Bloomberg TechnologyBloomberg's Caroline Hyde and Ed Ludlow discuss the market cool-off as investors digest the direction of Fed cuts and Donald Trump's next moves. And, EVs take a hit as reports emerge that the $7,500 EV tax incentive will be cut under the new Trump administration. Plus, how one company is growing customers with their plant-based protein.
Bloomberg Audio Studios, podcasts, radio news from Mahard.
We're Innovation of Money and power Collie in Silicon Valley, NBN. This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.
Live from New York and San Francisco. This is Bloomberg Technology Coming up. Tech leads us lower as we end the week in the red. All eyes on in video earnings as the Trump trade it fades plus.
Ali Barber reports solid growth in international and cloud units, offsetting week sales in its China e commerce.
Business, and SpaceX gets ready to launch a tender offer in December, which would value it at more than two hundred and fifty billion dollars according to reports. But first from private markets to public markets. We're having a pretty lower end to the week. Look, the risk off focus has come. Whether it's Trump Trade, the euphoria dying, or whether it's Federal reserve. Reality is we cut our bets for a FED rate cut in December to as low as a fifty percent chance. Now we're off by three percent. This is the worst week since the beginning of September for the NASDAC. Just bear that in mind. Four straight days of losses. We thank one of our producers for that particular key fat. That is the worst set of losses that we've seen going back to April. On a back to back basis. We're looking at bitcoin though managers to continue to power higher on the week but not on the day.
Bitcoin up some fifteen percent.
It's a seven day version of this end because trades over the weekend.
What are you looking at on a micro basis, Yeah, I.
Think part of the reason that the overall euphoria's faded post election is the hearing now is about technology earnings. Applied Materials is the biggest US maker of chip making equipment. It's like the US version of ASML. It's given us a week outlook. We're going to dig into that later in the show. Bloombergsin and King. Clearly the stock is down a lot. Then you have Ali Barber. These are the US listed shares or ADRs, and we kind.
Of summer it at the top.
They're seeing really weak or anemic growth in e commerce in China, which is their domestic core business, even if they're doing well in other areas. Again, we will dig into that a little bit more in just a moment, but don't forget earnings is a story from here. Are in because the big one next week in Vidia. All relevant and we'll get to it later in the program.
Karen re member the twentieth after the market, All eyes on Nvidia, all eyes on what's moving the markets right here, right now. Bloomberg of course as well. Lee is over in Boston today. Just tell us what you're looking at in the market.
I'm looking at tech and it's really interesting because it's a weight and see for all these tech companies, they're really struggling to parse out what a second Trump administration will.
We'll do it.
It doesn't help the Trump personally. This likes meta and alphabet. And if you look at the stocks, they're reflecting that. While we have Tesla up at about twenty percent for a good reason, which is Elon Musk, the rest are really trading flat. And then as that, as you pointed out, is down for a four straight day, so that's really a really long stretch of losing streak. If you want to see the where we're seeing action, of course, it's Bitcoin. It's up thirty percent ever since Trump has declared victory. And we're looking actually at the sailor buffet ratio so as we know, Warren Buffett's Berkshire Hasaway is an established company, it tracks more in names so to speak, and micro Strategy tracks Bitcoin well. That ratio, which measures the relative stock performance of both so its highest level since two thousand and it's not really a surprise because micro Strategy is up over four hundred percent while Berkshire Hathaway is up just around thirty one percent. And for more conviction, we saw six billion flowing through crypto funds. That's a record, Caroline, So it's really interesting to see the two spaces as this administration plays out.
Okay, bloombergs Isabelle Lee, thank you very much. We mentioned it a moment ago, Ali Barber reporting some solid growth in its businesses outside of China international cloud divisions and that kind of helped set some of the drag from an anemic Chinese e commerce business.
Going back to.
Henry Wren out of London's been tracking this print and that sums up the story.
But what's going on, particularly.
In mainland China with the Chinese consumer that has at least the US listed shares moving downwards.
