Bloomberg TechnologyApple and Google's Gemini AI, and Nvidia's Annual Conference
Bloomberg's Caroline Hyde breaks down the potential blockbuster agreement between Apple and Google to use Gemini AI in iPhones, and how Nvidia faces sky-high expectations from investors as its annual conference is underway. Plus, highlights from Elon Musk's full interview with CNN veteran Don Lemon.
From Mahard where Innovation, Money and Power Collie in Silicon Vallet NBN.
This is Bloomberg Technology with Caroline Hyde and Ed Ludlove.
And Caroline Heider Bloomberg's world headquarters in New York. Ed Ludlow He's off today. This is Bloombag Technology coming up. Apple and Google in talks to use Google's Gemini AI in iPhones. Will break down the potential blockbuster agreement that could shake up the AI industry Prus. The Woodstock Festival of AI and Videos annual conference kicks off today and the company facing sky high expectations for investors. Willham full coverage ahead and Elon Musk's full interview with Don Lemon. It's out this morning after the billionaire canceled a planned partnership with the CNN. Veteran will bring you the takeaways what this means for X and why el says his Ketamin prescription is an investors' best interests. It's the most important story of the day when it comes to the stock moves the future of AI ahead of, of course, what we see from video. A little bit later, Alphabet shares soaring six point eight percent.
Why because we understand that there are indeed some conversations into the works that Gemini will be the AI of choice when it comes to generative AI for Apple, of course, two billion phones.
What does that mean?
Well, broadly, we have two point six percent high for Apple. Now notably though, what does it mean for Apple on its own generative AI story? And why not Microsoft and open Ai so much to discuss the Bloomberg's Mark German who brought us the scoop? Of course you did, Mark, amazing bit of reporting. Now first, what does this mean from your perspective for Apple? Because where are we in its own generative AI story?
Yeah, Caroline, thank you so much for having me.
This is a sizable moment.
For the AI industry, a big moment for relations between Apple and Google, and of course a big moment for Apple. Apple really has no choice but to get on the artificial intelligence chat GPT generative AI bandwagon. They were caught flat footed when all of those new software and AI initiatives started rolling out about a year and a half two years ago, and so Apple has a homegrown artificial intelligence model of its own. You're going to see Apple release several new AI features this year, but most of those features are focused on day to day productivity, proactive intelligence, doing things in the background. They're not focused on what we think of as AI today, which is essay creation, image generation, typing things into a Gemini or chet GPT or copilot like chatbot, and so to fill that gap, Apple is seeking an outside partner, and they've talked to two companies primarily, maybe a third, but the two they've talked to primarily are Open Ai, of course, and Google and Open AI and Apple held talks recently, but active talks are currently between Apple and Google about licensing Gemini to be used in iOS eighteen in the iPhone for generative AI use cases beginning later this year.
Okay, that's an interesting take, isn't it.
More broadly about the Microsoft relationship over are I'm many wondering whether how much of.
A done deal this is go back to alphabet and what this.
Means not only for Gemini, which of course has had some hits from a PR perspective, if not much more, but also it means sort of.
Certain chips that they make.
I mean, some people reading across that this isn't therefore just completely in video and an AMD's game here.
Yeah, certainly this is a big moment for Gemini and Google as well. Depending on how this thing is branded, it can turn Gemini into more of a household name.
From what I'm.
Told talks, they're not early, they're not advanced, They're sort of somewhere in the middle. So this is not a done deal by any stretch of the imagination. The companies have some time here before Apple needs to make its Artificial intelligen announcement. Commercial terms haven't been worked out yet, nor has branding been worked out yet, but this definitely would take Gemini and put it, like you said, on billions of more devices, depending on where Apple does these AI integrations and if they slapped the Gemini name on it. Obviously this would be very big for Google, but it's unclear yet if they will do that. It's also unclear if Gemini would be the default or one of multiple large language model options for checkbots and other things within Siri, in addition to Apple's homegrown EIE tools, and.
Not to mention what that means from an anti trust perspective of alphabet and Apple's relationship has been right through the calls of late Mark German, wonderful reporting. Thank you so much for bringing us the breakdown of the overall story that has really infused enthusiasm into the stocks today. Let's get more tap for you, Brentzdale, his Jeffrey's Equity research analyst, and let's start on what this means for Alphabet and indeed whether this deal can really get done from an anti trust perspective.
