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tv   Bloomberg West  Bloomberg  August 3, 2016 11:00pm-12:01am EDT

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mark: i am mark crumpton you're , watching "bloomberg west." let's begin with first word news. republican presidential nominee donald trump is in florida where he again sounded the alarm on iran. donald trump: iran is now in power, and they will have nuclear weapons much sooner than you think, and they have plenty of money, and they have plenty of everything now. mark: trump also ripped hillary clinton, telling supporters she should receive an award as the founder of islamic state. mike pence is breaking with mr. trump by endorsing paul ryan in his primary fight. the move comes after donald trump said in an interview, "he
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is not quite there yet when it comes to backing ryan who has been critical of trump." president obama is commuting sentences of 214 federal prisoners, including 67 serving life. it is the most in more than a century. almost all were serving time for nonviolent drug offenses. most will be released december 1. michael phelps, the most decorated athlete in olympic history will carry the american , flag for the opening ceremonies in rio. michael phelps is heading into his fifth olympics with 18 goals and 22 medals overall. global news 24 hours a day, powered by over 2600 journalists and analysts in more than 120 countries. i am mark crumpton and this is bloomberg. "bloomberg west" is next. ♪ emily: emily: i am emily chang,
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and this is "bloomberg west." coming up, a major miss for tech club, but investors do not care. shall we call it the elon musk effect? we will take you through all of the numbers. shares of square surge. what is propelling this mobile payment company. and we asked two top-tier vps about the appetite for risk amongst a gloomy, global outlook. plus, what they think about peter thiel backing donald trump. but first, to our lead, investors shrugging off the day quarterly miss from tesla. the electric car and battery maker posting a loss and share of $1.06 much wider than most analysts had estimated. sales rose 31% from a year ago but also missed estimates. tesla missed on deliveries the last two quarters, but is still on track to deliver 50,000 cars in the second half of the fiscal year. that and improving gross margin is encouraging tesla bulls after
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hours. joining us for more perspective, auto analyst and bloomberg do columnist in portland and cory johnson with me in the studio. would you call it the elon musk affect? >> there is a steve jobsians effect. people look at the future. today is the day we can look at what the company is doing. i think one of the interesting things we can do is look at the number of cars may have sold in the quarter or delivered in the quarter. they changed the numbers from of thekend release fourth of july holiday. they released them at a time where no one was there to see them. they changed the numbers a little bit. just a few more here and there. you can see that you see the terminal. number of deliveries. you can see the numbers coming down. in the fourth quarter, bunch of tax deals that expired at the end of last year. the fourth quarter is always bigger. the fact is the numbers are , coming down. when we look at a year-over-year basis, it is one way to look at it, it was the biggest european
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year. this is sequential. that is year-over-year. growth was still getting bigger until it is smaller and is worse. it is also sequentially as well when you see the decline in the sales quarter after quarter. the bottom line is that growth for this company and the number of cars they sell is not happening. they are selling fewer and fewer every quarter. talk about how many they they make they made 27% more cars , than they could sell over the last quarter. that is disconcerting when it comes to an operational efficiency standpoint. emily: and yet, shares are going strong after hours. investors seem to be pretty excited about these potential delivery numbers for the second half of the year. they did miss the last two quarters. do you believe it? cory: -- >> well look, i think this is a , company that if you really invested in it, you are investing in it for the long-term. that is why, for me, i tend to look more the fundamentals anyway. i don't think a miss or two will
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shake or even several in a row will really shake the people they need in the long-term vision as elon musk laid out. what is important is there is 18 months before model threes get to be delivered. i think that is the tipping if point. you believe in elon musk, that is what you are looking to to maintain your bullishness. when i look at what the company said in its releases today, and also the last quarter, the issue is not so much, did they make their guidance, did they hit analyst estimates, did they build credibility? they have 18 months of what the questions are going to continue to increase, even amongst people who really believe in the vision can execute it. like -- thinkngs things like sticking to the old number for the model three deposit, and they were asked about it on the call today. they did not give a new number. it screams credulity to believe
