much is about where the consumer is physically, but how does that square with data concerns? we will ask the foursquare ceo. for many of the national security teams that monitor threats on the u.s., the apparent drone strike saturday was the realization of their worst fears. the attack raised concerns by u.s. security officials and experts in terrorism about the rapid evolution and technologies that may have allowed these inexpensive devices to pierce saudi defenses, flying long distances to drop bombs. i'm joined by alan. alan: we are still not 100% sure exactly what devices were used. the rebels in yemen, which took initial credit for the attack, said they used drones. later, u.s. officials said that they were "cruise missiles" and possibly drones as well. a cruise missile is a kind of a drone. at the very least, cruise missiles used to be kind of the weapons used by large military organizations, but as the technology has gotten cheaper and easier to use, we now see kind of it merging into rebel groups like this. very definitely, this is kind of a boundary that has been crossed that is quite troubling. taylor: do national security officials just assume that more of this technology will be used in warfare? alan: we have certainly heard that from the point of view of domestic terrorism. homeland security has identified quote unquote drones, so that is a big category. but as a threat going forward, the federal aviation administration is looking for ways to track these devices better. clearly, the same is true overseas, where groups can sort of work on these kind of things without being tracked by the fbi and u.s. intelligence. it is definitely a concern. taylor: besides tracking some of these devices, how much future regulation do you see coming down to this? alan: there is a host of things. quickly, and the next couple of months, the government is about to propose requirements that every drone in the usb tract trackede u.s. be electronically. beyond that, they are also looking at better registration, they are trying to create a low-level tracking system that will follow these kind of like radar does. i have to tell you, the technology is tricky. they did some tests at airports and it was difficult to spot intruder drones. sometimes radars see them but sometimes not so well. it is a very tricky technology problem. it is also tricky how to take them out of the sky. you can override their radar signals. it is quite a tricky problem. taylor: tricky problem indeed. that was alan levin. apple fights a tax case this weekend luxembourg. they will tell the european union courts that they pay more taxes than anybody in the world. the judge has ruled that apple's tax deals with ireland let the company pay far less than other businesses. mark gurman, who has the upper hand this week, apple or the eu? mark: apple would not be sending a team of six people if they did not think the eu had the upper hand. i don't think apple is coming in with a position of strength. having tax loopholes in ireland has been heavily criticized for years. the e.u. has its position on this. apple has its position as well. if recent history is any indication, apple has taken these things to court but settled quickly. i would not be surprised to see if there was a meeting of the minds between apple and the eu. taylor: if there is not a meeting of the minds and we get a $14.4 billion tax bill, what does that mean for apple's bottom line. mark: that is a lot of money. i would really like a check for that amount of money right now. they will find a way to sprinkle it across several quarters, do different adjustments, maybe take debt out. of course, they have over $200 billion in cash offhand. if any company could take that bill, it is apple. taylor: what do the tensions mean for apple's strategy in europe? are they less likely to wanting to be working with europe? mark: basically every global corporation, so they have these issues across different countries. they are dealing with the tariff situation. in china, the balance between local laws and what they want to do for their consumer. the e.u., they have this tax situation. what you are seeing here is another one of those things, one of the biggest and most successful companies in the history of the planet has to deal with. i think you will still see them working on striking deals to get the apple card there and some of the other products they want to work on. taylor: we await some other announcements on that this week. coming up, wework entering the public market has been quite a ride. why vision fund and some others are having second thoughts. that is next. this is bloomberg. ♪ taylor: the biggest backers of softbank's vision fund is having second thoughts. they are reconsidering how much to commit to its next investment vehicle. softbank invested in it at a $47 billion valuation. now there is talk that the company could be worth less than one third of that in an ipo. for what we should expect from the roadshow, i am joined by sarah and ellen. how much of a scar do we think wework is a relative now for softbank? ellen: i think we are seeing they are more closely tied than expected. they have invested something around $10 billion in the co-working company. we are starting to see how the ipo gets a little shaky, there are effects on softbank's ability to make money going forward. abu dhabi and saudi arabia, which have traditionally been backers of the enormous vision fund, they are starting to get nervous. they are saying, we are not sure that we want to invest the same amount we did in the first fund in the second. we are starting