Reddit's IPO, Bitcoin's Rise, and SVB's Collapse
Summary
TLDRThis Bloomberg Technology episode covers a range of topics, including the latest on Reddit's IPO, Bitcoin's surge past $72,000, and the impact of Silicon Valley Bank's collapse on the VC ecosystem. The show also features an interview with Vinod Khosla, discussing the state of OpenAI amidst recent controversies and his views on the venture community's response to crises. Additionally, the episode touches on the performance of tech stocks and the significance of the Oscars for streaming platforms.
Takeaways
- 📉 Nasdaq experiences a slight sell-off following Friday's trend, with inflationary pressures from the CPI being a key concern.
- 🚀 Bitcoin surpasses $72,000 for the first time, continuing its rally as a digital currency.
- 🌐 Chinese stocks in the US see a small recovery, with the Golden Dragon index up 2.6%.
- 💡 The UK looks favorably on Bitcoin ETNs, with Bitcoin reaching a new record high.
- 📈 Coinbase shares rise 4.3%, trading at its highest level since 2021 due to the Bitcoin rally.
- 📚 Reddit's IPO is on the horizon, with an amended S-1 filed and a valuation around $6.4 billion discussed.
- 🤖 Covariant, an AI robotics company, announces a new robotics foundation model that gives robots human-like reasoning abilities.
- 💼 Vinod Khosla reflects on the collapse of Silicon Valley Bank and its minimal impact on the tech and startup community.
- 🏆 Oscars 2024 sees traditional film studios dominate, with streamers like Netflix and Apple having a lackluster showing.
- 🌐 The London Stock Exchange is set to accept applications for ETNs backed by Bitcoin or Ethereum, marking a significant change for the European market.
Q & A
What significant event is Reddit associated with in the technology news?
-Reddit is raising nearly $750 million for its public offering, with an IPO that values the company at about $6.4 billion.
What is the current status of Bitcoin in terms of its value?
-Bitcoin has surpassed $72,000 for the first time, continuing its rally.
Who is joining the show to discuss Bitcoin's new record?
-Ophelia Sneider of 21 shares is joining the show to discuss Bitcoin's new record value.
What is the impact of the collapse of Silicon Valley Bank on the venture capital ecosystem?
-The collapse of Silicon Valley Bank led to a minimal net result, with people moving on to other banking sources and the valley adjusting to the changes.
What is Vinod Khosla's stance on Elon Musk's lawsuit against OpenAI?
-Vinod Khosla believes Elon Musk is wrong, citing that Musk reneged on his commitment to fund OpenAI and that the lawsuit is not the right way to compete.
How does the script address the topic of AI and its development?
-The script discusses AI development in the context of OpenAI, its funding, and the importance of not slowing down AI progress for the benefit of humanity.
What is the significance of the new robotics foundation model announced by Covariant?
-The new robotics foundation model allows robots to have a human-like ability to reason, understand language, and the physical world, marking a significant advancement in AI robotics.
How is the performance of tech stocks in the Nasdaq 100?
-The performance of tech stocks in the Nasdaq 100 is mixed, with some experiencing losses and others, like Moderna, leading the charge with significant gains.
What is the current state of access to working capital for startups?
-Access to working capital for startups depends on the area they are in, with AI startups having more access due to high demand and interest from investors.
What is the significance of the Oscars for streamers like Netflix and Apple?
-The Oscars are significant for streamers as they provide recognition and prestige, but in the most recent ceremony, Netflix only won one award, and Apple received none, indicating a lackluster showing for the streamers.
What is the reaction of the venture community to the Silicon Valley Bank collapse?
-Vinod Khosla was disappointed with the venture community's reaction, as he believes they did not support their portfolio companies as expected during the crisis.
What is the role of security research in AI development?
-Security research should be part of what every university and government funds to ensure the safe and responsible development of AI technologies.
Outlines
📺 Introduction to Bloomberg Technology
The script begins with an introduction to the Bloomberg Technology show, hosted by Caroline Hyde and Ed Ludlow. They discuss upcoming topics, including the latest on Reddit's IPO, Bitcoin's surge past $72,000, and an interview with venture capitalist Vinod Khosla. They also touch on the public markets' reaction to tech names and the anticipation of CPI data.
📈 Market Discussion and Reddit IPO
The hosts delve into the market trends, highlighting the performance of the Nasdaq and the Golden Dragon index. They discuss the Reddit IPO, its pricing, and the potential impact on trading, especially considering the platform's user base and recent memos sent to Redditors. The conversation also includes a look at other tech IPOs expected to follow Reddit's lead.
💰 Bitcoin's Record High and Institutional Adoption
The segment focuses on Bitcoin's new record high and the increasing institutional adoption of cryptocurrencies. The discussion involves the impact of ETF flows on Bitcoin's market structure and the shift in trading focus towards the US. The interview with Ophelia Snider of 21 shares provides insights into the European market's stance on crypto and the company's expansion plans.
🤖 Advancements in Robotics with Covariant
Co-founder and CEO of Covariant, Peter Chen, discusses the company's new robotics foundation model, which aims to give robots human-like reasoning abilities. The conversation covers the importance of diverse data sets for training AI in the physical world and the applications of Covariant's technology in various industries, including retail and logistics.
🏦 Silicon Valley Bank Collapse: One Year Later
Venture capitalist Vinod Khosla reflects on the aftermath of Silicon Valley Bank's collapse one year ago. He shares his perspective on the minimal net result of the event, the adjustment of the Valley, and the emergence of alternative banking services. Khosla also discusses the lessons learned from the crisis and the venture community's response.