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that number has not changed and yet they have not given an , us update. for me, the real issue is credibility and i think the earning reports are an opportunity to become more transparent and build credibility in the company as it goes towards the model three launch, and that is the opportunity i think they are missing. emily: part of that big long-term vision is of course elon musk's master plan where he laid out for new vehicles, as in -- a semi- a pickup truck, a , small minibus. what we learn about the model x and how the newest model is actually selling? x sold a dozen more than the numbers from july, but they have not being gangbusters. this is the second full quarter this company has, really fantastic. it points to the issue of gross
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margins. the gross margins, the more cars s in full model production, model x in full production -- and yet the collapsing gross margins are a concern. you would think, the more they run the factory, the more efficiently they run the factory, and that would show itself in the gross margins. the gross margins are actually coming down, basically flat the last quarter, which is ok, but a lot worse than what they were. you can see the effect of the fact that they are not getting as many subsidies from the government. some of those have expired. if you look at the year-over-year change, you can see the climb and decline in decline. maybe that is getting a little bit better for these guys, but i think it is a concern that the pace of change in the gross margins is on the wrong side of change. emily: we have been listening in on the earnings call and musk has proposed a merger between tesla and solar cities. shareholders and regulators still have to approve that. he just said there was no reason for tesla and spacex, the other company that he runs to merge. ,investors who might have been
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worried about that can rest easy. he also spoke a little bit about autopilot cars, self driving cars. take a listen to what he had to say. elon: we estimate a truly enormous number of autonomous vehicles for there to be any demandaturation. basically the only car that anyone wants to buy. musk is sticking to this idea that the tesla autopiloted car could be the safest car on the planet. it is a very differing view from the self driving cars over at google, where they are focused on fully autonomous cars, and tesla is focused on sort of semi-autonomous cars where the driver can remain engaged. you know as we know, there was , that accident in florida where someone died. safety investigators are looking into that. do you think that was a one-off or could we see more issues to come? ed: yeah, i think google has
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made it very clear that they do not want to even mess with semi autonomous. they want to go to fully economist because the research that is out there shows that anytime there needs to be a transition between human control and the vehicle, autonomous control, is a very dangerous situation. essentially in that period the driver is impaired at the level of a drunk driver. so that is really dangerous. i think the tesla has created a lot of questions about the true capability of its autopilot in the way that it presented it, in the way that the media sort of took some of the things they said about it and ran with it. i think there are issues. we obviously still have to wait for the investigation to understand that whole situation better. emily: we are anxiously awaiting the results of that investigation. the bloomberg view columnist joining us portland. and editor at large cory johnson , with us as well. thank you both. coming up, square reporting better than expected second-quarter revenues.
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we will look at the numbers in the play vince -- payments company and the news it may expand its partnership with starbucks. plus, a billionaire entrepreneur who is making space history. and no, we are not talking about elon musk. richard branson or jeff bezos. it is an interview you do not want to miss. this is bloomberg. ♪
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mark: -- emily: turning back to tech earnings, shares of square popping 10% in extended trading. the payments company reporting a loss of shares but revenue beating analysts expectations. the company had an adjusted revenue of up 54% year-over-year $171 million, and increased its yearly outlook. gross payment was valium by $12.5 billion. what are investors reacting so
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positively to? we have selina wang of bloomberg news. what are they reacting positively to? >> the numbers were pretty good across the board. this was a very good quarter for square. you saw them raise forecast, they beat analyst estimates. not only did they grow their business, you mentioned gdp numbers and some of their with data and software lines. you saw that jump as well. that number is very important to analysts and investors because they see that high-margin as the futureness driver of growth for the company. emily: profitability has been jack's here.of how important a milestone is that? >> it is important because public markets have changed their perception.
