Bloomberg TechBloomberg’s Caroline Hyde and Ed Ludlow break down Apple hitting a record, the S&P closing at all-time highs after a dovish Fed signal, and what it all means for the tech rally. Plus, GM’s Cruise slashes 24% of its workforce, and Adobe faces regulatory scrutiny.
From Mahard where Innovation, Money and Power Collie in Silicon Valley, NBN.
This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.
And Caroline Heind of Bloomberg's world headquarters in New York, and I'm Ed Ludlow in San Francisco.
This is Bloomberg Technology coming up Apple.
It hits an intra day record.
The SMP closes in on its all time highs after a dovish FED signal. What does it mean for the tech rally?
We discussed plus as GM's cruise slashes twenty four percent of its workforce. We'll talk the state of the tech labor market as more than two hundred and fifty thousand workers at tech companies of all sizes have been let go this year.
Meanwhile, Adobe facing regulatory scrutiny and for the company subscription practices, we'll take a look at the FTC investigation and why the company AI ambissions well may take longer than expected.
The other big mover this morning is Intel. It has given us details on its AI strategy. The stock up three percent or two and a half percent now it had been up as much as five and a half percent. You have new zeon server chips. Those chips have been through two redesigns in the last year already. You also have details around Goudi three, the AI accelerator. This is the GPU CPU hybrid that basically is going to take on in video's h one hundred. And you have Intel with this fighting talk saying that Galdi three is going to be as good, if not better than in videos H one hundred, but it's nowhere to be seen yet, doesn't come out until twenty twenty four, Caroline. But the battleground for AI we were at AMD last week is heating up now.
It really feels this end of the year as just a florry to get as much of the innovation out the door as they possibly can, to steal some of the market share. The overall hype that there's been around AI, and as you say, some fighting talk coming from Pat Gelsinger, and they're like the Galdi three has the most approved, But ultimately how much of a win do you think is the fact that they'll be more efficient with some of these chips going to the data centers.
What's interesting in Intel's case is that they basically are saying the market's going to be so big there'll be something for everyone. Arsn Vidia and AMD, but they're also focusing on PCs. Remember that's their bread and butter. They're the biggest PC processor maker. And we're increasingly talking about on device right, the idea that the processing power of our laptops and our phones needs to be able to handle the inference side of a generative AI product. It needs to have the compute to perform whether it's in aeroplane mode or not. And that seems to be a part of what Intel's discussing today.
And I think you're so right to say this is about the rest of the ecosystem of chips. We keep talking about H one hundreds and keep sort of talking about the Gowdy threes, but there's an awful lot of infrastructure play, an awful lot of other ultimately picks and shovers, bolts and chips that need to go into all of this to ensure that the AI becomes reality. Let's dig into that a little bit more with our next guest, ed Silvia Geblonski Ceocio Defiance ETS, who you know has been coming off what is an extraordinary day in terms of macro policy, and I'm interested if you can put that onto the micro of whether or not technology and the AI HiPE was still something to buy into at these points.
Absolutely, So you know, I think yesterday felt like Santa Claus came to town a little bit.
Right.
The market's like the outlook for next year, we're finally done with ray hikes. I think, you know, we'll have some restrictive policy, but at least no more kind of like pounding on the gas to hike rates and you know, kind of break the economy. So I think that sets tech up very well. And I do think that the next five to ten years of technology are going to be super computing, quantum computing, and AI. And we've talked so much this year about Navidia. You and I have talked so much about Navidia and a MD this year, and I think they're kind of the clear leaders and chips. But what I think will happen next year is now all of the floodgates will open, So Intel's going to come in, companies like ion cbe like IBM, and you know, the bigger components around AI, like data processing, super computing five G for the speed to make AI work will all become tradable. Themes and you're going to start getting, you know, beyond the magnific magnificent.
Seven for AI place.
What's interesting though, is how much the exuberance becomes real revenue now.
And Vidia has managed to prove.
That point to certain extent, but I think of Adobe, We're going to dig into that story later in the show. But ultimately it's earnings not living up to the hype in terms of how quickly it can turn it into revenue into the bottom line. How much can an IBM, how much can quantum computing finally becomes the sort of revenue driver.
