Bitcoin ETF Ruling | Bloomberg Technology 08/29/2023
ANNOUNCER: FROM THE HEART OF WHERE INNOVATION, MONEY, AND POWER GLIDE IN SILICON VALLEY AND BEYOND. THIS IS "BLOOMBERG TECHNOLOGY" WITH CAROLINE HYDE AND ED LUDLOW. CAROLINE: I'M CAROLINE HYDE IN BLOOMBERG'S WORLD HEADQUARTERS IN NEW YORK. ED: I'M ED LUDLOW IN SAN FRANCISCO.
THIS IS BLOOMBERG TECHNOLOGY. CAROLINE: CRYPTO ASSETS SURGE AS THE U.S. OVERTURNS THE FCC. WE WILL COVER YOU THROUGHOUT THE HOUR. ED: WE BRING YOU THE LATEST FROM THE EARNINGS FRONT.
IT TOPS PROFIT ESTIMATES, MOREHEAD. CAROLINE: RAISED 100 MIL DOLLARS TO REACH A .6 MILLION VALUATION. WE SIT DOWN WITH THE CEO TO DISCUSS BUT FIRST LET'S HONE IN ON WHAT HAS BEEN THE STORY OF THE LAST HOUR, BITCOINS SURGING, THE SUDDEN MOVE TO THE UPSIDE. WE ARE BACK IN THE $27,000 RANGE AND THE CRYPTO SPACE UP 5.6% BECAUSE IT SEEMS THE FEDERAL COURT HAS GONE AGAINST THE GRAIN OF THE SEC AND DECIDED -- A SIGNED MAYBE WE CAN CARVE AWAY FOR A BITCOIN ETF. THIS IS ABOUT THE GRAYSCALE
MOVE PRODDING IN. ED: WE ALSO SEE THE APP UNSURPRISINGLY PLAY OUT IN CRYPTO RELATED STOCKS. COINBASE JUMPING BY THE MOST IN MORE THAN SIX WEEKS. COLLEAGUES ARE BLOOMBERG INTELLIGENCE HAVE A NOTE OUT THAT KIND OF IMPLIES TO ALL OF THESE -- APPLIES TO ALL OF THESE NAMES, EACH PART OF THE UNIVERSE RELATED TO CRYPTO MAY BENEFIT AS MORE ETF'S GET APPROVED BUT THEY NOTE THERE ARE MULTIPLE APPLICATIONS. BLACKROCK BEING ONE INSTITUTION
THAT HAS AN ETF APPLICATION IN. HOW DOES COINBASE BENEFIT AS AN EXAMPLE FROM SERVICING THOSE, UP 14 -- 13.4%. GOING TO UNDERSTAND WHAT HAPPENED, IT WAS A SURPRISED LET'S BRING IN SONALI BASAK. A GOOD PLACE TO START, WHAT DID THE APPEALS COURT SAY ABOUT THE ORIGINAL SEC DECISION TO BLOCK AN APPLICATION FOR BITCOIN ETF? SONALI: I THINK THE PART IMPORTANT HERE IS THIS IDEA THE DENIAL OF GRAYSCALE'S PROPOSAL AND THIS IS ACCORDING TO THEIR RULING THAT THE DENIAL WAS ARBITRARY AND CAPRICIOUS BECAUSE COMMISSION FAILED TO EXPLAIN THE DIFFERENCE OF TREATMENT OF SIMILAR PRODUCTS WHICH WAS A KEY PART OF THE GRAYSCALE ARGUMENT HERE. AND YOU LOOK AT THE DECISION BY THE COURT, AND REMEMBER THERE ARE THREE JUDGES THAT RULED IN GRAYSCALE'S FAVOR, THERE IS A PROCESS THAT YOU HAVE TO UNDERSTAND.
IT IS THIS IDEA THERE ARE 45 DAYS IN WHICH BOTH SIDES REVIEW THIS RULING AND THE SEC COULD ALWAYS PUSH BACK. THE OTHER THING THAT IS A BIG OPEN QUESTION FOR GRAYSCALE IS THE IDEA OF WHETHER THEY HAVE TO REFILE FOR AN ETF. WHEN YOU LOOK AT GRAYSCALE'S FILING RELATIVE TO MANY OTHER FILINGS INCLUDING BLACKROCK'S FILING IS THIS SURVEILLANCE SHARING AGREEMENT, WHICH HAS LARGELY SAID TO BE BENEFITING SOME OF THE FILINGS SUCH AS BLACKROCK. IN THE NEXT HOUR OR SO, WE WILL BE SPEAKING TO COINBASE'S TOP LAWYER ABOUT THE BENEFITS OF FOR EXAMPLE AN AGREEMENT IN WHICH COINBASE HAS BEEN A BIG PART OF THE PUSH. IT IS UNCLEAR HOW SOON GRAYSCALE CAN GET FROM AGP D.C.
TO ETF CONVERSION. AND REALLY RIGHT NOW WHEN YOU LOOK AT GPT SEE, IT HAS BEEN NARROWED, THE DISCOUNT AND ASSET VALUE IS THE REASON TO HOLD GPT SEE HAS BECOME PART OF THE IDEA THAT IT WOULD EVENTUALLY CONVERT TO AN ETF. EVEN TODAY IN THE WAKE OF THE RULING, THEY WERE LOOKING THIS MORNING AT A 25% NEARLY DISCOUNT NET ASSET VALUE THAT HAS NARROWED TO 15%. YOU SEE IT COME MUCH CLOSER TO
ITS NET ASSET VALUE IN THE WAKE OF ITS RULING AND IN THE EXPECTATION OF EVEN WITH THIS UNCERTAINTY, THIS IS STILL A LARGE WIN FOR GRAYSCALE AND THE CRYPTO INDUSTRY. AND YOU ARE SEEING TO THE POINT YOU ARE MAKING EARLIER, BITCOIN PRICES AND OTHER CRYPTO-RELATED STOCKS RISING IN THINK RENZI. CAROLINE: THE SEC SAID THEY ARE REVIEWING THIS ON GRAYSCALE AND GRAYSCALE COULD BE -- THE VALUE COULD BE GIVEN BACK TO THE INVESTOR BASE IF IT COULD TURN TO A TRUST -- FROM A TRUST TO AN ETF. ALONG THE NUANCE INTO THE MICRO BUT LET'S GO BIT MORE MACRO AND WHAT THIS MEANS FOR THE INDUSTRY. WE HAVE THE COFOUNDER OF FRACTAL, AN PROVIDER FOR CRYPTO ON CHAIN. DOES THIS LURE IN MORE INSTITUTIONAL PLAYERS.
DOES THIS MEAN THIS IS ALMOST A SAFE SPACE TO GET INTO? SHANNON: ABSOLUTELY. YOU CAN SEE THAT IN TERMS OF OVERALL MARKET SENTIMENT. COIN SHARE PUBLISHED A VERY INTERESTING REPORT THIS MORNING THAT SHOWED THE OUTFLOW OF DOLLARS INTO CRYPTO PRODUCTS, INSTITUTIONAL PRODUCTS, WAS AT ITS HIGHEST, SIMILAR TO MARCH RING THE BANKING CRISIS.
OVERALL BANKING SENTIMENT WAS NEGATIVE INTO THIS NEWS AND I THINK TO ALL THE MARKET MOVES WAS CAUGHT OFFGUARD IN TERMS OF THE ANNOUNCEMENT THIS MORNING. IT IS GREAT. IT CHANGES THE SENTIMENT IN THE U.S. AND GLOBALLY FOR INSTITUTIONS AROUND THIS IS MOVING FORWARD. WE WILL GET THE GUIDELINES WE HAVE BEEN LOOKING FOR IN TERMS OF HOW TO APPROACH THE SPACE AT LARGE. CAROLINE: GO GLOBAL FOR A MOMENT TO OTHER PLACES HAVE SPOT BITCOIN ETF'S.