to see, we work is having ripple effects beyond just their own ipo. taylor: you have been writing some great articles about how they have been an enabler. does that show that softbank's demand is not limitless at this point? >> i think that is correct. the tensions between softbank and some of its investors have been going on for some time and wework of course is at the center of some of those concerns. the big saudi arabia government fund had some questions about softbank pouring as much money as they wanted to into the company. tensions inside of softbank between executives who wanted to invest money into it and others who were not quite so sure. taylor: we know that the roadshow sort of kicked off today. >> we are expecting to have it this week. there are still some last minute filings and final decisions that we are waiting for. i think if things go forward as planned, what we were hoping is that they would have this roadshow starting soon and they would be able to wrap it up before the jewish holiday, which is a time that their ceo may need to spend some time away from technology. there is pressure to get it done soon and they are hoping maybe investors will show some more interest in the stocks now that they have made some governance changes. friday, they brought back some of the more dramatic corporate governance decisions that the company had made and we will have to wait and see if that will have any effect on the company? taylor: you talked a lot about how changing the corporate governance structures frankly has not changed what is really wrong with the company, which is its finances. do you think the structural changes did not go far enough? >> it certainly helps. it addresses at least one of the question marks. this is a company that is burning cash like crazy so it needs a constant resupply of cash to survive. it owes something close to $50 billion in lease payments and, again, this company has a short history and pleads cash. -- and bleeds cash. it is still almost entirely in control of one person, ceo and cofounder adam newman. the company sort of made some questionable investment or business decisions. it is probably good that they addressed some of the governance concerns, some of the powers of adam newman, but it rolls back for a few of them. taylor: the big red flags, what are the biggest concerns? shira: this is a company that is growing very fast but look how it got there. we don't know how much money, how much profit the company makes on buildings it has subleased for a considerable period of time. it doesn't really go into any disclosures about the buildings it has owned or leased for a longer period of time. this is a company with an uncertain financial model and it is on the hook for $50 billion in lease payments. the mismatch around the question marks about its ability to profit ever or the cold hard cash that it owes in coming years, that is certainly a red flag for me. taylor: i think we were a little bit surprised that wework went through with the ipo or the roadshow despite pressure not to. any idea how that relationship between wework and softbank may change? >> part of the interest in following this story has been trying to track the disagreement internally between softbank, wework, between the companies, the banks, about how to proceed. continuing forward with the ipo despite reservations and hesitations from other parties, because they really need this cash. it is not just the $3 billion or so they are hoping to raise, but it is the $6 billion of additional credit facility to get access to only if they have a successful ipo that raises at least $3 billion. there's a lot at stake for wework to try to make something work, try to see if they can move forward with a plan as had been discussed. changes are a possibility but that is not what they would hope to happen. taylor: a gauge on how well they think the ipo is doing. thank you for joining me. coming up, our exclusive interview with ibm ceo ginni rometty as she discusses red hat and the future of the company. this is bloomberg. ♪ taylor: ginni rometty started at ibm in 1981, became ceo in 2012, and has overseen a dramatic repositioning of the company. chapter two of tech's evolution is centered around reconfiguring data. caroline hyde spoke exclusively with ginni rometty about the cloud and why they can be collaborators. ginni: this is something we always felt so true about, that the customer is first. you live in a world where sometimes your innovation will come from google, amazon, microsoft, ibm, and you want to take advantage of wherever innovation comes from. you want to build something once, run it anywhere. the second part, you want to get to innovation wherever it is. in almost every business, you have competition and cooperation. when we bought red hat, absolute commitment. it is open source. absolute commitment to the integrity of that. that is really for our clients. caroline: would you still see microsoft, amazon as competition? ginni: we are the number one hybrid cloud player now. that is what i want my name synonymous with. number one hybrid cloud, best partner to make you a cognitive enterprise. data and ai infused in all the ways it does its work. if you do that, you have to have a hybrid cloud underneath it. i am really amount the digital transformation journey. you already have many clouds. clients, i will say, how many clouds do you think you have? they will say, two. come back, i have seven. the idea is connect all of that together and when you speak of just cloud alone, the idea of cloud, which is both private and public, you really