>> FROM THE HEART OF WHERE INNOVATION, MONEY, POWER GLIDE IN SILICON VALLEY AND BEYOND, THIS IS BLOOMBERG TECHNOLOGY WITH CAROLINE HYDE AND ED LUDLOW. CAROLINE: LIVE FROM NEW YORK AND SAN FRANCISCO THIS IS BLOOMBERG TECHNOLOGY. OPENAI'S HISTORIC FUNDING ROUND. ONE OF THE LARGEST EVER PRIVATE INVESTMENTS AND ITS NEW LOAN AGREEMENT SECURING $10 BILLION IN LIQUIDITY. ED: IF THE LATEST DATA FOR VENTURE FUNDING IN THE THIRD QUARTER. CAROLINE: NVIDIA INSIDERS CASH IN ON THE AI HYPE. THAT AND SO MUCH MORE COMING UP. ED: OPENAI SAID IT HAS COMPLETED A DEAL TO RAISE SIX POINTS $6 BILLION IN NEW FUNDING, GIVING

THE AI COMPANY $157 BILLION VALUATION AND BOLSTERING ITS EFFORTS TO BUILD THE WORLD'S LEADING GENERATIVE AI TECHNOLOGY. IN THE LAST HOUR OF THE STARTUP ALSO ANNOUNCED A $4 BILLION CREDIT LINE FROM BANKS AROUND THE WORLD, GIVING ACCESS TO MORE THAN $10 BILLION WARCHEST. BLOOMBERG'S RACHEL METZ JOINS US ON SET IN SAN FRANCISCO. WE HAVE BEEN TRACKING THIS FOR WEEKS AND MONTHS. THE IMPORTANT POINT IS THEY NEED THE MONEY BECAUSE THE CUTTING-EDGE MODEL REQUIRES THE MONEY TO TRADE AND BUILD. RACHEL: THEY ARE IN A VERY EXPENSIVE BUSINESS. IF YOU WANT TO BUILD A CUTTING-EDGE LARGE LANGUAGE MODEL, YOU'RE LOOKING AT SPENDING HUNDREDS OF MILLIONS OF DOLLARS. IF YOU THINK ABOUT MULTIPLYING

THAT OVER A COUPLE OF BILLION DOLLARS, YOU CAN TRAIN A COUPLE OF MODELS. WHAT IF YOU TRADE ONE AND YOU ARE LIKE, YOU KNOW WHAT, I AM NOT HAPPY WITH THIS? IT COSTS A LOT OF MONEY. THEY HAVE CHIPS AND STAFF IN ALL KINDS OF EXPENSES. THEY ARE BRINGING IN REVENUE, BUT IT STILL COSTS QUITE A BIT. CAROLINE: IS THE FUTURE PROFITABILITY THAT MEANS STAND OUT LIKE THRIVE CAPITAL, BUT NUMEROUS SUBSTANTIAL BANKS BACK THE CREDIT FACILITY. WE ARE LOOKING AT GOLDMAN SACHS, J.P. MORGAN, SANTANDER, WELLS FARGO TO NAME A FEW. WHAT IS THE FUTURE GROWTH MODEL THEY ARE ALL BUILDING VALUATION ON? RACHEL: THEY ARE LOOKING AT BUSINESSES USING THEIR PRODUCTS GOING

FORWARD. THEY ARE HOPING BUSINESSES WILL DO THINGS LIKE FINE-TUNE THE MODELS. USE THEM IN DIFFERENT PARTS OF THEIR WORKFLOW AND FIND IT USEFUL ENOUGH THEY WILL KEEP PAYING FOR IT. THEY ARE STARTING TO SEE UPTAKE. THEY HAVE QUITE A NUMBER OF INDIVIDUAL AND BUSINESS USERS AT THIS POINT. THEY PASSED THE ONE MILLION BUSINESS USER MARK FOR USERS OF CHATGPT IN PARTICULAR, BUT THEY HAVE A LONG WAYS TO GO IF THEY WANT TO GET TO THIS LEVEL. THIS VALUATION IS SHOWING THEM GOING TO AT SOME POINT. ED: THERE ARE TWO POINTS I WANT TO MAKE. THIS IS A PRE-EBITDA PRIVATE COMPANY, SO IT COULD GO TO BANKS AND GET $4 BILLION IN CREDIT IS REMARKABLE. ALSO, THE EAGLES LIED AUDIENCE WILL SAY SOME OF THOSE BANKS