Yeah, and that's a great point.
And I think what happened a little bit with AI is that AI has been around for such a long time, and there was a news flash around Microsoft this year and then AI became kind of the word of the year. But then it started to feel like a bubble and people started to equate it to you know, memestock media and you know, kind of kind of that world that happened, and then it was kind of like thrown to the side a little bit. But now it's back because to your point, they're starting to show revenues. So I do think that everyone who's sort of hitched the word AI onto their wagon, is now going to have to prove it in you know, Q one, Q two, probably actually Q four as well earning. So I do think that you're going to start that play out, and it is super important for companies like IBM. So IBM is a company that has a formed you know, quantum computer, and they're actually working with companies like Cleveland Clinic to have better outcomes and drug trials and things like this. So quantum computing is now actually becoming more of a.
Reality and it exists.
Granted, you need a whole room the size of this and a lot of air conditioners torovite it for a process now, but it's there, right, So five to ten years from now, you know, Sky's limit.
Taking a look at the defiance quantum etf TICKA, qt M, with which of course you are familiar, it's yours and all of the names you've just mentioned are in there. What I find so interesting is how long does this keep going?
Right?
You look at the performance year today up almost forty percent. You have Lisa Sewer of AMD saying that the market she saw as being one hundred and fifty billion dollars just in August is actually going to be four hundred billion in twenty twenty seven.
How do you keep this going? It's been ridiculous.
Yeah, that's a great point.
And I think what's interesting about you know, the CTF and you know, some of the names I mentioned is IBM, I ONQ, you know, Arabella. Some of the smaller types of companies in this index are not companies that we're talking about right now. We're talking about Microsoft. We're talking about Google, Navidia, A m D, maybe a little bit of other names in there. But what's going to happen is that you have a whole lot of small cap names in there. So you know, why aren't we up two hundred percent? Where you're getting the performance of the large caps, the small caps because of rates and you know, kind of new to the scene types of conditions are going to probably start to rally and pick up performance. So I do think that this is going to ride out as those smaller companies start to you know, generate revenues and then are kind of cushioned by the Google and the Microsoft might end up returning five to ten percent next year and not you know, triple digit for Navidias and things like that. So I think having that well balanced mix of names you're not thinking about gives it room to run Sylvie.
In the context of yesterday's FED meeting, the ECO data we've had of late, how isolated is what's happening in the AI industry for want of a better descriptor, from what's actually happening in the global economy.
Yeah, So I.
Think I think that, you know, the AI industry is kind of almost being you know, pigeonholed again into some of the Magnificent seven and a couple of specific you know, themes that are very sort of just like straight technology focused AI data processing things like that, but we don't really talk about, you know, the macro impact and how you know that will play into what's going on. So, you know, first, the government is going to increase AI spending by you know, billions of dollars next year, so there's going to be sort of money going into AI, supercomputing, artificial intelligence. The growth of AI is creating this need for cloud and cybersecurity, so that's going to increase in you know, kind of macro business spending and things like this. And then I think just overall, you're finally going to start talking about how AI impacts different sectors, you know, healthcare for example, are we getting those better kind of like drug outcomes, surgical proceeds, your outcomes, things like this. So I think the story is going to change more about how is AI making companies more efficient? And that started a little bit with digitalization of factories for missing workers, but I think that'll really continue to play out.
I'm interested in well Ed says, maybe the rally's been ridiculous when it comes to AI. Some might have said that crypto is starting to look a bit ridiculous again, but it's managed to top out about shot forty five thousand.
There has been a rule in twenty twenty three? Will that continue? Is that all about Matt Crow? Is there anything it is in classic that you like that? Yeah?
So I think that there's a little more room to run in crypto. And that's because I suspect I can't predict the future. If I suspect that these approvals that we've kind of longer waited for are probably going to play out, and then you know, so you're just going to have kind of a shift of assets and you know, in some regard and new products are going to have to buy more bitcoin to create themselves, so you know, you'll really have that demand need. But then once that comes out, now all of a sudden, these products become more institutionalized, easier to trade, you get better spreads, you don't have to worry about kind of futures, rolling contangle or managing digital wallets. And then I think the efficiency of all that starts to play out more. So, you know, do I think it's going to double or triple? I don't know, but I do think that there's some solid runway left, particularly around that once we get that stamp like this is approved, I think, you know, I think bitcoin's going.