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i think right now they are measuring them on true. it is inevitable at this emily: point. at are the big takeaways for you? you have watched the business launched newve business is like square capital, giving food delivery -- what is the real promise of square? keith: i think the market is beginning to appreciate the unique aspect of square. it is all across united states. small businesses. the only company in the planet that has more paying in small businesses is intuit. square over time turn these relationships with small .usinesses these businesses are already running the most important part of their business on square, and just add services. the pain of running a small business is still there, and there are plenty of opportunities to make life easier for people who are the sole providers or so business owners. emily: how does the delivery fit into the picture? keith: that is a good question. i am not going to it answer that. emily: what do you think?
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selina: something that both touched on was they had an increase in large businesses. this is very important, because it means their numbers get better, gdp increases. something that has been a concern of investors is there whole addressable market, the small businesses that need this payment processor. but the fact that larger businesses appreciate them as well, and as keith was mentioning earlier, they have this whole ecosystem. they integrate software and hardware, it shows that their total market is larger than what may be what had been previously thought. emily: they said they are working to extend the starbucks partnership. this has been a kind of controversial deal. some have disputed whether it was really a good business deal for square to get into bed with starbucks anyway. what do you think? keith: i think it had a lot of benefits. one is the increased reliability safety perception as square of
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the ecosystem. they had boosted in various other places in terms of brand. secondly, i think it was a shot to make square wallet successful, which turned out not to work, but there is no problem with a start up taking a risk. if it had worked, it would've made them a more valuable company. third of all, i think actually andthird of all, i think actually the process of serving a large customer is not paying -- now paying dividends. i saw the earnings call that's where is moving up market. there was a lot of product work that went into being able to serve starbucks, which will pay dividends to other customers. i noticed the margins are increasing and the revenue rate is also stable and slightly increasing even, though the customer segment is getting larger, so that is a promising sign. emily: a strong quarter quickly, it was a strong quarter for square capital. -- severaled 889
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million dollars in capital. up 123% year-over-year. this is a new business growth, but what more can we expect? selina: everybody is asking this , is the young company. there are a lot of different levers they can pull. are they going to extend their antiquary business like or are they going to look internationally? i asked this question to the cfo and she said, yes, you should be expecting more types of products that are going to help small businesses grow, and they're also looking at global expansion. there were rumors about the u.k. she is not commenting whether they are pushing their in the immediate future, but she says it is a very interesting markets , so i will be keeping my eyes on that. emily: keith, another question that always gets asked and probably will be asked quarter after quarter as jack dorsey leads square and twitter. obviously, you know how hard it is to run square. jack is under a lot of pressure at twitter. how long do you think he will continue to do this, and would you recommend it? keith: square is obviously performing well, up 80 metrics. emily: twitter is a different
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story. keith: twitter is a different story. i am not a user of twitter. i think twitter has got one or two problems. if they fix the adoption aspect, important, more impact on the world than facebook, snapshot, instagram combined. it is fundamentally, can you get new users on board that is easy , intuitive, does not feel like a chore? if not, twitter is like a quagmire, and they are not fun. we just witnessed it with yahoo! i think that is more of a drive -- more of a drag them square. square looks like it is finally firing on all cylinders now. emily: former ceo of square, you'll be with us for the second half of the show for our special series. selina wang also, thank you. be sure to tune in for my exclusive interview with the square cfo sarah frier. we will have the extended full interview at 3:00 p.m. pacific.
