Apple WWDC 2024, MoviePass Documentary

Published Jun 10, 2024, 8:11 PM

Bloomberg's Caroline Hyde discusses the latest from Apple as the company's annual developer conference kicks off in Cupertino, California. Plus, conversations with DreamWorks Founder Jeffrey Katzenberg and MoviePass Co-Founder Hamet Watt.  

From Markhard We're Innovation of Money and Power Collie in Silicon Valley, NBN.

This is Bloomberg Technology with Caroline Hyde and Ed Ludlove.

I'm karenin Hide, Bloomberg's world headquarters in New York. Ed Ludlow, He's off. This is Bloomberg Technology. Coming up. We go live to Kubutuina, California, as Apple's Annual Developers Conference kicks off. Full coverage ahead. Thus we sit down with DreamWorks founder Jeffre Katzenberg. That's this. This venture firm raises nearly half a billion dollars for a new fund, and we sit down with Movie Past co founder Come It What to discuss the new documentary on the company's dramatic rise. And it's full first. That's checking on these markets. And look, we have a lot to digest when it comes to political risk over in Europe, when it comes to anticipating what the Fed does, and indeed where CPI pushes us from the US macro perspective. And we have some new entrance to the S and P five hundred and some of them are tech names and they're helping them in the Nasdaq sustain a little bit of risk on attitude. We're up just a tenth of fve percent on the key tech benchmark. We're looking though at bond selling off across the board, most notably in Europe, but US yields also pushing up as we do or have some trepidation about which direction the Federal Reserve points has come Wednesday and Thursday throughout the week. Indeed, we euro under pressure look down six tens percent. This is about France. This is about political risk. This is about the right basically gaining yet more power when it comes to European Parliament and what the French President Macron is trying to do to perhaps gain back the narrative, calling of course a key legislative vote. Let's move on and have a look at what's happening in terms of individual names on the tech area though, because Microsoft up six tens one percent, we've got a BI rating coming back on this company. They're seeing. Further uptick on the share prices is all around AI, of course, and it's leading us from a points perspective. In Vidia actually turning to the upside rop sevent tens percent, which have been down when trading first started in what is now a much smaller price point tenth of the price point that we'd seen currently on Friday. Of course, because we've got that stock split. One hundred and twenty one is where we currently trade. Maybe retail liking this new price point. I'm looking at Apple though one hundred ninety five were off by three quarters of percent. We are all eyes on WWDC what we'll get in Apple in terms of its AI focus, what Apple Intelligence is there. Jackie Devlos is with us live from Couviutino to discuss really what we're going to expect, a whole raft of how AI is going to be injected into the software and into the hardware.

Jackie, expectations are really high, Caroline. In just under two hours, Tim Cook is going to deliver a keynote address which will lay out this artificial intelligence vision. Now, thanks to Mark German's reporting, we have a little bit of a preview.

For us what to expect.

The first being its AI system called Apple Intelligence. This is where we will see some generative artificial intelligence features being embedded across the iPhone, iPad and MAX with that new operating system upgrade. There will also be a major announcement with OpenAI. This is the technology, of course that powers Chat GPT, which will bring a version of a chatbot to Apple and perhaps even provide a makeover for its current AI assistant SII. There's a lot hanging here, Carolina, especially because Apple has been viewed as somewhat of a laggard in comparison to tech peers like Microsoft and Google, which it is also in conversations with for its large language model technology Gemini.

I like that context, Jackie, because there has been a lot in anticipation, most markedly in the share price managing to push higher market capitalization back on top for Apple, and I'm interested as to whether really we're going to be able to steal the narrative back. Is having partnerships good in the short.

Term, that's certainly the hope. But Apple really isn't fooling anyone here. It is somewhat behind the curve, and this keynote address will really show just exactly how it intends to bring some of that momentum back. Think about exactly what Apple excels at devices and really coupling that with cutting edge software, but AI and specifically generative AI is a whole new ball game. So just exactly how it plans to integrate AI features across products like air pods for example, or even bring it into augmented reality devices or home robotics. That will really provide the longer term picture for how AI will change Apple's future.

