tv Bloomberg West Bloomberg August 10, 2016 11:00pm-12:01am EDT
mark: i'm mark crumpton. you are watching "bloomberg west." let's begin with a check of your first word news. at this hour, and i don't -- an unidentified man is scaling the all glass facade of the trump tower in manhattan. police have lowered scaffolding and broken through windows and ventilation docks -- ducts to reach the man moving laterally using suction cups, ropes and a harness. a justice department report says baltimore police officers routinely discriminate against blacks repeatedly use excessive , force, and are not adequately held accountable for misconduct. >> the problems in baltimore did not happen overnight or appear in a day.
the pattern of practice that we found results in long-standing systemic deficiencies in the bpd. mark: the report says officers make large numbers of stops in poor black neighborhoods and are -- unlawfully arrested citizens for speech deemed disrespectful. the brazilian parliament has moved to go ahead with the suspension of the president dilma rousseff. the trial is expected to start at the end of the month. russian president putin promising a response to an alleged terror plot in crimea, he says the move by ukrainian special forces to carry out what he called subversive actions was criminal, stupid and an attempt by ukraine to distract its people from its economic problems. ♪
emily: i'm emily chang, and this is "bloomberg west." coming up, reinventing the macbook pro. after four years, they hit refresh on one of the more resilient products, but why tinker now? and lessons learned from the bitcoin breach. the hong kong exchange crawling back from the brink after a massive attack costs investors $71 million. and the magic of early-stage investing. we will hear from two veteran investors about how to spot diamonds in the rough. first to our lead -- bloomberg's first report details of a long-awaited update to apple's macbook pro line. according to people familiar with the line the new notebooks , will be thinner, including touchscreen strip and will have more powerful processors to appeal to video editors and engineers. it has been four years since apple gave the macbook pro this kind of attention. apple cofounder steve jobs said the ipad would usher in the post pc era.
so why are they investing in such a significant overhaul now? broke this story joins us now with more details. great to have you back. first of all what do we know? , how are they going to be different? mark: like you said, this is a very significant refresh to the the latest since 2012 with the retina models. this version will be quite a bit bigger and have some new ports. some of the bigger changes involve the keyboard and track pad. the trackpad is going to be larger, which is always good for manipulating with a mouse or like a mouse. higheyboard will have a resolution that does not use a lot of battery light that replaces the function row. so like a mini pcs, you have the function row at the top. emily: volume, cause -- mark: media control. now the screen can change the
controls based on what you are doing. let's say you are in itunes watching a movie. you get controls optimized for media like brightness and music controls. but let's say you are doing something like video editing. maybe a word app, you get copy and paste, different things like bold italicized. going to be optimized to what you are doing, a very new concept. emily: the interesting thing is not hardware, it is software, so apple can up date it was a software update. mark: yeah if apple comes out , two years now and you want to get a quick button to access it, they could do it the a software update and you don't have to buy , a new computer to get that button. emily: six years ago, the ipad was the new hot thing, but sales know,lling and, you macbook sales are still going up. mark: this shows the resiliency
of the mac and the notebook lineup in particular. the ipad has been falling the first few quarters. in this past quarter, we doubled the quarter, they actually sold double the amount of ipads as lastast quarter -- macs quarter, but the revenue is pretty much the same off like $2 million. so that shows the mac and ipad have pretty much equalize in terms of bottom line as the previous quarter, which is a huge change after stephen jobs and -- steve jobs and tim cook and these apple executives were pushing the ipad as a lap top replacement. now they are taking what is clearly working and still working at a great level and improving it. they found a product that has very high margins, so they are going to capitalize on it with this new model. emily: what does this mean for the ipad? tim cook has been pushing the ipad pro. when i talked to the cfo of apple after earnings, he said the ipad pro is doing well, especially among business users,