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up next, the billionaire entrepreneur who is making space history with the first private company cleared for a lunar mission. this is bloomberg. ♪
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emily: a milestone for space history. aviation officials have granted the private company permission first to leave earth's orbit and land on the moon. remember, we see spacex launches all the time, but knows nation -- company has gone above the international space station and landed. i started by asking this man of all the milestones he is aiming for which is most important? , >> going to the moon is least symbolic of what a small group of people and the dedicated entrepreneurs can achieve, so of course we are going to the moon and yes, it is a literal moonshot, but it really means is that the thing that could only
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be done by the superpowers, to imagine there were only three superpowers that have ever landed on the moon. no private company has ever done it. when we land, we are not the first company to ever do it, but we become the fourth superpower. to me, that is more than anything else. that shows and inspires people to say, if the man who grew up poor in india can come to this country and achieve the big things of landing on the moon, what is my moonshot? emily: you have your eyes on elon musk, don't you? >> elon musk is still doing suborbital's, but we love him. when you go down, leaving the earth, orbiting and going beyond that and become the first company ever to do so, so what we are announcing today is actually is really interesting. we became the first company and the only company ever to have received the permission to leave earth's orbit. so think about that. people think everybody is going
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to space. what they do not realize is everybody is coming to a space station. that is the lower part of it. we will become the first company to ever leave earth's orbit as a private company. emily: give me the timeline here. what do you plan to do once you get there? >> we plan to go next year, the second half of next year is when we plan to go to the moon. it will be sometime i would say fall of next year. we are starting to look for the minerals on the moon. whether it is looking for the platinum grade material, the rarest elements or looking for helium three. helium three is the best resource for clean energy. the small quantity of helium three could power the planet for billions of years. emily: why is it important for space exploration and the future of humanity? become ae if you multi-planetary society, you have to learn to live off of the planet. if you if you want to go to mars like elon musk wants to do the best place to get your , training is living on the
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moon. because once you learn to live off of the planet, you have to learn how to live without all of the facilities we have, in radiation. all of the structures we have here. and once that, you can go beyond the moon to mars. we know there is plenty of water on the moon, so what if we can take the water and hydrogen and oxygen and that becomes feel for -- fuel for the rocket and fuel for humanity? emily: do you want to start a colony on the moon? >> i really want to learn to live off the planet, live on the moon create a colony on the moon , and that becomes the basis for , us to live on mars. more than that, we also want to create and reduce the cost of going to space, and one way to do that is getting all of the fuel from earth, what if we had a fuel depot on the earth orbit and a fuel depot on the moon orbit see you do not have all of the fuel you need to get to mars. you can refuel on the way. emily: you are planning to send robots first, but you do plan to
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send humans? when do you plan to do that? >> we initially went to send a robot. think about what we are doing as opposed to building a self driving car. there is no gps on the moon, so we are building a spacecraft capable of landing and doing everything on the moon. obviously, the next 10 to 15 years, we will be able to send a human to the moon. emily: tell me about how you went about getting government approval for this? >> there was never a government agency that was dedicated to granting an approval because nobody has ever asked. or ever imagine anyone would do this. emily: you are saying yes because nobody ever asked? >> no every department was going , to say no but nobody could say yes. so ultimately we had to go to the white house which called a meeting of all of the departments and essentially found a solution, and they gave us an exception because we are the only company asking for it. they say look based on all of , the things that we want you to follow, you actually followed to the guidelines and we want to give you one time approval.
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in the meantime, we are going to figure out what happens next. emily: do you think you can get to other planets? >> absolutely. there is no doubt in my mind. the moon is just a stepping stone to mars and beyond. emily: sounds pretty convincing. moon express cofounder. walmart is interested in the deal would give walmart e-commerce efforts a much-needed chilled as it goes beyond brick-and-mortar to take on amazon. it may result in a strategic investment as opposed to a complete acquisition. according to a bloomberg source. more m&a news time warner has a , 10% stake in hulu. the immediate company paid a hundred $83 million -- media company paid $583 million for the share. they face increasing pressure. shares of time warner rose 3% at one point, its biggest gain. they want to have an online channel for old films. shares rose 3%, the biggest gain
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since coming up, is this the may. right time to back consumer internet startups? we will cover a lot of ground with two venture capitalists next from the changing appetite for big risks to peter thiel ♪ backing trump. ♪ [hip hop beat]
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♪olympics 2016, let me get you on my level. ♪ so you never miss a moment, ♪ ♪miss a minute, miss a medal. ♪ ♪ why settle when you can have it all? ♪ ♪soccer to wrestling. track and field to basketball. ♪ fencing to cycling. diving to balance beam. ♪ ♪all you have to sa♪ ♪ is, "show me," and boom it's on the screen♪ ♪ from the bottom of the mat, ♪ ♪ to the couch where you at? ♪ ♪ show me the latest medal count♪ ♪xfinity's where it's at. ♪ welcome to it all. comcast nbcuniversal is proud to bring you coverage of the rio olympic games.