Jackie Devilos on the ground love the reporting for a couple of hours. Still to wait, Let's keep this conversation going. That's going to really feel for whether or not this is going to help them shift more phones. Marabella Lopez is with US Bounder and Principle Analysts that Lopez Research, and Marabel is great to have your voice, because that's what everyone's wandering is the AI announcement's going to be enough to make us upgrade our phones right now.

We're seeing with the smartphone market right now, and it has been driven primarily by AI features. We've seen the camera features come into it, but I actually don't think it's just the smartphones we're looking at. As mentioned earlier, we're seeing the opportunity for Apple to infuse artificial intelligence across this entire stack, including the Vision pro which when you look at the augmented reality virtual reality market, we still have a long way to go in terms of customers adopting this in droves. So there's great opportunity across the entire stack. I don't think anybody's really talked about the opportunity to improve the services landscape with artificial intelligence.

So we're actually going.

To see a lot of activity I think with AI across the entire Apple portfolio and including the developer landscape, where we expect them to have easier to access software coding tools using generative AI.

And this is what is meant to be about. Yes, investors get excited, but we're meant to be seeing the developers get excited. Here, Marma, I'm interested in what you're saying about services. How will that shift?

So what we're saying right now services have looked pretty much the same since the dawn of cable. We go in, we select a program, there's a lot of pull, not necessarily enough push or recommendations or guidance. So there's a tremendous opportunity there in terms of how do we make things more discoverable moving forward.

So that's one aspect of it. We haven't talked a lot about healthcare yet.

There's a real opportunity with AI to fundamentally change what could happen in some of the smart watch on health apps going forward. So really, I know that everybody said Apple is behind an AI, but I'd like to pose the question of how much revenue they really lost by quote unquote being behind. If you look at the only person that's really making a ton of money on AI right now, it's in Nvidia. If you're selling picks and shovels, you make a lot of money in AI. Everybody else is just still coming up with a strategy that they're trying to propose to consumers to get them excited about the new technology.

You might argue, maybe Microsoft's make some revenue, and certainly they've been able to do so by teaming up with open Ai. How Marvell should that ongoing partnership look like if we do see the open Ai Apple convergence here.

Yeah, this is really interesting because I think we've seen all the cloud competing providers tie up with foundation model companies and it's been very good for them because the money they have to invest to build the foundation models themselves doesn't make any sense. I think this is the same for Apple. They can tie up, they can use the foundation models. We're seeing a wide range of innovation that's happened over the past year so Caroline, so we have many models. I expect Apple in the longer term to be what we call AI engine agnostic. You know, put in any foundation model. That's not where the differentiation comes. The differentiation comes from not just them using the language from generative AI, but from them actually building their own AA models to layer on top of that. And you would better bet that Apple is building its own AI models as well to layer on top of this. So the combination of these two means of things that are say more pedestrian and generic in nature for AI, they can outsource to a foundation model company, but the things that would be more specific to Apple products, those are the things that they're going to invest their AI talent in.

And maybe we've seen this time and time again that Apple isn't first, but it's best, and we're waiting for ultimately then to articulate what is going to be better then, for example, how already Samsung's infused Google AI within its hardware. Will it just beat out the competition.

I think what we're looking at right now is how will Apple propose the use of multimodal models. So everyone says that Apple's behind, but that was on the basic generative AI chatbot style model. What we saw in Google Io was really a new way to think about how to use AI in terms of adding vision and imagery and generating a wide range of things, or using it to say change a process, look at an image and suggest how to make it better if it were even.

A process or a workflow.

So I think there's a tremendous app oportunity for Apple to show that across as stack, and this is what I think is better. It's not enough to just layer a chatbot on top of your software and say I've made it better. You actually want to create a fundamentally new experience, and this is I think where Apple excels as creating that easier experience. So they're not first to market with a lot of things, but they're the first to try to make it the best to market.

We are seeing hope some exuberance factor back into the overall market capitalization of Apple. We're back at a three trillion dollar handle. We're looking at nearly eclipsing the record high that we saw back in twenty twenty three. Marama, do you think it will be revenue generating in the near term from an AI perspective for Apple?

I absolutely think that AI will be revenue generating, because if you don't have a good AI stack in your product, you're actually not going to be able to sell a product in twenty twenty four and beyond.

So therefore it will be revenue generating.

The question has always been how much and can it outsize the competition, So this is still to be determined, but we're all very optimistic that Apple spent a a lot of time thinking about this.