are the best cloud for mission-critical work, because of the security and our ability to take mission-critical apps, that is our sweet spot. caroline: our clients getting it? ginni: take the example of delta and at&t. at&t will move all of their applications onto the ibm hybrid cloud. with red hat, it will be out into the network so your network services come faster. delta airlines, a lot of work done with them as you front end deal with your customers. when you rebook an airline, not only can you rebook, but everything a passenger wants, done. real-time when you are up in the air. delta, real strong proponent of red hat as well. mission-critical, hybrid, multi-cloud on open systems so you can get lots of innovation, and it is very secure. caroline: red hat, $34 billion, amazing acquisition. you are someone who knew about acquisitions. you helped integrate within ibm previously. how are you ensuring the integration can be as smooth with red hat? ginni: i don't think the word is integration. it is related to what you asked me a minute ago. red hat is the world's number one open-source company and together we are the number one hybrid cloud provider. when we acquired red hat which, by the way, it is a very fair price. they are a very good company and very profitable company high-growth, high profit is not what you associate with a cloud company. an outstanding firm built over many years. ibm has worked with red hat over 20 years. we were the original folks who really helped propel open-source onto the stage. we put a billion dollars into something called linux back then. not everyone is familiar with all the tech pieces but it will be linux, containers on top, and something that moves containers around. this is the future architecture. i think that war is over, that is the architecture of the future. that is what red hat is. when we acquired them, we have two goals. horizontal and vertical. we are leaving them as a separate and distinct unit. i have plenty of experience. i have done 60 acquisitions in my time. they will participate and continue to be the leader in open-source. it is a very different community out there. they must remain committed and neutral. the second, they have to be on all of our competitors' platforms. i want to see firm neutrality on that. what ibm does -- think of them as completely nonbiased. ibm will be opinionated. we take their products, we use the best mission-critical cloud. i have already built all my software to take advantage of there's. you can now take ibm's entire key software portfolio, and it can run anywhere. that is a dream to be able to renovate. all the mission-critical apps in the world are built on ibm. the world is already more than half linux, which is what red hat is, and the destination is our architecture. taylor: tune in all week at 2:30 p.m. eastern for more of our exclusive conversation with ibm's ginni rometty. tuesday, they talk about ibm's push into quantum. coming up, the rest of the gig economy with that new potential law ab-5. this is bloomberg. ♪ here, it all starts with a simple... hello! -hi! how can i help? a data plan for everyone. everyone? everyone. let's send to everyone! [ camera clicking ] wifi up there? -ahhh. sure, why not? how'd he get out?! a camera might figure it out. that was easy! glad i could help. at xfinity, we're here to make life simple. easy. awesome. so come ask, shop, discover at your xfinity store today. taylor: new california legislation including many companies from claiming workers as independent contractors will take effect in 2023 named a.b. 5, the law passed the senate and assembly last week and governor gavin newsom indicated he will sign it. i will companies like uber and lyft make out? to discuss, i am joined by steve jang of kindred ventures. he's also an uber shareholder so you are the perfect person to talk about this. how big of a hit is it? steve: some of the estimates, anywhere from 20% to 30% in terms of the california operations. larger than just uber and lyft. it is any gig economy marketplace. that includes service marketplaces. a lot of these companies have come about in the last 10 years. they are involved in fixing appliances in your home, perhaps cleaning your office, driving you or your family or your coworkers to and from their employment. it is really a far-reaching bill. there has been a lot of exceptions applied into it as part of the political legislative process. it has been an interesting thing to watch. taylor: do you think uber or lyft might be hit more? steve: definitely the service marketplaces will feel the hit. they will have to react to that. the truth is the process from here is still complex. not only does the governor have to finally ratify that, but it is in negotiation right now with the governor. it's also the companies have created a consortium to propose a bill for next year that will be voted upon. their idea is to provide a lot of the benefits that makes sense and keeps the business running with as many participants, in terms of part-time, discretionary workers who want to be independent contractors, but to provide minimum income and benefits to them. the end outcome here is there is going to be a compromise where a lot of these benefits and assurances should have been proactively proposed by a lot of these companies. the test is whether they can come to a good agreement and do something that is good for the people that are not only part-time and want that discretionary, independent contractor work, but also the people working full-time and to provide something for both of them. yet, keep the number of jobs