What do you think, Brent.
Well, I think and get done.
Google needs it. I mean, right now, Google's had a really difficult run. It's been an investor story that most investors right now are are disappointed with the leadership, and obviously the.
AI launches that they they've they've come out with.
And so I'd say in terms of the most negative sentiment in any stock I cover right now is on Google. So they need a good win like this, and they need Gemini to to be put on the front burner and and this would be obviously a huge opportunity for them. Whether it happens or not, who knows at this point, but yeah, this is a this is a is a great opportunity for Google. I'd just say that right now, all the attention has really been on Microsoft with the open Eye relationship, and so obviously you're starting to see different alignments in different AI technologies, right, Microsoft and open Ai, obviously Apple, my Amazon's now aligning with others in the industry. So you're seeing kind of clear alignment in the industry around different AI leaders. And we think that again this would make sense given what's happened with the search relationship, to extend on Gemini out to the platform. And again I think the opportunity is great for consumers, which today a lot of these AI agents are.
Kind of difficult to navigate.
They're they're kind of wonky, right, So could Apple and Google seamlessly integrate this into the products, you know, where I can literally open up my Apple laptop and say what are my top appointments for today, you know, and the agent can read read off what's happening today that doesn't really exist. So there's a lot of integration that can make this really easy for end users and the adoption you can take off further for for Google.
But Brent, what does it mean more broadly therefore?
On an ability for alphabet to maintain its market share here many have worried that open ai, for example, would start to steal away some of the search penetration that it has, but it hasn't so far.
It feels like, what do you think about that?
It's early, Yeah, it's very early.
And I think why this is so important is to your point that everyone's so worried that we're all gonna have all these little agents running around. We're gonna ask questions what's the weather like in San Francisco, house traffic? And X y Z from point A to point B. Right, We're gonna have these agents doing this. And I think this again is why it's so badly needed that if you can put on one of the top platforms that this effectively and this they would capture those search shares through through Gemini, right, So the AI agents need the data, and they need the users, and they need the back end information. And so if effectively this can front end, then you know, again versus other chatbots that they could partner with or any other AI agents, this this is again gonna be a huge removal of that overhang.
Uh if that if that happen.
And now today I think that again many of the AI agents can't really solve real world problems, right, and they're starting to show that that they're getting better, and so yeah, there's the fear I certainly think that this would help, but that fear is not going to go away for Google. Many of these systems you know, for example and chat GPT. You know, I was in the Atlanta airport last week. I had meetings all day. I didn't know where I didn't know where Chick fil A was. You can ask it's internal a right. The agents are getting smarter. I don't think it would have probably known that, you know, six months ago, but these agents are getting smarter. So that is going to be an ongoing conserve for Google. The bigger issue for Google right now is really no no CFO. Who's going to be the CFO. I they're going to be shareholder friendly?
Uh?
And to your point, search share and then AI relevance are all weighing on investors' minds right now.
Okay, so still, what about Ruth Porat's replacement as she moved to a different part of the business. More broadly, Brent, but go back to Microsoft, which you also have a buy rating on, I believe in the moment, and how much this means for the traction of open AI partnership with Microsoft and what being represents as a TAP challenger, and more broadly, it's.
World of AI.
You worried that the fact that it hasn't automatically pushed out alphabet here, I'm not worried.
I think again, it would make sense that Apple and Google wouldligne over over an Apple Microsoft alignment, So never rule it out.
But certainly I think that alignment with Google makes a lot of sense.
Again, I think the thing is that you're going to have multiple vendors that win. There won't be a lot of winners in AI among large caps. They're only going to be a few right in the Amazon, Microsoft and Google, but they're all going to have an alignment and just doesn't concern me for Microsoft relationship. If you think about where Microsoft's writing is in large enterprise, They've gotten just incredible adoption and everywhere we turn they're getting adopted often right from even big Amazon shops. So it doesn't it doesn't concern me. I think you're going to see again, as I said, formation around different AI platforms from all the big tech leaders, and that formation is started, so I would I would think that the Apple Google relationship would make make more sense. They never rule out Microsoft, but again it's that it's not a thesis, uh crushure for Microsoft, given their presence and a lot of the big insurance healthcare government.
Uh, they're doing just fine.
There's plenty of contracts for them to go after outside this one.