💡 OpenAI Lawsuit and the Future of AI
Vinod Khosla shares his views on the recent lawsuit against OpenAI, involving Elon Musk. Khosla argues against Musk's claims, highlighting OpenAI's need for a for-profit structure to fund its extensive R&D. The discussion also touches on the importance of AI development, the role of Microsoft in OpenAI, and concerns about the pace of AGI development.
🎥 Oscars and Streamers' Performance
The script concludes with a discussion on the Oscars and the performance of streaming platforms. Netflix's limited success, with only one award, and Apple's lack of recognition are noted. The conversation contrasts this with the achievements of traditional studios and the impact of the event on public discourse.
Mindmap
Keywords
💡Silicon Valley
💡Reddit IPO
💡Bitcoin
💡Venture Capitalist
💡Inflation
💡Cryptocurrency
💡Open AI
💡S-1 Filing
💡Nasdaq
💡ETFs
💡Artificial Intelligence (AI)
Highlights
Reddit IPO is raising nearly $750 million for its public offering.
Bitcoin tops $72,000 for the first time as the digital currency continues its rally.
Venture capitalist Vinod Khosla joins the discussion on the collapse of Silicon Valley Bank and Open AI.
Global markets are showing signs of bottom picking, especially in China with the Golden Dragon index up 2.6%.
U.K. is looking favorably on some Bitcoin ETNs, with Bitcoin at $72,000.
Crypto related stocks are moving higher, with Coinbase up 4.3%.
Reddit's S-1 filing reveals a valuation of about $6.4 billion on a diluted basis.
There's a discussion around whether the 8% of shares offered in the Reddit IPO to investors, employees, and existing shareholders will impact trading.
The London Stock Exchange will accept applications for ETNs backed by Bitcoin or Ether.
TSMC, the Taiwanese semiconductor company, has eclipsed Broadcom in overall market capitalization.
Ophelia Sneider of 21 shares discusses the institutional adoption of Bitcoin in the US and its impact on market structure.
Covariance, an AI robotics company, announces a new robotics foundation model that gives robots human-like reasoning abilities.
Vinod Khosla shares his thoughts on the state of Silicon Valley Bank a year after its collapse and its implications for the VC ecosystem.
Open AI's shift to a for-profit model is a survival strategy, as open-sourcing state-of-the-art technology does not make economic sense.
Elon Musk's lawsuit against Open AI is seen as an attempt to control the organization, which Vinod Khosla disagrees with.
The new board of Open AI is announced, with a focus on benefiting humanity and a structure similar to other non-profit and for-profit entities.
The pace of AGI development is uncontrollable, but security research should be funded by universities and governments.
Apple is set to open its eighth store in Shanghai, despite slowing iPhone sales in China.
TikTok faces potential forced sale to US owners under a bill being voted on in the House.
The US may tighten controls on China's access to sophisticated semiconductor technologies.
Streamers like Netflix and Apple had a lackluster showing at the Oscars, with traditional studios dominating the awards.
Transcripts
From the hardware, innovation, money and power collide in Silicon Valley and
beyond. This is Bloomberg Technology with
Caroline Hyde and Ed Ludlow.
I'm Caroline Hyde at Bloomberg's world headquarters in New York.
And I'm ed Ludlow in san francisco. This is Bloomberg Technology.
Coming up, we'll bring you the latest details on that Reddit IPO as the social
media company is raising nearly a $750 million for its public offering.
Plus, Bitcoin tops $72,000 for the first time as the digital currency continues
its rally. Ophelia Sneider of 21 shares joins us to
discuss. And later this hour, we'll be joined by
venture capitalist Vinod Khosla to talk one year since the collapse of Silicon
Valley Bank and of course his thoughts on open AI and so much more.
But now let's turn our attention to the public markets and look a little bit of
caution still surrounding these tech names.
We sold off on Friday. We continue that into Monday as we eye
big macro points from the CPI, from the CPI, basically, where is inflationary
pressure taking us? Well down only by about a 10th of a
percent on the Nasdaq. And I'm looking at a ten year yield up
only some two basis points now. So we're just fading some of that
initial sell off, but still carry over from Friday.
Interesting that globally speaking, we're seeing a little bit of bottom
picking happening in China at last, at least it seems, after we wrap up the
focus on the overall party and indeed the future of the economic trajectory of
China. We're up about 2.6% on those Chinese
traded names here in the US. That's the Golden Dragon index I look
at. Let's have a look at what's happening in
the area that just moves apart from the risk concern that we see in the equity
market and continues to pile up power ever higher.
Ed, we'll dig into why the U.K. is looking more favorably on some spot
Bitcoin. ETNs.
I'm looking at 3.9% higher on Bitcoin 72,000 eclipse today.
What we've got on the micro well, unsurprisingly, in the equity space, you
do see crypto related stocks moving higher.
Coinbase kind of the main ones up 4.3%. I think at one point in the session
trading at its highest level since 2021, its year to date gain now beyond 50%.
That often happens right when rallies in Bitcoin continue.
So did the crypto related equities side. The story matter to the downside.
Biggest drag on the Nasdaq 100. There's no kind of clear news headline
out there, but I would note that Trump This morning, former President Trump
reiterated his comments that a ban on TikTok is bad because it would benefit
matter and he thinks matter is bad. I'm not drawing a causal link between
the move and that narrative, but it's the only thing really that's out there.
