using his platform to fight Climate Change. The cofounder and coceo of Enterprise Software Company Atlassian sat down with ed hammond to discuss climate, tech and why the future needs to be ready for more disruption. Mike we have a very complicated business sector when it comes to this because in finance and insurance and lots of other areas, australia is very progressive about this tough and very worried about Climate Change. Even in the mining sector, if you look at the opportunities for australia, in a green world, what are we going to make . Rare earth minerals, lithium, nickel. We have a phenomenal amount of opportunities before we get to sun and wind. That does not mean the fossil fuel part of mining is incompatible with future climate. We dont have to transition out of. Ed i just want to pick on this. You famously had this bet you lost with elon musk a couple of years ago where he said he could build a battery in 100 days and he did. The standardbearer of thoughts for this push to be more green and environmentally friendly. A representative of a lot of people in the Tech Industry were making these claims about where we should be heading. Is there a problem that people like mr. Musk are so aloof and otherworldly that perhaps it is hard for the average person to relate to them and say this is something we should be on board with . Mike sure. In australia, we have some phenomenal examples of where there should be an opportunity. I absolutely agree. It can be hard. Elon is an awesome character, but he is not your regular guy. Nor should he be. He is amazing for humanity, but you have to have both connectivity with parts of technology. We have the highest penetration of household solar in the world. More people sleep per capita under a solar panel in australia than anywhere else. That is a movement. If you are sleeping under a solar panel, you understand this. When it comes to batteries, it is even more crazy. We have more batteries in australia, full stop, residentially than anywhere else in the world. Than the rest of the world put together, more residential batteries. We have this engaged population that understands these issues already in australia. We have to get that aligned with policy. Ed another area you have been strong with the government is saying they need to do much more to position the country and the business sector particularly for this wave of technology that is going to disrupt not just tech and retail and the more obvious industries, but in your mind, every industry will be a Tech Industry. Are they doing enough . Mike we are working well with the government in this area and trying to push forward. We need sensible policy. Complex topics of encryption and other things, but we still need to be very engaged and to move that stuff forward to a sensible place. Secondly, we need to have a viable Tech Industry and tech enabled every other industry in australia. 1 of the worlds gdp if we are not 1 of the Worlds Technology production, then we are going to be in trouble as an economy. The biggest industry in the world already, it is only getting bigger. We have to be producing some technology in australia. It does not have to be all of it, but we have to produce 1 of the Worlds Technology to be 1 of the worlds gdp. We need to keep moving the economy forward. Education, immigration, sensible policies. Ed immigration obviously is a huge part that allows some countries to be more successful at technology than others but tech is entirely transient and will go where they feel the best opportunities are. What does a country like australia have to do to attract that workforce to such an extent it can be at that 1 level or higher . Mike i think we are doing a relatively good job recently. Weve had some big changes the last couple of years with immigration as it relates to the Tech Industry. A pretty good spot. They can always be a bit better. Over the last couple of years, it is in a really good spot. I think most of the policy settings are pretty sane around you must invest around education. The way we think about it at atlassian is simple, we need to invest in talent coming up from the bottom. So, high school, tertiary education. We need to have lots of talent. We dont have a lot of experience. The higher up the company you get, the more we dont have a lot of people in australia with 10 years worth of technology experience. We have to import those. We make sure internally when we import half of a level or area, the half we import are helping the other half and all of the graduates, and that is how we grow the economy. Hopefully, that talent stays in australia. A great lifestyle, great place to live. A lot of sensible jobs. The economy is obviously doing pretty well over a three decade period. We are hopeful we can get that talented individual into the country, they will stay longterm and contribute to the economy. Taylor that was atlassian coceo Mike Cannonbrookes speaking to bloombergs ed hammond. Now, ecigarette company juul is cutting its workforce. The Company Plans to restructure jobs and eliminate some positions, according to a person familiar with the matter. The san franciscobased startup employs 3900 people after a rapid expansion. Juul is currently under scrutiny by federal and state officials following reports of a Mysterious Illness related to vaping and a proposed ban on flavored ecigarettes. Still ahead, transforming b2b payments. A startup wants businesses to transact with each other without thirdparty risk. We will meet the ceo next. This is bloomberg. Taylor b2b payments and credit platform fundbox has raised 176 million from Global Investors in a series of funding rounds. It secured a 150 Million Credit Facility from institutional credit investors. The company is part of a growing theme of startups that want to lend to Small Business customers and it is banking on Artificial