is the ipad really passed its prime? mark: if you look at the sales, the ipad really peaks at the end of 2013 into 2014. as of today, you can look at it as passing its prime, but it is also before its next prime. i think in a year from now, the ipad will be a hit story again when they finally start taking advantage of the capabilities. the ipad pro is a great device from a hardware perspective. its processing speed and theoretical power are on par with some of the latest macs and pcs from the windows world. the problem, i believe, is the software. software does not allow things like advanced photo management or video editing that people could be comfortable with like a mac operating system. i think apple knows that, and at some point, we are going to see the differences between a mac and and ipad blur even more than they do today. that will take the ipad to the next level. until that time comes, it is
important for apple to have a product that needs the needs of professionals. emily: who is going to buy this? you mentioned gamers in the story. editorsmers, video people who do lots of photo , editing, people who like to do high quality and detailed sketches, people who are into technology and want the latest technology. the key thing about that what we talked about, it started brainstormed more advanced technology to be used by more than people. you and i are very used to keyboard shortcuts, but there is a lot of people that need a guide. this will display it up there for you. will make things easier for a lot more people. emily: they have been in advanced testing for the last year, but we're not going to see it at the upcoming event in september. mark: apple is currently planning an event on september 7 to unveil the new iphone, but it does not sound likely as of right now that the macbook will appear there. if testing and distribution
ramps up, it is possible, but right now we think it is iphone and something else. mark: i am expecting -- emily: i am expecting another scoop tomorrow. thank you. turning now to a stock we're watching -- jd.com soaring -- in nearly six months on a stronger-than-expected earnings report. this is china's second-largest online retailer. that narrowedss substantially from a year ago. the company is traditionally focused on electronic gadgets but has revamped its product mix and is selling more things on behalf of third-party merchants. china's biggest e-commerce company, alibaba, is set to report first quarter results later this evening. the results are going to look a bit different. the sec opened a probe into into the company's accounting practices earlier this year. alibaba said with reporting metrics and five new categories to help investors better understand the business. they are core e-commerce cloud
, computing, and media entertainment. other initiatives like social media and equity investment. analysts point to cloud computing as alibaba's key to growth. citigroup says the jet business could generate $3.3 billion in sales by for reference, alibaba 2019. posted less than half of ilion -- in cloud computing revenue billion dollars last fiscal year. you can see this in the bloomberg chart. you can see year on year growth in cloud computing and internet infrastructure is deadly -- steadily increasing. we know alibaba is consolidating two of its moneymaking acquisitions, yellow and another. that will put pressure on markets this year but eventually will recover it in a few years. you can see that pressure on alibaba's growth margins here particularly last quarter. , another line to watch is how much money alibaba is generating per user. here we are looking at revenue per active accounts, and you can see in the same time last year,
alibaba made $8.89 per account. that is the number to beat. we will continue to watch all of this and much more tomorrow morning. later tonight, i will speak to two alibaba cofounder for the latest results. coming up, how self driving cars have pushed the auto industry to its biggest year for m&a in a decade. we are exploring the autonomous driving the revolution next. this is bloomberg. ♪
it allows coaches instant feedback to things like this. bmw is not just helping in the pool, they are unveiling a new racing wheelchair for the paralympics. the self driving revolution is spurring a wave of consolidation. in the car supplier industry. in the last few years the total , value of deals has exceeded $74 billion. compare that to an average of $17.7 billion for the last 10 years. joining me to discuss the heavy traffic in auto deals, the head fort, a former startup racing. also a former racecar driver. what is driving all of these deals? ultimately, we know it is like computers on wheels, but that really is the case as we get more autonomous technology in think of what the future of cars will be. it really is a big computer. the components of cars are going