To run all lies on that spot Bitcoin ETF. Sylvia Jamansky, who knows a thing or two about ets, she just of course the defiance ETF.
And we thank you so much for being in the studio.
Ed all right. Coming up on the program, twenty twenty three was a brutal year for tech workers. We're going to be joined by the creator of the tech Layoffs Tracker Layoffs dot FYI.
That's coming up next.
Let's talk layoffs. Because Cruise, the autonomous vehicle unit of General Motors, will lay off twenty four percent of its workforce. Around nine hundred people, it'scording to a blog post by the company. These layoffs come just one day after Cruise also just missed nine of its top executives. Now, the company has been trying to cut its costs in an effort to revamp the company after, of course, that crucial accident in which a Cruise card dragged a pedestrian in October ed.
Yeah, it's been a big story here in this city and for that company and Cruises. Layoffs are just the latest occurrence piling onto this year's wave of layoffs.
In the tech sector.
In total, more than two hundred and fifty thousand workers at tech companies big and small have been let go in twenty twenty three.
That's according to.
The job tracker Layoffs dot FYI. Let's bring in the job trackers creator Roger Lee to dig into that data. I think a good starting point is to ask, well, two hundred and fifty thousand, what does that look like relative to prior years, prior periods of recession, prior periods of economic pain.
Well, the number is very high, even compared to last year when we first started seeing a wave of tech layoffs. Twenty twenty three is the highest number that we've seen today. So two hundred fifty thousand tech employees have been laid off so far this year. That's up from one hundred and sixty five and twenty twenty two. And even in twenty twenty, when we saw a wave of pandemic related tech layoffs, that number was only about eighty thousand. So this year has been the worst time in the past few years.
What if anything to the companies that have done layoffs and cuts got in common, be it their reasons for doing so or their reaction into something.
Well, the biggest reason for these tech layoffs has been an over correction of the over hiring that they did during the pandemic search. You know, back in twenty twenty to twenty twenty one, we were in a very low industrate environment. Tech companies were booming in demand from people staying at home and turning to tech services more and more, and so these companies are able to go on a hiring spree and they invested aggressively in initiatives that were respeculative or wouldn't payoff for several years.
Now, of course, the climate is entally different.
We're in a period of interest rate hikes, and so that's causing these same companies now cut back and correct for that over hiring from before.
Okay, so now we're in talk of cups. So does twenty twenty.
Four mean we rectify that we see more exuberant, more hiring or is it actually slower and more specific.
Like, yes, we'll hire, but only in AI.
Yeah. Well, you know, after seeing actually some declines and layoffs over the course of this year, the past two months have marked an uptick in the tech layoffs and I do expect that to carry over to early next year because the year end is a natural time that connoct a layoff as a coin science and annual budgeting. So as companies in tech are taking stock of their full year perform and are looking ahead to twenty twenty four, they're finding our job cuts aren't necessary to improve profitability.
So I do expect.
That this remains slow for the next few months, although as we look ahead to the rest of twenty twenty four, hopefully if interest rates do come down as is expected, that would mean that the tech where they are will finally subside Roger.
It's interesting, isn't it that much of the so called silver lining when everyone was really talking about the big cuts that were being executed. At the beginning of the year, everyone was like, well, more startups will be formed, while people will leave. They've got some cash in the bank that we be able to start up some other companies. Now it feels also that we're talking of well, technology being necessary everywhere, particularly in the field of AI, and people going into banking sectors, going into different industry groups that need that sort of technology retail.
I mean there is an industry that it doesn't affect. Are people leaving tech more broadly?
Yeah, you know, the rate of startupformation is affected because fundraising is so hard to come by. We're in an era now where the cost of capital is much higher than in years past, and so startups are finding it harder to raise money compared to before. And that does make it harder for these late off tech employees to stay in tech or to go start their own company.
And so you are finding that.