The top story is about a name that will soon be publicly traded, and that is
Reddit. We got the amended S-1, and this is what
it looks like, 22 million shares in the upper end of the range, $34 a share in
terms of the pricing. And if you take it on a diluted basis,
the valuation about $6.4 billion. It's interesting to go through the S-1.
It's kind of as much about what you learn on the company and what you don't
some of the stuff that's missing. But we've been waiting for this one
since 2021 when they file confidentially and they kind of missed what was a
banner year then the US IPO's. Have they got the timing right now.
Key question is perhaps we come off the boil a little bit when we look at the
tech names as of late. Bloomberg's Ryan Gould joins us for more
on all of this. Ed and Ron, what did you learn from the
filing? And as Ed insinuates, what do you feel
was really left out? I think there was a little bit left,
sort of a little bit of a question mark around, you know, exactly how much how
much is going to be offered. I think there was some question as to
whether or not there would be more. And I think, you know, Ed is drawing
attention to the valuation discrepancy. I think, you know, there have been some
calls that I've had this morning. Is it 5.4?
Is it 6.4? I think that is a that is a valid
question. Obviously, on a fully diluted basis, it
does extend as much as $6.4 billion. But you remember we wrote that, you
know, early testing the waters meeting said that they should target sort of 5
billion as a as a as a minimum. And I think, you know, that's sort of in
the ballpark of the days that they've gone to.
But what I do think is interesting from the filing is that, you know, this 8%
that is going to you know, they're saying we say investors, it's their
employees, it's some of their existing shareholders.
And also, you know, the fact that a lot of those shares aren't going to be
locked up. So come tomorrow, if there's a pop, you
could you could be selling these shares. If you are if you feel so inclined
and not only sort of what we would call insiders staff, but if you're a redditor
or a moderator on the platform, you can get access to the shares, too.
And Ryan, you and I were talking the other day, right when they sent out that
memos, Redditors, their pitch was basically like, hey, you can get in on
the IPO at the same level as the Wall Street institutional investor.
Look how fantastic this access is. How big a factor, though, if it's just
8% of shares and that there's no lock down or lock on them, how do you think
that's going to impact trading in the day?
And I think I'd put this in the sort of the ballpark of curious, just not least
because, you know, there is this campaign on Reddit itself around, you
know, amongst the Wallstreetbets crowd around shorting the stock on the open
tomorrow. I think there's an obviously a lot of
bravado around that. But I mean, you know, this is an IPO.
You're about, you know, trying to strike, you know, equality for for
Reddit's and its employees, it's customers.
I think Reddit wouldn't have got to this place had it not been for those those
very loyal users who have stuck behind it for in this past three years, because
a lot of them have been waiting for this moment.
Some of them may not agree that, you know, the part the public is is the
right one. But, you know, this is a this is a
transition for the company. This is something that they're looking
to move past and sort of get behind, because there's a whole lot of stuff to
be done as a public company after trading, which is expected to be next
week. Well said.
And we have had glimmers of light within the IPO space more broadly among sports
came out. We also know that there's a a key air
name that's backed by Intel that's looking at the markets as terror labs
more broadly. If this does go well, do we think more
technology names will follow behind Caroline?
For sure. Not least because I think this this
window that we're in now, this March window, has been one that there's been
so much written about and so much said about it.
Reddit is really a bellwether. It's going to be a very significant
bellwether for names like Rubrik, for names like Tyro, Waystar, a lot of the
sponsor backed tech names. You mentioned the Star Labs that is
feeding directly into the sort of AI chips frenzy is another name, Cerebro
Solutions that we have also covered. You know, that's all said, you know,
there is a huge backlog of tech names that are really look, we know with eyes
on today, tomorrow into next week not least to see how the book builds
because, you know, we should get a sense into Wednesday or Thursday of this week
as to how the book is building early next week.
We should get an indication as to how firm the demand is across the price
range. And I think that will feed directly into
the momentum that will follow all eyes on some of those lead banks.
Morgan Stanley Goldman, Jp morgan, Bank of America.
Yeah. Well, also I point out for the
aficionado or the redditor out there that on Wall Street bets for and
thousands upvoted a post that was calling for Reddit stock to be shorted
on the day it starts trading. And that sums up the relationship
between its user base and management of that company pretty much.
Ryan, go. Terrific reporting.
Now coming up here on the show, we'll sit down with Ophelia Snyder of 21
shares as Bitcoin hits a new record 72,000 USD per token, in fact, above
that card. Yeah.
Let's just focus in on another publicly traded stock, obviously global stock,
Taiwanese semiconductor. So TSMC, we're all by well, it had been
off by some 3% throughout US trading and indeed in its own trading.
But the fact that we've now seen it eclipsed from an overall market
capitalization perspective, Broadcom means it is back in the top ten of the
most valuable companies in the world. So they managed to push on higher.
This is Broadcom. This is all, of course, still a bet on
artificial intelligence. This is Bloomberg Technology.
Bitcoin just still on its tear, surging to a new record, $72,000 per token
today. In fact, digital assets have scored
another win, it would feel like more globally speaking.
The London Stock Exchange said it will soon accept applications for ETNs
exchange traded notes backed by Bitcoin or ether as joined now 21 shares.