WHAT HAS BEEN THE U.S. ISSUE WITH THAT, WHAT MORE BROADLY DID YOU FEEL WAS DIFFERENT WITH THE SEC THAN OTHER REGULATORS? AYA: AT A HIGH-LEVEL IT IS THE DIFFERENT PLAYERS IN THE SPACE TODAY, WHETHER ON THE FACT OF THE SEC WORKING CLOSELY WITH COINBASE AND OBVIOUSLY THERE'S A LAWSUIT THERE, WORKING THROUGH THE SEC AND GRAYSCALE AND THERE'S A BUNCH OF INTERMEDIARIES THE SEC IS WORKING WITH AND IT IS UNCLEAR IN TERMS OF HOW THE SEC WILL REGULATE VERSUS THEM PUSHING OUT A RULEBOOK OR CONGRESS HAVING TO JUST TAKE THE STEP AND MAKE GUIDELINES FOR EVERYONE IN THE UNITED STATES TO FOLLOW. UNFORTUNATELY, EVEN IF YOU GO TO THE U.K. WITH MICA, WE HAVE NOT SEEN THAT LEVEL OF PROACTIVE GUIDELINES IN THE UNITED STATES. ED:
JUDGE NAOMI ROW ON THE APPEALS PANEL POINTED OUT SPECIFICALLY THE SEC'S TREATMENT OF GRAYSCALE WAS ARBITRARY AND CAPRICIOUS BECAUSE THEY HAD NOT TREATED OTHERS IN THE SAME WAY AND OUR COLLEAGUE, KATIE GREIFELD, WHO LEADS OUR COVERAGE POINTS OUT THIS IS WERE JUST ONE THING THAT MIGHT HAPPEN THIS WEEK. THERE'S A DEADLINE FRIDAY FOR BLACKROCK, 811 SHARES DEADLINE SATURDAY. WHAT HAPPENS NEXT TO YOUR MIND? AYA: AGAIN, I THINK THE MARKET WAS SIMPLY CAUGHT OFFGUARD HERE AND WE WERE EXPECTING THIS GPT SEE NEWS TO COME OUT IN THE LAST TWO WEEKS, SO ON THE BACKS OF MACRO, ON THE BACKS OF JACKSON HOLE, YOU ARE SEEING THE MARKET WAS NOT EXPECTING THIS NEWS AND OVERALL SENTIMENT WAS NEGATIVE, VOLATILITY WAS AT ITS LOWEST. WHAT THAT SETS US UP FOR IS A VERY VOLATILE Q3 AND Q4. WE ARE PROBABLY GOING TO SEE THE NEXT THREE MONTHS HAVE A LOT OF ACTIVITY BETWEEN THESE DIFFERENT PLAYERS AND THE LEGAL BANDWIDTH OF BLACKROCK AND FIDELITY AS WELL AS ARC, IT WILL BE FAR LARGER THAN SOME OF THE CRYPTO PLAYERS AND WE WILL LIKELY SEE CONVERSATIONS GET PUSHED FURTHER THAN WHAT WE HAVE SEEN TO DATE. IT IS EXCITING FOR THE UNITED STATES. ED: WHO BENEFITS THE MOST FROM THIS?
IF AN ETF IS APPROVED, BEYOND THE ETF PROVIDER THEMSELVES, WHO WINS? AYA: INSTITUTIONAL INVESTORS. THE REASON THAT WHEN IS INSTITUTIONAL INVESTORS ARE LOOKING FOR REGULATED PATHS TO GET EXPOSURE TO THESE ASSETS IN STRUCTURES THAT THEY ARE USE TO IN TRADITIONAL FINANCE AND THAT JUST HAS NOT BEEN AVAILABLE YET TODAY IN THE UNITED STATES. SO REALLY THIS IS A HUGE PUSH FORWARD FOR US. WE ALWAYS SAID THE INSTITUTIONAL WAVE IS COMING BUT IT CANNOT COME UNTIL WE HAVE SIMPLE REGULATED PRODUCTS AVAILABLE IN THE MARKET AND THIS IS A BIG PUSH FORWARD TOWARD THAT. CAROLINE: I HAVE ASKED WHAT FRACTAL IS ALL ABOUT.
A SPOT ETF IS BASIC AT BEST, A FUTURES ETF TOO. YOU ARE THINKING ABOUT OPTIONS OFFERINGS, HOW YOU CAN GET BASICALLY TRADITIONAL FINANCE TO SEE WHAT THEY CAN DO IN NORMAL FINANCE AND BRING IT TO CRYPTO. HOW EASY OR OR SLOW A PROCESS IS THAT? AYA: THAT'S RIGHT. IT IS A SLOW PROCESS ONLY BECAUSE IT HAS TAKEN SO LONG FOR US TO GET TO THIS FIRST BASE WITH THE SPOT ETF. ONCE WE GET THE SPOT ETF, IT WILL BE SO MUCH CLEARER FOR US TO GIVE ACCESS. YOU SAW COINBASE, ALL ABLE TO
TRADE FUTURES IN THE UNITED STATES. THAT TOOK A LONG TIME FOR THAT TO HAPPEN AS WELL IN THE STATES SO YOU ARE ABLE TO SEE A PATH FORWARD FOR US TO REALLY BE ABLE TO OFFER NOT ONLY OPTIONS BUT STRUCTURE PRODUCTS ON A REGULATED WAY THAT INSTITUTIONS ARE COMFORTABLE GETTING ACCESS TO. IT IS EXCITING. CAROLINE: GREAT TO HAVE YOU HERE. TO WALK US ALL THROUGH IT, THE RAMIFICATIONS MORE BROADLY OF THIS SPECIFIC RULING THAT HAS COME FROM THE APPEALS COURT. AYA KANTOROVICH FROM FRACTAL, BASED IN NEW YORK.
OVER TO YOU IN SAN FRANCISCO. WHAT ARE WE LOOKING AT? ED: BREAKING NEWS, APPLE IS SETTING SEPTEMBER 12 AS THE DATE FOR THE LAUNCH OF THE IPHONE 15. IT'S NEW WATCH -- MY INVITE HIT MY INBOX WHICH IS GOOD NEWS FOR "BLOOMBERG TECHNOLOGY." MARK GURMAN REPORTED SEPTEMBER 12 WOULD BE THE DATE.