More and more folks are going to other industries either, you know, folks on the business side, like sales people recruiters are leaving tech entirely because they can find better roles in other industries. Since the tech downtern has not broadly affected what's going on in the rest of the economy where unemployment is still very, very favorable. And then even engineers are also looking at other options too outside of tech because of the reasons you said, tech is everywhere, and they industry now has a need to invest in technology.
Yeah, Roger, I found it fascinating that the principal driver is undoing the over exuberance of hiring from the pandemic period about Caroline, But I just had this weird deja vu because I felt like we told that story a year ago.
Yeah, so why are these.
Companies doing cuts twelve months later on the same rationale.
Anyway, I just thought that was interesting.
Yeah, and the pendulum and we hope doesn't swing completely the other direction once more. Roger, lee'fraid we have to leave it there, but thank you so much. Creator of layoffs dot f Yi. French billionaire Vizant Belori, Well, he's considering a split of the media and entertainment empire he effectively controls Blue Meg. Sources say the breakup would allow for the venue to split into several companies in order to better take advantage of each unit's strength.
Cheers. They've been searching on the hills of that report.
Edd Let's continue that story with Bloomberg's Benoir Bertilo out in Paris. Go out to Paris with our correspondent who in the last two hours has broken even more news on the Vendi. Let's start with the basic premise of what Vincen Belaure is doing here.
Yeah, a very unexpected move. Really announced late yes of the that it would break up or explore the breaking up of his company in three different units. That would be one unit for PATV is building a sort of Netflix like streaming service out of PATV operators across Europe, so that's can help. Plus another unit would be the ad group Avers. It's a good ad group valued between two billion and three billion euros by investors, but it's much smaller than Peers publicis WPP on income, So that would be a stand alone company as well, both listed company, and that would be a third company, an investment company holding the shares of various groups that the Boloy and Vivandi group has, including La Gardeer, which is a publishing giant encompassing the third book publisher in the world, which is Ashet. It also has travel retail operations, so a complete split of the group he tried to build for the past decade would be explored now.
I mean volsobroken news.
So maybe he thinks about selling a steak in the former poem Monopolia Italy Telecometalia. It's also fascinating and paint a picture of Beloray for us, because what's so interesting in your story is basically on the Puifontein. The CEO of Ivandi almost doesn't get a mention here. This is about a lot sort of a Rupot Murdoch figure of France.
Yeah, we've compared him to report Murdoc in the past, is like him a media mogul, is pretty conservative in the line of his media outlets. He's seventy one years old. Officially he retired last year, so he's not the CEO of all chairman of the groups we're talking about, but he is said to be really calling the shots for any big moves like this, and it's really the writing on the walls. Being known as a corporate Rado has made a lot of surprising moves with his companies. For example the listing of Universal Group two years ago, which really is sort of an inspiration for what's happening now. So so yeah, is at the age of a try of free daring. Clearly he has his two older sons, Sel and Yannique, both heads of Boloy and Vivandi. But clearly, like it seems, he has a lot of some moves still to.
Make all right.
Bloomberg's Ben wor Betterlow out in Paris on that story. Coming up here on the program, we're gonna have all the details on the FTC's probe into Adobe subscription cancelation rules. Drives a lot to be mad I see on social media. We're gonna be joined by Tech Policy Institute's senior fellow, Sarah o'lamb. That's coming up next from San Francisco. This is Bloomberg Technology. Welcome back to Bloomberg Technology, Ed Lovelow.
In San Francisco, and Carolin Hyde right here in New York.
Let's get a check on these markets because we are dictated by macro polls at the moment. We had the Federal Reserve yesterday, of course, signaling that rake carts say are to come in twenty twenty four. The retail sales number also just showing the resilience of this US economy. The fact that we saw not only three percent growth in retail sales in November rather than a contraction who also of course got.
Jobless claims looking good. This is a strong economy. Do we see a rotation?
Therefore, money is still going into the NASAC, though tentatively, and this is the Nawstak one hundred. What's interesting is you're getting more love for the well, let's more left out in what has been a ramp in twenty twenty three the small caps, of course, and let's move on and to see what's happening on the individual stock movers of choice though at the moment, and Apple did hit an intra day high at one point, so there was some love some of the big tech and still those magnificent seven names.
Adobe.