Co-Founder and President Ophelia Snider, 21, says is the world's largest issue of
crypto exchange traded products. Already got your presence here in the US
and in Europe so I can imagine with the latest on two eyes these things, what
you're looking at, how you start to cross those TS dot those highs.
Yes, absolutely. So I think this has been a quite a while
coming and we're quite excited that the UK is now looking to allow these these
listings domestically. It should be quite a important change
for the European market. What's interesting though, is that still
reticence from the UK market on allowing retail ultimately to be having access to
such overall assets that are traded in this
way. What is the difference that you're
seeing between us, between Europe and potentially between the UK as to whether
this is really institutional money they want to bring in or still allow easier
access for a retail investor? So we've seen a pretty broad mix.
Europe has for a long time, including Switzerland, allowed both retail and
institutional investors and that's been our bread and butter has been really
catering to both for the last five years as we brought these products to market.
I think what we're seeing in the U.S., it's a little bit different.
It's still quite early for for big institutions in the US.
Mostly they require typically 90 days to assess products and due diligence to
allow listings on wire houses. So that has barely begun.
And it's a little bit earlier in its adoption cycle.
I think you'll see something similar in the UK over time that we'll see a little
bit more retail participation, but it's early days still for that.
Markets. I really appreciated Caroline's question
because I feel like we're still trying to understand both kind of what short
term and long term drive is are at play with Bitcoin in particular, right?
I always look at the chart over the weekend because Sunday rolls round, it
trades 24 seven and there always seems to be this kind of like start the week
with momentum trade on bitcoin. What do you think has happened in just
the last four or five days alone? So I think you're seeing and this is not
just the last four or five days, but I think the last four or five days are a
big part of this narrative, is we're seeing institutional adoption in the US.
It's quite early still because obviously not all of the warehouses, not all
institutions have access to it, but you're actually beginning to see those
types of investors come online, and that's changing Bitcoin's market
structure and biasing it towards weekday trading in a way that hasn't
historically always been the case when this was a more retail dominated market
and a market that quite frankly had a lot of focus on Asian market hours,
you're seeing that come more towards the US from a trading volume perspective,
and it's largely being driven by ETF flows which are trading on the US hours
and trade is going to ask you, well, I was going to ask you, what are the
datasets that you look at each day beyond just the spot price at any given
moment? So actually I don't spend much time
looking at the spot price at any given moment.
I am typically more interested in in fundamentals and what's happening from
an on chain metrics perspective and what's happening within the blockchain
community in the blockchain ecosystem. The reason for that is that it's quite
sometimes challenging to see signal to noise purely in price action, whereas on
chain metrics are a bit more sophisticated in that way and a bit tell
you more about what's actually happening within the blockchain.
And so that's actually the basis of one of the products that we operate in.
The US is actually turning prioritizing those types of metrics into an ETF, But
those are typically the things that I look at.
What's been so interesting, of course, is the Bitcoin exuberance.
Yes, it solidified it in terms of the dominant player, but still all boats
seem to have lifted to a certain degree. I mean, we're starting to talk about
mean coins and some of them affiliated with politics.
Others I mean, don't with for whatever reason just catching the meme site.
GEIST But you also offer there's other products out there that you have and you
have exposure to the likes of Tesla. I'm looking at what you've got.
Avalanche Uniswap How are you seeing real desire to be going outside Bitcoin
and ether? So we've seen obviously a lot of
concentrated desire in Bitcoin at the moment because of the arrival of the US
ETFs. We'll see if that dynamic also spreads
to ETH as the regulatory process in the US moves forward.
I think beyond sort of those top two names, we've actually seen quite an
uptick in demand, including from institutional investors in that longer
tail, and we're quite a unique firm in that capacity.
We're really the only people who offer that broad of a suite.
It's about 40 products outside of the US covering all sorts of different assets.
And what we've seen is an. Interest in that longer tail being
driven by some of our largest clients who are now looking at blockchain
applications and adoption of blockchain applications in a very different light.
I think know a key name. There would be something like Solana
where we've seen an enormous amount of interest over the last several months,
and that's continued as I think the overhang from some of the Black Swan
events has dissipated and the bankruptcy of states have have come undone.
And you're starting to look at those on chain metrics that I just mentioned and
you're seeing that actually there's some interesting things happening within
those communities and within these ecosystems that may or may not be priced
in at this point. The institutional clients, I'm assuming,
looking for not just a store of value but a utility here, I mean, the main
points are the opposite of that. It's just about sort of greed for greed
sake and that not always being a bad thing, but it's more of a speculation
trade. But institutions want to see what how is
this changing dynamics exactly? How is it changing dynamics?
What are people using them for? Why are they using them?
What do you what do these blockchains offer and what do these applications
offer in terms of actual utility? I think that's actually a very big shift
versus prior market cycles, and it's coming partially from that
institutionalization. I think it's going to ultimately be very
positive for the space. Every time I post on social media about
a fresh Bitcoin height as this one Veg Cassius, who replies almost every single
time going, I like this stock referencing, you know exactly what he's
referencing. The one thing that the Bulls and Bears
agree on is that Bitcoin and other crypto currencies or tokens are likely
to go up before having a significant pullback or have a pullback now.
But later rise. What's your kind of big picture outlook?
Do you have a kind of one year Bitcoin core one?
What is it based on? So I think a lot of that discussion
around a potential pullback in the market centers around the having
the point in time at which the rewards to you blockchain might or through
bitcoin miners actually reduces by 50%. The reason people are assuming this is
because there's an assumption that that dynamic is priced in in some way.