This is a show me moment for Alphabet Brentzelle is so good to catch up with you. Thank you this Monday morning of Jeffries. Meanwhile, look, if you wanted a trade out there of those stocks, you might have had a bit of a problem in earlier market hours. That was at least the NASDAQX Dot Market Exchange now saying it has resolved that technology glitch the disrupted pre market trading in almost well three hours of time. Now the NASDACS person that we spoke with, they said that they issue did start shortly after four am, but it was resolved around seven am. And the disruption was the second at Nasdaq in about three months. But it must be said they had These sorts of issues from the Nasdaq are very few and far between. You can see the impact of basically nothing going through the markets pre market trading up until seven am.
Now coming up, we'll turn to nvideo.
What can we expect from the first day of the Semiconductor Companies Annual Artificial Intelligence Conference?
It's called the woodstock of AI. We'll tell you why.
Meanwhile, look, maybe not many people are buying these ar VR bits of hardware as have been inspected and Sony we understand, still up two point two percent on the day, but it's hit pause on its PlayStation VR two production.
Basically, it's got too much inventory. Needs to get rid of it before.
It pumps out any more of these five hund and fifty dollars wearable accessories from New York. This is Blue Meade Technology. All eyes on Nvidia today. The Semiconductor Make is GtC is an overall technology conference. Of course, it's kicking off in San Jose today. Get this, some ten thousand people are going to be watching live. We understand last night it's twenty two million watched virtually. Those expectations are high for a amount of people tuning in.
But what it means for this stock rally that you can see two one and forty three.
Percent higher over the course of a year. That's bringing Blue meg Intelligence analysts Content Savani for.
More on what to expect.
Is four pm Eastern where I sit one pm your time over on the West coast.
What will we hear from Jensen do you think, Well, we.
Expect a few significant announcement that should sort of recharge the already strong rally. First is the announcement of the new B one hundred chip, which we believe will be the first cold chip in a package product. And what it's important is it should have a performance of rate over H one hundreds of at least two x, but we believe more sort of two point five x. Second, would be sort of an upside on the TAM last GtC that HAM was about a trillion, with three hundred billion being the size for the market of the chips and hardware. We think since then the estimates have kept on rising and they are likely to announce a higher number on the chips in the hardware section. And finally, what we think would be an ideal update would be a lot more clarity and visibility on their software business execution, more importantly, the monetization and the revenue run.
Rate over there.
Okay, so you want a lot of transparency on pricing, on speed on addressable market.
I'm interested on the.
Pricing side of things, just quickly, because when we are seeing such iterations, when we are seeing such ability and power being brought to the market, as in what you insinuate with the B one hundred, are they going to be able to charge a whole lot more for it?
They should be able to. I mean, look, two x performance over the last is significant and it should help them widen their technology performance gap even higher, so they should be able to charge a lot more pricing with that.
Briefly, the risk for you, quj is it that we don't get enough of these numbers? Is it that people's expectations are too high going in?
Yeah, it's mainly the headline risk. I think in the intermediary period, while the B one hundred starts ramping, you know we're hearing the customers might think about should I adopt let's say, in H two hundred right now or wait for a B one hundred. So what that might mean is sort of a lower magnitude of beaten raises in the intermediary Also, the other thing to remember is one hundred launches, it will be a new supply chain stack, so it could be again supply constraint limiting Nvidia's ability to again deliver higher beats and raiss.
Very importantly, put remeg Intelligence Analyst con Jient Savanni, thank you so much, and let's talk about some of those risks and opportunities a little bit more now when bring in advisors.
Capital management partner and portfolio manager Joanne.
Feeney, and I feel as though this is something you've mentioned time and time again. The supply side is the issue here, not the demand side. And what are you worried perhaps with a B one hundred and a supply chain that has to be reampt even more there.
Yeah, it's certainly going to be a complicated process, but Nvidia has been there before. The challenge now is really on the packaging side, and it's been a constraint for a while for them to get more chips out the door.
Now they're going to have more to work with.
They're going to have the old you know, H one hundred, the H two hundred coming out this year, and then the B one hundred. So I suspect that different sorts of customers will get the different sorts of chips and that will help ease their supply constraints. But that new one that's going to ramp towards the end of the year, it's probably going to be a twenty twenty five story in terms of real numbers and by then we should see the increase in packaging that's being made available now by TSMC, by some of the specialty packaging companies, and even by Intel, with whom Nvidia is going to work for some of their advanced packaging needs.