Interesting outline, we're off by almost six percent. Big move was Perform and then as that one hundred ed and a lot of this to do with numbers that didn't live up to expectations in terms of their earnings.
Still going to see double.
Digit growth in revenue, but the market wanted to see more, particularly in the digital media. But I think also the ongoing narrative around the fact that they're getting pushed back on the Pigma deal and of course, the FTC the fact that they are too difficult to cancel, and that's a key story that want to dig in on.
Yeah, so Adobe has been cooperating with the FTC in a civil investigation since twenty twenty two, which looks exactly that policies around canceling subscriptions. It's driven many of you mad. We know you tell us on social media, but it's an interesting disclosure that Adobe had in that filing last night. Let's bring in Tech Policy Institute Senior fellow Sarah o'lam joining us here on the program. Your reaction to that FTC look at Adobe's practices around canceling subscriptions and products and services.
Sure, well, it was news yesterday and Adobe's eight K filing that it wasn't really known before that that the FTC as an investigative demand before it, and that in November twenty twenty three last month, that it would enter into negotiations to possibly impose penalties. They're using this authority under Section five A Unfair and Deceptive Practices, but also the Restore Online Shoppers Confidence Act RASCA.
It's a statute from twenty ten.
Folks might be reminded of the use of this law as well when FTC sued Amazon earlier this year also for prime subscription practices, So this is ongoing. It's also related to rulemaking proceding a click to cancel negative option rule proceeding from earlier this year as well. So the FTC seems to be ramping up its investigations of subscription practices.
And maybe we shouldn't be surprised President Joe Biden. Of course it was back in March. I think really talking about the need for the ability to sign on to be as easy as the ability to cancel these online subscriptions, digital subscriptions, and you know when it costs up to seven hundred dollars a year for an Adobe subscription, no wonder they want to ensure that it doesn't drag on in some way. Do you think the FTC is sort of going to get more broad with this? Is it always going to be looking for settlements, for example that could have significant monetary costs Adobe lines?
Well, in January, in the new year, it's going to have a hearing, a public hearing about this negative option rule, which is its way of saying that they want to make a rule across all companies that to make it easier to cancel the click to cancel.
So it's an ongoing open proceeding for the FTC.
What's interesting about yesterday's announcement was that they are sending these investigative demands to public companies with outside of the rulemaking process, and so I think that might be causing some stock market effects that that they're.
Getting all these investigative demands.
And what's interesting is, yeah, the Figma acquisition is still up in the air. It's still under review at the Justice Department. So Adobe has a few things happening with the FTC right now and Justice Department.
And so does some other companies.
I mean, the FDC has got busy, so have actually global regulators towards the end of the year. You're seeing what the FTC looking at the nature of Microsoft's investment in open Ai. The EU is looking at a similar So while the UK indeed is looking at a similar sort of relationship between Microsoft and open Ai, we've got the EU looking in many a field of regulatory oversight. We think of alphabets impact earlier this week, Sarah, our regulators just having enough with some of these business models.
Well, what makes it easy for regulators is that they can send a letter an investigative demand pretty costlessly. I mean, they prepare it, but they send it, and then the companies have to do a lot to respond.
And beyond noticed.
And so it depends on your view of how broad the FTC's Section five a Unfair and Deceptive Practices authority is, if they're going beyond the scope of their authority or if they're within the scope of their authority. And so that's a really good question right now about this FTC in particular, which is a little bit more active than prior FTCs.
Well, I appreciate Caroline's question too, because throughout the cadence of this year, I think the only thing we can agree on is there's been a lot of antitrust and regulatory news when it comes to big tech net net Sarah, who came out on top at the end of twenty twenty three. The regulators or the technology companies.
Well, you know, it slows down business, but folks would say that maybe it is the job of these government regulators to make it harder or to protect consumers. And so, you know, you hope that there is that balance of being pro consumer and pro investment, especially for American companies, which are you making up the most of big tech in the markets and in globally, and so hopefully that they can strike that balance.
Some of that is, Kurry pointed out, was in the context of M and A, right, you think about like Microsoft Activision or maybe now Microsoft's stake and open AI in twenty twenty four, what will be the area of focus do you think from regulators is they look at technology companies?
