tv Bloomberg West Bloomberg June 24, 2015 8:30pm-9:01pm EDT
emily: dropbox grows its user base. but competitors are closing in on market share. i will talk about the company's strategy with the ceo. ♪ emily: i am emily chang. this is bloomberg west. coming up, box teams up with ibm. how will it help in the cut gros cutthroat race for customers. john scully has a plan to disrupt ibm, salesforce, and oracle. he is here to tell us a about his new company.
motorola solutions is using big data and drones to fight crime but is it leading to a robocop future? all of that, ahead on "bloomberg west." to our lead. dropbox growing rapidly. in an exclusive interview, ceo told me that user base has jumped to 400 million. up from 300 million a few years ago. it is being used in 8 million businesses. dropbox is valued at $10 billion. rivals are catching up. while dropbox still leads with 24% share microsoft is gaining ground at 19% and box at 15%. i sat down with the founder and asked him about the company's rapid rise and plans to go public. >> 8 million businesses. there are orders of magnitude more than that in the world. there are billions of people on
the internet. a ton of room to grow. if you look at how valuable that problem is. the things that people put in their dropbox are the most important possessions. if your house were burning down you would go get it. for a company making a company's , team productive, a safe place for their information, that's extremely valuable things. we ship on samsung phones out of the box. we just partnered with microsoft last year to build dropbox natively into office. and so there is a lot going on. investors see the potential. emily you always said that drop : box is a standalone company. do you have that same conviction today? that you had to, 3, 8 years ago? drew: being independent allows us to support different platforms. as you see other companies tend to favor their native platform at the expense of the others.
that sort of switzerland approach is not of value to us. emily how do you plan to raise : money? in this environment? drew: we have been able to do a lot. we were able to raise money that we have not really needed. emily: why take it if you don't need it? drew we want flexibility. : we do in investment in infrastructure, acquisitions having a stronger balance sheet gives us the possibility to make big, long-term investments. emily do you have the cash you : need? drew for sure. : the important thing is not just generating cash. it is important to keep investing. emily could you move ahead : without investing more money? could you get to that place?
drew: for sure. we can just stay focused on building and growing our audience. emily what are your plans to go : public? drew: we don't have any right now. again that's what we get with the flexibility from raising this money. emily what have you learned from : box's ipo? it has gotten hammered. drew i'm glad that we have our : approach. with our sales force it means , that we don't have to spend the kind of mothers that others do on sales and marketing. emily are you profitable? :drew we don't break that out : now. our investors are happy. our focus is not on profitability. right now, it is on investing and growing. emily: the dropbox ceo and cofounder there. you can see more on studio 1.0. at 7:30 p.m. eastern and pacific. right now i want to bring in , leslie, who covers ipos. as well as michael wolff,
founder and ceo of activate. a technology and strategy consulting firm. michael, let's start with you. dropbox is still in the lead. when it comes to businesses. obviously, competitors are closing in. is it worth $10 billion? michael: there is so much growth ahead for that company. people keep looking at it as storage. reality it is collaboration. , the other companies are friendly. cios like those other companies. collaboration is a consumer issue. consumers love dropbox. dropbox is easy for them to use, especially when they are bringing their own devices to work. so i see a lot of runway ahead. , emily: what are your sources telling you? you covered the ipo. do investors like dropbox? do you think they will like it more than box? leslie: the sentiment has changed over the last year. i remember when box's filing
timeout. sources kept saying that dropbox has better numbers than this. don't worry. it will look better at that time. here we are one year later people looking at dropbox, and the discussion has changed highlighting potential cash burn rate. however, others say they have only gotten through series b funding. they still have a long way to go. in terms of an ipo, most people seem to mirror what he was saying. in terms of they don't have a plan to go public. dropbox is the type of company that to surpass the $10 billion valuation is an achievement. what he said about not breaking out profit, that is something that will not help them achieve those goals. emily: he said that he can go public without raising more money. michael, we are seeing high profile people leaving. gentry underwood, running mailbox, said he would leave then changed his mind.