This is what's so interesting about the space is its one big front of me club as well as I can work out intell and and Video sort of against each other, but so.
Dependent on one another.
And when we then think about the demand side as well, there's front of me.
Is there too the.
Story that Apple may be looking to Alphabet for its generative AI applications, then the read across some analysts is well, Alphabet starting to make its own chips. How much of a concern is competition for Nvidia at the stage, Well, I think.
It's a little bit early. But what they say this week, and particularly what Jensen says later today, I think is going to help frame people's expectations on the competition front.
And there's really two areas.
One the training side, which requires the absolute best possible accelerator chips made by Nvidia, and then there's the inference side, which is less computationally intensive. It's just where you ask the question and it gets answered that competition is and this is demanding, and that's where we're seeing more competition. And clearly, you know, Google has its own chips that they make in coordination with Broadcom, which is one of the reasons why we continue to like Broadcom as a as a stock pick here. And then you also have a bunch of startups that are starting to get into this space, whether they're private companies or older A six sorts of companies.
So there's definitely going to be a lot of competition.
They're attracted by those high prices and high margins, but it's no easy trick to build a very highly computationally capable chip like the ones in video has worked out for decades.
Let's just dig into the software side as well. And you've talked about COUDA in particular over within video.
We were hitting from Kunjan saying, you know, where is the ongoing growth and particularly from our revenue perspective of software, Where are you seeing growth for video there?
Yeah, I think that the software side is, as we've been learning, is going to become increasingly important. I mean, the chips don't work in isolation, and the Kuda software platform that Nvidia has had out there for you know, along many many years, works tightly with their chips and it makes it easier to run these models and to basically build the code. The code is now trained on you know, many many software programmers have grown up learning Kuda, and so they have a huge advantage in the coordination between the hardware and the software side. And we do expect the software side to become a bigger driver of revenues as they're really closely tied together. And that's why we do think there's room a little bit of room for a bit more margin over at in video. It's one of the reasons that earnings have outpaced revenue growth over the last four or five years, and we do think it'll be able to push it a little bit harder for the next couple of years.
I love how you dissect what basically the room and developers are going to want to be hearing, and then the room of investors on the back of what developers are hearing, going do we wanting to be listening into margin?
I mean, tell us a little bit about where in video.
Sits in your portfolio, whether you add to at these levels, whether you want to be going more broadly.
Yeah, so you know, we've held in video for a while now. We've always liked the AI story. The role of Nvidia in portfolio is really depends on the client. Right, This is clearly a growth company. It's going to be potentially more volatile than some other companies out there in terms of its stock, so it's not suitable for everybody, but we do see as a core holding in our growth strategy. We do see the opportunity for it to continue to grow. We see eighty percent revenue growth this year, but that's really built on the fact that they hit twenty two billion in revenues last quarter.
So you just run that forward, add a.
Little bit of sequential growth and you get to, you know, over one hundred billion, one hundred and ten billion in revenue, so you get eighty percent growth. But going forward, people have to recognize that we're going to seem more like twenty percent growth. Yeah, twenty five percent growth and.
At the moment still trading on forward p valuation of thirty five times but market cap just what two and a half trillion? Extraordinary the run we've seen.
Joanne Feoenie of Advisor's Capital Management, we thank you so much.
Time.
Now if for talking tech.
First up Intel backed semiconductor connectivity company that's the Steri Labs. Let's raise the size of its ban ib here by get there's twenty six percent. As the investor frenzy around AI continues to rage. Now, according to an updated registration statement that was filed with the SEC, the company and its investors now planned sell nineteen point eight million shares at thirty two to thirty.
Four dollars each.
That means the offering would raise as much as six hundred and seventy three point two million dollars plus. A barber has appointed a new head of its grocery arm that's Freship Home, in the latest step for a broadery structuring effort. Now, the CFO is going to replace the company's founder a CEO a fresher pot. They will retire but serve as a senior advisor to the company that's a former founder. Of course, all of this according to sources, and the EO is considering a form more review of how widely businesses use mature or lower end chips from China. Look, they're joining the United States and flagging a potential risk to national security and of course global supply chains.
Now, according to a.
Draft working statement, the EU is weighing whether to investigate how deeply such semiconductors are indeed embedded across industry networks.
Now coming up, we've got.