Well, I think what's really important for you know, us in the policy arena and Congress and the regulators is to know that any government involvement slows things down. And so there might be you know, good good reasons for caution and for policy making, but there's also you know, a big important value in letting companies innovate and merge and acquire each other and then learn that way see what happens in the market. So you know, I would recommend the regulators to make sure that we're accelerating growth and not slowing it down.
Well, said Sarah Alamb's great to have you, senior fellow at the Technology Policy Institute. Great to have your expertise. Meanwhile, let's just stick with it Obie for a moment, because well, we know that the shares runner pressure. Also because of its warm outlook for sales in twenty twenty four, it seemed to signal a potential that the AI boosts, particularly when it comes to its product far Fly, It's going to take longer than expected to actually boost the bottom line. Wall Street still expects Adobie to be one of the first software chants to benefit.
From general to AI. Now that's stick with AI and look.
At just all the industries that it's going to transform, most likely healthcare. I sat down with Best Some Adventures partners Steve Kraus just talk about what he's seeing in the impact so far.
Take a listen.
We at Bessemer have made a really large commitment to AI, and I would say that healthcare is actually one of the industries where it's going to be most relevant, most impactful. And the reason for that is, you know, healthcare is the most laborious, inefficient industry in the economy. It's also thirty percent of the world's data and so if you think about that combination, what is artificial intelligence good at. It's good at automating tasks in all parts of our economy, but we think in healthcare it's going to be really impactful basically everywhere, from how the payment in healthcare is administered on the back end, how healthcare is delivered you know, by clinicians. In terms of clinical decision support, for instance, AI can be very impactful, and then also how drugs are designed and delivered to improve human health. And so we think all aspects of the healthcare economy are going to be revolutionized by AI.
The problem with twenty twenty three is suddenly we felt that AI was this bright, new shiny object, and ultimately artificial intelligen has been in an un sexy topic for years, and I'm interested as to therefore for you, was it a out starting to amplify the AI story amid the companies you've already backed, or is it finding new companies that are being built out of this sudden nique change that we did see with generative AI.
I think it's both.
We've actually been investing You're right, it's been around for a long time these technologies, and we've actually been investing in five plus years in terms of how these technologies are applied to healthcare, and I mentioned some of the ways that could be and so I think there's going to be plenty of new opportunities that come out over the next decade of how AI can be applied to healthcare. But I also think for existing companies. As you point out, I talked about how healthcare is a very laborious industry.
A lot of its services you.
Know, humans doing tasks that actually can be automated, that are pretty mundane but are very important. And so we actually think AI is going to shift services to more software, like in their administration and how care is delivered.
What has it done to the valuation story of the companies that you're looking to invest it or already have that.
Well, AI is a hot space and I think, you know, the valuations the AI sector are pretty robust, but we also think the opportunities equally as robust.
And it's if you think about it.
You know, in my career and venture there have been several platform changes, you know, moving from on premise software to the cloud. That was a huge, huge shift in our economy and created hundreds of billions, trillions of dollars of innovation entrepreneurship. The iPhone right huge moment. AI is also a huge moment. So while you know valuations are heady, I actually think the opportunity is almost uncapped, and so we're excited. And that applies to healthcare AI companies.
Too, and maybe even some exits.
I mean, talk to us about when you're thinking of best some adventures, I think of, well, some of the unbelievable companies that have been gone public through the pinterest that you've been from early days and some of the other Twilios linkedins.
Who are they in your current.
Source of portfolio companies that you've invested in. Where do we see those exits coming from.
Yeah, I think it's the AI wave.
We're early in it, and so I think those exits will come in you know, five ten years. But right now, one area that we've invested in is the digitization of the healthcare economy. Again, it's often been experienced where people get their healthcare in person, but we saw that covid actually unlock the whole idea of telehealth, and so we think all throughout the delivery of care, whether it be companies like Headspace Health or Hinge Health. Headspace is obviously focused on mental health care, which as you know, has been an area where frankly, there's a lack of supply of clinicians in the US and in the world. And so a company like Headspace that delivers really important, high quality mental health care to all if you have a phone, an iPhone. Again, that's a huge, huge opportunity that we think is going to run for a long time. And also a company like Hinge, which is doing the same when it comes to back or knee or hip pain, being able to deliver that care like physical therapy, you don't have to go to see your physical therapist in person. You can actually do that care via your iPhone. Again, a huge market opportunity, and we think those are the companies that we're going to see you get to exits in the near term.