togo down from $40,000 $10,000, and it will and a lot of it will be replaced with software. for these companies that are in the technology, if it's not something that they are particularly adept at, they need to be able to consolidate with people who are ahead of the game so they can keep their footing as one of the largest suppliers. emily: what kinds of things are in demand? what kinds of things are companies buying? alex: it is all the -- here we are in silicon valley and this is the hub of it. it is the self driving technology and companies like tesla that are leaps and bounds ahead of everyone else. they are innovating and forging a path. right now it is money back to everybody. it is a little behind the eight ball trying to catch up because these are not technology companies at least to begin with. so they are looking to try a partner with all of these different technology companies that can provide that information and deliver them the
capabilities that they need to keep on pace with the transition. emily: give me some specifics -- camera sensors, traffic data -- are the the things in demand? area of the every car you can imagine has to be covered in cameras and sensors. it is the surroundings of the car and that nature, but also, the cars have to be able to speak to one another. in the future they have got to be able to talk to traffic lights. everything in one big network. you are looking deep into the future. we need things like traffic lights and all these things. there's so much happening, and you have to be so far ahead of the game. if you are not in it now by the time we start realizing that technology in our everyday life, if they are not 10 years ahead, then they have missed the bus. emily: we see more partnerships between silicon valley and
detroit? alex: absolutely. everyone is looking at silicon valley. going back to tesla, that is why they have such a head start. i think that is perhaps scary to the number of people who are automakers. you have gm who are taking it seriously. they have invested in lyft, things like that. they are one of the more wielding ones, long-range electric cars when that comes out with the volt, so they are certainly trying to take it seriously. but i do think you have this problem where you have big manufacturers that have done it a certain way for so long, and all of the sudden, the next five years, we will see more change than we have in the last 50. and that is where it is tricky to keep up. emily: we have been talking a lot about elon musk's vision for the future. do you believe in it? do you believe in a solar powered electric car? alex: you know what, i do. it is not just to believe in it, but you hear uber talking about rideshare -- everything is going
to be rideshare. ownership is going to die. i and my company don't believe that at all. it can complement each other, but elon musk's master plan part two was that if you own a car for the 90% of the time when you are not using it, that car can be leased out to the network and you can actually earn money , when that car is out there . the autonomous electric vehicle is out there picking up other actuallynd you can be banking half of that. i think that is the future. ownership will go down in price, insurance will not be as much because autonomous vehicles in theory should not crash. we will not have fuel prices, it will be electricity. there will be a set cost. but ownership should reduce cost the same way ridesharing will ultimately save people money. so i don't think it is going to kill ridesharing is going to kill ownership. i think we really agree with tesla's master plan, as they
like to call it, it will be a very different model of what ownership means. emily: all right, thank you. alex: online. selling cars online. emily: on the topic of car technology, smart cars and other internet connected products are the fastest growing part of the u.s. wireless industry, adding more than tablets and phones combined. for the carriers, the internet of things has become a major source of revenue growth when handset related businesses are weakening. at&t is adding connected cars at twice the pace of tablets. coming up, the hong kong bitcoin exchange resumes trading after a multimillion dollar hack. we will dig into what has been done to keep the currency exchanges safe. and later is the consumer , internet startup space getting saturated? where do investors see the seeds of opportunity. ♪
emily:emily: a story we are watching, tv executives are sounding the alarm about the overs by of content as netflix fuels another record year of production. netflix will make 500 original fromams, a 20% increase last year. netflix alone will make 71 of those shows, not even counting the growing number of kid series, movies and foreign-language programming. in a presentation to critics a , veteran fox executive warned we are ballooning into oversupply. i continue to believe there's a greater supply of tv than can be produced profitably. afterg now to bitcoin, this hong kong exchange was robbed after $71 million, trading on the platform has resumed. it brought back memories of a leading bitcoin exchange where stock investors blamed disruptions on technical issues and cyber attacks.
