Challenging the news industry. We will hear from a top lawmaker who does not think big is necessarily bad. But first, to our top story. Apple has a backup plan if the u. S. China trade war continues to escalate. Hon hai, the companys manufacturing partner, says it is able to make all iphones bound for the u. S. Outside of china if necessary. Hon hai now makes most of apples smartphones at its chinese factory. Our bloomberg tech editor joined vonnie quinn with the details. Alistair this is an executive who was talking to investors and other people in taiwan, and our reporter in asia, debbie wu, was there to listen. This is more of a plan. They did not say apple asked foxconn to do this yet, but he was saying they are very capable of doing it. It has raised a lot of questions. We spoke to an analyst over here who looks at the smartphone industry, and he was saying that if youre talking about actual final assembly, which is what foxconn does, putting together all the components in an iphone if you are talking about that, it might be relatively easy to move. If you are talking about the whole manufacturing process for an iphone, that would be a lot harder. Vonnie we know that politically china and taiwan are a little bit at odds. Is there any danger that china would retaliate against the company if this were to happen, if apple were to move all of its production to the Taiwanese Company . Alistair yeah, that is a very good question. Apple has got to be very careful in general with this kind of thing. Some of the activities that are going on with huawei in the u. S. , where the u. S. Government is Encouraging Companies and consumers to steer clear of huawei, that has raised concerns about what happens to the treatment of apple in china. There has been a lot of concerns that there would be kind of an unofficial recommendation that chinese consumers not buy iphones and buy something else. And that market is still really important for apple. It is a big risk. Vonnie hon hai, of course also known as foxconn, had a plan for a wisconsin plant that would have employed 13,000 people. Does its plan for wisconsin change materially at all, alistair . Alistair the executive who was speaking yesterday, he seemed pretty bullish about the wisconsin plant, and he kind of placed it in the same type of strategic realm, this idea that you could move the iphone assembly out of china. And also india, india is something to consider, too. Foxconn has plants in india already, and it was dealing with similar types of restrictions from the indian government. So it certainly does have a lot of options around the world. Emily bloomberg techs Alistair Barr there. Well, the recent wave of antitrust scrutiny by the u. S. Government is not stopping salesforce from gobbling up the competition. This week, the Sales Software giant agreed to buy Tableau Software for more than 15 billion. Seattlebased tableau helps customers turn raw data into easily understandable dashboards and charts. The move is expected to give salesforce even more ways to help its customers analyze data. Tableau is salesforces biggest acquisition to date, and it means they have now bought more than 60 companies in the last two decades. For reaction, we were joined by a Senior Analyst from sanford bernstein, and our correspondent from bloomberg tech. This makes a ton of sense for both companies. Tableau has been moving upmarket up into the enterprise customers, and they have always had the best r d, the best products. But what they lacked, until the new ceo showed up, was an enterprising inner sales force. Existing enterprise relationships. The salesforce, very large ecosystem, massive capacity for driving sales. It is really a huge landgrab opportunity for salesforce to cross tableau into their existing customer base. It also makes a lot of sense for the two companies in terms of their mission. Both Companies Want to use data and information to digitize companies and help customers go through a digital transformation. And the challenge salesforce has had in my view is not having the existing systems outside of their crm to look into other silos in large enterprises, and tableau can really provide that. Emily adam felicity, the ceo formerly of amazon. An analyst out there thinks this is not one of salesforces core competencies, it does not help expand the core business. Of course, you have got other competitors out there like google, which just bought looker. Talk to us about the range of reactions. It really has been diverse. Microsoft is out there with power v. I. , and they have just been very dominant. Particularly because they can Sell Cloud Services and power v. I. At the same time. One analyst has told me that in her opinion, microsoft has been eating tableaus lunch. There are some people who think that the deal is quite expensive, a 42 markup from tableaus market cap from the close on friday, but others say all Software Stocks are valued pretty richly these days. I think, you know, what it shows is that marc benioff is not afraid to continue to buy the companies that he covets. He said he was interested in this company for a long time. As you said, even in this antitrust landscape, salesforce is really benefiting because it is not on the governments radar. The Enterprise Market is so competitive, and because consumers are not involved, you know, it does not seem there is a huge power imbalance between this company and its customers. Emily what do you have to say to the skeptics here . Microsoft was eating tableaus lunch, tableau was about to be in competition with google as well. Now they will be a bit more protected under the salesforce umbrella, but this is not necessarily additive to salesforces current product. I think the skeptics will say a couple of things. That this was a defensive move on the part of tableau. I do not think that is true. In q1, tableau landed a 100,000 seat deployment with a large retailer. There are only a few retailers that