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>> top stories this hour, asian stocks holding advances on a rebound since the worst day of advancest vote as oil $41 in new york. stocks in japan negative after the lunch break. they strengthened on inflation comments from the government and boj. the aussie dollar higher. the boj's deputy governor has dropped hints about what the policy review has next month. it is not clear when the new inflation target will be reached. and the economy minister says canstrengthening economics deliver 1.5% for the middle of next year.
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after a decade of wrangling, india's upper hill has passed a national sales tax to bring a single market and replace a dozen levees. it is the biggest legislative victory for prime minister modi since 2014. it has to be endorsed by the lower house and endorsed by half of the state. global news 24 hours a day, powered by 2600 journalists and analysts in more than 120 countries. let's go to the latest. time inor the first three days, mostly green on the except for japan and shanghai. we are seeing gains. i will get to japan in just a moment. this is coming off of three days of losses as well. the stakes, look at emerging markets. that seems to be or continues to be outperform her. when you look at the likes of
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taiwan, south korea, indonesia. we are looking at how india trades later on. cb -- lifting the overall index. counting for more than half of the gains in hong kong. japan could focus down midmorning from the deputy governor of the boj, driving dollar-yen lower. it reached 1-1 level earlier. they managed to retrace some of that. the yield is doing this. i will talk about bond in just a moment. the topics up 1.4%. a little bit of a rebound in the afternoon session. the bond space doing this, yield on the way up. just keep your eye on what is happening in australia. still very sharp up there. and the big story that we are
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following is the reaction we will see when markets open up. ", 6686.k at the emily: this is "bloomberg west." i am emily chang. it is time for series a, where we look at themes in tech investors. we have the owner of coastal investments and strike. he has him listed -- invested in youtube and airbnb. also jeff lewis, partner of founders fund, whose portfolio includes lyft, new bank and has been a pioneering investor in efforts to legalize marijuana. i want to start with politics. on wednesday, hp enterprise eeo
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meg whitman announced her support for hillary clinton. despite running for governor of california as a republican in 2010, she said, this year is different. to vote republican out of party loyalty alone would be to endorse a candidacy that i believe has exploited anger, grievance xenophobia and racial , division. donald trump's demagoguery has undermined the fabric of our national character. her comments come on the heels of a national convention where peter thiel took to the stage to endorse republican presidential nominee donald trump. take a listen. >> i do not pretend to agree with every plank in our party's platform but state culture wars us from ouract economic decline. and nobody in this race is being honest about it except donald trump. emily: he is one of the original founders of founders fund. and jeff, you worked alongside peter any years. it know him all the way back to paypal and stanford university.
