No lapses of decisionmaking surrounding a military operation in yemen that killed navy seal ryan. Global news, 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. Im Alisa Parenti, and this is bloomberg. Caroline im Caroline Hyde and this is Bloomberg Technology. Up, thats coming up, airbnbs war chest expands. Plus Julian Assange extending a companies,e complicating an already tense relationship between Silicon Valley and washington. What the street is banking on now. First, to our lead. Airbnb raised more than a billion dollars with the stock of about 100 billion dollars. Bloomberg first reported its plans to increase funding back in december. Airbnb became profitable in the second half of 2016 and expects to continue to be profitable on an ebitda basis this year. Mark, fabulous to have you with us, as ever. Raising and raising and racing in 2016 and they seem to double the overall amount. How much did we know that this billion dollar close was coming . You mentioned we reported in december they had asked and at their target to raise about a billion dollars. This is very capitalintensive business, but we had also reported a couple of months ago that the company was profitable for the first time in the second alsoof 2016 and they are targeting profitability for this year, which is an encouraging sign for investors as they push ever closer to a longdelayed potential ipo. Thatine where do we think billion dollars is already going to be put to work . Splashing 300 million into a canadian company. Do we expect more of that . You mentioned a luxury ,etreat, the canadian highend you can rent a mansion or villa in the hamptons or on the coast of florida. They have articulated this vision to be this sort of fullservice travel company. Right now their Main Business is really just renting out peoples homes and apartments, but they want to add all these addon services. In november they launched ad on travel services so you could get tours and go pick mushrooms in a forest with a tour guide. They want to do more of that and they seem to be open to acquiring companies to get there. That is one way they could put some of this money to use. We also reported a couple of months ago that they are looking at china this year as a point of expansion. There ord do a deal they may just need to hire a bunch of bodies in beijing to get that done. Caroline the valuation of 31 billion is pretty hefty. In fridays trading, they were at a similar election. How do they rank in those terms . Airbnb is the second most valuable tech startup in the united states, right behind. Oober right behind uber around for almost as long or even a little longer thanuber, of longer uber, about a decade. Many are saying, when is this Company Going to go public . Dollars ona billion the ground shows they can hold out on the private market for a little longer. Lets move away from airbnb and more to the upcoming batch of tech ipos that are potentially coming our way. Jerry covers enterprise businesses. Wonderful to have you here. Lets cast our minds back to how to educateeen trying the market. Lets listen. A Great Company should always be ready to go public because you want to operate your company like a public company. You want to have all the fiduciary duties in place. We dont have any more need for capital. We dont have plans over the next two years to go public. After that, we will see. Is 2017 going to be a good year for ipos . So much excitement built up around the snap ipo. Next 2016 was not a great year for ipos. You see a bunch of public for tech not thirsty companies. Are some companies that could go public in 2017. I dont know about dropbox, but go public in 2017. All these companies that are enabling enterprise to move to growthud, there is a secular story around that. Public investors want to have access to this growth. Theyve not had that in 20152016, so they are thirsty for a new ipo. Caroline how frustrating is it airbnb canies like keep raising cash in the private market, since they will just delay as much as they can . Frustratingewhat it for the investors and many of the employees who are locked in the shares that many of them cannot offload. They need to put money down on a house or to get out of the have the amount of compensation and airbnb, but uber have shown stubbornness to stay private. And the ability to keep raising and raising money. You mentioned snap, it is an interesting example of a company , obviously there was the usual rocky first few days after the initial public offering, but it seems to have been, by many measures, a successful ipo. A lot of people are saying it is probably more of an outlier and they are looking more for the other company you mentioned, its more like a Business Software company, to more set the standard of opening the floodgates. Cisco swooped in and bought the 11thompany at hour. Caroline so enterprises going to be hot. And pushese pulls about whether they come to the market in 2017 . Perhaps they dont want to have overbearing investor base. There are Different Reasons to go public. For