They didn't race into the market, so.

They could come with a very solid showing at WWDC in what I would consider the things that matter. I do think that from a technical standpoint, we always expect Apple to blow the doors off of it, but I really think we have to look at would somebody really be pleased with this as opposed to is it going to revolutionize the world.

And I think if they can nail that, they can nail people really wanting to use AI because.

It does something meaningful for them, then they will sell a ton of iPhones, smart watches, they may even sell a fair amount of vision pros, particularly in the enterprise market. So we're really optimistic and excited to see what they show us next.

A little lesson two hours ago Marvell Dave has thank you so much for putting us towards that excitement. Found a principle, analyst ever at Lopez Research. Meanwhile, coming up some shareholders over at Tesla Key Highes this week too the vote on the fifty six billion dollar pay package for CEO Ino Mask. We'll get the latest on what we can expect from the vote next. Well, let's just shine up on the mean stock. There was all the rator on Friday as Roaring Kitty came back to YouTube. GameStop now under pressure still by more than three point eight percent. That's as we know that they're selling more shares, trying to make the most some of the hype within the share price twenty seven dollars is where we trade Beard analyst Colin Sebastian saying, look the results we got on Friday. The disappointing results underscore ongoing challenges to the company's retail business model. This is bruly med technology.

Now.

The Supreme Court has agreed to Meta's request to consider killing a multi billion dollar shareholder lawsuit that accuses the social media john of misleading investors about the data harvesting scandal evolving political consulting firm Cambridge Analytica. Remember that one joining us now to really go into why this is meaningful, rugs Mike Shephard over in Washington, and actually is not just Meta that perhaps once it's killed off, but certainly the Chamber of Commerce wants to have this heard by the Supreme Court because they're worried that there's a misreading of what's happening with the sec And there's a lot of well lawsuits, a wave of meritless securities fraud suits they call.

Well, Carolyn.

When you look at the stakes for Meta, it is financial. It's a two billion dollars potential settlement.

When you talk to our Bloomberg.

Intelligence analysts, our colleague Schttenhelm has analyzed this and found that it could be that kind of a payout for the company to those aggrieved shareholders. But the stakes are far wider as alluded to, because look, since two thousand and five, the Securities and Exchange Commission has required companies to disclose the risks that could have a material impact on a share price. It could be information, it could be an event, and the shareholders in this case were alleging that Facebook was too slow in disclosing those risks from the Cambridge Analytica episode. Now the Chamber of Commerce and others that are saying that those same rules have been too widely applied and are generating a whole bunch of rivolous and their view lawsuits that have no merit, and they have sided with Meta in this case.

It is interesting just to go back to July twenty eighteen. That was when we saw the biggest eroad and of value with that stock plunge, as we started to perhaps front run what ultimately the damage from Cambridge Analytica and the reporting on it could mean for Meta A. Meta's argument here is that we could never have anticipated how babb this would get for a shareholder perspective.

And also they're seeing, Caroline that all of the information and risks were out there already. They had been reported publicly by The Guardian and then by the New York Times, so that the element of surprise for shareholders was really gone at least as far as this episode was concerned. And the concern from the company is that they are being punished for something that is so far back and that maybe since then has been wiped out if you look at how the company's shares have gained since then thanks to acquisition and expansion other changes.

Meanwhile, of course, as shareholders say the company had inadequate disclosures, we'll see how this goes. Mike Shepard, brilliant, Thank you so much. Indeed, meanwhile, let's just talk about some other shareholders. Now, Tesla's because they're voting this week on a fifty six billion dollar pay package to CEO Elo Musk. Let's get into the details. But me megs Max traffickin his hair. And what's interesting is, well, this, even if it goes through, it might not help Elon Musk get his fifty six billion dollar pay package.

Yeah.

Absolutely, this is going to be settled in Delaware court, and I suppose possibly in Texas court or maybe in a federal court at some point, depending on how Elon Musk responds. But what Tesla is trying to do is create, as our colleagues Dana Hall and Jeff feely Road, is to create a kind of way to explain this to the court. They're going to say, look, our shareholders approved it in twenty eighteen. Now they're approving it again, hopefully as far as Elon Musk is concerned.

In twenty twenty four, So it's.