could be, like walmart. So if you are landing customers like walmart, they also have exxon mobil, facebook some of the most advanced companies are already using tableau at scale. Instead of the microsoft power v. I. Product. I think that shows the strength of their solution. And from all of our customer conversations, they have remained strong and they are growing the recurring revenue almost 40 a year with the transcription. Some will say this is expensive, but if you look at the mulesoft acquisition, i believe that was 16 times forward sales, i believe this is about 10 times forward sales for tableau. So you could argue for something growing recurring revenue almost 40 a year, they could have paid more. This is a valuable asset, because without being able to look into all of the different silos where enterprises have their data stored, it is really impossible to digitize a company or go through a digital transformation. So i do think while it is outside the core competency of salesforce, it is going to be very synergistic in what they want customers to do. Emily mulesoft another big acquisition, but not quite as big. Tableau also has customers like verizon and netflix. Put this in the context of salesforces other acquisitions, not all of which have panned out. Yeah, there have been some products that have not waived the old analytics tool, which salesforce admits have been a flop. But i think it really shows that salesforce has been on this trajectory of moving from Customer Relationship powerhouse to a bit more of a generalpurpose Information Technology company. Emily bloombergs nico grant and zane crane of sanford bernstein. Coming up, the year of the tech ipo continues. Well talk to crowd strikes Ceo George Kurtz about going public next. And if you like bloomberg news, you can check us out on the radio, the bloomberg app, online and on sirius xm. This is bloomberg. Emily the year of tech ipos continues. Shares of crowdstrike soared in their first day of trading, wednesday. The stock jumped as much as 97 at one point in the session. Crowdstrike raised 612 million in an ipo, giving them an 11. 4 billion market cap. Crowdstrike Ceo George Kurtz joined us from the nasdaq. George well, i think at crowdstrike, we are really focused on going public when we were ready. From our perspective, we have always taken a longterm view. And today is one day where we raised a financing round, and we are going to continue to focus on the future. I think we should look back on today and celebrate it, but tomorrow we are back at it. Focusing on Customer Success and preventing breaches for large and Small Companies around the globe. Emily how much are you following what is happening globally . And how much exposure do you have to china . George we dont really sell in china, so that, you know, has not affected us. I think from a china perspective, we typically see a lot of activity around geopolitical tensions. And that activity tends to manifest itself in cyberattacks. So with some of this unrest, we continue to see nationstate attacks, and again why we started the company was to help nations around the world against these determined adversaries and nationstate actors. Emily certainly, what is happening with the u. S. China trade war is impacting u. S. Companies. The cybersecurity landscape continues to change, the Threat Landscape continues to change. How do you stay competitive in an everchanging world . George a big part of our success has been the fact we have really built a cloud platform. In security, there has not really been a security cloud. If you think of service now and salesforce, it has been an equivalent company. Part of our overall approach has been to collect a lot of endpoint data, Security Threat information. That has driven a lot of the Artificial Intelligence algorithms that we have. The more data we consume, the smarter our technology tends to get in identifying breaches that have never been seen before. So that is a big part of the overall story. What we focus on is really the platform approach as opposed to building yet another point product. And that has resonated well with our customers. Emily what are the biggest trends you see on the horizon, given that we are going into the heat of the u. S. Election season, and the last election season was certainly not secure . George whether it is elections, whether it is intellectual property theft, or whether it is destruction from ransomware, these are all Cyber Threats that organizations of all shapes and sizes have to deal with. I think what it does underscore is just how Vulnerable Companies are, organizations are, nongovernment organizations, to these sorts of cyberattacks. And unfortunately, they have been burdened with Legacy Technology that has been incapable of identifying these breaches. And again, that is part of what we really focus on is Building Technology not only to stop malware, but the broader issue is actually stopping breaches. Emily what trends are you seeing in company decisionmaking . Are Companies Rising to this rising threat . Are they protected as they should be, or are they more broadly very vulnerable . George i think more broadly, they are still very vulnerable. And unfortunately, there is a tapestry of Security Products that they have been using in the past that may not have given them the protection that they need. From an awareness perspective, the good news is that boards of directors are taking this very seriously. This is a board issue, a risk issue, and when you look at some of the attacks we have seen some years back, like wannacry, where ransomware literally took companies off the map for many weeks, in some cases months on end, it moved from just purely being infected to, well, this can be a Systemic Risk for our corporation. And worstcase, they are spending hundreds of millions of dollars in trying to recover their company and bring them back to health. Emily meantime, we reported that cisco held talks