an Enterprise Software company, they kind of want to go public. If your large fortune 100 newany taking odds on a to understand how solvent and liquid how you are, it gives more certitude around your huge or as a vendor. For an Enterprise Software company, their buyers dont care if your public or not. They will typically go ipo earlier than consumer companies. On the consumer side, the need to go public is less related to the Customer Base but more for the other reasons you just mentioned. Caroline i want to get your take on the president thats been set. List in thepany u. S. With no shareholder Voting Rights whatsoever, is this something we will see again and again . I think it is more a oneoff. Its not very typical. There are a handful of Companies Like facebook or google that has superility to do these Voting Rights for the founders or shareholders. The typical listing still looks pretty vanilla to me. Mark, thank you very much for joining us. Jerry chen is sticking with me. The wikileaks founder Julian Assange offered in expo nation on why he put thousands of files on the internet this week terry the cia developed a giant arsenal of what appears to be the largest arsenal of trojans in the world. Systemsks most of the that journalists and people in government, politicians, ceos and average people use. Didnt secure it, lost control of it, and then appears to have covered up that fact. Caroline he is also offering help to the Tech Companies ciartedly vulnerable to the tools. More on that with a roundtable experts later this hour. Coming up next, we dive into the infrastructure in this. Why some are saying its a sector ripe for disruption. All episodes of Bloomberg Technology or now Live Streaming on twitter. This is bloomberg. Hasline President Trump called on congress to find a trillion dollars in private funds for certain projects. Industry isucture ourts prime for guest jerry chen invests in this space. Constructionk at labor over the past 10 or 20 stats Labor Productivity versus every other vertical, construction has not been increasing productivity the past few years. Seeingtwo, we are Construction Companies used Technology Like drones to measure progress, gps to drive tractors. They are using these technologies to build ridges and roads faster and better. Caroline we saw the first 3d printed building in less than 24 hours. Im not sure i would want to live in it, but it is a step forward. You mentioned drones and gps. You thinkny element will be the first to be focused on . One company where involved in is focused on Labor Productivity. It attacks the number one cost driver in construction, labor. On site,1000 people and frankly, that productivity has not improved. Labor productivity will be a improvement for Construction Companies. What about some of the other areas of the Portfolio Companies you have. Are separated into areas that come into construction. You think about infrastructure, the other area the formerly socalled information superhighway. Investment in cloud infrastructure, telco infrastructure is important. Onare investing aggressively next gen infrastructure for the physical world and for the Virtual World as well. Caroline what is the opportunity from a 1 trillion investment . Longterm that . Were looking at different verticals from mining, construction, construction has lagged i. T. Spending. I was talking to a construction executive of the years ago and he said the first thing that goes into every construction site now is wifi. Think about that. Before they lay the first brick, they put in wifi. Needs snapchat or something. Wifi is the first thing that goes in. That got me thinking. Once wifi is everywhere, what can you do . Caroline this is not just the u. S. Issue, this is an international issue. We are seeing Infrastructure Spending in the u k and across europe as well. How global are these companies youre looking at . Its a multitrillion dollar industry of trust the globe, not just the u. S. Most of the companies we are investing in start locally around california or around the united states. Constructions Construction Centers take the technology global. Start building here and take it to the middle east or asia. You bring the best practices across the globe. Caroline and the people founding me startups, you must have had to be on the ground and been building to understand some of the issues that arise, where the pain points are. There people coming up are the technologists or are they builders . You have to be both. To be a founder, you want that expertiseersection of and have the entrepreneurial spirit. Two cofounders were ex Navy Veterans who worked in construction and they had military that round. They had that entrepreneurial dna. You merge it altogether and you have a company attacking the trillion dollar market. Like,ne drones and the 3d printing companies, they are suddenly realizing where they can expand into, or all they also coming from a construction perfect storm . Ive seen some of them they said they can use drones to measure construction and start