so what have we learned from the latest incident? joining me now is joseph lang. thank you so much for joining us. as i understand it, you lost money in this hack, and my right? joseph: i lost a few thousand dollars u.s. i have positions on all the exchanges. emily: so what exactly happened here? what went wrong? joseph: what went wrong as we are dealing with new technology. as with new technology, it's not as if we have been doing this for 50 years. and once you have new technology, then things will go wrong. it turns out that hackers found hole in it, and they stole one third of the money before anyone realized the money was gone. this is one of those things where we look back and see what
went wrong and what went right and how to fix it and make it better for next time. emily: investors losing 36% of their deposits. how is what happened here different than what happened with the other thing? joseph: the big difference is as far as anybody can tell, no one is covering anything up. as far as anyone can tell everyone is trying to be honest , and work this out. the only people that we know have done something wrong are the people that stole the money. right now what everybody is trying to do is, they are trying to work through the losses as best they can. emily: so one of the things that this has made clear is that it is hard to tell between a good bitcoin company and a bad one. would you agree with that? joseph: i would say this is just new technology. it is one of those things where you have to realize there are risks, and if you are not comfortable essentially rolling your own parachute, you should
be doing something else. i mean bitcoin is new , technology. it's like writing an airplane in riding an airplane in 1915. several decades from now it will be mature and safe, but right now it is really new technology. it's a good idea if you are really interested in the technology to find out as much about it, but you have to realize it is not something you want to put all your money in. emily: that said as technology , improves, don't hackers improve as well, and aren't some of them just always one step ahead? guest: it's not just about hackers. it is mostly about people and processes. what happens is that how hackers work and how the system works, we can improve our processes. now, one of the interesting things that has happened in this case, you have a major exchange that fell down. but bitcoin keeps on rolling along. that is interesting because if you look at 2008 when lehman
brothers went down, and we are still trying to recover from it. and the other thing that we are learning from this is all the major banks, they have been asked to explain what happens if they lose like 40% of their capital, and they can't. but we are in a situation where a major exchange has lost 40% of its capital, and we are going through a legal process by which reasonable things will happen. emily: so what can exchanges do to better improve themselves improve security? ,joseph: well, it is not a matter of just the exchange. it's a matter of the user. one of the important things is don't put any money on the , exchange that you are not actually exchanging. it is just easier to hold your bitcoin in a hardware wallet that you can control. the other thing you can do is money across different exchanges , that way if one exchange goes down, you do not suffer a total loss. emily: but is that a good
long-term plan? it sounds like stuffing money under your mattress. joseph: the problem with -- the good and the bad thing is nobody is going to get a government bailout. it is not government insured. you actually see the risks. if you understand the risks and if you can manage the risks yourself, it is a good ring to be in. but it is your responsibility to actually understand what's going on because it is not government insured. you are not going to get a bailout from the government if something goes wrong. emily: all right, joseph weighing, cheese -- wang, chief science manager at bitcoin research laboratory joining us from hong kong. coming up, the magic of early-stage investing -- we will hear from two veteran investors about how to spot the diamond in the rough. and if you like a bloomberg news, check us out on the radio on the bloomberg radio app, bloomberg.com and sirius xm. this is bloomberg. ♪
>> asian stocks have slipped from a one-year high, falling crude prices raise concern about global growth with japan holiday. energy stocks leading across the rest of the region. korean stocks down the first time in six days. rates in singapore following the most in a week. we have the latest policymaker to declare central banks are running out of ammunition. australian dollars at a one-year high today. they cut interest rates will record low 2%. he later said the bank has very limited influence over the exchange rate.
has set the highest rate in nearly a year after a shock evaluation went under global markets. analysts in the recent stability is coming out of cost. policymakers say this will bring up trade. yuan share of payments has dropped to a two-year low. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. that is the latest on the markets, asian stocks climbing in oil. heidi has the latest. deeplythese losses are in the session as crude prices weigh on sentiment. we have 3% decline in u.s. over that night. that has transferred in terms of risk here in asia. , given japan is on holiday for mountain day, that is contributing to the lack of momentum we are seeing.
for at the losses in sydney the deepest losses coming through the stocks in sydney, given this strong energy oil-producing as well as materials waiting right there. we also have the kospi korean koreandown 0.1%, the bank refraining from an additional rate cut. in terms of greater china, we have seen black spots here in hong kong, up 0.2%. they are seeing the sixth straight day on account of the stir we talked about earlier, potentially bad loans. china holding in the second quarter. taiwan seeing losses of 1%. we are seeing the significantly energy losses. and we had a rally on the back of that. -- malaysia isea the only miss of oil exporters.