available to these marketplaces and the consumer is happy. taylor: how do you value a company like uber? an analyst said he values it as a social media company because you are tracking how many monthly downloads you have of the app. how do you value a company like uber that is in so many businesses? steve: it is a global business as well. it has international coverage but also multiple product lines. the core platform is called marketplace. what they have done so well is launched uber eats, uber freight, uber health, which is a very performance version of taking you to your doctor's office on a scheduled and on-demand basis. a lot of these businesses are built on the same exact matching engine. this matching engine is not dissimilar from a stock market, like nasdaq. the idea that this marketplace has multiple products, it does make it a challenge to identify the overall size of the business when you have so any different product lines growing at different paces and different timelines, beginnings. looking at it as a platform and evaluating each product line is the way to go. taylor: you mentioned uber eats. you are an investor in postmates, which you were an investor at different times. one might consider those competitors. that food delivery space is so competitive. how do you think postmates can make it, all of those big competitors? steve: i think postmates and door dash were very early on and very focused on food delivery. uber entered the market realizing their logistics network and drivers and marketplace could be expanded into different areas. a lot of drivers could also become also food delivery drivers as well and couriers. one of the interesting things about a.b. 5 is really affects a lot of different industries where there might be people working as a food delivery courier for one company and as a driver for another. for instance, a lot of drivers on uber are also drivers on lyft. with a.b. 5 getting introduced, it forces managers to figure out how they are going to build a viable workforce that is now dedicated and treated like a full-time employee? the lack of choice will be introduced to those drivers. they will have to work for one company because of the cost dynamics and what it will mean for these marketplaces. you look at some of the growth internationally, you see the map being divided by region, continent, also by type. you are seeing cloud kitchens rise up in offering restaurants an ability to service all of these food delivery networks. a lot of things are changing underneath the service and it is really interesting to see. i think the ones that are very focused and try to create the highest margin through working with cloud kitchens and using a driver network where they can, those are the key advantages. taylor: another big story we have been following within the last few months has been peloton. you are not an investor, but what about that company and that connected business makes it so successful? steve: sure. peloton is interesting. it is sort of the first company that has been both equal parts hardware and media in the fitness space. you have prior companies like gopro and fitbit. fitbit was a fitness tracker, hopefully it would motivate you to do something healthy for yourself. gopro is more about entertainment and fun, video capture while you are doing something. now what you see is something that is directly benefiting your health in terms of treadmills and cycles. the hardware from that is not the only revenue. the lifetime value of a member or subscriber is quite interesting. $40 a month, more than most people pay for netflix and spotify. it is a technology company as well as a media company. it's providing for the angle of fitness. the community around that and the services and hardware you get from that, is it something you can get from a gym? yes. but, a lot of people don't have the convenience of going to a gym. some of them have families or live far away. this is really the beginning of a long series of products. we're investors in a company that is doing this for strength training rather than cardiovascular fitness. it gives you the power of a gym through software, hardware and media to be able to be coached and trained in the convenience of your home. there is long list of companies that are happening in the private market now. taylor: it is all about convenience. thank you, steve jang, of kindred ventures. now a social media platform that upends conventional notions of what social media is. vsco has photos with no public likes or comments. no followers, but one of generation z's favorite social media platforms. co-founder joel flory spoke recently with caroline hyde and scarlet fu about the platform's continued growth. joel: a community without likes or comments, we have created a safe space for people to be who they are. this is no coincidence or surprise. on the other hand, the scale has caught us by surprise. scarlet: neither of us are gen z. i have a kid that is 13, but talks about vsco. you are not a platform in and of itself, are you? joel: vsco is a mobile app that helps you take professional quality photos on your mobile phone. we are providing heightened tools for mobile and video, but making it accessible. the key component is the community we have that drives you with creativity around inspiration, education. caroline: how many users now? joel: we have 20 million weekly active users. the growth we have seen is unprecedented. since 2012, we have seen extreme growth. in 2017, we launched a subscription service. last year, we hit north of 2 million subscribers. scarlet: drill more into the