More about forming the appeal rather than some kind of definitive resolution to this case.

It's like narrative basically one hundred percent. But the narrative with some of the well proxy investigots and those advising shareholders hasn't been great. I've been saying, don't go with this.

So these proxy advisors generally don't back these gigantic pay packages. They did not back the twenty eighteen one. But what is interesting here is that you have some major shareholders coming out and saying we are against this. Over the weekend, the Norwegian Sovereign Wealth Fund said that they're going to vote against this pay package, or that as as far as they're concerned right now, they're going to Maybe there'll be some further negotiation between now and Thursday, but in any case, that fund is a major shareholder, top ten shareholder. Norway's also a huge market for Tesla, so that seems like a significant kind of caution light for elon Musk right now.

Thirteen can keep an eye MaTx Chafkin with all the details on Tesla. There's a new documentary out there from Max and it's highlighting the rise and then the fall of Movie Past, the subscription app that allowed users to go to as many movie showings as they want from a monthly fee with highlighting also how the founders they lost control of the company and it's narrative they're regaining it. How may what was one of those founders? And indeed you're now Upfront Ventures as a board partner. You've got share ventures as well, where you're trying to reclaim the narrative of allocating money and capital to minority founders in particularly. How many out there might go, sorry, you're the founder, you're a co founder. I thought it was Ted Farnsworth. I thought it was Mitch low educate us.

Yeah, yeah, well it was a process.

My co founder and I, who were in love with the movie going process, wanted to innovate on the model and started a company twenty eleven. We raised a couple of rounds of capital, but got to a place like many other entrepreneurs, where we struggled, and so we had to raise some capital from some folks that we probably didn't know as well as we should have known.

And ultimately they were able to invest quite a bit of.

Money into the company and take over the company, and it was just quite an experience.

You have to watch the movie get all the details.

And actually the documentary does a good bait and switch in a way of allowing you to go with what your own biases that there's these two white co founders, and in fact, there were two black co founders who were ousted. And I'm interested now as to what you think the learning of the overall documentary is. Because you say you struggle to make and get funding like many, but do you think you were less likely to get funding because the fact that you were black?

A little bit? But I was very mindful in this documentary. I didn't want it to be a black versus white thing.

You know, all entrepreneurs struggle at some level raising capital, and we were very fortunate in our early investors were all white, so it really wasn't exactly that, but it's natural. One of the things we talk about is just the idea that sometimes we walk into the room raising capital. We're probably the first time that at that time, at least the two black co founders were walking in trying to innovate on.

In an industry and trying to reimagine the industry. So that's hard by itself.

It's also hard when you have the extra unfamiliarity of not having invested, perhaps in folks that looked like us.

What's interesting, your other co founder, Stacy Spikes, has gone back and bought the business afterwards raised its value, and he's brought it back and he's still innovating. But almost your premise was right. You just needed the movie theaters not to build their own subscriptions, which they went and did, But really the issue was about the price point here. What do you think about the price points of moviegoing, of content consuming, of the way in which we see the landscape evolving.

Yeah, it felt like such an inevitable change to happen in the movie going space. It's kind of why I went out. I came to LA to begin with twenty years ago because I felt like some of this industry was slower to innovate. So we did feel like it was inevitable. We felt like, really the opportunity to be a Switzerland in the space was the sweet spot. Of course, they're opportunities for silos and for folks to be able to do it on their own, but we thought that the idea that there could be a community that tied it all together could be special, and then we were also going to innovate. We did innovate quite a bit more than a lot of the folks were individually.

It's been a great lesson.

I think it was a long time ago that we started that company, and where movies was probably.

More centric to our world.

I've now moved on to focus on health and longevity and things that I'm.

Much more passionate about.

But Stacey's making a go at it, and he's doing a great job. I think he's turned the company to be profitable, and he's figured out the pricing model that will work long term.

How much do you think there's still an issue of founders versus the money they raise? Who has the power when ultimately some of these contracts are written.

Yeah, I think you know it ebbs and flows.