To get back to that crypto rise and slight pullback of late dig into the markets with August co founder Aya Cantorovich. Next up, let's look at what we're watching in terms of those publicly traded companies, Cloud Flair, interesting sort of revolving door here we've seen Stephanie Cohen. That name will ring a bell because Shoe, of course was the leader behind Marcus, the retail offering coming from Goldman Sachs. And now she's the latest executive to step down from that particular bank where she gone. Cloud Flair chief strategy officer for Stephanie Cohene from New York. This is Bluebig Technology. I'll come back to Blueberg Technology. I'm Caroline hired in New York.
Let's get your check in on these markets.
And after a slight technology outage of its own over at the NASDAK, we're back on track and we're actually see the NASAQ one hundred up one and a half percent. So after that pre market issue from a technical perspective that stops on trading. We're now up one and a half and it seems to be AI that's leading the charge. The hopes of course within certain well the woodstock of AI. A little bit later, Stock six six hundred though over in Europe just finished trading and actually down some two tens percent. So this sort of euphoria from AI not being built in to what's happening globally in the stock market today. And remember this is a big week for the macro picture, particularly from central banks back of England, back of Japan is coming tomorrow and of course the Fed on Wednesday. We're looking at Bitcoin just lower versus the US dollar, and in fact US dollar has been higher against most of its G ten currency pairs. We're off by another two percent, let's call it sixty six thousand, nine hundred and seventy four. Get dig into that in a moment. Move on though, and have a look at some of the individual companies that we're looking at. And I mean, this is the story of the day coming from a scoop from our own Mark Gum, and we're seeing Alphabet shares powering up almost seven percent.
Why because it looks as.
Though Apple are already in talks of them to be using Gemini the generative AI part and offering from Alphabet within the iPhones and iPhone ecosystem. But Apple, more broadly, what does that mean for adoption? What does that mean for its penetration and holding its overall market share when it comes to search. I'm looking also what's happening with Cisco one point two three percent higher?
Why because finally the.
Deal is done with Splunk and I actually want to stick with that very news because the CEO Chuck Robbins and the former now Splunk CEO Gary Steel join Bloomberg earlier today, need to discuss how this Splunk iteration fitting in within Cisco's product and financial strategy is going to continue to.
Take a listen.
There's an emerging area called observability, which is effectively trying to help our customers understand application performance, what's going on in their technology infrastructure, particularly in this world where you have hybrid cloud, multi cloud, private cloud SaaS and so that's one big area, and then the other big area of cybersecurity. If you think about the utilization of AI by the bad actors, we're going to have to do a better job of doing real time analytics, in real time detection and response, and in my view, we have to be able to take three or four different things that we're seeing happening at the same time, and those three or four independently might not indicate a problem, but together there's a problem. And their data platform with our detection response capabilities and all of our endpoints and all of the sources of threat intelligence. So we have in our massive amount of intel that we see on a daily basis, we think brings our customers the ability to actually do that in real time.
And of course when you talk to the cell side, there's also this narrative out there that you're trying to remake Cisco as a provider of networking services and really trying to lessen your reliance on one time sales of equipment. How do you see this deal as really pushing that effort forward.
Well, that's an accurate narrative.
So we.
Have been moving into more software. So I think the three metrics I would share is at last quarter we hit a milestone that we had set to try to get to fifty percent of our revenue coming from recurring revenue, and we did that last quarter, which is a big move from eight years ago. The other thing is combined, Geary and the team bring four point two billion of ar run in mid teams.
Fifteen percent as of the climes at the end of the year.
And combined we have arr now of almost twenty nine billion, and we're over twenty billion from just software sales in the company now, which is when we add splung software sales to it. So I think we've made a lot of progress and we're going to continue marching down that path well.
As this integration goes forward. Of course, both of your companies have announced layoffs in the recent months. As you integrate these two, would you expect to be there to be further headcount reductions.
This still was not predicated on cost synergies at all. It was built on revenue synergy. So it was built on the integration that we talked about and the new capabilities that we can bring to our customers. So that was never part of our plan as we were putting the integration plan together.
And of course you had mentioned chat that when it comes to AI there's a concern and uptick and that being harnessed by bad actors and Gary I'm curious what you're seeing in your data when it comes to these AI side for security attacks.