there. Others just throw everything against the wall and realize that construction infrastructure is what is working. It works both ways. It sometimes more efficient if you know the domain first, but if you picked the wrong one, you are stuck there. Chen joining us, thank you very much. Still to come, a 50 pound drone falls out of the sky, that could be pretty lethal. Research says they are testing these kind of accidents on crash test dummies. That story is next. This is bloomberg. Caroline as drilling becomes more as drones become more commonplace, so is the chance of one falling out of the sky. Researchers are studying how to make them safer, with the help of dummies. Check it out. Risk of injurye if a drone impact occurs . Is it serious or fatal . We had the Worlds Largest injury biomechanics research. Its all about head injury risk. Testwe have is a hybrid me. The same dummy used to certify your car. We use that to get an idea of the interaction between a drone and human. Flown aft are once the impact occurs, data is gthered to measure the forces. We look at quantifying injury risk and we look at acceleration and load. Acceleration and compare those to other research weve done for other safety and the military and thats how we determine injury risk. If you look at cars and automobile safety, we put an incredible amount of work and time into making sure they are safe. We are hoping to have the same sort of analysis for drones. You have some sort of parachute device, if its not rigid and breaks apart on impact, that will reduce the energy transfer. There are a lot of things we need to better understand to help the industry make safer drones, and that is the goal of the research. That stories featured in the latest edition of bloomberg is this week. Our reporter joins us with a little more update on the peace. We want to understand the Regulatory Environment around this as well. Tofaa has been doing a lot help ensure that drones come in in a safe and standardized way. Right now the federal Aviation Administration is trying to write the first basic rules that will allow widespread flights over human beings, overcrowd the people. The rules are a little bit on hold, they are trying to figure out how to deal with security concerns, like how to police know whether a drone is legal to be over a crowd or not. Its also caught up in the Trump Administrations go slow approach on new regulations, but theyre working feverishly to come up with the standards right now. In terms of how the researchers are helping align themselves to where standards must be set, i can think of the if theyre going to deliver your new football shirt to you in the outcome you need to be sure they are allowed. What is the research being done . The whole point of the researches, this is such a new industry, people dont know what is going to happen in a worstcase scenario. You have millions of these consumer drones being sold to people. What happens if one falls out of the sky and hits a child in the head . What theyre trying to do with these tests is to figure out what the parameters are. Once they do that, as we heard in the video, then they can start trying to eager out mitigations. The padding on, cover the propellers, build them out of materials that break apart of it dont hurt as much when the impact, etc. Thats really the point of the research right now. Caroline have there been any incidents of people being hurt so far . Its hard to get a handle on the actual numbers every if you go on youtube and online, there are scores of cases. There was a tragic story in the u. K. Last year or the year before of a toddler who lost an eye. There are a lot of them out there. Caroline thank you very much. You can check out the full story. N bloomberg. Com stick with us. Julian assange is next. This is bloomberg. Im Alisa Parenti and youre watching Bloomberg Technology. Prime minister theresa may says the u. K. s on a twoyear timetable to wrap a trade deal with the eu, despite a claim by the danish Prime Minister that the process will take 15 years. May says its in the interest of the u. K. And the eu to close the deal quickly. She pledged to trigger article 50 by the end of march. Scotland may hold a second referendum on the u. K. Next year, according to scottish minister nicola sturgeon. Independence is inevitable unless the u. K. Softens its brexit stance. Some favored another top politician over the former Prime Minister. He was reelected at the eu summit in malta. Russian president Latimer Putin and israeli president benjamin that yahoo held talks in moscow today on the assisted on the situation in syria. Net yahoo forcesaise concern about in syria. Japan says the 185 cases of cancer found in children who live near the 2011 Fukushima Nuclear disaster cannot be linked to radiation. Doctors at Fukushima Medical University said the cases were found due to blanket screening and not radiation that leak from the plant. Global news, 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. Im Alisa Parenti. This is bloomberg. Its just after 5 30 p. M. Thursday in new york. Its already 6 30 friday morning in hong kong. David has a look at the markets. Morning tory good you. Ask 30 in the morning as you mentioned. Im about 10 or 12 hours away from my happy hour. Futures indicating a slightly higher start. We look at markets in australia, were dead flat on the new zealand markets. Japanese futures are looking to open higher by about. 