And so there'll be some overbought dynamics.
I think this is a little bit different than what is currently being discussed,
quite frankly. I think that's a little bit overblown
that the size and impact of the halving relative to the size of institutional
flows is so asymmetric, I'm not sure it will create as much of a
you know, that. Sell off event, as I think has been
predicted, primarily due to just that this is not as impactful of an event
from a purely numerical or to book standpoint as it would have been in
previous market cycles. I think as we look longer term, I see
quite a bit of upside. There are the having while it can
introduce some short term turbulence does further restrict the supply side of
this market that ultimately as long as demand continues should be a positive
indicator for price action. Yeah, that will take a little bit of
time. I think you'll as long as you can.
You do see increased institutional adoption and demand for these for the
U.S. ETFs, for the European ETFs.
More broadly, from the international investor community, I think that's where
you're going to see price continue, continue to come up.
And it's something that I'm quite bullish looking towards this year.
Ofelia Snider, we thank you. 21 shares and what's coming up.
Okay. Coming up, Covariant announced a new
robotics foundation model that would allow them to do just that.
Robotics RFM one. We'll have the details for you next.
The software behind the hardware. This is Bloomberg.
Okay, let's talk robotics. Covariance is seven year old AI robotics
company that works with retailers and logistics providers across apparel,
health and beauty. Pharmaceuticals as well has announced a
new robotics foundation model all and one that will give robots a human like
ability to reason. And with that a deeper understanding of
language and the physical world. Delighted to bring in covariant
co-founder and CEO Peter Chen. We talk increasingly about humanoid
robots, robotics broadly. On this program you are working on the
software side, not the hardware side, correct?
Just explain the approach of covariant. So what Kibo in this building is really
the beauty of robotics. So think about it as the general purpose
brain that can sit behind any robotics hardware that gives it the ability to
see the world, think about what's happening around it and make decisions
intelligently. And this is a big contrast with
traditional robotics, which is really programming robots to do the same thing
again and again, which just doesn't cut it in today's warehouse environment,
manufacturing environments where you have constant changes that are coming
in. And the unique covariant approach here
is we don't just build a single specific A.I.
that can solve one task. We are really approaching it in a
similar manner that, for example, like large language model is approaching chat
bot are the language locations as a single model powering multiple use
cases. But here's the thing that you don't
control the hardware side, right? Take Tesla as a comparison.
I don't know your thoughts on the Optimus program, but they are developing
both the hardware and the software. They obviously have Dojo that they're
working on in-house. What are the risks and benefits of just
focusing on software if you're not too also doing purpose built hardware to
match it? Yeah.
So first of all, on Ultima, we think it's an amazing robotics program.
Like it's a really great humanoid hardware that is being built, is being
iterated very quickly from a career in perspective, we believe there's not a
single hardware form factor that would rule robotics to come because the
physical world is very diverse, like there's not going to be a single
software, a single hardware at all. And we believe there are going to be
multiple kinds of robot houses, some in the human life factors, some in the
industrial and form factors, some with maybe a mobile robot with a manipulator
on top of it. And all of these different hardware form
factors still need to make sense of the same physical world.
And covering this building exactly that, the same brain that can power multiple
kinds of hardware to make sense of the physical world.
So Peter, talk to us about the inputs here.
How hard what are the intricacies you need to go about building?
What is the largest dataset ever to train this new robotics foundation
model? That's an amazing question.
So we have seen the explosive success of large language model and what is really
behind its amazing generalization power is the fact that is trained on the whole
Internet of text. And if you want to build a robot A.I.
that is as smart as, for example, large language model.
But in the physical world, you also need to build the same kind of data set.
But there's no internet to scrape in this case.
So you need to deploy a large fleet of robots in the world doing diverse and
dynamic things and collecting the video data, images, data, robot actions and
the outcome of those robot actions in order to really train a model that
understand the world in all kinds of settings and be robust, even in the wear
long tail scenarios and truly deliver a human level performance to our
customers. And the reason you've been able to get
such a wide, varied underlying dataset is because the amount of countries
you're in, the amount of companies you're already working with.
Can you just give us an idea of what this model is already being applied?
How are we starting to see it in our everyday lives?
Yeah, so we have already to deploy the covariant AI to more than dozens of
customers in more than ten countries, and they are powering the warehouse
operations, the e-commerce fulfillment operations in a lot of places.
So very likely like if you have order an item, for example doing Black Friday,
there's a really good chance that that item has been touched by one of the
covariance robots this operating around the world.
Peter, very quickly, we have 10 seconds. Your favorite use case for the robotics
you're working on. My favorite use case for the new
Robotics Foundation model iPhone one is really the ability to talk to it instead
of robots that are just rigidly doing the same thing again and again.
We now have the ability to communicate with robots in natural language, very
similar to how you would talk to Chhatrapati or Gemini in natural
language and ask questions, really democratizing access to AI.
For a lot of people, we're really doing the same with robotics, which I found
one covariant co-founder and CEO Peter Chan.
Great to have you here on set. Carrot Loving Lewis Robotics Chat.
Meanwhile, coming up, interestingly, Peter is an alumni of Openai.
We're going to be discussing that much more.
But first, also the VC ecosystem when it comes to the.
Implications of Silicon Valley Bank's collapse.
Remember a year ago what we learned because the Venture's founder, Vinod
Khosla, joins us. On that particular element, first and
foremost. But let's also check on what's happening
in the public markets right here, right now.