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let's start with you. do you agree with his support of trump? what do you think? >> first of all, i have immense respect for peter as a friend. not only the cal league but as it -- colleague but a friend. concurrently, i personally have a different view. i am very strongly against trump as a person. i think he is not fit for the presidency. i think that he lacks basic human decency, and i want to be crystal clear that personally, i am very strongly against trump. that said, one of the things i think makes us a really good team at founders fund is we have diversity of thought. we have people with a lot of perspective on a wide range of issues. we have really good debates, and sometimes we net out in different places. that is what makes us good investors, i think. emily: you have been tweeting up a storm about this election. do you agree with peter's position here, and you understand it. >> i understand it. if you believe the status quo is not acceptable voting for , hillary clinton is not going
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to fix it. that said, i believe donald trump is a sociopath. it is hard to imagine voting for a social path as president of the united states. if trump was the ceo of any of our companies, we would probably fire him. it is hard to vote for someone that you would fire if they were a ceo. and you were on the board. emily: have you had conversations with peter about this? geoff: yes, but we will not share it. as a colleague and friend, i would not share personal conversations i have had with folks. i think they're somewhat striking about the silicon valley monoculture where you have someone who has a different opinion, and like it is so different from everyone else, everyone agrees with that. you can think something different, it is hard to do now. this is a specific position i have a different view on. i am very strongly against trump, but i think politics is personal. people have a right to have positions. emily: we heard from meg whitman and you have more than 100
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people that signed a letter calling for donald trump as a disaster for innovation and , people have speculated that he could lose entrepreneurs because of this. what do you think? keith: >> i think that letter was signed mostly by democrats. i think 100% people on that letter voted for obama. i think is ridiculous to call trump a disaster. globalization was this conventional view that everything was becoming increasingly globalized over the past 15 years, and that may not be true. we might be like anti-globalizing. that may lead to a lot of investments and a lot of trades that are very interesting. i think that may be driving some of peter's perspective as well , and he will probably be proven right on the substantive part of that argument. emily: jeff, do you wonder -- worry about founders fund losing its ideals? geoff: i think an analogy, if you are someone that works for a public company and you are sort , of concerned about these
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things you would have to , research what everything to one of your investors in your public company thinks politically. so because -- i think an entrepreneur that would not want to work with founders fund is probably not an entrepreneur we get from an investment standpoint. that would be my intuition. emily: do you guys agree that to the point of that the decline of america is real? do you think america is on the decline? keith: i think there is not enough growth in the united states. there is a lot of vulnerability to terrorism. i think violence is increasing. i think there is a lot of bad signals. i think it can be turned into an advantage, and america can be the shining city on the hill , but i don't think trump is the right person to do it. i do not think the status quo is any better. i think hillary clinton will lead to an unmitigated disaster in silicon valley. emily: what does that mean for for, what does that mean silicon valley? what does it mean for innovation? keith: let's just cancel the
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election. [laughter] emily: that is not going to happen. geoff: there is no question this has been a uniquely insane and scary number of months in the united states and also globally, and i think to not acknowledge that fact, to ignore it and pretend everything is ok would be sort of really, really crazy. you have to acknowledge things are really deeply off. the part of peter's rnc speech that did really doesn't a with me was when he talked about technological stagnation. not only in the u.s. but also globally. we are focused on this day in and day out, trying to back founders that are trying to do new things using technology . they are going to solve some of the really big problems we have here in the u.s. and hopefully around the world. not every problem, but some problems, and i think you can do that from technology. emily: how is this impacting your investing? are you changing your strategy because of this crazy macro economic environment we are dealing with right now? keith: i would distinguish
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investor capital from growth capital. we invest in series a rounds, series b rounds. for yearscompanies away for maturity. it does not matter what the current environment is for these countries. i don't think it matters how we invest in any material way. emily: what about you? geoff: i would say that different partners on this team had different strategies. my partner, an incredible investor -- emily: multibillion-dollar -- geoff: the company is literally working to cure cancer, and brian's view is all that matters is the micro. he is a micro investor. he is focused on the company. my own personal view is there is , some combination of micro and macro. there is some really long time in things, and biotechnology breaks through for you can withstand crazy macro cycles. we have invested in spacex, proven that out. i do think that the macro volatility prevents these
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one-time opportunities to really do interesting things, so we invest in airbnb in 2012. that was a time when consumer net was out of fashion. groupon had blown up somewhat. it was a one-time opportunity where you can actually make contrary and investments based on the macro. emily: consumer internet seems to be out of fashion but you do not believe that is true and we are going to talk about that next. jeff lewis of founders fund, keith we will be right back. , we are going to dive into your higher risk investing strategy next. this is bloomberg. ♪
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emily: welcome back to "bloomberg west." and our tech weekly investing roundtable, series a.