5 . Way up, thats the story we are watching closely with the aussie tenure down 3 . Its judgment day for the suspended president , the decision should be out in about four hours now. Ingles in hong kong. Caroline this is Bloomberg Technology. Airbnb raises more than a billion dollars in its latest funding round. That raises the valuation to roughly 31 billion, according to people familiar with the companys efforts. The first reported lance to increase funding back in december. The company has raised more than 3 billion to date and just turned a profit for the first of lastthe second half year. Another top story this week, wikileaks publishing nearly 9000 cias cyberhe spying capabilities. Now Julian Assange says he will work directly with Tech Companies to help close the gaps in their security. He spoke in a webcast earlier. Hearing the call from some of the manufacturers, we have decided to work with them to give them some exclusive access to additional Technical Details that we have. So that fixes can be developed and pushed out so people can be secured. Caroline joining us to discuss what this does to the relationship between Silicon Valley and the u. S. Intelligence community is our bloomberg reporter who covers this from washington. Also eric oneill with carbon black. He is a former counterterrorism operative for the cia. The cia has not commented on the exclusive it he of the leak, but they have been making some statements. We have been hearing from the cia. It dont usually hear from them on breaking news story, but weve been getting statements yesterday and today. Today they said hes not really known as a bastion of integrity. That was pretty interesting. Weve also heard from them saying the American Public should be deeply troubled by any leaks wikileaks may be putting out that could compromise u. S. Intelligence in protecting the american people. While theyve not quite confirmed anything, theyve come out publicly to us telling us directly that they dont stand , anything that would compromise the u. S. Ability to gather information. They have also tried to make clear that they are not allowed to do electronic surveillance on u. S. Soil. So you see them pushing back at some of the accusations we been hearing from these disclosures over the last couple of days. Assange weighed in more on the webcast. Horset it was a trojan from the cia. Have a listen. The cia developed a giant arsenal, what appears to be the largest arsenal of trojans and nurses in the world that attacks thatof the systems journalist, people in government, politicians, ceos. Nd average people use did not secure it, lost control of it, and then appears to have covered up that fact. Eric, accused of losing control and covering up the facts. Thedangerous could it be if cia did indeed leave these vulnerabilities open for others to find as well . We are saying vulnerabilities, but the real name for these things is weapons. Its one thing to release the tools, but when you release the actual vulnerabilities, those can be weaponize. Weve seen that within 24 hours of discovering a new vulnerability, especially if it is spread around the world, then attackers will use that vulnerability, and 99 of the major breaches that have happened happened because of an unpatched vulnerability. Wants toaks actually be responsible for once, then they need to take great care and how they release these vulnerabilities. Are lookinge fbi into how wikileaks came across this information. Right. Wikileaks has told us that this ande of code and malware security vulnerabilities was circulating for a long time among government hackers and contractors. They say one of those people handed the content over to wikileaks. The question is, who could that have been . The cia will be making a list of who those people are in trying to find who that one person was that turned over the content. Thats something we will have to wait and see if this is going to be happening, with an investigation into this. You mentioned if wikileaks was going to be responsible for once, it should be careful in letting the tools be known. Shouldnt the cia have been just as responsible . For the cia is responsible conducting espionage and for gathering information all over the world in order to protect the counterintelligence of the u. S. , to protect us here. So there is a National Security reason to protect the information and to be able to use these tools. Espionage today is not conducted by sneaking into buildings and stealing files. It is conducted through cyber attacks. So there is an authentic capability that every single nation uses. I do agree there is a problem when the cia loses the