SOME UPDATES WE ARE EXPECTING ON IPHONE 15 BOTH HARDWARE RELATED AND OS RELATED, NOT DOING MUCH IN THE MOMENT TO MOVE THE STOCK. UP 1.8% ON APPLE SHARES BUT A LOT OF QUESTIONS OVER WHAT WE WILL GET WITH THE IPHONE 15 AT THAT EVENT. COMING UP ON "BLOOMBERG TECHNOLOGY," THE SALES SLUMP FOR TECH COULD BE BOTTOMING OUT, THAT IS WHAT RESULTS FROM CHINA. BEST BUY IN THE UNITED STATES, HAVING COME UP, WE WILL RECAP THOSE RESULTS NEXT. THIS IS BLOOMBERG TECHNOLOGY. ♪ ED: WE ARE CHECKING IN ON EARNINGS MOVERS OUT OF CHINA. THE SHARES OF SOME CHINA TECH NAMES, PDD, TOPLINE GROWTH SIX HE 6%. WAY OUTPERFORMING NAMES LIKE
ALIBABA AND JD BUT IT IS ABOUT TIMO, -- TEEMU, THE BUSINESS THAT CAME OUT WITH AN AD IN THE SUPER BOWL. BYD, DOUBLE NET INCOME IN THE QUARTER. WE ALREADY TALKED ABOUT HOW BYD HAD A RECORD WITH BOTH PLUG-IN HYBRIDS AND BATTERY ELECTRIC CARS IN THE COURT -- AND THE COURTS HAVE SHOWN UP ON THE BOTTOM LINE IN TERMS OF PROFIT. WHITER THAN EXPECT A QUARTERLY LOSS, HE DIFFERENT STORY IN THE EV CASE. AN INTERESTING ONE AND THE SMARTPHONE HANDSET DISCUSSION, BETTER-THAN-EXPECTED FINANCIAL RESULTS. I THINK WHAT THEY ALL HAVE IN COMMON IS WE ARE GETTING MORE SIGNALS ABOUT THE CHINESE ECONOMY AND CHINESE CONSUMER. JOINING US WITH MORE,
BLOOMBERG'S VILLAS -- ISABEL LEE IN NEW YORK AND HENRY RAN IN LONDON. PENRY, LET'S START WITH SOME SPECIFIC NAMES. I THING WE START WITH SHAO ME BECAUSE THIS WAS ONE THAT WAS SURPRISING TO SOME INVESTORS. HENRY: YES, SO THERE REVENUE FELL BY 4% IN THE LAST QUARTER BUT THAT THE CLIENT HAS BEEN BETTER THAN EXPECTATIONS. THAT DOES SHOW THE MARKET SLUMP MIGHT HAVE BEEN PASSED ITS WORST PERIOD. REMEMBER, THEY SELL SMARTPHONE
DEVICES FROM ALL OVER THE WORLD SO IT IS NOT JUST THERE BUT IN MANY EMERGING MARKETS COUNTRIES AND SOME PARTS OF EUROPE AS WELL SO IT'S RESULTS SEEM TO BE A BAROMETER FOR THE GLOBAL SMART FIRM -- SMARTPHONE MARKET. AND XIAOMI ALSO PRIORITIZED ITS PROFITABILITY AND IT IS PUSHING THROUGH ITS STRATEGY FOR PREMIUM OFFERINGS. AND IT DOES SEEM TO BE BEARING FRUIT. IT'S AVERAGE SELLING PRICE AND CHINA EXPANDED BY 24% IN THE LAST QUARTER. THE COMPANY SET ON THE EARNINGS CALL THAT IT SEEKS TO EXPAND STRATEGY TO NOT JUST IN CHINA BUT OVERSEAS. IT SAYS WE NEED TO FOCUS ON
THESE PREMIUM PRODUCTS LIKE THESE FOLDABLE PHONES AND WE DO WELL IN THIS. CAROLINE: IT'S INTERESTING THEY ARE SAYING LET'S GO FOR A HIGHER PRICE POINT. STILL THINKING ABOUT OVERALL PROFITABILITY OF GROWTH. WHEN THEIR OVERALL MACRO ECONOMY IS IN A PAINFUL PLACE. WE LOOK AT HOW MUCH THEY ARE HAVING TOP THE ANTI-WHERE THE OTHER WILL BE CUTTING MORTGAGE RATES TO SPUR ON THE CHINESE RATE. WHAT TO THESE EARNINGS TELL US
ABOUT THAT? >> I THINK THESE 2 -- AND HENRY CAN GO TO MORE DETAIL, THEY ARE GOOD EARNINGS. STOCKS ARE REALLY REACTING POSITIVELY TO THEM BUT THEN THEY COME WITH A NUANCE. ON PDD, ITS FOCUS IS MORE LOWER INCOME CONSUMERS SO THAT MIGHT BODE WELL FOR CHINA'S SWELTERING ECONOMY.
IT WORKS IN REVERSE IN THAT WAY BUT CHINA'S ECONOMY IS NOT DOING AS WELL, NEARLY EVERY DAY YOU SEE ONE LOOMING HEADLINE AFTER ANOTHER. TODAY WE HAVE COUNTRY GARDEN HOLDINGS, A BIG PROPERTY GIANT MAKING FRESH EFFORTS TO AVOID DEFAULT AND THEN WE HAVE CHINA ASSET MANAGEMENT, ALSO SUFFERING A BOND FLOP. WE SEE WITH A CREDIT MARKET THAT IS UNDERSCORING ONE THING, THE ECONOMY IS WEAK.
WE ALSO HAVE A LOT OF DEVELOPMENT IN THE REGIONAL BANK SPACE, MORTGAGE SPACE, SO IT IS NOT LOOKING THAT GOOD YES BUT IT IS NOT ALL GLOOM AND DOOM BECAUSE WE CAN SEE SOME STANDOUT COMPANIES LIKE PDD AND XIAOMI DOING WELL. SOMETIMES WHAT IS GOOD FOR ONE THING CAN BE BAD FOR ANOTHER. ED: HENRY WAS SHOWING THE BIG JUMP ON THE PDD ADRS U.S. LISTED SHARES AND THERE IS A STORY HERE ABOUT THEM BEATING OUT OTHER DOMESTIC CHINESE NAMES AND TERMS OF TOPLINE GROWTH ERIE WE LEARNED A LOT ABOUT THEIR U.S. BUSINESS BUT WE DON'T DISCUSS
PDD A LOT ON THE SHOW. WHAT HAPPENED IN THE QUARTER. HENRY: SURE. THE OVERALL RESULTS WERE GOOD AS WE CAN SEE IN THE MARKET REACTION. IT IS A SHARP PAUSE REACTION FROM INVESTORS, 20% OF SHARE PRICE EXPANSION DURING THE SESSION. BUT AS YOU SAID, THE FOCUS IS ON TEEMU, SHOPPING OVERSEAS.
THAT APP HAS MADE SPENDING FAST IN EUROPE AS WELL AS IN THE U.S. AS WELL. THE COMPANY DISCLOSED LITTLE ABOUT THE SHOPPING UP BUT IT DOES AND CREW IN ONE OF HIS LINES CALLED TRANSACTIONAL SERVICES REVENUE.
THAT TRANSACTION SERVICES REVENUE INCLUDES SOME THINGS LIKE THE TEEMU -- INTERNATIONAL BUSINESS BUT ALSO GROCERY BUYING BUSINESS. RUBEN KNEW HAS BEEN WELL ABOVE ANALYST ESTIMATES. SO IT DOES SEEM TO SHOW TEEMU HAS BEEN GAINING TRACTION OVERSEAS. HOWEVER, THERE IS ANOTHER CONCERN ON THE PROFITABILITY SIDE ON MARGINS. THE COMPANY IS SPENDING OVERSEAS SO INVESTING MORE SO THE MARGINS COULD BE HIT BECAUSE OF THAT. CAROLINE:
WE WANT TO THANK BOTH OF YOU, HENRY REN, ISABELLE LEE, ACROSS THE MACRO AND MICRO PICTURE AND WHAT THE U.S. CONSUMERS TELLING US LET'S DIG IN THERE FOR A MOMENT, BEST BUY SAYS IT REACHED THE LOW POINT IN TECH DEMAND. AFTER A STRONG SECOND QUARTER REPORT POINTS TO AN UPTICK, OR MAYBE FOLDING FOR DEMANDS OF HOUSEHOLD APPLIANCES.
THAT'S GO TO BRENDAN IN DALLAS. IT IS UGLY, THE QUARTER GONE, BUT IT SEEMS THEY THINK MAYBE THERE IS A TURNING OF THE TIDE? >> WHAT THEY'RE SAYING IS THEY ARE STARTING TO SEE LIGHT AT THE END OF THE TUNNEL, THE BACKDROP HERE IS THE SALES DECLINES AT BEST BUY HAVE BEEN AMONG THE BIGGEST IN THE WORLD OF BIG U.S. RETAILERS. WHAT THEY SAY NOW IS THEY ARE STARTING TO GET A LITTLE LESS BAD AND THEY HAVE A LINE OF SIGHT TO BEING FLAT, MAYBE EVEN GROW A LITTLE BIT HERE. ED: THEY ALSO SAID SHORT REFRESH CYCLES ARE DRIVEN BY, GUESS WHAT, ARTIFICIAL INTELLIGENCE. OUR THANKS TO BRENDAN CASE. WE TALK ABOUT BY NOW AND PAY LATER AND SPEAK TO THE CEO OF A COMPANY THAT LAUNCHES IN OPPOSITION TO THE MOVEMENT.