should we be concerned? michael: the war for talent is fierce. the reality is that technology companies with the best technologist win. we're going to see a lot of competition for talent. they are still able to hire great people. as are everyone else. other companies are having the same attrition issues. the good news is they get great talent. people find it an exciting place to work. the proof is in the product. they keep innovating, creating new features that consumers love. emily: i did ask drew about this. he said they monitor engineers and are seeing better numbers than ever. i want to turn to what we saw with box today. box teaming up with ibm to go after large corporate customers, now able to store content in big blue`s cloud. ibm has also established partnerships with twitter.
i asked aaron leavy of box about the deal and what is next in the cloud. aaron: the cloud is disruptive in the economic sense and the way you deliver value to customers. but it is not particularly hard to deliver the cloud. i think that most of the incumbent technology vendors will be able to get the cloud and do that successfully. it is now going to be the new opportunity and competitive market, what you do on top of the data, information, and computing in the cloud. you know commodity infrastructure is not particularly interesting. what are you doing with that information to deliver more value to customers? i see more points of view from microsoft, ibm, oracle, and others. i think that this is a new market that has yet to play out. emily: it is interesting michael, there are so many
companies chasing the cloud, microsoft, google, oracle, box and dropbox. box and ibm are competitors. in addition to being partners now. are we going to see more consolidation? what is going on here? michael they are all trying to : integrate as much as possible. the challenge is making the cloud smarter. it is allowing users to be able to get out of the cloud what they have put into it. and so i think we will see more , partnerships. yes, people will fight in one sandbox and play together and another one. especially when it comes to a lot of these things that are shared across applications. emily: is this confusing for investors? leslie it confuses me a little , bit. leslie: it confuses me too. when you look at something like this, it is a great partnership. ibm is a great brand name. what does it really do for box's bottom line. that is the question that investors are concerned about. at the moment it is not clear , how it could boost earnings and subsequently boost share
price, but it seems like it is a better option for them than ceding to the competition, to partner with -- especially when people keep expressing their concerns about cloud storage being a commodity business better to partner than die right? emily: right. i did question them on revenue sharing. how much money is changing hands, but they wouldn't go there. why doesn't ibm just buy box? aaron leavy said to me, we want to be a big, independent company. michael: i doubt that ibm can push the same kind of innovation that a small company can. it is a challenge for large companies to act as startups. and as we were talking about hiring the best people and get them to do things that are going to yield great results for consumers. emily: the race for the cloud is something that we will continue to watch. michael wolff of activate, you will be with me throughout the show. thanks leslie.
emily: in unicorn news, raising funds at a $10 billion valuation. back in december, this round of funding could be announced this week. well, big data could mean big bucks for advertisers if they know how to use the technology. data interactive help brands to crunch the numbers and send data to customers. they work with 700 different customers, quaker oats, british airways, sprint. david steinberg joins us now. we have more and the company cofounder, john's scully. michael wolff from activeate is still with me. john, i will start with you. how can you serve the needs of everyone with one technology? john we are a platform company : able to leverage that capability with 350 million
profile names, and we have a repeatable model. last year, we grew over 70% topline. we had 700 people. this is a company that is at the stage of rapid scaling. michael: how are you going to stand out in the world of ad tech. there are so many other companies with great data science, and the march of advertising innovation continues forward. john: just to jump in. we are a data and analytics company. the big difference between us and to companies we compete with, ibm, salesforce, we focus on the entire customer lifecycle versus just focusing on crm, which is what our competitors do. so, we help very large
enterprises, help them combine their data and build an analytical breakdown, and then we go help find them dramatic cost savings they can invest to create customers. whereas most companies just focus on that crm component. we do acquisitions, crm, and monetization. of the customers for large enterprises. emily: john, you have led two advertising powerhouses. i think about the pepsi taste challenge, apple 1984, and i wonder with big data, everything is becoming more targeted. you have more information about consumers. i wonder how that impacts creativity in advertising. would a shocking campaign like 1984, would it be possible today? john i don't think it would be : the place to put your best talent. those campaigns were designed when everything was about experience marketing and you had a lot of audience and a lot of time.