You've just seen more sophisticated attacks, whether they're specifically target attacks, phishing attacks, we're just seeing more sophistication and it's a new set of tools that bad actors can drive more and more sophisticated attacks. And we feel very good about coming together and the work that we can do collectively driving great outcomes through the use of AI to ensure that our enterprise customers are well protected.
If I could add real quickly, we have an organization called Tellos that sees about twenty billion threats a day, and so one of the things that we believe we can do is take that all of that intelligence and inject it into the data platform that they provide customers and give them a whole new level of real time visibility that they've never had before. So it's pretty exciting.
Nature of AI future of their relationship. CEO Chuck Robbins, the Cisco, of course, the formers Plunk CEO now part of the business, Gary Steele. Now let's pivot away for a moment and talk all things crypto. We just got to talk the numbers involved.
Investors adding get this, eight point one two billion dollars to crypto focused exchange train of products during the past month alone.
Fifteen point five billion in.
Fact, has been added to these ETFs in the past year, all according to day To compiled by Bloomberg. Let's get up to speed with why therefore some of the share well not shares, why crypto has pulled back in terms of our price point as as August co founder and co CEO Aya Kantorovich for more and look, the hype has been real, but the flows have been real, and now we pull back.
Any reason why, I absolutely so.
We did see, as you mentioned, a height of some new two thousand dollars reached last week and so we did finally clear the sixty nine thousand level.
And what we are hearing.
Is a rumor that that led to the BTC crash going into the weekend, and so we went from sey two thousand down to sixty five point five. And the rumor is that there was a fun blowing out roughly a billion dollars of the micro strategy BDC spread trade, and so this hedge fund set up a spread trade that shortly before the ETF approval considering that they were long BTC, they were short micro Strategy, and the idea behind it was that micro Strategy was going to fall once the ETF was approved and BTC is going to a rise. However, as you'll see in the market, that MicroStrategy actually outperformed Bitcoin and so it necessitated them unwinding the trade and closing the position. Into the weekend, you saw BDC dump as well as micro Strategy premium go high and a mini rally. There, so a lot of market activity and that's really the rumor going into why.
Okay, some rumors that we will check in on, make sure that we'll look around as to who this fund is and a MicroStrategy price currently at sixteen forty one, so down a little bit from its heights of the previous week.
When we move away from.
Rumors and look at fact at the moment, though, I what's factual is that Bitcoin has done well, but actually so has the entire ecosystem, and you're not just see eth do well. And there's many a rumor perhaps around the future ETF spot ETF for ETH in the US too, but just broadly like mean, coin's going well, but so some really you know, well, loved protocols such as Solana are all boat It's gonna keep rising.
I think right now what you're seeing, especially with Solana, is with regards to the mean coin trend. And I want to anchor on this because we're really seeing Solana look like Ethereum in the twenty seventeen Ico bubble. You're seeing mean coins come out with the pre sales that look very much like Ico pre sales. You're seeing that the Solana ecosystem has so much activity. Soul eth ratio is at an all time high right now, and Solana has also overtaken Ethereum on Google trends. You're also seeing a lot of this activity happen outside of the US. So for example, robin Hood Europe listed a couple of mean coins as well on their platform, and so you know, to your point, rising tidelifts of all boats, but there certainly are boat boes that are rising much faster than others, and especially with the correction that happened into the weekend, Solana was very much unfazed by that, and so it's very interesting to watch as well, and to your point, a lot of eyes on ethereum going into a potential etf.
Approval the main coin craze.
How much is that actually being jumped upon by institution investors, by crypto ogs who understand that perhaps the fundamentals on a basis of this, but this is a value creation like we haven't seen before.
It's going to be very much retail driven.
And you know, the way I think about it is very much a sense of community and engagement. And we saw a lot of this happen with Reddit and the Reddit community when you had GameStop on robin Hood, you had your robin Hood traders.
And again you're.
Seeing just absolute insane engagement on Reddit, which is going to be very interesting for them going into their IPO, and also engagement on Twitter around just people building communities. So you saw, you know, David Sachs for example, launch his own meme coin. You saw something called the Book of Meme which has performed tremendously. Obviously, Elon Musk is continuing to push dogecoin, and you saw dog with hat as well. These are all just very large communities of folks who you know, are engaging and can find a way to engage in the markets on Solona today primarily, which is where they're being pushed but it is very very much retail driven. I would say there's very few institutions who see perhaps the value accrule here long term as opposed to just trading in and out of these tokens as well.