And as you said, this is certainly a result that has some good and bad But the bad part is of course the local e commerce business, because this is the two thirds of ali Baba's revenue generation, and what we've been seeing for this quarter is still anemic because the revenue that ali Baba generates from third party merchants that grew only two percent during the quarter, So that's not a sort of rebound that investors have been hoping for. And a direct cell from Ali Baba's platform also stuck in the decline as well. That really shows that consumer sentiment in China is still weak, although this morning that we have some more positive retail sales state data in October showing that the retail sales actually expanded by four point eight percent, which is the fastest pace in eight months. However, we have to take in an account that these results came between June and September, and during that period we can say that the consumer sentiment.
Is really not on amend just yet.
International growth, how resilient is that going to be in the face of geopolitical headwinds, most dominantly here in the United States we're anticipating in new administration which isn't very China friendly.
Yeah, So, as we discussed the domestic e commerce business has been weak for quarters and quarters, so they have to find a new growth engine. It used to be Cloud, but Cloud that growth engine has been sputtering for several quarters in a row. Now it has showed some signs of recovery, but still a long way to go. So another way to expand is through overseas business. What we see from pdd door as well, which we've been seeing from team.
Explosive growth in the US.
For Ali Baba, the focus has been in other Asian markets. We're talking about Malaysia, Indonesia, those markets, and they've been doing quite well, although we would have to point out that Ali Baba is still burning.
Cash in those markets.
What we've been seeing in the past quarter is they are narrowing losses and we see the margins has been improving, although it's still some distance away from break even.
Henry Wren has been across all of these Chinese e commerce players.
We thank you.
Now and we're going to turn our attention a minute to SpaceX. It's preparing a tender offer in December. The two hundred and fifty billion dollar valuation. We're going to get to those reports. That's next.
This is bloe Meg.
Technology SpaceX is preparing to launch a tender offer in December that will sell existing shares in the business at about one hundred and thirty five dollars each. That's according to a report in the Financial Times, where they cited sources. Bloomberg's Bris ein Horn is here with us and Bruce just for a Bloomberg technology audience. The basics a tender is where employees or some early investors sell shares. There's no new capital raise. The main point, I think is a valuation of two hundred and fifty billion dollars or more is quite eye watering. Put SpaceX up there. What else do we know?
That's right?
And so typically SpaceX does these offerings twice a year. The previous valuation, which was in mid year, was around two hundred and ten billion dollars, So two hundred and fifty billion dollars of course a big jump up. It would be a record for a US company. It's not a record for a startup. The record for a startup is two hundred and sixty eight billion dollars for Byte downs to the Chinese parent of TikTok. Just to give you a sense of just how much SpaceX's valuation has increased. A year ago, when there was a similar offer, the valuation was one hundred and eighty billion dollars.
It feels for some as though the valuation goes higher, maybe it gets a Trump Elon Musk bump. Maybe everyone's just trying to plow in money to associate themselves with the success of Elon Musk and the considerable perhaps ease with which he'll get better regulatory approvals when he's associated with the next administration. Is that something you eyeing, Bruce, certainly, gwinnshot while the president of SpaceX is talking about that very thing this morning.
It's a good point that, of course Elon Musk does have the ear of President elect Trump. That said, though this is a lot more than just a politics story. Starlink has more than six thousand satellites in operation. Gwinshot well this morning, speaking at a conference in New York, said that the company has launched more than seven thousand satellites. This puts Starlink far ahead of any competitor. So they are really the dominant player for now, at least in lower th orbit. The satellite communication, which the valuation partly reflects.
You know, Bruce, the focus on SpaceX is about reusability. The Falcon generation of rocket can go up and then come back down and be used again. But our attention is going to turn to Starship. What did Shotwell say about Starship? And I guess should the audience be looking out to see another test anytime soon?
Yes, so there will be another test soon. This morning Gwinschotwell said that we should expect that on Tuesday next week. This would be the latest test of Starship. Starship is just a level, a whole other level bigger than anything that's existed up until now. And in her comments this morning, she also did say that the company expects to launch direct to sell service sometime before the end of the year, sometime in the next month or so. That would also put SpaceX out front in another business that's really just getting started, offering satellite based communication that could go directly to cell phones without having to have any sort of satellite dish or any other type of equipment.
More than four hundred Starship launches are possible in the next four years, according to Quench Shutwell, extraordinary numbers on both evaluation and the amount of launches. Briseiinhorn, we thank you Meanwhile, let's talk about Elon Masqu's Tesla seeing a big reaction alongside other EV makers.