information. Nafeesa, what is it like on the ground, what are people saying within the government and the white house about how the cia should potentially have reacted and acted . Weve not had any confirmation that this content so no one has quite said that yet. Sean spicer at the white house saying this is very serious. Weve heard resident donald trump previously say that he loves wikileaks, kind of backstabbing from those previous comments. We have also seen the fact that on the hill, weve heard from john mccain saying this is extremely serious and we need to look into this and it puts american lives that risk. Hand somen the one discomfort around how did it get out from the cia but also will it now compromise the u. S. Ability to gather intelligence and information as well. Caroline eric, this is a strange relationship between the ath giants and washington times. We go back to the San Bernardino shooting and the fact that they dont like to allow backdoors into their encryption. How does this put the onus on the relationship Going Forward . Eric the government needs to make some strong National Security decisions about what they need to provide to the Tech Companies. If the cia did lose this information and they knew that it proliferated and certain hackers were using it, i would like to see an earlier disclosure and worked with Tech Companies to strengthen our to its, because that is security, protecting people here in the u. S. Is National Security, especially something as important as a cell phone and our data company which is where we put everything we do and say these days. Caroline and even more so as the internet continues to grow. Thank you for all your reporting. Moving on, one stock we are watching his ire i. Fireeye. Company has the achieved consistency in its sales leader she leadership. He reiterated they are not opposed to making acquisitions, although its not part of the companys turnaround plan. Snap wraps up its first full week of trading, and has been quite a wild one. What we have learned about the companys projections, next. This weekend, we bring you our best interviews from the week, including our exclusive sebastian n with trune. Soon in this saturday for the best of Bloomberg Technology. This is bloomberg. Caroline facebook is not done taking a page from snaps playbook. Messenger just added a new feature called day. It allows users to post videos that disappear after 24 hours. If it sounds mail your, its story. Snapchat created has it also called stories. Its a move in order to keep up and prevent them from shifting their attention to a competitors app. Ofit the sincerest form flattery . Andes closed down just. 5 its down over 7 since the ipo closed. Snaps stock has been taking hits in shortsellers bets on future declines. As an analyst for morningstar who has labeled the company as overvalued. This is like a triple strike we are seeing from facebook. All of their messaging apps taking a leaf out of snaps book. How harsh is the competition . Think overharsh, we the next few years, snapchat has tocontinue to invest in r d continue to invest in sales and toketing of it, in order obtain additional users and generate user growth and add revenue. Its going to be tough competition for snap. Caroline 158 million daily active users. They seem to be trying to stay to say on the ipo lead up that perhaps they dont need to grow that much quicker. Its the addiction they are ready have to the app. Do you buy that . How much do you want to see daily active users growth . We want to see that at a much higher rate. And we have modeled it at a much higher rate. We think these guys are going to userccessful in generating growth, but in terms of engagement and interaction and spending time on the at, theres only 24 hours a day, basically, for users to be on multiple apps. When there is engagement on facebook and other facebook apps, as you mentioned messenger and instagram, it limits the Growth Opportunity in terms of on in terms of engagement snapchat. Caroline it vindicates the business model, the new way of consuming media that perhaps the appetite in the market seems to be more attracted to. Snap is a big market, as did mention on the roadshow. Its a large market and growing fast. The negative part of it is that basically what we call the larger companies, the teams of Online Advertising such as facebook and google, they already have the large user base, especially facebook. Although we are pretty confident that advertising dollars will flow to snapchat, given the features that it has and the innovation that it has in the user data that it can compile, we think still a larger portion of the ad dollars will continue to go to facebook, somewhat limiting Growth Opportunity for snap. Caroline what about the leadership . Some think theres too much control, and theres no shareholder Voting Rights for those who bought into the ipo. The sea need someone to be a clear number two to come up with Product Innovation . In terms of innovation and running the company, in terms of ising an environment that energized