THIS IS BLOOMBERG. ♪ >> FINTECH A FIRM IS BETTING CONSUMERS WANT TO DECIDE IN REAL-TIME WHETHER OR NOT TO PAY INTEREST ON PURCHASES. THIS IS THE A FIRM CARD, LOOKS LIKE ANY OTHER CREDIT OR DEBIT CARD. THE DIFFERENCE IS THE APP GIVES USERS A REAL-TIME CHOICE TO PAY UPFRONT LIKE A DEBIT CARD OR PAY LATER, SPREAD OVER TIME, AND OFTEN INCLUDING INTEREST LIKE A CREDIT CARD. I MET UP WITH THE FIRM'S CEO TO
FIGURE OUT HOW IT WORKS. FIRST FIND SOMETHING DIVIDE, MAX WANTED TO GET HIMSELF A BURRITO. IT MAKE SENSE TO PAY UPFRONT. HE SWIPED THE CARD AND FUNDS WILL GET PULLED FROM A LINKED BANK ACCOUNT. BIGGER TRANSACTIONS, SAY MORE THAN 00, YOU CAN PAY WITH A CARD, GO INTO THE APP, AND CHOOSE DISK WITH THE PURCHASE UP OVER TIME AFTER YOU HAVE CHECKED OUT.
YOU HAVE UP TO 24 HOURS AFTER THE PURCHASE TO DO SO. SAY IT IS A BIG PURCHASE YOU HAVE HAD YOUR EYE ON FOR SOME TIME, YOU CAN ALSO REQUEST A PAYMENT PLAN IN THE APP BEFORE YOU CHECK OUT. A FIRM HAS INTEREST-FREE AND INTEREST-BEARING PAYMENT PLANS AND YOU CAN ADJUST THE TIMELINE FOR THE REPAYMENT. >> A SENSIBLE IDEA YOU SHOULD NOT BE PAYING INTEREST ON COFFEE AND DONUTS AND BREAKFAST BURRITOS LIKE I HAVE BOUGHT. YOU WILL PAY ANY -- IF YOU'RE GOING TO PAY INTEREST AT ALL, YOU SHOULD DO IT DELIBERATELY ON THINGS DECIDING WORTH IT. ED: IT WILL ULTIMATELY DEPEND ON YOUR CREDIT WORTHINESS, THE SIZE OF YOUR PURCHASE, AND WHETHER YOU CHOOSE TO SPLIT AHEAD OF TIME OR AFTER YOU BUY. SETTING OUT THE SIMPLE IDEA OF
WHY SPREADING PAYMENTS OVER TIME AND AVOIDING INTEREST ON SMALL PAYMENTS IS WORTH IT. JOINING US NOW IS MICHAEL HIRSCHFIELD, A CREW FOUNDER AND CEO, THE FIRST PAYMENT SOLUTION IN THE SAME NOW BY LATER CATEGORY, LAUNCHED IN OPPOSITION TO THE BUY NOW PAY LATER CRAZE. LET'S START WITH WHAT YOU HEARD FROM AFFIRM AND MAX ALEXION. THEIR ARGUMENT IS SIMPLE, SOMETHING NOMINAL, NO POINT IN PAYING INTEREST BUT IF IT IS BIGGER, YOU CAN PAY INTEREST OVER TIME. WHAT DO YOU MAKE OF THAT IDEA?
MICHAEL: IT'S NOT JUST ABOUT A FIRM BOW NOW PAY LATER HAS GROWN SO MUCH AND IT IS NOT JUST BUY NOW PAY LATER, WE HAVE SEEN SHORT-TERM CONSUMER CREDIT THE LAST THREE TO FOUR YEARS BALLOON. NOT NEGATIVE, THERE ARE GOOD THINGS ABOUT IT, EXPOSURE CREDIT CAN BE POSITIVE BUT THE REALITY IS WE HAVE TRILLION IN CREDIT CARD DEBT IN THE UNITED STATES AND IT IS GROWING, RISE OF THE LINK WITH TINA LAST QUARTER IN THE UNITED STATES AND THAT SAYS SOMETHING TO AMERICAN RETAILERS. THERE SHOULD BE AWARE THERE IS PAIN GOING ON RELATED TO CONSUMER BEHAVIOR. AS WE HAVE INNOVATED FOR YEARS,
DECADES AROUND SHORT-TERM CONSUMER CREDIT, BRAND-NEW CREDIT CARDS, BOW NOW AND PAY LATER, THERE IS ANY OVEREXTENSION NEEDS TO BE AN ALTERNATIVE PATH AROUND PAYMENT DIVERSITY. CAROLINE: SO SAY YOU ARE PITTING YOURSELF AGAINST A PRETTY WISE AND SAVVY USER OF A BUY NOW PAY LATER WHO IS USING IT FOR THE WAYS IN WHICH MAX FORESEES, THEY ARE STAGGERING PAYMENTS, KEEPING AN EYE ON IT, THEY'RE NOT GETTING THEMSELVES IN DEBT. WHAT IS YOUR OFFERING AT A CREW? MICHAEL: MAJORITY OF AMERICANS ARE NOW ARE ACTIVELY SAVING FOR SOMETHING THEY WANT IN THEIR LIFE. WE HAVE CONTINUED TO PUSH AS RETAILERS PUSH INTO SOCIETY AND SO THERE'S ALWAYS A PLACE FOR SHORT-TERM CONSUMER CREDIT. I THINK THE AVERAGE STORE NEEDS IT. BUT THAT DOESN'T MEAN THERE
SHOULD NOT BE AN ALTERNATIVE WAY. WE SEE THIS AROUND A RISING AMOUNT OF HOUSEHOLD SAVINGS IN THE UNITED STATES AND THE IDEA OF A STORED WALLET, STARBUCKS OBVIOUSLY A VERY SUCCESSFUL WALLET EXPERIENCE FOR PEOPLE TO DEPOSIT MONEY INTO THEIR STARBUCKS WALLET TO PURCHASE IN THE STORE. THIS ISN'T ABOUT REPLACING WHAT EXISTS TODAY, IT IS ABOUT SEEING WHERE JEN'S EARS ARE, WHERE MILLENNIALS ARE, THEY ARE SPENDING DIFFERENT. THEY WANT TO ENGAGE THE BRAIN DIFFERENTLY. IT IS NOT JUST ABOUT THE OLD WAY. I THINK MAX ARTICULATES THAT
CLEARLY. WE HAVE SEEN AN OVEREXTENSION. WHERE CAN YOU GO AND NOT USE CREDIT IS THE BIG QUESTION, AND CONSUMERS WANT AN ALTERNATIVE, SAVINGS. OBVIOUSLY WE HAVE SEEN A TERMINUS GROWTH. WE WERE ONLY TWO YEARS OLD, WE HAVE GROWN QUITE RAPIDLY, WE WILL WATCHING SOME LARGER RETAILERS -- WE ARE WATCHING SOME LARGER RETAILERS BECAUSE OF THAT. CAROLINE: YOU HAVE FUNDS AND YOUR BACK. I'M INTERESTING -- INTERESTED IN WHEN WE SEE HIGH-YIELD ACCOUNTS OFFERING 4% TO 6%.
WHY SHOULD I NOT JUST TAKE MONEY ON THE SAVINGS I HAVE IN THE BANK WHERE I HAVE ACCRUED INTEREST AND PUT IT DIRECTLY INTO A CASPER OFFERING ON CREW? I DON'T SEE THE UPSIDE. -- ACCRUE. I DON'T SEE THE UPSIDE. MICHAEL: MOST AMERICANS DON'T HAVE ACCESS TO A HIGH-YIELD SAVINGS ACCOUNT. THE AVERAGE AMERICAN NEEDS TO CREATE A FRAMING WORK, AS THEY DO, THEY DEPOSIT MONEY ON A REALLY BASIS TO GO ON A TRIP OR POTENTIALLY USING CREDIT AND ONE IN FIVE AMERICANS ARE GOING TO CREDIT CARD DEBT TO GO ON A TRIP. THE REALITY IS THERE ARE MANY
AMERICANS THAT NEED THE SUPPORT, THAT NEED THE SUPPORT FROM THE BRAND AND PUSH CREDIT TO THEM FOR A LONG TIME FOR THEM TO GO ON THE EXPERIENCE THEY WANT IN THEIR LIFE. FRANKLY, THAT IS NOT NECESSARILY FAIR TO COMPARE DIRECTLY TO AN INTEREST YIELD. OUR REWARD IS COMPOUNDED ON EVERY DEPOSIT. FIVE X, SIX X, 10 X OF A PARTICULAR YIELD BECAUSE RBC YOU DEPOSIT ONE DOLLAR ONE MONTH, 0 ANOTHER MONTH, AND THAT IS NOT COMPOUNDING. COMPOUNDING CHANGES OVER TIME
SO EVERY DOLLAR YOU GET 5% OR 10% OR 15%. CAROLINE: WE'RE GONNA HAVE TO WRAP IT UP THERE. THINGS FOR BREAKING DOWN THE BUSINESS MODEL.