Your worst performer on the Nasdaq 100 Marvel technology.
The numbers came out Thursday and Friday.
Trade, We saw weakness. We're worrying about the fact that A.I.
applications of mobile technology thus far not making up for weakness and the
rest of its networking business is the Bloomberg Technology.
Welcome back to Bloomberg Technology Ed Ludlow here in San Francisco, Caroline
Hyde right here in New York, getting you a check on your markets because, well,
we are eyeing plenty of macro data to start this week.
We're going to be looking at what p CPI, basically the inflationary prints bring
us and the direction of travel. Is it a shock once again to the overall
system when we think about inflation pressures still having to be dialed up
again? I'm looking at the Nasdaq just off about
6/10 of a percent. We're only off about a 10th of a cent to
start the show. So accelerating some of the losses.
One of looking at the big board, NASDAQ 100.
I'm looking at what's happening in the two year yield space as well, actually
yields pushing up higher as we anticipate perhaps a little bit more
stress coming from inflationary pressures later in the week.
So yields up some five basis points. Let's call it Bitcoin, though, just
managing to separate itself as an asset class today.
We're not looking at tech more broadly as a spillover effect.
In fact, it's going its own path and we're up another 4.3%, 72,000, a level
never seen before with bitcoin. We want to see what are the individual
stocks that are on the move today. And I want to be focusing in on what has
been happening with Moderna. It is leading the charge when it comes
to the Nasdaq 100. Why?
Well, maybe it's going to be able to find its application of its technology,
its biotechnology throughout into the skin cancer space.
And that's something that they're going to be teaming up with work on.
We're up 8.8, up more than 10% at one point.
Most are looking what's happening with PDS and the Chinese names managing to
get a lift. And in fact, some notes coming from
analysts saying that the geopolitical risk is overdone for this particular
name. They still like to move entering the
overall US market. I think it's going to do well.
We're up some 3%. Lastly, don't matter on the downside and
you pointed this out to start the show rose by more than 4%.
No real fundamental catalyst other than, well, of course, former President Trump
on CNBC earlier today really talking once again, reiterating what it says on
trade social that he feels any ban of tick tock could actually be a negative
because it would empower embolden the likes of Facebook, which owns Facebook
Instagram. So the better parent of course, on the
downside on the back of that potentially today.
Ed, what've you got? Yeah, a year ago today, fear was
spreading in the technology and startup community following the collapse of
Silicon Valley Bank. And it was swift.
In a matter of a few days, we went from plans for an emergency sale of its stock
to VCs and start ups pulling their money out to us regulators taking control.
For a while, it even looked like the contagion could spread throughout the US
banking system. Now, just a year on, where do we stand?
I want to bring in Coastal Ventures founder Vinod Khosla.
Good morning to you. Good morning.
I wanted you to come on the program in part because you were one of the first
VCs to look at what was happening and offer to make personal loans to the
founders of the startups in your portfolio.
But you're also a Silicon Valley veteran and had a close association with Silicon
Valley Bank by virtue of doing business today.
What was the net result of all of that? Well, the net result has been minimal,
to be honest. People have moved on.
They have other banking sources. Some of the people involved in Silicon
Valley Bank are still around working for other firms or other entities.
And life goes on. The Valley has adjusted.
You know, you noted there there were other sources of banking know it brought
names like Mercury, what I would call alternative lending or transaction
services to the fore. But if there was a lesson learned, it
was the high concentration of SPV, Right?
If you are, as I say, an early stage startup,
you had your banking there, but you probably had some debt there as well or
lending. And it was often the first place you
could get a check. Is that concentration risk still there?
You know, the risk with Silicon Valley Bank had nothing to do with Silicon
Valley in startups. It had to do with interest rate
speculation, which the bank did so in a separate, irresponsible actions on their
part in this. And on the interest rate side, from what
the business was, I think the business was a solid business in most of it has
continued in the same way. I don't think it has changed
dramatically. You know, the alternative banks, Mercury
and others came up, but there's other banks that are still the principal banks
for start ups in the valley. I don't know if there's as much
concentration, but, you know, we don't worry about that too
much, Vinod. What's been interesting is perhaps there
was a moment of realization in a time of a crisis.
Who could you depend on? There is so much fierce competition to
get in money to the right startup. Yes, that competition perhaps faded a
little bit as the economy turned direction.
But more broadly, has it brought you more business, do you think, by the fact
that you were able to stick your neck out early and say, I'm here and I've got
your back? Well, that was what was most
disappointing about the venture community for me.
I called a number of other leading venture capital firms and said we should
all support our companies. It's a temporary crisis.
A couple of weeks, maybe, but I didn't get a lot of support.
So we had to unilaterally go out and say for our portfolio companies where we
were major investors or lead investors. We would support all of them.
I think every firm should have done that because Venture likes to talk about how
they help their portfolio companies. But when the going got tough, most
people didn't stand up to that scrutiny. But notice it stopped you going in to
rounds with other players. No, it hasn't.
We continue to work with the same players, but to be honest, we don't rely
as much on other players to add value to investors when the going gets rough.
V.A. at its core, because this is Bloomberg
Technology. Right.
We're also looking at this from the point of view of the startups
themselves. It was a discussion about access to
working capital. The rate environment was part of the
risk on the bank side. But today, do you think that there is a
stronger access to working capital for startups of all sizes?