We'll based on the East Coast, but up in Boston. Yes, where are those opportunities coming from? Where are these companies being built at the moment? Do you think that you're going to be looking to in twenty twenty four?
I You know, we at Bessemer have lawn believed that you know, Silicon Valley is obviously a hotbed of innovation, but Boston's a hot bed of biopharmacutical and healthcare innovation. New York but frankly, we've invested all over the United States and.
All over the globe.
We have offices worldwide, and so we actually think entrepreneurs can be anywhere. And frankly, one of the things that you know remote work taught us is that you you know, entrepreneurs.
Are everywhere and people can work everywhere.
And so we've invested in everywhere from Minneapolis to North Carolina to London, Israel, and all.
Across the globe.
And so I don't think entrepreneurs are limited and where they live. I think it's that spirit lives everywhere and the possibilities are everywhere.
Steve Krausser from Bessemer Venture.
Partners venture back startups in the lab grown meat space have received billions of dollars in the last decade, but the companies aren't actually delivering and what was initially forecast for mainstream adoption. In the latest edition of Bloomberg Business Week, we dive deep into one of the industry's biggest players, Upside Foods. Joining us now is one of the co authors of that piece. Bloomberg's preer and end. There is a stigma we've grab loan lab grown anything.
Tell us about your article in the magazine. What is the main conclusion that it comes to.
These companies, especially Upside Foods, promised that they would deliver a center of plate sort of style of meat that is an equal substitute to folks who enjoy eating meat, different from the plant based industry, where you know, it's not necessarily one to one and it's not necessarily real meat. There are other components of vegetables and other things like that mixed in. And what has become clear is over the years, after hundreds of millions of dollars in funding for Upside Foods in particular, the company is still struggling to make the technology work to actually deliver what it has promised over the years.
Well like that one basics, so is it even revenue generating? In other words, does it have a meat product lab grown that it sells anywhere?
Right now, the company is supplying small amounts to a restaurant, very very very small amounts, and it's far away from being able to make a similar product at scale for supermarkets.
And for years, the promise.
Has been that these kinds of companies will by twenty twenty one under supermarkets like Costco. And the idea was people love eating meat, why should we slaughter more animals for it?
What ultimately has been perhaps an exuberance about the timetable here, is there any reality that we'll start to see lab grown meat on our plates more quickly? Because you have this beautiful part of the story where you're saying that basically people are having.
To sort of dig out of test tubes.
And make one very small, tiny piece of chicken in the metal when they should be making much larger amounts of a feel that's right.
There are a number of companies in the space that say they're going to use animal cells to create sort.
Of hybrid products that are.
Partly plant based, partly this lab grown meat to make a plant based meat while tastes more like actual chicken or actual beef, for example. And these companies say that they will in a couple of years have these sort of hybrid products available. But at the same time, the process has been slow moving, and many of the largest companies are still only in these small scale tasting events. And in the case of Upside Foods, we've learned that the company has yet to actually be producing at scale.
Preer fascinating. Go read the story.
It's really sort of a history of what is exuberant in this particular space.
Faced with reality priann end. We thank you so much.
Meanwhile, look we're turning to another story, this gone viral.
That we haven't had a chance to discuss yet.
Ail Musk is starting his own university of wanting to tax filings for the billionaire's latest charity, called the Foundation Now as a CEO is planning.
To start a university in Austin.
New institution, inceeded with roughly one hundred million dollars gift from Musk, will start with a STEM focused primary and secondary school and then move on to late style education.
He's actually not the first time.
He started education for kids, right, Yeah, He's actually set up a school for his children years ago in Texas.
This is the next level Elon Muster, the philanthropist.
What's he gonna call it? Is that have has something to do with.
X Maybe it has something to do with being proximity to his space company.
I think convenience is everything. Meanwhile, that does it. For this edition of Bluebog Technology, check
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