Today we get a reprieve. It was yesterday that a.
Report hit from Reuter's saying that Donald Trump and his administration is set to end some seven and a half thousand dollars EV tax credits that are currently out there. Joining us is Terry o Day, in charge Energy COO Terry. So the point here is that when you buy an EV you can get a nice, juicy tax credits seven and a half thousand dollars and that would be wiped out potentially by the next administration.
How important, How integral is that tax credit to demand?
Well, it's not clear yet, but we do know that it is important. It's very valuable to the industry, and it's important because of both consumers relying on it and manufacturers relying on it. So it's really about EV jobs when it comes down to it. And the current incentive is only available to American made vehicles, So what we're really talking about is manufacturing in the US, and that's why this comes as a bit of a surprise. And the last time this personal tax credit was challenged, it had a lot of support in Congress from states that are manufacturing the components for electric vehicles, like states like Tennessee and South Carolina and Michigan and Illinois. They wanted to protect jobs and that's why they protected this tax credit last time. So we'll see how this proposal goes in Congress.
Many of those states, not blue states per se, potentially read and therefore affecting home territory to certain extent for your business, when you think about the infrastructure play of this, does this set back the adoption.
Of evs in the longer term?
Do you think I know it's hypothesis here, but does that make you think about readjusting your strategy?
It definitely has that potential.
I mean, for our business, we rely on demand from consumers and from businesses, so this is a personal task credit for individuals. There are other incentives in the industry that are definitely on the shopping block from this administration. So there's an important fight to protect a lot of those incentives.
Now, Terry, you said this is a surprise, is it really? Elon Musk has been talking about scrapping subsidies for years.
He has been close to.
Trump throughout the election process and now in an advisory role because those will out act outside of government.
He will have Trump's here.
But also we had decelerating EV sales growth anyway for the latter part of biden'sministration. Why is it a surprise to.
You, Well, I think decelerating sales growth was going to happen anyway, right, because when you're growing year over year double digits, you cannot continue that forever, just the law numbers doesn't allow it. So deceleration was going to happen. But this incentive has broad support, as I was saying, So that's why it comes as a bit of a surprise. And to be saying this so early in the transition is I think also kind of surprising. Look, this is not a significant tax credit and the range of new tax policy we're going to be seeing coming out of this administration, and it favors US manufacturing, which this new administration has been saying is what they really want.
So they're looking for manufacturing. This is something that does that.
Terry, Don't get me wrong, I've got a Tesla model why I think Carroy I'm right and saying, also has an EV I leased it. It was a competitive lease because of the seventy five hundred dollars tax credit. But big picture, what is it that's going to put electric vehicle sales in North America at least back on a path to accelerating sales growth. What do you want to see proactively the Trump administration do well?
The most important thing is that California has the right to regulate tailpipe emissions today, and about a dozen other states have signed.
On to that.
They have regulations forthcoming that are affecting fleets, So fleets would be required to buy evs when those fleets are larger than fifty vehicles in their fleet, and manufacturers would be required to sell to those fleets, so that dual regulation is in jeopardy. And overall, California's right to regulate tailpipe emissions is what created the EV industry in the first place. We think we can compete on an equal footing with gas and diesel. Today, my customers like PEPSI and FedEx and ups and school districts across the country are already saving money by going to electric because it's cheaper than gas and diesel on a total operating cost.
So we think we can compete on an equal putting.
But it's important to have these regulations in place to just kind of get over the hump of these pilot programs and enable it.
To go to scale.
In so saying that terry, it almost makes you think, well, why have them if already you're able to compete. That's sort of therein lies the argument, and going back to the consumer right now, is it that you need to compete by what you do. Many people are reticent to commit fully to an EV. They've been going back to a hybrid model because they're worried about infrastructure and alack thereof.
Yeah, and that's the real trick here.
I think, you know, committing capital to build out an industry like this is extremely risky. So those regulations provide the guardrails for investment. It attracts private investment and creates jobs. And so that's really what this is about, is not the you know, favoring one industry over another, but really just giving enough certainty to investors that they can put capital into the space to continue to grow that charging infrastructure, to continue to convert their fleets and do the things that we want to do for this space.