demographic because we see pictures of vsco girls become a meme. she has a scrunchy, a hydro-flask, swedish backpack which i cannot pronounce. what is the demographic breakdown? if not the u.s., outside the u.s.? joel: 80% is from outside the u.s. wherever ios or android is available, vsco is there. we see great growth in asia, europe and south america. really, it is around creativity and expression. what we see, especially with gen z -- 75% are under the age of 25 on vsco. what we have seen, they are the first generation that has lived not only their entire lives online, even before they are born, there is a digital footprint where parents are registering usernames on platforms. they live this life under pressure and scrutiny. whether you're looking for is this outlet where they could be who they are. since the beginning in 2013, when we built the community component, that is how we built it. caroline: do you think individuals can remain in a safe space as you grow and grow? do you think you are able to keep that novel element you have compared to the likes of instagram, and are you worried they might copy you? joel: why i think it is so critical is unlike other platforms where others are sharing how they want the world to see them. on vsco, it is about how you see the world. your self-expression and finding a safe space for you to share that. scarlet: vsco is unique in that you mentioned there are no likes or comments. you don't build this business based on eyeballs. you're not tracking that specifically. was that a hard decision to make, because i am sure a lot of your backers would have said this is the obvious way to go. you have a bunch of gigantic companies that do that very well and make a lot of money. joel: from the beginning, we have been about building a quality product people are willing to pay for. we started with the desktop plug-in, an app, and now a subscription-based. vsco has always been about paying for something. caroline: how do you evolve? you just follow gen z through their lifecycle? you ensure you remain relevant to younger audiences? do you think at some point they will depart you? joel: our focus is less on a specific demographic as it is a mindset. a mindset around investing in yourself. it is a mindset around mental health is important. creativity is an outlet for improving your mental health. we are helping people in that creative process and journey of accessing themselves. taylor: that was joel flory speaking earlier with bloomberg's scarlet fu and caroline hyde. coming up, we will have a check in with foursquare on the latest in the location enabled technology. that is next. this is bloomberg. ♪ taylor: tech regulators continue to target social media companies when it comes to protecting consumer data privacy. one tech company focused on user location has managed to stay under the radar. joining me now, foursquare ceo jeff glueck. thank you for joining me. as we take a look at foursquare, so popular when it launched, since then there has been a lot of competition. how do you stay relevant? jeff: it is great to be on your show. the company today is celebrating its 10-year anniversary and we are very different from what your viewers may have remembered. over $100 million revenue, bigger than ever. 99% really not social media location check-ins, but a platform that helps other companies with location technology and other tools. we are more ubiquitous than ever, but kind of like a location layer underneath and the intel inside for location. taylor: we talk more and more on this program about data privacy. how has data privacy concerns affected your business? jeff: foursquare, because it being started 10 years ago as a consumer company, had a head start and thinking about all the ways location can make our lives better but also the potential abuses and privacy implications where consumers should be in control. we have been talking about this and trying to build an ethical tech company. we talk a lot about the ethics and policy of approaching this stuff. i know that is unusual, but that is what we are about. for us, it's been in a way a benefit to our business because we are hoping that developers and marketers are actually taking a really close look at how they add value with location, whether they have adequate user opt-in, controls. we have been advocates about the fact there should be more regulation in the u.s., not less. for us, staking out a position where privacy and ethics are very core to what we are doing, we are actually a welcoming scrutiny and i hope there will be more. taylor: that is very interesting, especially when we talk about the impact on the big four and how it has been translating down to your business. i want to talk about one of the first acquisitions you made. a big fundraising round, $150 million. talk to me about placed. is it a typical horizontal acquisition of taking out competition? jeff: we raised $150 million. we acquired from snap, a b2b business called placed which is the measure of in-store business after seeing it on an ad, digital, outdoor billboards. it helps them make better decisions about what is working. we combine that with foursquare attribution and together we are the leader in helping marketers and companies understand what is working. we work with 50 of the fortune 100 in the u.s. 18 of the top 20 are qsr and dining brands. which is actually inspiring new consumers or regulars to come back into the door or storefront. with placed, we have taking a big leap forward in being the number one by far and that space and added a bunch of talented people including our new