with a lot of motivation, we think he is doing a good job. The rest of it remains to be seen. Basically this is where Disruptive Technology can come in at any time in force companies to change their entire strategy. It remains to be seen how spiegel will react to that. In terms of control of the company, they got the Voting Rights. Lets put it this way. If there is a potential acquirer of this company and they come in and bid on snapchat, or snap, i should say, it gets a lot of doubt in terms of whether spiegel and murphy will actually agree to that and agree to be sold. That could create some problems for shareholders in the future. Caroline interesting. Hes saying its an overvalued stock, but hold it. Now to a developing story. The Big Data Company back i intel is working with morgan stanley, jpmorgan, and bank of america. If ill confidentially for its ipo. Its planning to go public this year and is eyeing a valuation of war . 1 billion. A quick programming note, tomorrow its job stay in the usa and were joined by the director of President Trumps National Economic town so. That conversation at 9 30 a. M. New york time, 2 30 p. M. London time. Season is underway, but what happens if the snow doesnt come with it . That is next. This is bloomberg. Caroline a story we are watching, showing fake versions of its app to companies thought to be conducting things. The system would cancel rides for fake cars that were not actually nearby. 1. 5 billion remake of a resort in new hampshire. Plans call for luxury condos and construction of the largest ski area in the northeast. Cory johnson spoke with the developer who says he will employ the latest in snowmaking it rings therocess art back to the science. The idea is the difference between a cook and a chef. Given the same ingredients, the chef comes out with something you can charge 100 for, and that cook is putting out the same thing for 15. The ingredients will be the same , but the way you put them together and manage them means the difference between making great snow and just something that is quite. Current technology and putting the art back into snowmaking so that we make a product that you really want to ski on as opposed to something that is just white. In theaving snowboard it east coast and west coast, the snow we have out here is a lot better, a lot different. What are you trying to create . Youre trying to make a surface that doesnt make any noise. It feels and tastes like hacked powder to the skier. Theres a certain density and consistency you can achieve using a little more energy and a little bit smarter technology. At the end of the day, you would like an experience were summoned goes skiing and they will say its just as good as skiing out west, so they will stay here in the east. 15 or 20 years ago thats what we used to do. Now we want to combine it with the old artistry we had 20 or 30 years ago and produce more efficiently a really great product. Cory an interesting challenge are facing in terms of developing properties and selling real estate up there. When you look at the growth in the business, is this something that will be cash flow positive early on, or something that can really grow slowly over a long time . We think coming out of the box it will be cash flow positive, but the rope will go on for a very long time. We have decades of building we can go through with the approvals that we have. The exciting part of this is we can build a 21st century resort and keep building it over the next three or four decades. Cory what other things are you doing now that you could not have done 20 years ago due to the technology . Advancements in lift technology have made lifts better and more reliable, and more efficient as far as their cost to capacity. Things like combining activities at a resort so that you can sleep in the same room, park your car, if you want to go snowmobiling you can do that from the same place you would go from to go Alpine Skiing or kayaking. I hate to make this analogy, but we knew stay at one of the disney hotels, you can go to five or six different lands each day and the family can go in four or five Different Directions if they want. Were trying to have something read can get great Alpine Skiing, a wonderful nordic spot, go to cooking school, do yoga, and in the summertime, flip those activities with kayaking, boating, swimming, all from the same place and never having to use your car again, so you really have a destination resort. And there are different activities for the whole family to do every day. Caroline that was the American Skiing Company founder. That does it for this edition of Bloomberg Technology. Remember, all episodes are now Live Streaming on twitter. 5 00 us out weekdays at p. M. This is bloomberg. Announcer from our studios in new york city, this is charlie rose. Anthony im anthony mason. Filling in for charlie rose. We begin with politics. On monday, the Trump Administration and House Republicans unveiled their plan to update obamacare. Obamacare. To upend the bill has a new system of tax