I mean, there are times where the founders and the entrepreneurs have significantly more leverage because there's way more capital than there is there is companies, and then sometimes capital has a lot more control and power and say so, I think ultimately it's it's you know, as a founder and an investor, I try not to think about that. I try not to take advantage of leveraging in a way that's going to be unfair, because it's the tide is going to change at some point anyway. And I think we're seeing that play out now as the markets are starting to come back in terms of the private markets and investors becoming more aggressive again, and now entrepreneurs and the leverage is starting to shift back and forth again.

You're focused on wellness, as you say, longevity those founders out there, honey, And how are you seeing the ability for yourself to write checks and how are you seeing things different from when you were out there trying to fundraise?

Yeah, I'd say there are a couple of things. One is my model is slightly different. I have a venture studio and a fund, and so I like, I like being on both sides of the table, so to speak. I like inventing and reimagining new new businesses. And then I also like supporting entrepreneurs, and I also like I support entrepreneurs that oftentimes may not get that opportunity. I'm looking for something different in many ways. I think it's changing a lot. I hope we're going to see some outcomes that start to prove that. But there's a tremendous amount of talent and we're really looking at opening the aperture now to figure out how to get more talented entrepreneurs into the game. More talented operators, scientists, innovators, more perspectives on problems leads to better solutions to problems.

So I'm excited about where we're going.

There's still a long way to go, don't get me wrong, but I think we're in a good place.

Well, I'm excited about having some of those founders that you're working with, having some of the studio comptanies that you build and then birth and grow coming on the show. How may we come back you? Of course a million for past co founder. Welcome back to Bluemore Technology. I'm Carolin Hide in New York. Quick check on these markets because we'rewithstanding some of the overall pressure on the markets coming over from risker version in Europe and actually pushing higher in tech wet three times sent on the Nastak one hundred, Microsofts, some of the other key names managing to lead us higher on a points perspective. I'm looking at the French tenure yield as Europe ends at day trading. What a political upheaval day of trading it has been and of course concerns about what's happening with Macron calling that legislative vote, and we're seeing yields to push up some twelve thirteen basis points. We're also looking though at Bitcoin, managing to still be up about three tens percent. It's allD off hard on Friday. We're now still gathering a little bit of a steam at sixty nine thousand, near that record high there or thereabouts. Move on, have a look at what's happening on the individual movers at the moment. I'm looking at Nvidio. It happened with stock split. We're now up more than a percentage point, having actually just sold off into that move that happened, of course on Thursday Friday. We're currently one point five points higher the SCILLA one hundred and twenty two, so well well ten percent of where we were trading back on Friday. I'm looking at Apple one hundred and ninety five. We're currently down by seven tens of percent. We have built and crescendoed in terms of market capitalization into today, which is WWDC. We really want to understand what we're going to be getting from AI from Apple. Intel legends over in Apple Park now and we want to bring in Carolina Milanesy, President and principal analyst that creative strategies for your take and what to expect today, we are going to get a whole host of the way in which developers are going to be able to innovate across Apple, but also what me as a consumer might want to therefore go out and buy a new phone for what are you excited for?

Absolutely, I think you're spot on in both today being about the developers and how they can leverage artificial intelligence to drive more experiences through their applications. But then is about the consumer and for Apple is always about the hardware.

Is about bringing.

Value back to the hardware so that we want to upgrade, so we want to stay up today as a consumer perspective, so to me, is going to be about ease of views, is going to be about really mass market things that consumer want to do. Maybe around the camera is always a big thing for consumers today, or the use of the phone itself.

The phone gets to do.

More and more today in navigating it might become a bit cumbersome.

It's interesting that you say the photo the camera. I mean ostracial intelligence has been interlaced within Apple's products, particularly when in the photo product for a long time. It's just generative AI has brought about this idea that Apple's behind the curve? Is it truly behind the curve? Karina?

I think no consumer is running into a store today asking for genitive AI, right. I think from a street perspective, there is a perception that Apple hasn't talked enough about generative live, not at all up until now. But the reality is there are different kinds of AIS, and as you point out, Apple has been doing AI for a long time, from machine learning from a silicon perspective into their neural engine, so they're not behind from a technology perspective per se. What we want to see is more or actually what the streets wants to see is more proof that they have all the ingredients in place to deliver and stay in pace with the Microsoft and Google of the world.

And also how long those ingredients last. Open AI a partnership with that company short to medium term.