president david chen. taylor: there has been a lot of scrutiny on unprofitable tech companies, big companies that are trying to ipo who frankly look like unicorns who cannot cut it down to the bottom line. generally speaking as you talk to your investors in the fundraising environment, is there more scrutiny on your financials? jeff: we have been fortunate for a while, our biggest investor is andreessen horowitz. really balanced all along. fred wilson who has been involved with the beginning since the beginning is a big fan of companies having solid economics and a path to profitability because you never know how the cycle will turn. we focused a lot on growth, but also making sure that we will be profitable at scale and have profitability. we are getting very close. i look at companies that have sort of irrational unit economics and that is not what we are trying to do. we are trying to build a profitable, scale the business at foursquare and that is the advice we have gotten from investors. the market rewards high growth rates. you need to balance. you don't want to get to profitability at the cost of substantial growth. we are in the first inning of what technology can bring. not just in marketing, but self-driving cars. we don't want to miss out on the global opportunity that is ahead of us, but we want to be rational. taylor: you stole the words out of my mouth. path to profitability. thank you, jeff glueck. lime celebrates its 100 millionth ride. we will talk about its mission to be sustainable and affordable with its ceo. this is bloomberg. ♪ taylor: the united nations climate action summit is due to be held next week and most americans agree climate changes of the that needs to be addressed. bloomberg part is part of the covering climate now project which includes more than 100 news outlets. cbs news recently conducted a poll which found two thirds of americans, 56% now believe climate change is either a crisis or serious problem. lime mobility touts 100% renewable energy with electric scooters and electric bikes that it operates. the company recently surpassed its 100 millionth ride. with more, i am joined by brad bao, cofounder and ceo. congratulation on 100 million rides. is that really how you measure your success? brad: we are very excited about 100 million rides mark which we achieved faster. we are very excited about it, but this is not the only way we measure the business. we measure the business by the social impact we make in the cities we are operating in. in addition to reducing congestion and reducing pollution, the one thing we are super excited about is we are giving time back to the users. for example, in paris, the user reported a reduce of 10 minutes in traffic by using lime. that is 20 minutes a day. eight days in a year that they can spend with the people they love or doing the things they love. taylor: how are your conversations like with regulators in the city where you want to enter or want to enter and they say no? how do those conversations go? brad: it has changed quite a bit in the last year. 100 million rides is a number but it means a lot because it is a validation of cities seeing us more so as solutions than just another business. we enter every single market with contract with the city. we discuss with them what their challenges are in terms of traffic congestion, pollution, accessibility and then we work together. taylor: how does your technology differentiate between a scooter and a bike? a scooter and a bike was not invented yesterday. what about your technology makes it different? brad: the technology we deployed is two-fold. one is the convenience to the users. it is easy to find via app and gps, and easy to identify where the scooters are. we sometimes joke about it, but this is the closest thing to a magic carpet. it takes you to where you want to go. the other part is really the data and what we have on the back end drives the efficiency of this kind of business. taylor: i like that magic carpet phrase. i will use that. i want to talk a lot about the heart of your mission which is getting around climate change. how do you respond to critics or researchers who say some of the claims about being environmentally friendly are maybe overexaggerated? brad: i think the measures or benefits to the environment, one of that is clean energy. we are a company that is first in the category that is committed to 100% renewable energy to power our fleet. the second part is the direct impact we are making. out of the 100 million rides we generated, it goes around the globe 4000 times. we estimate it cut 25 million car miles. that is a reduction in terms of pollution going into society. the third thing i will mention is it is shifting the pollution where the highest population is to somewhere else. taylor: thank you. that was brad bao, cofounder and ceo of lime. that does it for this edition of "bloomberg technology." "bloomberg technology" is livestreaming on twitter. check us out, @technology. be sure to follow our global breaking news network, tictoc, on twitter. this is bloomberg. ♪ ♪ >> this is "boomer daybreak: middle east." is lessaudi oil giant optimistic that there will be a rapid recovery following the attacks on its side of a processing plant. kingdom also says preliminary findings show iranian weapons were used, and thus a strong response with the u.s., now taking action against the islamic republic. >> as markets fret about volatility and fears of a recession, the world's second richest man tells bloomberg he is not playing it safe. >> we are

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