President Elect Trump's point, i think is not that he's antiev but that he's not fully all in ev he wants choice. Terry O'Day in charge energy. Soah, great to have you on the program.
We're just getting started.
And the thing I remember about last week is when Donald Trump was in this room, everybody else was celebrating. He was stone cold ready for the next step. But I also want to thank him for making sure that Elon Musk and I own a position to start the mass deportations of millions of unelected federal bureaucrats out of the DC bureaucracy. That too, is how we're going to save this country. And I don't know if you've got to know Elon yet, but he doesn't bring a chisel. He brings a chainsaw, and we're going to be taking it to that bureaucracy.
It's gonna be a lot of fun.
Entrepreneur Vivek Ramaswami, who has recently chosen by President elect Donald Trump to co lead the new Department of Government Efficiency along with Elon Musk, to cut excess regulation, it says, and expenses. Let's discuss this with Jennifer Pallack Pulker.
Sorry, it's a Friday.
Jennifer Pulker, Senior Fellow at Niscannon Center and former President Barack Obama's deputy Chief Technology offers a boy, you have got inside knowledge about how easy or hard it is to affect policy change within a civil service that already exists. Look Vivek Ramaswami saying it will be fun to take a chainsaw to it. For many who work there, this won't be fun.
But what's the reality.
Do you agree that, in principle efficiency needs to be found?
I agree that government has to get better at doing what we say we're going to do, and I think our inability to do that has I've created the opening for this DOGE and sort of other initiatives that you see coming out of the Trump White House. Now there's so many questions about this. You have significant confluence of interest, especially for Elon Musk. They have established this thing outside of government, so it's unclear if they really intend to just rely on executive action or really get.
Involved with Congress.
So there's some questions about the whether they can be effective. But I do think that there is a real problem behind all of this rhetoric that needs to be handled with probably more care than the way that Musk and Ramaswami are talking about it.
Jediv I do want to be naive to the fact that people have been probably trying to make government more efficient for a little while.
So what is it that hasn't been done? Oh, we at the level now.
That this sort of decision not to care, not to be precise, but actually to just go at it with the chainsaw. Just every other Social Security number is out. Is that the place that we've got ourselves to.
I don't think it has to be. I think a good analogy might be brush fires. So I live part time in California in a very very high fire risk area, and I was told when we moved there, you know, backwen natives all in the land, there were fifteen trees per acre, sorry, yes, per acre, and now there's fifteen hundred and so the fires now are bigger, and we can do fire management. Now, we've learned a lot, and we can mitigate the worst damage.
But when you haven't cleared out.
The craft for many years, and I think that is unfortunately what has happened in our government is that we haven't, then we get these conflagrations.
That burn out of control.
I hope we can stop that, but we are going to have some burning, and some of it will end up being healthy over the long run. It's in a difficult situation to be in, and I think that public servants to Jennifer feel nervous about this, have.
A road to be We heard from Vivek Ramaswami in that SoundBite, but I had an exchange with him on x the social media platform yesterday, and as part of that exchange, I flagged the idea that investors are basically selling out of companies that are historically main contractors to the government.
For a reason.
They think that you know that mister Ramaswami, who calls Uncle Sam not supposed.
To be Uncle Sucker. They think he'll be successful. I guess that I would just like you.
To outline the reality of doing that, canceling long term contracts, looking at automate vendors, and ultimately reducing headcamp at government agencies based on your experience having worked within it.
If we do that, there.
Will be damage in all sorts of ways. There's going to be damage to.
Our ability to protect our nuclear arsenal.
For instance, Michael Lewis writes about this in the fifth Risk.
It will chill your bones. We do not want that.
On the other hand, we do need some changes, and we need when we do those changes to be thoughtful about preserving the foundations that this country is built on. Now, this isn't a Doge proposal, but if you look at the schedule F proposal, for instance, it's not actually addressing the real problems of being difficult to fire under performers, for instance. It's going at the core principles of a independent civil service that's able to tell the truth, that is hired and fired on the basis of merit. We need real civil service reform, not schedule F.
Jennifer Palker, Senior fellow at NISCAN and sent I really appreciate your time here on Bloomberg Technology.
Welcome back to Blue Meg Technology. I'm Caroline Hyde in New York and I met.