This is just an extremely online community wanting to show that love. But what therefore of more broadly, going back to where institutional money is bitcoin is some of the more outstanding protocols.
Are we seeing leverage back?
That would seem to be something that we're being flagged at the end of last week that maybe the poll pack is because we'd just go to heady again.
Yeah, we are seeing leverage back, but what is really nice is that we saw the funding reset into the weekend and so funding went from roughly eighty percent to twenty percent, which leaves us in a really healthy spot right now for.
Us to move forward.
Obviously, to your point, as you mentioned, when the funding does go out of hand, we tend to see pretty volatile moves, and I will just really emphasize that liquidity on exchanges is very very thin. This is some of the thinnest liquidity that we've seen, as you are seeing people hoddle or hold their bitcoin and so you're seeing very you know, very big market price moves and market moves because of that thin liquidity, and at large the technology is building. I mean, I will say, you know, outside of the mean coins Ethereum did have an upgrade last week, which meant that transaction costs on Layer two roll ups built on Ethereum are now lower. So you're getting a lot of updates, a lot of really interesting technology that's being pushed over the last few weeks. That is very focused on the institutional volume coming in across the top ten majors, and so we're excited to keep an eye on that. Well.
Thanks akeeping our eyes on it. We thank you, August co founder and co CEO Ia Kanorovich. Stay well.
Meanwhile, coming up, we're going to have more of the focus and other parts of the technology ecosystem startups in particular, Indexpensures is out with a new book for rapidly scaling companies or on that next with Indexpensures my partner Martin Migno Mina. Meanwhile, let's have a quick look at some of the public trading companies for a moment. FedEx Amazon, They're only up about three ten percent. Look, FedEx has its earnings coming out later this week. An interesting report coming from the Wall Street Journal. But FedEx and Amazon are and d discussing a partnership at as of course, the competition perhaps is returning for package and overall deliveries. We knew that the two companies last year discussed apparently FedEx accepting returns of Amazon packages at its retail locations from New York.
This is Bloomberg Technology.
Today in Theex Ventures well, it's launching a new book and mapp of course for its own founders.
Book is called Scaling.
Through Chaos, The Founder's Guide to Navigating a New Era of Innovation. It it explores the challenges of designing a rapidly scaling organization, investing in leadership, and so much more. Joining us to break it all down, Index Ventures partner Martin Mignore and it's great to have you here. You' of course moved from Europe to New York. You've been setting up more of a hub here. And I'm interested as to why founders need a blueprint because almost the whole idea of startups is that they're unprecedent and never seen before, totally new.
Yeah, so maybe taking a step back so inexpensure US is launching a new set of resources, as you mentioned, for founders to help them scale from zero to one thousand employees. And we call it scaling through chaos precisely to reflect the nature of the beast is. You know, it is challenging and there's a lot of uncertainty. This is the most in depth research on the topic. We analyzed more than two hundred of the fastest growing companies of the past decade, companies like Uber, Airbnb, id and Data Dog, and we also interviewed more than sixty founders and top operators from these companies to kind of bring the data to life. And the result is the book the Blueprint that you mentioned, throunded pages, an absolute page turner I can guarantee, and a companion app called team Plan, which is all available for free to everyone on scalingthroughkes dot com.
But having a business of any sort is chaotic at least, and then you throw in sort of huge valuations purchases not purchasing. I think a Figma, of course, is one of the companies that you backed in an extraordinary jurnel that Dylan has been on and having to now continue to build no matter what, even when you think you've got a massive deal on the table. What were some of the most surprising things you heard from the founders.
Yeah, well they are.
You know, it's a lot of pages, a lot of findings, but the three that really resonated with us. I would say the first one is the time spent on people related matters. It sounds obvious, but we quantified it in the book. And what's interesting is that across stages, so from zero to a thousand employees, it stays relatively constant at about fifty percent of the time of founders. And it's quite surprising for founders. Very often we think that the people a really matters is a bit of a tax on that time.
While it's not, it's.
The main thing. The nature of the time you spend is a bit different. In the early days, it's mostly about hiring and onboarding employees. Later on it's more aligning people and running the team, but that amount is pretty constant. The second finding that we thought was really telling was the importance of emphasizing performance over loyalty. One of the findings of the book is that by size fifty, only five of the first ten employees are still with the business, and when the company reached is one thousand employees only two or three, which means it's not a failure. It is a nature of the beast. It is, you know, this is a natural life cycle of a startup. It's very important for founders to realize that and almost embrace it, realize that this is part of the journey. And the third one is embracing chaos. More generally, these company is on average or growing more.