the decline in oil hitting that. gold is there haven money going into that. either gold miners declining and the kiwi dollar surging over 1% and holding onto most of those gains at the moment. that is what we are seeing here in asia. ♪ emily: this is bloomberg west, i emily chang. amit is time for what we call series a, our weekly deep dive into tech investing in venture capital. we are looking at early-stage investing. we are talking early. i'm joined by two veteran investors. we have managing partner jeff clavier, known as a super angel, acting events from fit it. and a partner with xl, from slack and square space and spotify among others and of course the big investment in facebook, which you will go down
in history for. and i want to differentiate the name of this series is called series a but we are not necessarily talking about series a investing. you are focused on earlier stage investing and brian at xl, you do more series a investing, but that of all, you know, at early a stage how do you find , companies to invest in? are you chasing them, or are they chasing you? >> 90% come to us. we have a broad network of people, friends we have invested , with who say this is an interesting opportunity and they us typically the a e-mail. and then we look at it and we go throughl meet and the investment strategy. we see 3000 of those referrals. roughly 1200 to 1500. >> we will see five or 6000 a
year. we may invest and 25 or and a lot of them are coming through people we know. existing founders, other angel investors. ,hen we see stuff that series a we will see stuff that has already launched and has some attraction. we do a fair amount of reading to figure out what is going on. emily: and the size -- >> as far as we are concerned, it is $2 million or $3 million. a photo. it doesn't really matter for us unless -- and then our job for the 18, 24 months on the runway we give them is to get the companies to be series a ready. i can get into go to brian and say, here are the critical hires we have made here, the risk on the product, sales and marketing, and basically we have seen with all of those hurdles met, you guys should invest.
give us $8 million, $10 million term sheet. emily: so at what stage how do , you know? what are you looking for? are you looking for the people, are you looking for the idea, are you looking for the idea and the people? >> it is the unique and exceptional the founders are. what is the right passion that drives them to build this product, either sort of a hard science or something truly differentiated. we don't want to be like we are going to invest in the 10th version of whatever on-demand product or something -- name your favorite. we want to invest in large opportunities because of the -- if the company succeeds, which is hard we want to see a , path to $100 million in revenue. if you get there, you can go ipo. and then we will sort of look at, how this company can be held by softek's resources. is it really something we should
do or is it something we can really do much with? and then finally, is one of us going to spain -- going to say, i want to spend the next five or eight years to work with this team to build this story the way i did with it did? emily: what about you guys? it is similar. you are looking for markets that have some fundamental change rather is a unique opportunity for these teams to go out and do something different and has not done before. a lot of it comes back to a wine out thesis and unique insight the team has for not only is there an opportunity but is it the right folks to go after it. emily: when it comes to -- and i was speaking to market earlier this year, and he said the hardest thing to do is stay open-minded and not immediately think it's never going to work. have you do that? how do you make sure you are not pattern matching ideas?
brian: it is hard. a lot of the reality is about pattern matching. otherwise you get lost in all the noise. you have to filter through thousands of opportunities. narrow it down to one or two you might to do as an individual in a given year. there is also a lot of false positive data as well where you or your firm invest in a company recently that was poorly timed. were you backed the wrong team. you try not to overemphasize particular pieces of data that they not be relevant for any particular opportunity. emily: this term pattern matching is like a double-edged sword. it is used to describe what vcs do when they are investing in founders and not investing in women or not investing in minorities. how do you make sure you're not pattern matching when it comes to the people you are investing in? of ouralk about 30% founders from the most recent fund are female, so we are really happy with that. emily: is that something you actively tried to do?