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i am here with founders fund. i want to start by talking about your investing philosophies because there is this idea, the black swan theory he is talking about, where you invest in things that have an extremely high risk of failure but also if they succeed, a high risk chance of saving or changing the world. how would you describe your philosophy? keith: >> my philosophy is more micro. i believe it is the right founder with the right product at the right time, so i'm looking for a very specific idea, specific founder, and the combination leads me to personally invest. just like jeff mentioned, we have different views on this. he is looking for specific instantiations of that. for example, five or six years ago, he predicted health care would be more about math than biology in the future. if your son or daughter wanted to be a doctor, they would be better off learning statistics calculus and math computer science rather than biology and
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chemistry, which is radical, but it is starting to play out. i have become a fan of that review and have made several investments along that basis. but the reason i made that is the right founder walked in with the right background in the right product and i said, yes, this makes sense. emily: founders fund motto is, we wanted flying cars, we got 140 characters. you guys make big risks and take big bets. how would you compare your philosophy? geoff: i think we want things that are going to lead to radical breakthroughs of the world and we are willing on our , end to back the truck up with things like airbnb, spacex. reinvested north of $300 million on stem sex. -- stem max. we tend to be pretty agnostic on the areas where we will find those things. the collection of people we have on our team are really of different backgrounds. we added someone who is
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interested in film and technology and media. we have scott nolan, and early employee of spacex. we have brian, kent, very diverse team of people so we are , open to doing anything, and we think the only role to finding these incredible breakthrough companies is you can really have no rules. emily: does brexit change anything for you guys globally? keith: i don't think so. geoff: i don't think it changes anything for us as investors. on brexit, it is too early to know what the effects would be. emily: here in silicon valley, we are following this story very closely, what is going on with evaluations. do stories like that change the appetite for risk or you see -- at all, where you see this sort of spectacular implosion of a company that had so much potential? keith: i am sure they change it for other people. not for us though. we tend to be pretty focused on our own. internal debates, through the
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investment team meetings, we have a lot of things we are thinking about internally, what is happening externally. we try not to get overlie -- overly distracted on that. viewing more risk with diversity but people areviewing more risk with diversity today. emily: i know you are close with david fax who has been pushing back on this idea that you are -- zenefits and theranos are in the same boat. are there any lessons? keith: i think that we similarly try to be as lack of consensus and lack of derivative from other people's views when making investment decisions. if you follow other people's views, you will return the same yield, which are very mediocre. see you cannot get trapped into what other people think. it is very dangerous and seductive. that said, where risk is basically priced out of a lot of rounds for the last three or four years, we are effectively people applying a risk discount , to the evaluations they were offering companies, it is hard to compete in an environment so far you as you have the same
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view about a company where no one is applying or many other people are not applying risk discounts. that has come back to normal. there are more risk discounts. they are applied to most rounds, so i think where we are interested for our own reasons in a company i think our offer is pretty competitive where two years ago it might have been 50% less than what people were willing to pay. emily: you tweeted, now is a great time to start a consumer internet company. i think some people might say we are past that. why now? geoff: you want to avoid buzzwords. i think people's words are, ai, machine learning, a range of buzzwords. we invested in ai second 2011. we led the first investment in e line. i think things not being done are things on the consumer side, the dollar shave club got acquired. the companies eating big portions of incumbent businesses. you have things like pokemon go, that is not a startup, but that is something that really captured a lot of imagination.
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i think there is still a lot of big on mind areas in consumer -- unmined areas in consumer internet. emily: we just saw the china business of didi waiting to white flight. it is struggling to gain market share in the united states. what happens to lyft? geoff: we were the first folks that once they switched, they had a lot more money and focused on black cars at the time -- that story is true at the time. they have always been bigger and had more money, and lyft was underestimated every step of the way. they have had a great july and they have been consistently underestimated, and we are proud to invest in them. emily: does lyft get bigger? keith. keith: i invested back when it was a zoom ride. i think lyft should be a sustained, independent business. i think that they have grown while uber was distracted. forayswith international that did not work out well.