CAROLINE: WELCOME BACK TO BLOOMBERG TECHNOLOGY. I AM CAROLINE HYDE. ED: I AM ED LUDLOW. LET'S GET TO TALKING TECH. OPENAI HAS A CORPORATE VERSION OF CHATGPT WITH PRIVACY SAFEGUARDS AND ADDED FEATURES LIKE LONGER TEXT PROMPTS. THIS IN AN EFFORT TO MAKE MONEY FROM ITS WELL-KNOWN CHATBOT. GOOGLE IS ADDING AI TOOLS FROM COMPANIES LIKE META AND ANTHROPIC TO ITS CLOUD PLATFORM.
WEAVING MORE GENERATIVE AI INTO ITS PRODUCTS AND POSITIONING ITSELF AS A ONE-STOP SHOP FOR CLOUD CUSTOMERS SEEKING TO TAP INTO THE TECHNOLOGY. PLACENTA MAJORITY CHUCK SCHUMER -- LEADER CHUCK SCHUMER PLANS TO BRING SEVERAL TECH CHIEFS TO BRING IN THE RAMIFICATIONS OF AI INCLUDING TESLA CEO, METAS CEO, THE CEOS OF GOOGLE, MICROSOFT, AND MANY OTHERS. THIS WILL BE THE FIRST OF HIS AI INSIGHT FORUMS AIMED AT GIVING CONGRESS MORE INFLUENCE OVER THE FUTURE OF AI. CAROLINE:
A CAGE MATCH. LET'S STICK WITH AI. CHANGING THE GAME OF BASICALLY EVERYTHING BUT PARTICULARLY YOUR WEALTH MANAGEMENT LET'S TALK ABOUT IT WITH THE FOUNDER AND CEO OF FATHER, A STARTUP FOCUSED ON UTILIZING CUTTING EDGE TECHNOLOGY TO ADVANCE WEALTH MANAGEMENT AND PARTICULARLY THE MASS AFFLUENT AREA I SUPPOSE. YOU WERE BUSY BUILDING AI TEAM AT GOLDMAN WHEN IT CAME BACK TO THE WEALTH PRIVATE WEALTH MANAGEMENT PARTS. HOW HAVE YOU BROUGHT THAT OVER WITH FATHER? WHAT ARE YOU OFFERING THAT IS DIFFERENT? >> FIRST THANKS FOR HAVING ME ON. IT IS FUN TO BE HERE, A FUN TIME TO BE IN WEALTH MANAGEMENT TECHNOLOGY AND WHEN YOU TALK TO SOMEONE LIKE ME, IT HAS BEEN FOUR YEARS IN THE TRENCHES AT FARTHER, GRINDING AWAY AND REALIZING OPPORTUNITY AHEAD. NOW WE HAVE BIG MOMENTS WHERE IT COMES TO THE PUBLIC SO WE HAVE BEEN OUT THIS FOR A LONG TIME.
QUICKLY, TO SORT OF ADJUST THERE, WE ARE FOCUSED ON THE CORE HIGH NET WORTH MARKET BUT YOU WILL FIND IF YOU USE TECHNOLOGY, YOU CAN BROADEN YOUR AUDIENCE, IT IS AN OPERATIONAL PROBLEM. WE PUT THESE WEALTH MANAGEMENT VERTICALS AROUND WEALTH BECAUSE IT IS PROFITABLE OPERATIONALLY SERVING HIGHER NET WORTH BUT IT IS THE SAME OPERATIONS ALL THE WAY DOWN. TO YOUR QUESTION ABOUT HOW WE ARE BRINGING RATE FOURTH AI, WE BELIEVE QUANTITATIVE METHODS ARE GOING TO HELP US MEET THE OPPORTUNITY IN OUR INDUSTRY AND IF WE LOOK AT HOW INDUSTRY IS COVERING THE OPPORTUNITY, THERE IS ABOUT $420 TRILLION OF NET WORTH IN THE UNITED STATES AND IF I ADD UP WHAT THE BIGGEST PLAYERS ARE DOING, IT IS HARD FOR ME TO DO $20 TRILLION. WE ARE TALKING ABOUT A MASSIVE OPPORTUNITY TO BRING EVERYTHING OUT TO A BROADER SET OF PEOPLE AND THAT IS WHAT AI CAN BRING US. CAROLINE: BUT CAN IT IN THE HERE AND NOW WHEN WE ARE LOOKING AT PERHAPS REGULATORY HEADWINDS AT LEAST? SEEMS TO BE GARNERING MORE OVERSIGHT FROM GARY GENSLER. BRAD: IT DOES SEEM TO BE GARNERING MORE OVERSIGHT BUT I THINK WE ARE FORTUNATE IN THIS TIME TO SAY -- TO HAVE SOMEONE HEADING THE SEC FOR EXAMPLE WHO KNOWS ABOUT THIS TECHNOLOGY AND IS ABLE TO TALK ABOUT IT BECAUSE I DON'T KNOW YOU HAVE THAT ACROSS-THE-BOARD IN GOVERNMENT. RIGHT NOW, IF YOU LOOK BACK AT
HOW VERY GANSLER HAS WRITTEN ABOUT AI TECHNOLOGY, HE WROTE A PAPER IN 2020, 3 YEARS AGO, ONE YEAR AFTER FARTHER WAS FOUNDED AND THIS IS WHEN WE SAW ALL THE PIECES COME TOGETHER FOR AI TO START DELIVERING. HE HAS A MISSION TO DO THE HERE AND NOW, PROTECT INVESTORS. I HOPE AS WE GO FORWARD HE ALSO REALIZES AND LEANS INTO PROTECTING INVESTORS BUT ALSO GETTING MAXIMUM NUMBER OF PEOPLE EXPOSURE TO MARKETS BECAUSE IT IS A TRUE MIRACLE IN MARKETS. ED:
CAN YOU EXPLAIN HOW YOUR TECHNOLOGY, PROPRIETARY TECH, WORKS? I SEE ON YOUR WEBSITE YOU STILL TALK UP THE EXPERIENCE OF THE HUMAN ADVISORS THAT WORK WITH YOU AT FARTHER. BRAD: YES. I THINK IT'S IMPORTANT THAT WE FUNDAMENTALLY BELIEVE -- AND THIS IS FROM THE KNOWLEDGE OF THE TECHNOLOGY -- HAS SOMEONE WHO HAS BEEN A LEADER AND BEEN AROUND FOR A LONG TIME -- THAT HUMANS ARE REQUIRED TO HAVE A GREAT WEALTH EXPERIENCE AND WILL BE FOR THE FORFEIT SEEABLE -- THE FORESEEABLE FUTURE. WE ASK PEOPLE, WOULD YOU LIKE AI TO FULLY MANAGE YOUR MONEY? IN A GENERAL WAY AND PEOPLE SAY WHAT DOES IT MEAN TO MANAGE MY MONEY AND ADVISORS HELP IN THAT AND THEY TEND TO SAY NO, WE WANT TO INTERACT WITH PEOPLE, IT IS TECHNOLOGY CAN ALLOW MORE HUMAN INTERACTION REALLY. ED: BRAD, YOU TALKED ABOUT YOUR LEADERSHIP AND TECHNOLOGY, YOU WERE AT GOLDMAN SACHS FOR SEVERAL YEARS.