Love Low in San Francisco. What's going on in the market, Scarret, I've risk off.
Kind of a day.
Look, we're back to fundamentals yourfuria. The highs of the Trump trade just ease a little bit, and we've refocused on the other guy, that is, of course, the head of monetary policy. We think about what Jay Power is saying in in terms of the FED and rate cuts, in the market really pairing back how likely that cut is for December.
We're off by almost three percent.
You can see the sudden jarring move that we've got on this last day of trade. It is the worst week for the Nasdaq, the main benchmark now's that one hundred at least since going back to the beginning of September. So we have got a sort of a bit of a pain trade to end the week. Move on and have a look at what's happening on the individual movers because we're actually back to fundamentals when it comes to earnings as well. Ed I China, like what's happening with some of the chip makers.
Firstly, Tesla is up four percent.
It's like the only Magnificent seven company that is on the higher side from the benchmark today it pulls up, but the rest of the Mags seven are pulling down on a points perspective, and really that's a relief rally after yesterday's sell off from the back of that ev news. Applying Materials down eight percent, we're seeing it trade at the lowest level since February of this year. This is a chip equipment maker like asml over in Europe. This is the US version, and look, it's signaling that perhaps everything in Chipland isn't all that rosy if you strip out AI again, we're thinking industrial or thinking autos, and we're thinking China. And I'm looking at in video what does this reader cross mean for in video? When we get its earnings on November the twentieth ed key for there were down by two and a half percent. Of course, the key points drag on the day. What are you looking at?
Well, let's go back to the chips and do a deep dive bloomberg z and King is here with us in San Francisco on Applied Materials. It's interesting because part of kind of the bigger tech markets discussion is we've got over the election.
Now and earnings are with US.
Applied Materials is America's biggest chip equipment maker. Was there anything in it that was kind of consistent with what we've heard from ASML the big themes about AI investment and those cutting edge machines or China or anything else.
Yeah, No, that's one hundred percent consistent with what we've heard from others. Spoke with the CEO yesterday after the release and he was like, look, everything's Okay, well, you know, there's nothing to worry about. The long term picture for this industry is fantastic. I'm not going to worry about, you know, the odd fluctuation here and there on a quarterly basis. Unfortunately for him, investors are because you know, you have to be perfect with the amount of money that's been put into these stocks, with the expectations that exist around AI. Our performance is the only performance.
Well said, I think a prior to this on the year, they had actually been up to the tune of about fifteen percent.
Now were only up about five percent. In the reader cross is important because we're all.
Going to be obsessing about in video next week, and this is your main company that you focus on.
What does it mean for in video?
Yeah?
I mean again, the word AIAIAI keeps cropping up over and over again. What we've heard with regards to in video has been very positive.
Right.
The only thing that's going to hold them back will be availability of supply. Can they get enough chips to meet demand. Everything that we're hearing in terms of the fundamentals, in terms of the sell through, in terms of the capex's planned is absolutely positive.
You've reported overnight that TSMC, the world's largest contract manufacturer of chips, is finalizing its awards from the US government through the Chips Act. What's new and why is that significant?
Oh, it's now a legally binding contract between the United States government and TSMC. So not I won't say there's no going back, but it makes going back a lot harder. It shows that they've already achieved some of the things that they were supposed to do. They're going to get a billion dollars of federal money this year, we were told yesterday. So in general it's a positive sign. It's moving that whole bill forward, obviously ahead of the administration handover.
Blimbozy and King and all things chips. Thank you very much, Carol.
Sticking with chips a little bit, it's time for talking tech ed and first up shares of Samsung. They'd been up in South Korean trade today because the tech giant is surprising investors with a mammoth buyback of seven billion dollars worth of its own stock over the next year. The move comes, of course, the mid investor concerns that the growth in the firm's memory chip business has been lackluster, Struggling to keep up with rival sk Heinex, for example. Meanwhile, Elon Musk was ramping up his feud with Sam Altman. In a revised court filing must highlighted and trust concerns by OpenAI, alleging that the company is trying to corner the Generator AI market and sacrificing safety.
OpenAI didn't immediately respond to.