Intelligence to do that. San franciscobased fundbox has confirmed the latest round does give it a valuation between 500 million and 1 billion, but they have not yet disclosed an exact number. Joining me to discuss this, fundbox ceo eyal shinar. Thank you for joining me. Congratulations on the funding round. Walk me through what you want to use the money for. Eyal thank you for having me. I think the main thing is just to play offense. Meaning we had a few milestones and we confirmed a piece of the big market, we can actually make a big difference. We will touch a little later on on how we do that. Now it is time to establish ourselves as a Market Leader before competition drives into the space. Taylor how are you planning to make a difference . Eyal we help businesses, mediumsized, small, some cases larger businesses, to be paid in a transaction by another business almost instantly. It eliminates the need for 30 or 60 days which is the typical way a transaction is done today. Instead of waiting for 30 or 60 or 90 days, you are getting paid almost instantly. And your buyer has flexible terms. They have the option to finance over time. Taylor how do you differentiate who your target customer is . Eyal we focus on our b2b. We usually have a lag between the time we incur the cash cost until the time we get paid. That would be, you name it it could be a forklift manufacturer. It could be a furniture manufacturer. Any business giving to another business does not benefit from the credit card network. What you see out of innovation is b2c which has been going on the last 60 years of innovation. Counting on paper checks to get paid after those 30 or 60 days. Taylor you had an equity raised and it was very interesting that a credit facility, the debt perspective of this all. As ceo, do you accept all money . How did you differentiate between credit and equity . Eyal equity is basically what we are going to use to spend on market, employees. San francisco, dallas, tel aviv. That is what we use equity for. The credit part is more for the actual advances, the payments we push to the merchants. When it comes to choosing the Investor Base, in my mind is do you have the option to choose . Because now we have good times where money is almost a commodity so you have a lot of investors investing money into companies. But in three months or three years, that could change. The question is do you have the option to choose your Investor Base . If the answer is not, just take the money. [laughter] eyal we were fortunate enough to be in a time and very strong Business Metrics to have investors that can add Strategic Value and facilitate the next few years for the business. Taylor i want to speak to one of those investors next. That was fundbox ceo eyal shinar. I want to go on the phone because david weiden is standing by. He participated in the latest funding round of this company. Thank you for joining me. As you take a look at the landscape of where you can put your money, why fundbox . David what we liked about fundbox we coled the round so we were quite enthusiastic about the company even though we have been involved for five years. We see the business accelerating. We think that is driven by now they have achieved Product Market for which to us means they have many customers that like the service they are getting from fundbox. We think that now their days are ahead of them because theyre Small Business market is so big that once they have perfected the product, now it is time to scale. Taylor how important is it now as an investor that you can clearly see a path to profitability . David oh, i think it is quite important. I think some other startup struggles we see in the headlines underscores that having a sound business that is profitable with its current customers, and if it is losing money, it should be because it is investing in growth. And, part of what we like about fundbox is it fits those parameters. The Current Business with the current customers is already profitable. The reason for investment is to scale further with new customers. Taylor when we talk about a lot of the other struggles in the marketplace right now, some of that also comes down to valuation. How do you make sure in your analysis and the private market that the valuation you see lines up with an eventual Public Market valuation . David that is a great question. The valuation is driven both by investors and by the Management Team. I find fundboxs Management Team is quite good, but really to be relatively understated. Choice,e a conscious although they could have raised money at a higher valuation. It was not the longterm way to build value. Something on the table. We are seeing companies that lesson thed that hard way. I believe you were an Equity Investor. Are you nervous about an equity line that might come in above and Equity Investor . For this kind of business, it is a part of doing business. I would say that we are comfortable with that, it is an aspect of this business. Both how they have brought technology to bear and we can be the success. Oxch that we think that fundb is an attractive place to extend credit. Happened is that there is a separation. I think they would be positioned and well if and when that occurs. Is there a preferred ipo . Yes. Fortunate to be the lead investor and other Companies Helping Small Businesses. Are have gone public and approximately 10 times what they were when they went public. Taylor not does it for this edition of lubricant technology. Onhave lived streaming facebook and twitter. This is bloomberg. Announcer welcome to a paid presentation for the dr. Janessa central radians collection. Designed for women over 40. Targeting uneven skin tone and sagging skin. How do you dramatically change the appearance of your skin . If you are over the age of 40, 50, 60 or older . Use a skin care system designed by a