That's an interesting if it's true, it's a very interesting collaboration because it's the first time that we would see Apple really bringing a name. Obviously, we know that they're collaborating with Google for parts of their search and everything else. But you know, it's the first time that we will see a name associated with Apple for a delivery of an experience. And I do think this is much more longer term than short term.

Creative strategies is in your business's name. So can you tell us how Apple is going to get creative with the way in which we use the phone going forward? How will generative AI change the way in which I use my next latest and greatest software and hardware from Apple.

You look at the history from an iPhone perspective, the things that always resonated with consumers are things that you use every day. You know, if you think about the beauty of I, message for a lot of people is about seamless experience in communicating is a rich experience in the way that you communicate.

You know.

Emojis were that thing that Apple was just just got everybody excited about, and there are rumors about a new version of emojis that will leverage generality AI. You know, it's the things that I use every day that are going to get me even more entrenched into the ecosystem that Apple is trying to do, because that at the end of the day is what that engagement, that everyday dependency is what is going to get consumers to continue to look for the next device, the next experience.

Does Apple in its entirety have to shift. There's an interesting line in some of the reporting done by Mark Gumman and others here a Bloomberg that bas it's going to have to shift from what is a hardware software services business more to becoming like a hardware AI cloud company and what does that distinction really mean?

The cloud part is going to be important going forward for sure, because obviously from an generitivevi I perspective, you do need a cloud component. I do think that there is end versus or, and I do think the generative VII is going to be pervasive across their experiences. From a software perspective as well as services perspective. There's a lot that GENERAITI VII for instance, can do as far as music or Apple TV shows the recommendations. So there's a lot there that the holy ecsystem can benefit from, and the cloud will be a means to deliver that.

You're ultimately saying, we need to hear from them that they've got all the bits in place, the infrastructure necessary to leverage. What is this new generative AI reality we're going to hit carry? But how quickly do you think it will be ultimately revenue generating for Apple? How quickly will they see the rewards of some these investments.

I would think that the first thing we're going to see is a replacement cycle, right, That's going to be the biggest way to see the return of investment from a revenue perspective. Obviously, with a lot of compute necessary on the device, you are going to need the latest and greatest silicon on the device. So I think it is natural to think that if you have a phone that is three four years old, you will have to upgrade in order to take advantage of a new features that are coming that are based on generative AI. So the first thing you'll see is an upgrade cycle across the devices. We've seen it already with the M four chip in the iPad that was launched just over a month ago.

Will it make us buy a Vision Pro? I don't know about that.

I think that for now, generative AI is really more about the mass market and the everyday device. I think for Vision Pro, I'm sure that we'll get there.

I don't know if.

It's necessarily the priority today, I think is more about what we use every day, and I think that historically that's what Apple has always done, is you know, taking features or taking moments, and you know, it's example of things, even from a technology perspective, that ours are brought to market and really made that a mass market moment. And that's what I'm expecting today.

Apparently in a milanacy, President Principal Anna say a creative strategy waiting the all important WWDC kickoff. We thank you for front running it for us. Meanwhile, time to go to talking tech now. First that Microsoft says a core feature in its AI branded PCs will be turned off when it ships. The feature is actually called Recall and it creates a record of everything users to do on the PC now. The tool set off alarm bells for security researchers, saying it could be used by bad actors to access and scoop up data and information. Xbox announced new entries to its popular gaming franchises and a showcase over the weekend. New titles for Doom and Gears, a war series, were announced. The presentation comes amid layoffs of, of course, nineteen hundred employees in its gaming division. Earlier this year, Volvo car is recalling nearly seventy two thousand of its fully electric Ex thirty due to a software issue. Now the car may have an error in their center screen that causes a speedometer to go into testmo basically when there started. According to Volvo, no other models were affected and there have been no related accidents or injuries reported. Coming up, Media veteran Jeffrey Hasenberg raises nearly half a billion dollars for his new venture fund based in cybersecurity. We're going to discuss with him and colleague next. Talking of content creation. This is perhaps one of the messiest deals of all time, but it feels as though Paramount Global currently moving just down about a percentage point. A former media executive Edgar Bronfman, you know, and from Warner muse from the liquor giant Seagram. He's backed by private equity firm Bane Capital, potentially to be buying National At the overall parent company of Sherry Redstone instead maybe of sky Dance. This is all about Egg of Rothman having a two billion plus bid for the company that can controls Paramount.