A request for comment, and the Ultimate Fighting Championship will be looking for a decade long partnership when it shops around its media rights next year. This is all according to the company CEO Dana White, who sat down with Boomberg TV yesterday. He also spoke about his relationship with the President elect Trump.
Just take a listen.
He's the one that when we first bought the company and venues didn't love the UFC. Back then, he opened up the TAJ and New Jersey and said, we did our first couple of events there at the TAJ and he showed up for the first one and stayed till the last fight. That was when he became a fan.
I know you've been friends with him for a long time. Any plans to actually work for him in his new administration.
I want nothing to do with politics.
No I do not I know.
Let's stay in the realm of fighting and competitive sports. Netflix shares actually down two percent. Remember tonight is the big fight. It is streamed exclusively on Netflix. Jake Paul versus Mike Tyson. Don't know about you, Carrot. It's been all over my social media feeds and it's an interesting moment for Netflix whether they can pull off There he is and there he Is. We'll be tuning in one to watch. You can discuss it on the show on Monday. Coming up on this edition of Bloombog Technology. Business leaders from around the world are gathered in Lima for apex CEO summit. That includes Google's VP of Government Affairs Corumbatia, and we're going to hear from him next Stay with us.
This has Boombog Technology.
Apex CEO Summit. It's been underway for the last few days.
In Lima, Peru.
Global business leaders gathered to discuss the latest in the space sector, in AI policy, and much more.
Most Lisa Bromo, it's.
Actually sat down with Google's VP of Government Affairs, Kuran Batia.
Take a listen.
In all honesty, I've been here today. The conversation actually has mostly been and I've been meeting with foreign ministries government officials has really mostly been about how can they get the benefits of this amazing new technological revolution that's happening around artificial intelligence. So they want to hear about what can they be doing in terms of building infrastructure, what can they be doing in terms of skilling their people. There are you know, there's an awareness that there is geopolitics that impacts the technology sector as well as everything else. But frankly, it's been interesting to me to see how much interest and appetite there is around getting that technological edge.
So how much have you been surprised or why is it important for Google to be so heavily invested in areas like Latin America, like zact East Asia.
Well, first of all, it kind of starts with our mission as a company, which is to organize the world's information and make it universally accessible and useful.
And that universal part.
Is really core to our being.
It's a recognition that Google's not fulfilling its mission if we're not operating in places like Latin America, like Southeast Asia, East Asia. So I think part of it literally has to do with what it is we do every day, and as the technology expands and as our business expands, these regions.
Become more and more important.
Obviously, you can't look at the growth that's happening in places in East Asia. Latin American markets are doing very well and not being encouraged by sort of we're seeing.
That was Corumbatia, Google VP of Global Public Policy and Government Relations. Let's get out to Lima, Peru and bring in Bloombergs Lisa Rumvitz, who's been there for a few days. And what's notable is the presence of big tech, right, not just Google, Microsoft as well. What is it that they were actually doing there, like give us a bit more of a sense of the role that those tech names played in the discussion.
It's a good question, And first I just want to say it is notable that the big tech firms were here because there were so many US companies that were absent.
We saw big.
Tech, we saw energy companies, we saw JP Morgan, but other than that, US companies were kind of more on the sidelines and Chinese companies much more present. Now when you talk about some of the big tech names, they want to make sure that they get their footprint as everybody clamorous for the artificial intelligence bedrock that a lot of people think will establish the next generation of business. But here's the question, how can they do that when regulatory regimes are not set? And that was sort of the big existential aggs hanging over all of this. How do you deal with the fact that President Trump, president elect Trump will have different policies than President Biden, and that even now we don't have a real sense of what counts as national security when some of these companies are expanding and what does.
It so true? Lisa, and we heard from Xijingping at the event, the Chinese narrative coming and saying, look, let's not backtrack, let's stick to a global economy here. But how much do you take that at face value at the moment? How all companies able to invest?
Well, this is a good question, and the answer is they look at where they can and what they do know. And I think that a lot of these companies have made inroads when it comes to, for example, big tech. They're looking for countries that have some energy infrastructure. So a place like this which has a copper and lithium and a whole host of other natural renewable energy sources that is appealing on the large your scale, though, there is a hesitance in certain sectors to really invest, and you are seeing that, which is maybe why you're not seeing some of the more consumer facing sectors like retail really coming down here. But you're right, there is this question of how do you invest in a time of change. The answer is carefully, and that's what people are saying. You are seeing on the margins, but it's select industries and otherwise there is a bit of a paralysis as people try to figure out what exactly comes next.