are you actively thought, we need to get better at this? >> as an industry, we do need to get better at it. a very early, we have been just backing all sorts of female founders. considerable, reaching out to us. i have a female partner, and you have to work hard and show you are very open to those and that is true to minorities and we are nowhere near as accessible with minorities. we are trying to reach out and say, please come see us and pitch us out your ideas. and then you have to go through the same process. going back to the pattern matching, i call it the quick no. you would see something like a bed and breakfast and look at airbnb and say, this is insane. emily: nobody ever works on somebody else's pattern. >> it was like, this is just no. they are lawyers, they have
tried to meet with the team three times. finally the third time i said yes, it was already too late. ,you see, as brian said, so many companies that don't make sense and you have two move them out , as soon as possible, but you sometimes you see that team and you have this intellectual secretary of that he to say, no, but maybe i should spend more time. at the firm we have this notion of second pair of eyes meeting. there isn says i think something, spend half an hour with them and either they know, or tell me what you think. emily: what is your philosophy? brian: the term pattern matching gets thrown around a lot. emily: and all this gets go back to mark zuckerberg. everyone is looking for the next person. young if you look at a white male from an ivy league institution, that is a flawed approach.
if you have a pattern showing a person with a unique insight around the social interacting that has not been done historically where there is an opportunity for change given how the web has evolved. so we are trying to pattern that on how these people can take it back to their on personal experiences. we all grew up in different excerpts this is -- different circumstances. folks are able to reflect on the circumstances and identify opportunities at a lie -- that lie with the whole wide demographic. whereas someone who sits there , causes and says, i really want to company, no let me go find a good idea. that tends to be the opportunities that are more cookie-cutter or trying to be like it over. -- like uber. emily: once you invested at what , point do you want to see traction? at what point, you know is the
, pressure on? >> as far as we are concerned we , will invest in the founders with a couple of engineers with a product which is maybe already in alpha, early market validation, and we look at the market opportunity. sometimes, because you see for all types of companies, cheap to start and build up their products, you can actually get a little bit of -- you can prove there is a willingness to pay from a certain type of customers. so you do a little bit of data network, validation to make sure there is something there. for us, there's no real minimum hurdle -- if ever we get the revenue, that is the cherry on it. emily: wendy want to see revenue or cash flow positive? brian: it depends heavily on the business and what the opportunity is.
facebook as you mentioned earlier, they took a long time before they started monetizing their business but a lot of people built a unique audience and a unique way that was monetizable. whereas on the flip side, if you are selling tools and enterprises, you might want to see a willingness to pay earlier because not only does it demonstrate a revenue model, demonstrates they are committed to implementing your technology. some of it appends on the business they are going after, and some of it depends on the bar the founder sets. the more money they are spending it, the faster they raise, the more pressure they put on themselves. they are running quickly to a brick wall as opposed to teams that are more in experimental mode where the bar they set is, we are trying to figure this out. it might be a science project at this and we are going to try to point, figure out if there is a commercial application here. a lot of it is the expectation with your investors and your team and how do you live up to
emily: this is bloomberg that -- "bloomberg west and we are picking up series a. we have two people here. brian, you have had a couple of wins in the last few weeks. you invested in jet at xl, which just got bought by walmart. so first of all, what do you make of these huge acquisitions in the consumer space? brian: i think what is exciting
that you have these large companies with billions of dollars on the balance sheet and a great way to innovate is companies with a unique insight. they are not the traditional tack acquirers or the tech companies that will get acquired. starship hub was a largely great innovator when it comes to their approach of marketing and their business model around subscription, which had not been done previously. and a lot of investors looked at that and saw these guys are reselling razors you can already buy on amazon for less money, what is the opportunity here? they ended up holding a connection with their customers that was attractive to unilever. and then on the jet side, a lot of people in silicon valley looked at that companies and kind of scratched their heads, but jet is they are focused on , an audience that is not your typical amazon customer. there is a lot of people that store it first base on price first and convenience second.