This.

We continue to watch National Amusements, of course, the key one that they would be looking to purchase this Bloomberg technology wonder Co. It's the investment firm and media veteran Jeffreykatzenberg and tech entrepreneur Sujai Jasua has just announced that it's raised nearly half a billion dollars for its latest venture fund. We're very pleased to welcome to VC Spotlight both founding partners, Jeffrey and Sujai. Welcome, gentlemen. And while I want to ask you Suji first, the perspective is on what security most importantly, cyber threats or artificial intelligence. Where is your sweet spot in the moments?

S Jack, Well, We're I mean you actually covered it all. That's a sweet spot.

Well, good, okay, Mike.

What we're trying to do is keep you and your family safe online. You know, we start with the consumer. That's obviously where Jeffrey's background and my background come from is thinking about how to apply new technologies to solve problems.

For each of us at home and at work.

And when we think about cybersecurity, one of the crazier things of the past couple decades is you can't think of a great innovation that is designed to protect all of us or our children or elderly relatives, and that seems shocking and terrible to us, and so we decided to go try to solve that.

Truffle hunting is how you describe what you're going to go about and do. Jeffrey talk us through how that is what a small amount of investments but more integral, more important, more impactful.

Well, I think you know that's the opportunity today. You know, there's so much incredible innovation going on, and we have found for us staying quite focused picking a handful of qual it five to seven investments each year, as well as starting a company ourselves, we'd like to be builders as well as investors, and so doing those things in parallel has proved to be you know, quite quite successful and quite.

Rewarding for us.

We all started as builders, we have founded companies ourselves, and we want to do both those things in parallel.

So, Joy, I'm interested in, for example, as we came out from WWDC or about to anticipate Apple's latest unveiling, one of your big bets is one pass word. We're looking at it now, but Apple is looking to take that on with its own homegrown ability for storing your passwords. How much do you worry about competition in this cyber area?

So I used to worry a lot about competition fifteen years ago from big tech platforms and at Dropbox in particular Steve Jobs last.

Speech he said, he was you know what do you use right now?

Use your Dropbox. I'm going to change it all with iCloud, and obviously dropbos did just find despite that competition. My view is that the best product ultimately wins, and in the case of one pass where they've built an amazing solution for helping you cross platform across Apple devices, Android devices, Microsoft devices, and so as long as you stay focused on the customer, you'll be fine as an entrepreneur.

Jeffrey, it's a tough question to ask, but of course many would associate of late you'll work with Quibi, and of course that was a big bet and a building bet and one that didn't pay off. Content is really tough right now. But how has that been tough to explain to the LPs And he brought over.

Well, first of all, I know feels to you like it was yesterday. In fact it was four years ago. It was a moonshot. That's part of being an entrepreneur. It's also part of being an investor. You know, there are it's a balance of the type of risk reward you take. Certainly that was a risk and our investors understood it. But digital media in general actually has turned out to be a very very challenged area, both for creators and for investors unless you own the control of the platform itself. So we actually four years ago pivoted out of digital media. We have no investments today in digital media.

We continue to look at.

It because, honestly, as you were talking about in your earlier segments, with the introduction of AI, there is going to be a slew of new types of opportunities, new types of content. I think ultimately a new and innovative platform is coming our way sooner rather than later, and we certainly will like to want to be on the forefront of that. But as we see here today, that opportunity hasn't.

Presented itself yet.

And again more importantly, for the last three or four years, our focus is one hundred percent been in tech and as a SJ outline to you, particularly consumer.

Techsjat how has the lp cohort been willing to jump onto this new fundraise. Have you got new LPs that come in to this latest fund.

Yeah, the answer is it's virtually entirely new from an LP standpoint because Wondercoe it was originally set up as a holding company, and so these are our first traditional LPGP funds. And what I would say is that several of our strongest supporters in the holding company again became our big supporters in the new funds. But as you know, it's been a difficult fundraising environment and we're thrilled with the new partners that we have, but we also understand that we're setting out to build these relationship with folks that didn't come in for the long haul and hope to get them in the future.