Lisa so busy, great conversations, key among them, Jamie Dimond. We appreciate it, Lisa Bramowitz. On the ground there in Peru. There's so much to unpack from the US election in terms of geopolitics as well from a venture capital standpoint too, from AI policies, tax implications.
Let's just get to it with a race between US and China.
Let's discuss it with a venture investing on today's VC Spotlight. Alfred Chuang Founer, General partner at Race Capital. Someone who has built businesses yourself, be a systems for example, And I'm really interested Alfred at this moment of how much you are putting your mind to the future of US China relations, the US global relations at this point.
Apparently, good morning, thank you for having me back by. Good to CEEO.
This is a very interesting time. But I think just.
If you look at where all the activities are in tech and inventure at this point, pretty much everything is AI driven, whether they are like what we do, which is straight in the plumbing. So I'm like the plumber of Silicon Valley. Try to ment all the infrastructure, which is all the critical pieces to enable the enterprise application. Do now have a new network inside and be able to be very smart and be very efficient and be extraordinarily efficient. The China and the US part of it is because the way that we train the data for the large model itself, we're not completely separated.
So there's a model for China, there's.
A completely different model what we've been doing actual multiple models in the United States.
Because I think a lot of it has to do with history.
Our data are just so much more organized, and we have systems that we've been preparing for the past decade, you know, like all the things that we're put into Spark data breaks, for example, we're all grape preparation for organizing this data to make the computer thing like human. So US has a huge advantage at this point in time and time and getting ahead of this program.
I'm interested in just the supply chains fact a bit there out for you talk about the efficiency, the clear efficiency that's been built in the US, but we're about to pledge you see, tariffs, so that we can't be unaware of the fact that a lot of things are important, even at the most high end technological element. Will that put pains to efficiency here in the US.
I think there's already pain. I think obviously there's more pain to the people that are not now allowed to be importing the eight one hundred and one hundred form En video. They're equivalently Obviously, supply chain is not like what it used to be before COVID, so we have that slowdown already at this point in time. There's never back to non one. By the way, we are still very behind in this country. So we're you know, we don't have any babs right well, pfares have limited availability. We are dependent on loot of fabs in Taiwan. Some of these lower trips are building China still, so there's call dependency between these countries in order to continue to advance.
At Ai and.
I'm you know, have great Hopdad, or the great reasons of continuing to progress mankind, we don't start this trade and which I don't think that will be the case, because it just will be dysfunction.
I want to think about the environment a bit, Alfred. This week, for example, my colleagues and I reported that Data Breaks is doing a tender largely for employee liquidity. And that's a name that Data Breaks. That that's in your portfolio. But there are signed things are happening right, whether it's the IPO market, whether it's.
Different kinds of exits through M and A.
I'm going to ask you what you think kind of happens next, particularly under a Trump administration, for your portfolio companies and vcs that are looking for an exit.
Yeah.
At Berger to CEO, thank you for having me back. Database is in the unique case Database perhaps, which I believe is probably the best, the most exciting, the fastest growing large enterprise tech company and run by probably the best CEO ever.
In enterprise tech. So they're in a unique place. I think.
Whatever they're going to do in fundraising is their choice that they decided not to go to the proper marketplace they might have qualified to do so. And I think that's just by choice. And I think that choice come from which I believe in the past ten days is kind of how we feel with all the founders in the valley, which is we're going through a rebook process. Does rebook process will likely have a chance pose to relook at how the SEC, the FDC, the CTPB, how they're going to be conducting business, on their policies, how they're going to regulate, how to get regularly AI, how they're going to regulate other webprear technology, cryptos and other things. And I think we kind of were stuck for the last two three years, you know, in a place where it's very difficult to get anything. Then from that perspective, very little company, one IPO, very m and A happened.
So I think there's a.
Lot of new hook you know, we don't know, Yeah, I mean, the new admonstration won't start until the twentyeth of January. How are they going to do to do things differently to kind of re enable this ability to do some.
Of these things.