emily: here is what i scratch my head about -- this is a barely one-year-old company that just got bought for $3.3 billion. how can it be worth that much? then: on a lot of times value is based in what the opportunity is with the acquirer. another example is facebook buying oculus. people might shake their head there or gm buying a company like cruise. if you are one of these businesses, for walmart, they getting threatened by amazon. their e-commerce growth has slowed in recent years. so instead of doing these smaller acquisitions which may not ultimately move the needle for business, they decide to bolderboulder move -- move and work for a company like jet which has a fresh brand that appeals to a younger demographic. emily: these are huge exits, not to take away from them at all, companies thatad
had big inventions. do you think m&a or ipo's would be the next exit strategy rather than -- >> the ipo market has been very challenging. on five ipo tech so far. so you are looking at what is going on in the actual market, bankers saying, you can move, you can go. there is pressure to go out in this environment where is it feels like there has been a lot of really awesome evan day, whether it is cultural or enterprise. -- m&a, whether it is cultural or enterprise. so you need to perform, look at the average performance of a lot of the ipo's. 2015, 2014they have been challenged. as a ceo, you look at a payback. the few hundred million dollars or more, personal versus [indiscernible]
i had a couple of my guys who say, well, i would rather m&a. emily: that is my next question. you also had a big thing with super tell and tencent. do you prefer companies go to the m&a route? you get a faster return and is more a search engine. ipo is expensive and takes a long time, you don't necessarily have control over what's going to happen. yeah, so for us we are really focused on building strong durable businesses. , facebook had several opportunities to sell early on , and we are very happy that they did not, they went the public path. having a public currency has helped them be aggressive with things like whatsapp and instagram. emily: what about light right now in this particular environment where we are not seeing ipo, the funding environment is tightening up and people are getting more picky? brian: as jeff mentioned earlier being a public company is a , really hard existence. if you have one bad quarter, it
can take a long time to get things back on track. and so, sometimes it depends on what is the setup for m&a? ,if you have a strong business and you are able to approach m&a from a position of power, a lot of the time you are setting up a relatively independent business under the umbrella of the acquirer. if you look at the founding teams of things like dollar shave and jet have, they are not going to be put in some office on the side of the route. they will have deciding roles in those companies going forward. at the end of the day, it is the founder's choice. it's hard to push someone down one path or another because acquirers can tell if someone doesn't want to be there. but if you are building strong, durable businesses, whether what you are going to get out this year in ipo or have m&a offers approach you are just keep growing the company and think about liquidity sometime down the road that's the kind of , flexibility we want our founders to have.
that is why a lot of companies have raised decent signed -- decent sized rounds. jeff: and the investors' infl uence on the founders, if this investor finds it interesting to sell, he will find them sort of executing, make the argument. but ultimately you will go with , him or her. likewise, if there's a greater theytunity to sell but want to continue, then they will do the same. it is our job to present the pros and cons and support and work with others. emily: jeff clavier, brian o'malley, we will talk about where you see the most promise in the consumer internet space. coming up, we'll have more with series a. ♪
last question, talking about the beenmer internet, you have heard that it is a consumer market, oversaturated, it is not the best time to start a consumer internet company. brian what do you think are the , hottest trends in consumer in a tent? -- internet? brian: it is like the 2005 2004, environment before the off.l really took a lot of people are scratching their heads about what is next. people are excited about vr and other things. the things i'm most focused on our underlying changes in demographics. you have got a lot of technology that is focused on your silicon valley tech crowd, and that's permeating much broader across the country. and you think about things like uber and what that has not to people not just from a consumer perspective but a new way of working, i think there is a lot of opportunity now that you have people across all kinds of
, urban, rural, now having access to smartphones and things they did not have five or 10 years ago. emily: jeff. jeff: we tried to apply consumer market place concepts to those changes and see how the supply demands dynamic really change. to see whereer this can really replicate. and then spending time in other consumer hardware opportunities. emily: like what? jeff: a company called molecule. they will change hundreds of billions of people that have disease or allergy, asthma. so i think this has the potential to be like fitbit, bigger than fitbit. a few others as well. emily: one was in vr. emily:all right, looking forward to finding out what that is. jeff clavier, brian o'malley, really appreciate the
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