So, Joy, I'm going to ask you another one just on exits therefore, because that's obviously what the LPs and what you want to be seeing. It's interesting that Figma was one of your big bets and that exit sort of unwound due to regulatory issues for Adobe and Figma. You've also done an exit, interesting one where you've tied up two of your own home built companies together and we're seeing the likes of Aura Bipango. That was all the way back in twenty twenty. What is the direction of travel for exits? Is it M and A? Is it? Is it IPOs?

Yeah, when you build a great company, you'd like to see it go public. In an ideal situation, you want these companies to run for many decades. While exits are always top of mind in a traditional fund, the best technology companies get built over multiple decades.

And from our.

Standpoint, our ambition and goals are to build great technology companies, So we don't look to the exit. Primarily, we look to building a great company, and if the exit comes in a near term, that's fine, but our ambition is to build them for the long haul.

Jeffrey, We of course did introduce you as the fact that everyone knows you from your media expertise. You're saying the moment, it's very hard in the digital media space. What is it from your mind? Is going on with Paramount? We were just breaking to the Wall Street Journal is articulating that Edgar Bronfman is de eying a two to two and a half billion bill dollar bid for National Amusements. I mean, is there any hope for em and A within the content creation space? Will Paramount get a deal that is a good one for investors, of.

Course it will.

Those assets are singular, they're unique, they're generational, and the reason why there is so much focus and attention around them is because of scarcity. And so you know, right now today it's a pretty complicated set of circumstances. There you have in Shari Redstone a controlling shareholder. They've actually had obviously a very difficult time over this last year or two. But make no mistake about it, these are still very very uh strong assets, and maybe they need to be reconfigured and redeployed in a you know, new and and maybe somewhat innovative way. But foundationally, the reason there is as much interest in them as you know, there's there's good reason for it.

Wow, you'll know, having been of course with well Disney Studios, having built over what was happening with DreamWorks, and your experience continuing the content and now consumer cyberspace. Jeffrey catsenough with us, of course.

I will tell it, and I will tell you.

I just literally I went to an early breakfast, ran into Bob Iger, JEFFS Shell, and Brian Robbins all in one room.

At one time.

The current president of Paramount, jeff Shell who's on Redbird, and Bob Iger who's watching it all.

That feels like a movie score r a morning. Yeah, next time invite us to that breakfast. We'd love to come. Jeffrey is great to have some time with you. Thank you, so Ja Jasa of Wonderco. We appreciate both of you spending some time with us today. Apple Intelligence, What will it look like? Feel like? What will we be announced at WWDC Lumos Jackie Doavlas is live from Covatino and look, we're almost an hour a little over away from today's event kickoff. What are you expecting in terms of feat just to be announced?

Well, the good thing is we have a lot together. From from Mark German's reporting, the key thing will be Apple Intelligence. That's the new AI system it plans to roll out in the iPhone, iPad and macOS system, which will get an upgrade. Now, the real key will be the AI features embedded inside. Let's drill down into some of those, because that's what people really want to know, what will show up on our devices. A big part of this push will be summarization. Think summarizing web articles, other web pages, your text messages, making it easier for you to dissect the information that you have to make a few clicks on your phone to actually get to think. Also, your mail app auto reply, the kind of thing that Gmail already has, but Apple's creating its own version of this. We'll also get voice memo transcription that will come in handy for me, Caroline, I.

Use that a lot.

And so these are just a few of the AI features we'll expect to see, but of course it's all part of a broader AI vision. Tim Cooch will address at ten am Pacific one pm Eastern.

I'm partnerships, an Open AI partnership. Perhaps that's the.

Big one who can forget because Apple can't do this on their own. They need the help of open Ai, which has the powerful chat GPT technology. We'll see some kind of chatbot version also in Apple's new upgrade. But of course the question is will this really revamp SERI in the way that it really needs to. Kind of been a disappointment since it's rollout nearly a decade ago, And so here we'll have open Ai kind of taking the lead.

In that way.

Apple's Apple Intelligence will also have Apple's own AI technology. But here we'll wait to see exactly how this partnership will unfold.

Jackie Devlos is going to be bringing it to us throughout the next hour or so. We really appreciate it. Now. That does it for this edition of bloombg Technology. Stay tuned for all that's going to come out of Coopatino. But if you miss it, go check out our podcast find on the Terminal, online on Apple, Spotify, and iHeart this is bloombgg Technology.

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