You know, access capital depends on the area you're in.
If you're an AI, you have lots of access to capital if you're not.
It is somewhat harder because many of the funds aren't doing as well because
they had to mark the 2021 and 2020 high prices down.
But it hasn't changed the reality. The robots, the scene is still very
robust, both in AI, obviously, but also in other areas.
I find the venture community is investing, but the startups are even
more exciting and more impactful. I think we should have a conversation
about artificial intelligence. Chrysler Ventures founder Vinod Khosla.
You're going to stick with us and we'll continue the conversation.
We're going to take a short break. We'll be right back.
This is Bloomberg Technology.
Welcome back to Bloomberg Technology. Still with us is Vinod Khosla, Silicon
Valley veteran and one of the first investors to write a check into open
air. The startup continues to be in the
headlines, but most recently that's due to a lawsuit filed by Elon Musk, who is
accused open AI of breach of contract and failing in its fiduciary duty to its
founding members because it no longer operates as a not for profit or pursues
its original goal of building, quote, beneficial, artificial and general
intelligence for the benefit of humanity.
V.A. You took to X in a threaded series of
posts to basically say you think Elon Musk is wrong.
What is your thesis on why Elon Musk is wrong?
Well, it's very clear Elon Musk wanted Openai to go aggressively, but reneged
on his commitment to put up to $1,000,000,000.
You're referencing there what the general public learned as being emails
that were redacted but open. I chose to post to its website and in
one of them, even though the names are redacted, Elon Musk forwards a memo
which suggests that the scale of funding needs to be in the billions.
But also that and I'm quoting as correctly as I can open a I attach
itself to Tesla. Well, I'm referring to the fact that
before that happened, he wanted open air to move aggressively and raise up to
$1,000,000,000, and he would commit to making up anything they couldn't raise
from other sources, since at that point it was a non-profit.
That's when we realized from the emails that he pivoted to wanting it to be a
subsidiary of Tesla. Tesla was driving was developing
self-driving technology for their cars. It was part of the A.I.
push, and he chose to try and take control, which didn't quite work for
him. And that was the source of the conflict.
What's so interesting is, of course, in many ways go to the heart of the case,
whether or not there's the legal grounding in it.
There is this interesting pivot that ultimately open I had to make.
You also articulately put in one of our articles on Bloomberg saying like, this
is about survival. No longer feasible to have an open
source model you spend $10 billion of R&D on and then hand it to everybody
else. The economics don't don't make sense.
Are you in any way having pause, though, about the closeness of open AI now with
Microsoft, does any of that consider any time in your head about a worry for you?
I am not worried at all about the Microsoft relationship.
It's a minority relationship. They don't own a majority, and it's
structured such that both firms benefit. The larger sources of AI in the world
are. Google, of course, has great A.I.
technology and of course and we have it in Baidu, in China also.
My original reason to invest was there needed to be a source outside of China
to help compete with China in this important technology.
But I'm not worried about Microsoft's control, and I think the rumors and
speculation about it is just plain false.
What's so interesting is we talk of you as a veteran of venture.
You are one of the most highly respected people in this space.
The fact that you open source was sort of an area that you helped spawn within
Sun Microsystems. I'm interested to know, did you ever
anticipate that you'd be drawn into basically memo arguments with the most
wealthy at one point mountain in the in the world?
How do you feel about having to take to X in this way?
Well, you know, it's not about the argument with your line.
The argument is really about our competition, our techno economic war
with China, which I've talked about before.
And if we have powerful technology, we shouldn't be open sourcing it and giving
it to China and other bad nation states, Russia, North Korea among them.
And they're benefiting a lot from the state of the art open source.
I'm still a big fan of open source in almost all other areas, including other
area eyes of A.I., which are not state of the art technology video you may have
seen on ABC's This Morning or overnight, Elon Musk posted to his account that
this week Grok would be open sourced. Do you have an interpretation of what
Musk meant by that? And and based on what you just said,
you'd be supportive of that? Well, I saw the tweet.
I'm fine with it. I don't think grok is state of the art,
but I haven't personally evaluated it and.
It will get better. It's started only recently,
but if it's state of the art technology, I think we should control the export of
that technology as closely as we control nuclear technology or other national
security technologies. To be clear, it is not just about
national security with China. It's beyond that.
It's political power coming from economic power globally because of how
powerful this technology is. I actually wanted to go back and I
probably should have asked this at the beginning, but we always say, well, you
were one of the first people to write a check into open A.I.
and you have a really long standing relationship with what is an evolving
business, right? Just explain to our audience what your
relationship with Open Air is, how involved you are or not, day to day.
Well, we are very early investors. I'm not day to day involved in every
decision. I am very I was very curious to see this
independent committee report, which, by the way, Sam insisted on at the time the
board was being reconstituted. It completely cleared Sam of any
wrongdoing. Beyond that, it really went on to say
Sam did a great job in many of the functions a CEO was supposed to do and
blamed the board playacting hastily. I do believe the board was irresponsible
in the way it acted before last Thanksgiving,
and I'm glad the report clarified all that and validated all that in an
independent sort of way. Let's look at the new board announced on
Friday. And there's more diversity in terms of
more women. One of them actually, of course, the CEO
of one of your portfolio companies. I'm interested whether you think
ultimately there is now enough diversity from a racial perspective, what you make
of this board being announced? Well, I think those are all accomplished
people. I wouldn't call them just women.