HAS DAVID SOLOMON PHONED YOU UP AND SAID I NEED YOUR HELP WITH THIS AI THING? I DON'T GET IT, COME IN AND HELP US? BRAD: YOU KNOW, I MUST BE OFF OF HIS TEXT CHAIN. CHUCK SCHUMER ALSO HAS NOT TEXTED ME YET. [LAUGHTER] I'M STILL WAITING FOR THE INVITE. CAROLINE: I'M SURE YOU WILL GET WIND TO THEM WITH SOME OF THE BACKERS YOU HAVE. YOU HAVE BACKERS LIKE COASTAL VENTURES, SOME OF THE VCS IN WASHINGTON MANY OF THE TIME.
I'M INTERESTED IN THE HIGH NET WORTH PROFESSIONALS YOU SERVE, WHAT WEREN'T THEY GETTING WHEN YOU ARE AT GOLDMAN? WHY DID YOU FEEL YOU HAD TO GET OUT AND HAD TO SERVE AND BUILD SOMETHING DIFFERENT? BRAD: WHEN YOU THINK ABOUT WHERE WE ARE, IF WE LOOK BACK AT THE HISTORY OF WEALTH MANAGEMENT, WE HAD FOR THE FIDELITY OF THE WORLD, VANGUARD OF THE WORLD WHO WERE BRINGING MUTUAL FUNDS, THAT IS AN EXECUTION AND STRATEGY INVOLVED. WHAT WE GET TO DO AN AI IS HAVE A DEEPLY PERSONALIZED PLAN AND PERSONALIZATION IS AN OVERUSED THING IN OUR INDUSTRY BUT REALLY WE ARE FULLY CONTEXTUALIZING AND ABLE TO FULLY CONTEXTUALIZE THE RELATIONSHIP. THAT IS BASED ON YOUR TAXES, WHERE YOU LIVE, WHAT IS GOING ON IN YOUR BANK ACCOUNT, AND WE CAN BROADEN THE BREATH OF WHAT WEALTH MANAGEMENT IS TO PROVIDE BETTER EXPERIENCE AND DELIVER IT AT SCALE. I'M TALKING ABOUT HOW WE ARE NOT REALLY COVERING THE OPPORTUNITY AS AN INDUSTRY. ED: HOW CONCERNED ARE YOUR CLIENTS ABOUT THEIR DATA, PROTECTION OF IT AND HOW IT IS USED AND BY EXTENSION I ALREADY ASK YOU ABOUT TECHNOLOGY BUT IS IT A CASE YOUR TECHNOLOGY AGNOSTIC, YOU TAKE AN EXISTING LARGE LANGUAGE MODEL AND VECTORIZED YOUR DATA? HOW DOES THAT WORK? BRAD: ONE OF THE THINGS THAT -- YOU TEND TO HEAR ME AS I TALK ABOUT AI SAY WE HAVE A LOT OF FRAMEWORK AND HISTORY THAT HAS BEEN SOLVED AROUND THESE PROBLEMS. IN WEALTH MANAGEMENT DISCRETION IS ONE OF THE MOST
IMPORTANT THINGS ADVISORS BRING TO THE TABLE. YOU'RE TALKING ABOUT THE MOST DEEPLY SENSITIVE CELLS OF -- SENSITIVE SUBJECTS IN YOUR LIFE, HOW YOU FEEL ABOUT YOUR FAMILY, YOU FEEL ABOUT YOUR JOB, AND THAT HAS BEEN A CORE TENANT OF A GOOD WEALTH ADVISOR AND EXTENDS TO TECHNOLOGY AS WELL. WHEN WE THINK ABOUT DATA IN MANAGED -- AND MANAGING IT, WE DON'T EVER SEND YOUR PERSONAL DATA TO LARGE LANGUAGE MODELS. WE MAY SEND TEMPLATES TO POPULATE THE DATA BUT WE RETAIN ALL OF THE DATA.
AS YOU POINTED TO, CHATGPT HAS AN ENTERPRISE VERSION BUT WE ARE ON -- WE ARE WAITING FOR MORE ROBUST TOOLS BEFORE SENDING DATA ACROSS. ED: BRAD GENSER, FOUNDER AND CEO OF FARTHER, INTERESTING TO DRAW THE LINK OF TECHNOLOGY AND YOUR INDUSTRY. THANK YOU FOR YOUR TIME. COMING UP ON "BLOOMBERG TECHNOLOGY," APOLLO.IO, A PLATFORM FOR SALES AND MARKETING TOOLS, NABS A 1.6 BILLION DOLLAR VALUATION. OUR EXCLUSIVE CONVERSATION
COMING UP WITH THE CIO AND MARRIOTT HUMMER. CAROLINE: LET'S SHINE A LIGHT ON CRYPTO COME UP 7% ON BITCOIN P THE BIGGEST MOVE FOR THE ASSET SINCE MARCH 2020 THREE. CLEARLY MANAGING TO TRADE AT ITS HIGHEST SINCE AUGUST 16.
WE HAVE SIGNIFICANTLY SOLD OFF THROUGHOUT THE MONTH OF AUGUST. AS WE HAVE ACROSS MOST OF THE TECH ASSET CLASSES. FROM NEW YORK AND SAN FRANCISCO, THIS IS BLOOMBERG TECHNOLOGY. ♪ ED: SALES TECH PLATFORM APOLLO.IO
RAISED 00 MILLION IN NEW FINANCING, PLACING IT AT A .6 BILLION VALUATION. INVESTMENT WAS LED BY VANE CAPITAL VENTURES WITH PARTICIPATION FROM EXISTING INVESTORS INCLUDING SEQUOIA CAPITAL, TRY CAPITAL, AND NEXUS VENTURE PARTNERS. AT A HIGHER VALUATION THEN IT HAD BEFORE. LET'S BRING IN THE CIO AND VENTURES PARTNER MARRIOTT HOLMER -- HUMMER. APOLLO'S A GREAT EXAMPLE OF A COMPANY WHERE AI IS ADDING TO THE VALUE AND UTILITY OF CUSTOMER DATA BUT YOU POINT OUT THEIR TRACK RECORD IS WHY YOU ARE INTERESTED TO DO THIS ROUND AND AT A HIGHER VALUATION.
>> ABSOLUTELY. WE WERE STRUCK BY THE FACT APOLLO IS GROWING SO QUICKLY AND EFFICIENTLY AT SCALE. MORE SO THAN THE VAST MAJORITY OF COMPANIES IN THE MARKET TODAY, VERY UNUSUAL COMBINATION OF CHARACTERISTICS THAT GOT US EXCITED ABOUT THE COMPANY. ED: TIM, YOU HAVE MORE THAN 500,000 COMPANIES, MILLIONS OF USERS, WHY DO YOU NEED 00 MILLION? TIM: I FEEL LIKE IT'S THE PERFECT TIME FOR US TO RAISE MONEY RIGHT NOW.
HAVE GROWN OUR REVENUE OVER NYMEX THE LAST COUPLE YEARS, WE ARE GOING AFTER GIANT MARKET, THOUGH WE ARE STILL REALLY EFFICIENT, WE FEEL LIKE NOW IS THE PERFECT TIME TO PUT MORE FUEL UNDER THE FIRE. CAROLINE: LET'S TALK ABOUT THAT, YOU SAID YOU ARE INVESTING IN PRODUCT, IN R&D, BUT ALSO TALENT. HOW EXPENSIVE IS THAT TALENT BECOMING AND WHERE DO YOU ADD TO IT? . TIM: WE ARE DEAFLY AN R&D COMPANY FIRST AND FOREMOST SO WE ARE INVESTING OVER 60% OF OUR REVENUE FOR THE WEEK ON R&D, HIRING GLOBALLY. THE MARKET IS DEFTLY NOT AS CRAZY AS IT WAS BEFORE IN TERMS OF THE TELE-MARKET BUT HIRING A LOT OF ENGINEERS, DESIGNERS, PRODUCT PEOPLE ACROSS THE WORLD.