60 seconds was a long time. we don't have that anymore. we have people who give us 10 seconds of attention. and so we are in the attention , economy. you have to look at the way people see media. today they are more likely to , see it on their mobile device. the campaigns that we did before, they would not be the kind of campaigns that i would be leading. in this era it would be in advertising and data analytics. michael: so much of the advertising is going to video. creativity becomes more important as we moved to video advertising. john: you have to make sure that people who are seeing the video are the ones most apt to buy the product and view the video. so you can look at how it is compiled, and creativity will always be an important component. we fully believe that. but we believe that spending to reach a massive audience, when
you could get much more focused and much tighter and get to the people who not only have the highest aptitude to purchase a product, but also to replicate your best customers. so you are adding customers, but , your highest revenue, highest value customers, by targeting down that micro and macro data. >> what we are seeing today is that we can use predictive analytics to know a lot about people we are targeting. as david pointed out we have a , very short attention span with the customer today. we want to focus on things that they will be most interested in. emily john scully, former ceo of : apple, pepsi, thank you all. emily: jack ma is expanding the alibaba empire. the chinese e-commerce giant will launch my bank. this is part of a trend of private banks being licensed by the government to target small loans.
including ebay. not everyone is thrilled by the growth. chinese banks are setting up e-commerce platforms as a defense to their expansion. my bank will begin operating tomorrow. up next, in the future computers will solve crime and prevent them from ever happening. that's what motorola solutions says. they will explain, next. ♪
one number that tells a whole lot. today's number is 190,227,552 i got it right. that is the number of posts on reddit. the front page turned 10 years old today. to celebrate, the company released the number of accounts 36 million, over one billion comments, and 200,000 lines of code. they have been generous. they donated just under $2 million to charities. some impressive numbers for a company that started in an apartment in massachusetts. motorola solutions is betting that the future of policing involves a lot more number crunching. public safety technology makes up about 70% of the business after the spinoff of the mobile phone business. and the company has been on a tear, investing in a drone maker, partnering with a crime analytics lab.
the chief information officer joins us from new york. along with michael wolff. since the new season of "true detective" started, i wonder how big data make a true detective's work easier, fight crime faster essentially. >> we purchased a company earlier this year that does predictive analytics. and we are able to predict 30% or 40% of the crimes that will happen the next day. in the timeframe or location that way detectives can deploy forces much better. the other part we did, we did a one-year partnership which included investigative analytics, connecting people places, and things. they can do better link analysis. shrinking from what takes days into hours or minutes.
emily: the idea of computers digging around in mind personal data, thinking on behalf of police officers, can it be creepy or controversial? andeduardo: this is data available in police databases. it is arrest records, 911 records, not easily accessible. that's what big data and the software we have does, accesses data, crushes numbers and does predictions. it is all publicly available. emily michael? :michael this is incredibly cool : stuff. it will be effective. because of all the devices, they have their own network. and this is not like the pre-crime unit in tom cruise movie "minority report." this is about looking and seeing the history of what is going on and using that network to say
what is likely to come next. emily: you guys are investing in drones. how far away is mass adoption of drones by police departments and how can they help? eduardo: we invested in a company earlier this year. two things drones will do for police. one thing is situational awareness, you think about a drone going up. one company we invested in they , can stay up in the air for a day or two days at a time. they can send video back. just yesterday, we did a cool demonstration on motorola where we set up a broadband network on a drone. and then in the case of a , natural disaster, the drone was able to create a dome of broadband into an area and connect all the devices that the police officers have. emily: michael does it concern you that we might be heading to a robocop future?
isn't it a little bit big brother? michael i think that the concern : is the broader consumer user. once that gets combined with what's going on out there, i think it can make a big difference. i mean, consumers -- the cloud being able to say what is going on is much more powerful than any algorithm that can get created. so i'm not concerned about it because in a lot of ways, this is something that consumers want and they will contribute to. emily: you're probably also not breaking the law. at least i hope not. , michael wolff, thank you for joining us. eduardo, motorola solutions, interesting work that you guys are doing. thank you so much. that does it for this edition of "bloomberg west". do not miss my full interview on studio 1.0. also on bloomberg west, we talk about silicon valley and
announcer: from our studios in new york city, this is charlie rose. charlie: 21-year-old jordan's spieth made history on sunday night. he became the youngest player to win the u.s. open since 1923. he joins an elite group and is the youngest to win multiple majors before turning the ripe old age of 22. joining me now is the editor in chief of golf world and the senior writer of golf digest. he wrote this story for the july issue.