I think they are accomplished and very qualified to be on the board and add a
lot. They've done very different kinds of
businesses. There is some nonprofit experience, and
I think the goal of Openai to benefit humanity hasn't changed.
In fact, one of the reasons Sam worked with us because he realized we had a
strong focus and large positive impact in all the work we did and I focus on.
And so I don't think the goal of Openai has changed from benefiting humanity.
It needed a for profit arm and that structure is pretty common globally.
We are for non-profit nonprofits, owned all or part of a for profit IKEA being
Bosch being examples, Tata in India, Mozilla in the US, so many, many
entities. So
I you know my my view is the goals haven't changed.
The board has experience in both for profit and not profit, not for profit.
And that's a great thing. So interesting Mozilla Foundation
founder has been saying maybe Sam has lost his way in that respect of a for
profit and not profit for Node. Ultimately, the mission is to best way
to carefully steward AGI into existence is a gradual transition to a world with
AGI is a better one than a sudden one. So interesting, you referenced China a
lot being the concern that you have about open sourcing, open eyes overall
technology. Because I was sat with CAI fully a few
weeks ago and he now feels as someone who is building over in China more, he's
really worried about the speed of AGI, the progress that we're making more
generally. He doesn't think that the pace of change
is controllable at the moment. What do you make of that?
Well, technology develops at the pace it developed.
We can't predict breakthroughs in technology ahead of time.
It does happen faster and we should be more cautious.
Absolutely. Security research should be part of what
every university and every government funds.
So I'm a big fan of that. But I don't think we need to slow down
AGI development or AI development. I think we are far from it.
We are making rapid progress. And so I think that's a good thing.
I think it would really, really benefit humanity.
I've talked a lot about it. I'm a big fan of not slowing it down.
Okay, let's try to move this moment forward.
Elon Musk is an incredibly influential person.
He has a history of litigation in many of the fields in which he's operated.
If you could give one message to him, I know it was a threaded series of
messages and we're showing some of them now, but what is it that you want out of
this situation? Well, I want to remind him that when
Blue Origin Jeff Bezos sued SpaceX Sacks, he tweeted, Elon tweeted.
You can't sue your way into space. I want to remind him he can't sue his
way into a guy He can do, hired great people, and he is hiring great people
and building technology, which is the right way to compete.
Well, I would try and get that message to Elon Musk.
And our audience should know. We, of course, have invited Elon Musk on
the program, but we are grateful that Khosla Ventures founder Vinod Khosla
joined us here on set in San Francisco and explained what's been busy weekend
for him on social media as well. Caroline It's a great deep dive with
him. We thank him.
Meanwhile, coming up, well, what else is happening this weekend?
Hollywood's old guard had a big night at the Oscars yesterday, but those
streamers lackluster showing for the likes of Netflix only winning just one
award Apple. And why with none.
We'll have more on that next. There's a Bloomberg Technology.
Time for talking tech. And first up, Apple is preparing to open
its eighth store in Shanghai this month, adding to the tech titans largest retail
network after the United States. As iPhone sales in China are slowing,
the new store will be located in the center of the city, which already hosts
the largest number of Apple stores in China's mainland.
And tick tock. Chinese owners would be forced to sell
the social media platform. Under a bill the House plans to vote on
this week if the bill advances through both sides of Congress.
President Joe Biden said he would sign his strongest support yet for the
proposal, according to Brandeis reporting.
Plus, the US could further tighten controls on China's access to
sophisticated semiconductor technologies.
Commerce Secretary Gina Raimondo giving us that signal.
Washington may also intensify its campaign to prevent Beijing catching up
in military capabilities, she told reporters in Manila.
We will do whatever it takes to protect our people, including expanding our
controls. And while it's going viral.
Yesterday, the Academy of Motion Picture Arts and Sciences held its 96th annual
Oscar ceremony. While Oppenheimer absolutely cleaned up
the biographical film about the inventor of the atomic bomb, which often people
sought to associate with. Well, ultimately, where we are in AI
right now, it picked up seven Academy Awards, including best Picture, best
director for Christopher Nolan. And interestingly, the STREAMER'S posted
a pretty lackluster showing. We've got to talk about the fact that
Netflix walked away with just one award, Apple receiving none.
I mean, what happened to Maestro? It had so many, well, potentials to win
and managed to walk away with anything. So many podcasts that I listen to would
say, well, my story is going to take a lot of these.
They did. And I just go back to basics, right?
It's no surprise you wake up Monday morning on Google Trends or X or even
LinkedIn. Everyone is arguing about that point,
right? Oppenheimer versus Maestro.
And Bobby doesn't even get a look in, even though, of course, that was the big
win from a monetary perspective. But it was back to those Universal
Pictures perspectives. It was back to Disney managing to count
and turn out the goods. I mean, congratulations where it's due.
It suddenly felt like a life event. I'm pretty sure it probably got the most
views that we've had in several years. And if we do a deeper post-mortem going
forward this year, I would just say Apple TV, where is same?
We always say, what about Netflix? Will Apple as well?
It's kind of the old guard that did well and Ryan Gosling singing his heart out.
That does it for this edition of Bloomberg Technology.
Please recap the show on the podcast. It was a pretty long conversation with
Vinod Khosla. The pod is on Apple, Spotify, iHeart and
of course we post it to the Bloomberg platforms as well one day into what's
going to be a very big week from San Francisco and New York City.
This is Bloomberg Technology.
5.0 / 5 (0 votes)