with crowdstrike about a possible deal about six months ago. The deal did not happen. Why did you decide that the right course was staying independent . George i cannot comment on rumors, but our goal has always been to be an independent company. And i think we have built the company, we have operated it as if it was a Public Company when we were private, and i think our growth and our financials are of the size and scale of what a Public Company should be. We went public when we wanted to, and i think we have seen a warm reception today from institutional investors. Emily george kurtz, ceo of crowdstrike. Meantime, slack is inspected to be valued between 16 billion and 17 billion when it lists its shares publicly next week. That is more than double the companys last evaluation less than one year ago. Unlike many Tech Companies that have gone public this year, slack is forgoing the traditional ipo route with a direct listing. Investors will be allowed to begin selling shares immediately. Bloombergs ellen huet gave us the details. What does it mean . Ellen it is coming from people familiar with talks about the deal as they are getting ready for the direct listing next thursday. So we dont specify with whom, but yes, obviously the people involved are the company, bankers, investors, thinking about how much is this Company Going to be worth when it lists next week . What is interesting is they are doing this math for the 16 billion to 17 billion valuation based off of some projections about the companys expected revenue for next year. So they are looking at this years projected revenue, the expected growth rate, and forwarding ahead to fiscal year 2021, because of the way the fiscal year calendar works, and expecting basically a 20 times valuation or 20 times revenue to make the valuation. Emily well, this sort of brings to mind the headline in which uber was targeting a 120 billion valuation, which as i understand it was floated by companys bankers and had nothing to do with actual demand. So that is far out from the ipo. We are now one week away from slacks ipo, so this feels very specific. Ellen this is going to be a little different, i think, simply because it is a direct listing rather than an ipo. My understanding is that in an ipo, theres a little more control over where the bank and the company and everyone is going to agree where the company, or where the stock will open at. They will set a price and set boundaries around that. With a direct listing, its a little different. What is going to happen is, at some point, there is going to be a Reference Price that is going to come out either from the exchange or the bank. As we saw from spotify, which did a direct listing last year, the reference range was quite large. It was somewhere between i think the 40s, 40 per share up to 130. Pretty wide, not very specific. And then what happens on the morning of trading, the exchange and the direct market maker, which in this case is citadel, will collect, buy, and sell orders from a bunch of different groups, and then try to figure out based on those orders where to open trading. And that may take several hours. Emily so the skeptics say that slacks financials do not appear to be as positive as, lets say, dropbox or docusign, when both of those Companies Went public. What is the response to that . Ellen well, slack has not been talking a lot. But it is true. If you look at slacks growth rate, or the growth rate of its revenue, it has been declining over the last few years. What is interesting is when we talk about the forward projections for the valuation of the company, they are based off of an assumption that the revenue will grow 50 next year because they have just seen that it is expected to grow 50 this year. But if you look at it, it grew somewhere in the 80s the year before and over 100 the year before that, so it has actually been declining. It is unclear i think to investors and people observing and deciding whether to buy this stock whether the growth rate slack saw in some of its earlier years will continue at the same rate. Emily now because they are doing the direct listing, it means investors and employees, right, can sell their shares right away. Should people buying into this company for the first time be worried about a talent exodus, if employees can now suddenly cash out . Ellen we have already seen there has been some trading happening on the private market ahead of time. It has been pretty consistent with the expected price for the valuation of this listing, so somewhere around 16 billion to 17 billion, and volume has been as expected. So i think people are looking at that to get an indication of whether people are expecting to sell a bunch. I think with spotify, if you looked at the first few days of trading, there was not a lot of volume, and i think in the end, people will probably have faith that slack is a company to be held in the longterm and will not have a big selloff. But you are right that investors and employees, unlike in a traditional ipo, can sell the first day of trading. Emily spotify was very quiet on the day of its direct listing. Do we expect to see slack executives in new york on the floor of the exchange celebrating . Ellen im not sure yet if there is going to be banners and all that, but stewart butterfield, the ceo, will be in new york. They will be doing something that morning on the new york stock exchange. And i think overall when you talk to experts about what they expect and what they hope will be a win for the slack ipo or the slack direct listing, i think no news is good news. If it is quiet, if it stays pretty stable, if there is some trading and nothing crazy happens, it will probably be seen as a pretty big win. Emily bloombergs ellen huet there. As a reminder, bloomberg beta, the Venture Capital arm of bloomberg lp, is an investor in slack. Hong kongs falls into chaos as citizens protest a china extradition bill, but what does it mean for inves