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i think lyft has been able to sneak up on uber and has a 50% market share in san francisco. just auditing my friends and looking out at the available services. lyft is pretty permanent. so i think emily: all right. i am going to quote you on that. founders fund. we'll be right back after this break. we will what you guys think of the areas that are most disruptive innovation are. also on bloomberg do not miss , bank of america ceo on the low rate environment among other things at 7:00 a.m. new york time. this is bloomberg. ♪
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emily: welcome back to "bloomberg west" and our weekly investing roundtable, series a. peter thiel has given us so much material that i have to bring the conversation back to him. nick denton filed for personal bankruptcy. i am curious what you think of his decision to back lawsuits
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against gawker? i mean, suing has had a very devastating result on the company and the people involved. of one factor that cannot be ignored is the fact that a judge in a jury are deciding a fate of gawker, and the journalists that were -- on elected journalist -- alleged it journalists, that were involved here. i personally, i do not know how people can defend folks who post revenge corn -- porn for clicks. that is not my value system and i do not view those people as real journalist. emily: what about the freedom of the press? geoff: absolutely vital. i think we would all say that freedom of speech is critical and vital. i don't think this poses risk to that at all. publickeith has been about his support of peter. what do you think? keith: i used to be a litigator and i do not believe in the , general idea of funding other people's losses.
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as far as it is permitted and authorized and well used i think , other people should use it to pursue whatever they want to and if the law works, it works for everybody. fundamentally i do not think , there is any threat to the freedom of the press based on this decision in florida. accountability has always been a part of the freedom of the press. it has always been a line and rules about what triggers the vitality of the media? there has always been rules. i have even done bible reading back in the day. the idea that this is some novel or new thing is just ridiculous. emily: so you know ironically, , the story ran in gawker and other publications but that peter is interested in blood transfusions from younger people to prevent aging, and then wonder, people make fun of it, but it is also exciting if it is possible. do you think that silicon valley and humanity needs radical iconoclasts like peter? geoff: i think humanity needs people who are willing to have original thoughts and do things that other people are not willing to do.
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i do not know anything about the para biosis stuff. people like that are vital and they are rare. keith: i agree. there is a study from 1954 at harvard taking mice, taking blood from young mice and mixing it with blood from old mice. there is a lot of precedent. this is not as crazy -- there is a book called "living gracefully" or something by a reputable doctor that cites the whole history of the research. there is actually raw science that could give insight into diseases andous aging which are painful on them and their family. you can satirize this stuff, but this is how you get breakthroughs. the caustic joke about like this is resigned to be opposed product, but if it comes with a solution, this may be one of those cases. emily: last question, you have 30 seconds. which areas do you think are most right for truly disruptive, flying car, black swan innovation?
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jeff. geoff: i am personally interested in mental health. it is a huge problem. there was a lot on the therapy side that can be done. i think it is very important. keith: i am interested in life extension. i think with current science it is possible to extend most people was he lives by 10 to 15 years. if you want to go 20 or 50 years, that is breakthrough, science-fiction stuff. 10 to 15 years is on the horizon now. i am looking for founders, startups, critical research to take to market. similarly, i believe in health care. if you use it now, you can continue the data is digitalized. that is the first fundamental precept, so i think how terrible -- health care is going to be improved for most people. emily: i hope that works out. thank you guys so much. we could do this for hours. i really appreciate you stopping by. geoff: thank you. emily: that does it for this edition of "bloomberg west." off the back of the earnings
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report do not miss our exclusive , conversation with square cfo sarah frier tomorrow. that is all for now from san francisco. this is bloomberg. ♪
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>> oil extends his rebound as the biggest fall in u.s. gasoline reserves trims the global night -- glut. rishaad: the worst airplane crash in the 30 year history of emirates. it is still not known what caused the airplane crash. the turkish lira tumbles. rishaad:


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