So I think I'm very optimistic I think next year is going to be an unreal great year for innovation and for our venture deployment.
Capital out for it very quickly.
The next area of growth for you, the fair the next area of growth. Where are you looking right now? We just have ten seconds?
Okay, ten seconds without a doubt, AI enabled enterprise applications. Let's gette hundred percent efficiency on every individual they're using enterprice computing.
That's where the growth would be.
That was ten seconds.
Alfred Trunk, founder and Race General Partner at Race Capital, Thank you very much. Plantable Foods has already harnessed the power of plants to manufacture the Ruby protein, which comes from duck weed. Now the company's looking to grow the popularity of the nutrient rich products with a new thirty million dollars Series B funding. Round here with more Plantable co founder Tony Martin's bacchini and welcome to the program.
Thank you.
Also known as water lentils. If you're not familiar with duck weed, I don't really know where to start other than you have some specific technology that has made something others have tried a success.
Yeah, well we really tried to do it.
Plantable is to work backwards from what the food industry needs, right. I think over the past couple of years, we've seen the food industry being overwhelmed with synthetic, unhealthy or elecgenic ingredients, and we started to look for a natural successor to these unhealthy ingredients that they're using today. We found that in an enzyme known as ribisco, which is funnily enough, one of the most abundant proteins on the planet and millions of people are consuming it on a daily basis because it's present in every leafy green. Now, then we started to look for the most cost efficient and environmentally friendly way of scaling ribisco, and we found that in this aquatic plant known as lemna or some other people might call it water lentils.
And so, why do you need the thirty million dollars of what's the process from here?
Yeah, So over the past couple of years, we've built out our first commercial manufacturing module in West Texas, and since then we've been able to start to fulfill some of the commercial demand that's out there in the market. But we're seeing that we aren't really able to keep up with the demand that's out there, and so we need to thirty million dollars in order to continue to expand our manufacturing operations in Texas to fulfill the commercial demand that's out there.
So Tony, am I eating this now? Is it available?
It is available?
You can Actually there are some products on the market that contain our product at the moment, so absolutely you can eat it right now.
Where are you in sort of the general approvals when it comes to FDA, when it comes to Food Science Authority as well.
Yeah, great question. So at the moment we're self affirmed Grass. We're working with the FDA to get the final letter of no questions from their site. In the meantime, we're also working on a formal approval from the European Food Safety Authority, which we hope to get by the end of twenty twenty five early twenty twenty six.
What's it like in the world of raising capital for food tech ad tech right now? Because it's been through to some peaks and troughs, shall we.
Say, yeah, it's misogonistic as maybe the right word. But I think we've been working incredibly hard as a team to hit milestone after milestone and that has really allowed us to propel the company forward show that we can scale up, but also scale out our technology and prove that they're true product market fit for our ingredient while actually discovering new and new market opportunities every day of the week.
Let's talk about the investors why they're interested in you? Are they traditional texts? And how did you go about doing this? It's a pretty tough environment. Actually, yeah, it is a pretty tough environment.
I think like, why are these Why are the investors, both the financial and the strategic investors interested? Is for a couple of reasons, right, I think on the on the financial side, we've obviously been able to show the de risking of the technology, the de risking of the market risk, and it's now a matter of solving the operational risk as we move from being an R and D company to a full fledged manufacturing company very quickly.
Chipotle is on there.
What's the kind of go to market I'm assuming that's more a strategic partner, sure, and just financial Yeah.
I think about Chipotle as a company that's really whose mission it is to produce food with integrity and basically create delicious, clean label and healthy foods for the consumers out there.
And what we're able to do is We're able.
To allow them to unlock new recipes or improve their current recipes without having to introduce new allergence or food safety risk containing ingredients.
I'm going to look at the ponds near me in a whole new way water Lentils.
That's their name.
Plantable co founder Tony Martin's bikini.
Great to have some time with you. Congratulations on the rais.
Well.
That does it for this edition of Bloomberg Technology.
What a week, ed, Yeah, another astonishing week, a historic week in many ways in the context of the election, but also tech. Check out the podcast It's Worth the recap online on Apple, Spotify and also on iHeart. Big thank you to the team in New York and here in San Francisco.
This is Bloomberg Technology.