CAROLINE: TALKING ABOUT THINGS THAT ARE NOT AS CRAZY, FUNDING IS NOT AS CRAZY AT THE MOMENT AND IT HAS BEEN A TOUGHER TIME FOR VENTURE CAPITALISTS WHO RAISED BIG FUNDS AS VENTURES HAS. TO BE TRYING TO ALLOCATE IN THIS ENVIRONMENT WHERE PERHAPS THERE ARE FEWER TO CHOOSE FROM. WHAT SORT OF GROWTH DO YOU WANT TO SEE HER -- FROM COMPANIES? IS IT ABOUT ANNUAL RECURRING REVENUES? IS IT ABOUT BEING ABLE TO RETRENCH ON SPENDING AND ENSURE THEY ARE FOCUSED ON THE BOTTOM LINE? IS THERE A RULE OF THUMB HERE? TIM: IS A GREAT QUESTION -- MERRITT: IT'S A GREAT QUESTION, A TIMELY QUESTION P WHAT WE HAVE SEEN IN THE MARKET, TOPLINE MOMENTUM WAS REALLY THE PRIMARY THING INVESTORS WERE PAYING ATTENTION TO IN THE VENTURE SPACE AND I THINK THAT HAS SHIFTED THINKING MORE ABOUT EFFICIENT GROWTH, WHAT IS THE INVESTMENT REQUIRED TO DRIVE THAT TOPLINE MOMENTUM. THAT IS WHERE APOLLO REALLY STANDS OUT. WHEN YOU LOOK AT THEIR EFFICIENT GROWTH METRICS, METRICS LIKE RULE OF 40, THEY ARE BEST IN CLASS AND THAT IS WHAT GOT US EXCITED ABOUT MAKING THE INVESTMENT. ED: TIM, WHAT I FIND INTERESTING ABOUT YOUR COUNTRY THAT COMPANY IS YOU'RE BASED IN SAN FRANCISCO BUT YOU ARE REMOTE FIRST, A TOPIC WE DISCUSSED ON THE SHOW A LOT RECENTLY. EXPLAIN YOUR THESIS OF WHY THAT
IS THE BEST WAY TO WORK. TIM: DEFINITELY. THERE IS SO MUCH TALENT AROUND THE WORLD AND WE WANT THE BEST ACCESS TO TALENT, REGARDLESS OF WHEREVER THEY ARE LOCATED, AND ESPECIALLY THERE IS AN EXIT IS OF TALENT FROM THE AREA, THE BAY AREA STILL THE CENTER OF TECH BUT GREAT TALENT IS EVERYWHERE IN THE WORLD. ED: I KNOW A NUMBER OF EASY BOARD MEMBERS DON'T AGREE WITH THAT THESIS AND THEY WANT TO SEE THEIR PORTFOLIO COMPANIES WORK TOGETHER, BE IN ONE PLACE.
WHAT DO YOU MAKE OF THE REMOTE WORK POSITION APOLLO HAS? MERRITT: I THINK OUR VIEW IS THERE IS NOT A ONE-SIZE-FITS-ALL ANSWER TO THAT. FOR EVERY COMPANY IT IS DIFFERENT AND FOR SOME COMPANIES, A DISTURBED WORKFORCE CAN WORK WELL DEPENDING ON THE NATURE OF WHAT THEY DO AND FOR OTHERS IT IS IMPORTANT TO BE CENTRALLY LOCATED IN ONE PLACE. CAROLINE: I'M JUST GONNA GO BACK TO, TIM, WHAT YOU OFFER.
YOU ARE THE FIRST SALES TECH UNICORN MINTED IN 2023 AND YOU HAVE BEEN SAYING WHAT MAKES YOU STAND OUT AND OF COURSE IT IS ABOUT ALLOWING SALES REPS TO DO EXACTLY WHAT THAT IS, TO SELL, TO NOT TERMINALLY MOVE BETWEEN TOOLS AND HAVING CUMBERSOME INTERACTION WITH CRM BUT ONE THING THAT TOOK MY EYE WAS THE FACT YOU WERE SAYING SOME COMPETITORS, DARE I NAME ONE OF THEM, ZOOM INFO, THEY SEEM UNIFIED BUT THEY'RE NOT BECAUSE THEY HAVE ACQUIRED. DOES THAT MEAN YOU WILL NOT BE USING FUNDS TO ACQUIRE OTHER COMPANIES? TIM: NEVER SAY NEVER, BUT WE ARE FOCUSED ON PROVIDING THE BEST USER EXPERIENCE FOR THE END-USER FROM DAY ONE. OUR GOAL IS TO BUILD THE UNIFIED ANALYST SOLUTION FROM THE BOTTOMS UP, THE SIMPLEST USE AND MOST SUCCESSFUL TO GET STARTED. WE HAVE NOW BUILT THE NUMBER ONE RATED PRODUCT FOR SALES, THE MOST LOVED PRODUCT AND A LOT OF THAT HAS BEEN THE WAY WE ARCHITECT THE PROJECT FROM DAY ONE. ED: ON THIS PROGRAM WE MAKE THE
DISTINCTION BETWEEN AI NATIVE AND AI ADJACENT COMPANIES, THOSE SET TO MOST BENEFIT FROM THE NEXT GENERATION OF ARTIFICIAL INTELLIGENCE TECHNOLOGY. DOES YOUR INVESTMENT THESIS FOR THAT SPLIT AS WELL? MERRITT: ABSOLUTELY. THOUGH I WOULD CALL IT AI ENABLED.
APOLLO IS AN AI COMPANY BUT IT HAD AN ESTABLISHED DISTRIBUTION AND PRODUCT THAT WAS NOT AI NATIVE FROM THE START BUT HAS UNIQUE RIGHT TO EMBED AI INTO THE PROJECT OVER TIME. CAROLINE: WE WANT TO THANK BOTH OF YOU, FASCINATING TO GET INTO THE INNERWORKINGS OF WHAT MAKES AN UP ROUND AND CONGRATULATIONS ON APOLLO.IO, TIM ZHENG AND MERRITT HUMMER. WE JUST FINISHED WITH ED AND LET'S BRING A BACK TO NVIDIA, SHARES AT MORE THAN 4% AND ALPHABET STING HIGHER, WE GOT NEWS THEY WILL BE DEEPENING SOME OF THEIR RELATIONSHIP ON GOOGLE CLOUD WITH NVIDIA EXPANDING THEIR PARTNERSHIP TO ADVANCED AI COMPUTING. SO REALLY STARTING TO SEE THE OVERALL BUILDING BLOCKS COMING INTO THE CLOUD OFFERING. LET'S TALK ABOUT OTHER PARTNERSHIPS, WALMART FOR EXAMPLE TAKING TO THE SKIES BY TEAMING UP WITH WING OR DRONE DELIVERIES MORE GENERALLY. WING IS PART OF OUR -- CEO SHANNON NASH WILL BE JOINING US.
AS UBER TECHNOLOGY. ED: WALMART IS PLANNING ITS LONGEST DISTANCE DRONE DELIVERIES YET BY TEAMING UP WITHOUT THE BET'S WING UNIT AT TWO DALLAS AREA STORES. THE DRONES WILL BE ABLE TO DROP OFF FOOD AND HOUSEHOLD ESSENTIALS AS FAR AS SIX MILES FROM THE STORES. LET'S BRING IN WINGS CFO, SHANNON NASH, HERE IN SAN FRANCISCO. CAVEAT IS A SPOTTER IS NEEDED TO LOOK OUT FOR ANY AIRCRAFT THAT CANNOT TRANSMIT THEIR LOCATION.