Than two x.
You're on your for four to five years. So at any given time when those first five foundational years, but then half of the team will be new to the business. So there is an inherent level of chaos and uncertainty that wally happen, and you can't tame it entirely. So you have to learn to live with it, grow with it, and bring processes progressively. And that's what this book and the app is hopefully helping will be helping founders.
To do and look, maybe use the chaos your advantage. And what's interesting is it's called navigating a new era and innovation, And boy do we keep going on about the new era of AI. And I'm interested whether how much that changes the game. When I think of HR, when I think of hiring. I suddenly think, well, is AI going to uphend that amount of people you are having to increase or the types of people that you're adding to. How are you trying to foresee the new types of chaos companies are going to see.
Yeah, we may update later on our research for the new type of AI companies. But the way we think about innovation is that happens through waves, and a wave and replace the previous web it builds on top of it. So AI, for example, is built on top of cloud and mobile, and so that's why the pace of innovation seems and is actually happening faster because you're leveraging what happened before. But the reality of building a business I don't think we'll change. I think the time spent on people will remain at fifty percent across the entire life cycle in this first thousand employees' journey of a company, and the type of people to hire and how you retain them and how you motivate and how you lead them. AI is not going to change that. Actually, I think if anything, this is going to make it even more important.
Well, you're going to be talking about this much more an event that you're hosting a little bit later in the extensures partner.
We thank you so much. It's out. A full interview.
Elo Musk and Don Lemon's hour long interview has been released, and it's just days after we understood that, of course, the billionaire in your Mask actually canceled the CNN's lums partnership with x in it. Well, the interview kind of discussed a wide range of topics Mask's commitment to free speech.
For example, take a listen.
I'm here, you know, as you know, I'm on the platform because you are. You say you're a free speech absolutist, right, and there're no condition.
Yeah, free speeches as much as possible within the bows.
Of the law.
Yeah.
So the reason I'm saying that is because there are no conditions on this interview. You said that, you know, we'll speak to you.
For an hour.
I don't like SoundBite, so I welcome that. So let's get into it.
I'm on the platform, but then not on the platform.
And actually it is very hard to watch the interview on the platform for the first hour or so.
Let's bring in Williemos Kirk Wagner.
Who has watched part of it, and I mean from the get go.
It was an awkward conversation.
The key takeaway for some and certainly investors in Elon's publicly traded companies, are well the way in which he's sort of vindicating his use of ketamin for example.
Yeah, that was a very tense exchange.
I thought they talked about Elon was, you know, talked about his prescription for ketamine. He of course said he doesn't abuse it. He uses it because of you know, a doctor's advice, and that he sort of suffers at times from depression or sadness.
And so he also kind of pushed back very very briefly.
He was like, you know, asking someone about a personal prescription is a pretty private thing to ask, and he kind of you know, pushed back on Don Lemon's question there. But it was just very interesting to see him sort of challenged on this reported drug use, right, and Don Lemon asked, you know, is this going to impact your contracts with the US government, impact your decision making your tweeting? And so that, as you can imagine, was a rather tense exchange very pretty early on in the conversation, which sort of sets the stage for a tougher conversation.
I mean, Don Lemon went on to give his own views on why his show has been canceled on the platform, him saying that must disliked his line of questioning.
Meanwhile, you know, Musque himself.
Is saying that basically, this isn't what we envisaged. It's just CNN but on social media. So reading between the lines, what does this mean for X's push to being a video first platform, to getting these sorts of well top talent to come on and give them content.
Well, I would say Don Lemon was probably the headline of this entire push we saw at CES in January. They came out and announced, you know, a small handful of new shows and how they were, as you said, kind of pivot into video, making that a priority.
But when they're you know, top or perhaps most well known.
Partnership apart before it ever really gets going, and when Don Lemon is out there saying the reason it fell apart is because I can't actually ask hard questions of the sources that I wanted to ask, it definitely does not bode well, for one, the push to video in general, but also Elon's stance on free speech.
Wagner, we thank you for bringing us the latest on all things X.
Meanwhile, that does it for this edition of Bloomberg Technology, wherever you consume it.