EXPLAIN THAT CAVEAT AND HOW THE TECHNOLOGY WORKS. SHANNON: AT WING, WE HAVE PERMISSION FROM THE FAA TO FLY WHAT IS CALLED BEYOND THE DIGITAL LINE OF SIGHT. SO FOR US, WE DO NOT HAVE THE SPOTTER YOU ARE TALKING ABOUT. THE WAY WE OPERATE IS WE HAVE SOMEBODY, PILOTS, ABLE TO REALLY LOOK AT THE AREA IF YOU WILL IN TERMS OF WHERE OUR DRONES ARE FLYING AS OPPOSED TO LOOKING AT -- I THINK PEOPLE THINK THERE IS SOMEBODY LOOKING AT THE DRONE AND FLYING AND SEEING HOW FAR IT CAN GO. I'VE HAD PEOPLE SAY THEY THINK
THERE IS SOMEONE WITH A JOYSTICK CONTROLLING THE DRONE. WE ARE COMPLETELY AUTONOMOUS PEER THAT IS WHY WE ARE EXCITED ABOUT THIS OPPORTUNITY. ED: YOU ARE THE CFO OF WINGS, IT IS TO STORES, BIG STORES IN DALLAS, HOW BIG OF A DEAL IS THIS FOR WING? SHANNON: THIS IS A HUGE DOP LET'S TAKE A STEP BACK, WING HAS OPERATED AND DONE OVER 300 50,000 COMMERCIAL DELIVERIES IN THREE CONTINENTS. THIS ALLOWS US TO EXPAND IN THE U.S.
WITH THIS WALMART PARTNERSHIP, BEING ABLE TO REACH OVER 60,000 HOUSEHOLDS IN THE DALLAS, FORT WORTH AREA, SO THIS IS AGAIN PART OF OUR SCALING OF OPPORTUNITY AND WE ARE SUPER EXCITING TO BE WORKING WITH WALMART. CAROLINE: WHAT DEMAND ARE YOU SEEIN? HOW MANY PEOPLE ARE RUSHING TO THE APP TO MAKE SURE THEY CAN RECEIVE THESE DELIVERIES WE SAW ON OUR SCREEN? SHANNON: SO WE SPENT A LOT OF TIME WORKING ON SENTIMENT AND ENGAGING ON THE NEED FOR OUR SERVICES IN THE LOCAL AREA. WE HAVE BEEN OPERATING IN DALLAS, WE HAVE A PARTNERSHIP WITH WALGREENS, AND PEOPLE HAVE BEEN ASKING FOR US TO DO MORE SO WE ARE SUPER EXCITED WE ARE ABLE TO COME BACK TO THE DALLAS AREA NOT ONLY DO MORE WITH WALMART, EXPANDED OUR HOURS AND WE WILL BE ABLE TO REACH A LOT MORE OF THE DALLAS, FORT WORTH AREA. CAROLINE: MEDICINE, MEDICAL DRONE DELIVERY ALSO A FOCUS IN IRELAND FOR EXAMPLE. I'M INTERESTED IN WHAT THE STEPPINGSTONE MEANS. BECAUSE 60,000 IS A LOT OF PEOPLE BUT IT IS CERTAINLY NOT THE MILLIONS IN THE U.S..
WHAT GETS US THERE? WHAT IS THE TIMELINE OR REGULATORY APPROVAL YOU NEED SO ME IN NEW YORK AND ALSO GET IT DELIVERED? SHANNON: I THINK THOSE ARE GREAT QUESTIONS AND WE HAVE SPENT A LOT OF TIME WORKING WITH INDUSTRY PARTNERS ON EXPANDING SOME OF THOSE APPROVALS. I THINK REALITY IS WE ARE PARTNERING RIGHT NOW WITH THE STEPPINGSTONE TO GET TO WHERE YOU'RE TALKING ABOUT WHERE THIS IS EXPANDED TO THE MILLIONS. WE THINK WE ARE BUILDING A SAFE, RELIABLE, EFFICIENT DRONE DELIVERY SYSTEM THAT IS CAPABLE OF GETTING TO THOSE MILLIONS. SO THIS IS THE JOURNEY WE ARE TAKING AND WALMART IS IMPORTANT DOS EXPANDING IN THAT WAY. -- TO US EXPANDING IN THAT WAY. ED:
THE -- THERE ARE DIFFERENT ATTITUDES FROM DIFFERENT CITIES, STATES, RETAILERS. WHERE DO YOU FEEL LIKE YOU'RE MAKING THE MOST PROGRESS? WHAT IS THE MOST SUPPORTIVE TO THE POINT DRONE TECHNOLOGY? SHANNON: THERE'S A STUDY THAT VIRGINIA TECH DID IN VIRGINIA WHERE WE ARE DOING DRONE DELIVERY AND IT SHOWED 90% -- ALMOST 90% OF THOSE WHO TOOK THE STUDY WERE VERY POSITIVE ABOUT DRONE DELIVERY AND WANTED IT IN THEIR COMMUNITIES. WE EAT FOR RECENTLY SHOWCASED -- WE EVEN RECENTLY SHOWCASED A COUPLE IN THEIR 80'S WHO HAVE HAD THE MOST DRONE DELIVERIES AND SET A WORLD RECORD, OVER 1200 DELIVERIES IN THE LAST COUPLE YEARS. MY FAVORITE PART ABOUT THEIR 1200 DELIVERIES IS THEY GOT ALMOST 100 BOXES OF GIRL SCOUTS DELIVERED TO THEIR HOUSE. [LAUGHTER] WE THINK THE DEMAND IS THERE. CAROLINE:
THAT'S A BRILLIANT STORY I WILL NOT ASK HIM ANY EGGS THEY GOT DELIVERED BECAUSE YOU DO THAT EFFICIENTLY. IT NEEDS SOME POWER PLAYERS AND MASS ADOPTION AND PEOPLE TO REALLY SHOW HOW MUCH THIS WORKS BUT ULTIMATELY WHAT OTHER THINGS ARE THE ISSUES IN YOUR SCALING? WHAT ABOUT TALENT, WHAT ABOUT BRINGING IN THE KNOW HOW TO CONTINUE TO EXPAND AND ENSURE THIS DELIVERY CAN HAPPEN TO SING TO LEE? IS IT SOMETHING YOU THINK ABOUT A LOT? SHANNON: ABSOLUTELY. AS MOST TECH COMPANIES, INNOVATIVE TECH COMPANIES, YOU THINK ABOUT ATTRACTING AND RETAINING THE BEST TALENT OUT THERE. WE ARE VERY FORTUNATE TO BE A PART OF ALPHABET, OUR PARENT COMPANY, SO I THINK WE CONTINUE TO ATTRACT AND TRY TO RETAIN THE BEST TALENT OUT THERE. I THINK THERE ARE A LOT OF OPPORTUNITIES FOR PEOPLE LOOKING TO GET INTO NEW INDUSTRIES PER THE DRONE DELIVERY INDUSTRY OFFERS OPPORTUNITY AND I THINK WE WILL SEE A LOT MORE TALENT COMING INTO THE INDUSTRY. ED: SORRY. CFO SHANNON NASH. I GET EXCITED ABOUT DRONES AND
IT IS INTERESTING TO SEE REAL-WORLD DEPLOYMENT. CAROLINE: I GET EXCITED ABOUT BREAKING NEWS AS WELL WHICH IS ENTIRELY WHY I TRY TO STEP ON YOUR FUN THERE A LITTLE BIT BECAUSE WE HAVE NEWS COMING FROM X, ALLOWING ADVERTISING. THE COMPANY SAYS IN A BLOG POST WHEN YOU GO TO THE BLOG POST IT IS SUPPORTING PEOPLE'S RIGHT TO ACCURATE SAFE POLITICAL DISPORT -- DISCOURSE ON C AND THEY'RE TALKING ABOUT HOW THEY ARE EXPANDING THEIR SAFETY AND ELECTIONS TEAMS TO FOCUS ON COMBATING MANIPULATION AND CLOSELY MONITORING THE PLATFORM FOR EMERGING THREATS. NOTABLE THEY ARE THINKING OF
BEEFING UP TEAMS IN THE AREA AFTER THE HEADCOUNT CUTS WE HAVE SEEN IN ADVERTISING. ED: IT STARTS IN THE U.S. AND WILL ALLOW PHYSICAL VOTES BUT PROHIBIT MISLEADING CONTENT. CAROLINE: THAT DOES IT FOR THIS EDITION A BLOOMER TECHNOLOGY. TOMORROW, THE GRAYSCALE CEO JOINING US AT 10:30 A.M. ON THE LANDMARK RULING.
2023-09-03 13:34