ARE IN EUROPE. THAT IS ALSO REMARKABLE. WHEN THEY ANNOUNCE THE CLOSING OF THE EQUITY ROUND, THEY ALSO GAVE US DATA ON HOW THEY ARE DOING. HOW MANY PEOPLE ARE USING OPENAI? WE KNOW ANYTHING ABOUT THE SCALE OF THE COMPANY IN THE REAL WORLD? RACHEL: THERE ARE 250 MILLION WEEKLY USERS OF CHATGPT. THEY ALSO PASSED MORE THAN ONE MILLION BUSINESS USERS FOR CHATGPT, AND THAT SPANS DIFFERENT PRODUCTS RELATED TO AN EDUCATIONAL PRODUCT THEY HAVE, SMALLER BUSINESS PRODUCT, AND ALSO MORE ENTERPRISING PRODUCTS. THEY WILL HIT AT A LOT OF DIFFERENT PEOPLE AND A LOT OF DIFFERENT AREAS. THEY ARE CERTAINLY BRINGING IN REVENUE, AND THEY ARE SEEING USERS. WHAT REMAINS TO BE SEEN IS HOW WELL THIS WILL WORK OVERTIME.

INVESTORS HAVE TO BE WILLING TO WAIT. THIS IS NOT LIKE YOUR AVERAGE STARTUP. YOU MIGHT GET A SHORT-TERM RETURN, AND MAYBE WE'LL GET A LONG-TERM RETURN. YOU'LL HAVE TO WAIT AND SEE WHAT WE COME UP WITH OVER TIME. CAROLINE: RACHEL METZ, WE THANK YOU SO MUCH. COASTAL VENTURES PARTICIPATED IN THE OPENAI AROUND. TUNE IN TOMORROW FOR OUR INTERVIEW ON THIS AND AI'S FUTURE IMPACT. U.S. PROSECUTORS ARE BROADENING THE PROBE BY SOFTWARE MAKER SAP, SEEKING TO EXAMINE THE COMPANY'S WORK WITH ALMOST 100 GOVERNMENT AGENCIES, ACCORDING TO A NEW COURT RECORD. YOU HAVE BEEN SIFTING THROUGH THESE COURT DOCUMENTS.

REMIND US WHAT IS BEING INVESTIGATED IF NOT ACCUSED. JAKE: THE INVESTIGATION IS LOOKING AT THE COMPANIES YOU MENTIONED AND SOME OTHER COMPANIES, THE IDENTITIES OF WHICH WE DO NOT KNOW FOR A POTENTIAL SCHEME, AND I SHOULD STRESS IT IS POTENTIAL, TO FIX THE PRICES, TO INFLATE THE PRICES IN SALES OF SAP TECHNOLOGY TO THE U.S. GOVERNMENT. ED: YOU JOINED US THE OTHER DAY TO DISCUSS YOUR REPORTING. BUT I AM TRYING TO UNDERSTAND WHAT IS NEW. 100 AGENCIES IS MORE THAN THE AGENCIES YOU OUTLINED THE OTHER DAY. IS THERE AN EXPANSION IN THE SCOPE OF WHAT THEY ARE LOOKING AT. HAVE THEY DISCOVERED MORE INFORMATION THAT PROMPTED MORE AGENCIES TO SAY WE BETTER GET ON BOARD WITH THIS? JAKE: IT IS DIFFICULT TO SAY WHAT THE

PROSECUTORS HAVE DISCOVERED. SOMETHING WE KNOW IS THEY SAY THEY'VE BEEN HAVING DIFFICULTY GETTING INFORMATION FROM THE COMPANY AT THE HEART OF THIS. AS YOU POINT, WHAT HAS HAPPENED IS THEY WENT FROM AN INVESTIGATION PRIMARILY FOCUSED ON SALES TO THE DEPARTMENT OF DEFENSE AND AS OF JULY HAVE BROUGHT THIS OUT TRAUMATICALLY TO LOOK AT SALES TO AS MANY AS 94 CIVILIAN GOVERNMENT AGENCIES AS WELL. ED: -- CAROLINE: WE ARE LOOKING AT THE STATEMENTS COMING FROM THE COMPANIES. SAP SAYS AS OF THE CURRENT CIRCUMSTANCES THERE WAS NO REQUIREMENT TO REPORT. CARAHSOFT ALSO GAVE US A STATEMENT. HOW WILL THEY BE INTERACTING, WHAT ROLE DO THEY PLAY IN THIS? JAKE: THE HISTORIC ROLE THESE

COMPANIES HAVE PLAYED IS BY PUTTING OUT A PRODUCT. SAP MAKES ALL SORTS OF WORKFORCE SOFTWARE, TIMECARDS, HR SOFTWARE, AND THE COMPLICATED PROCESS OF SELLING THAT SORT OF SOFTWARE TO THE U.S. GOVERNMENT IS HANDLED BY CARAHSOFT, WHICH STANDS IN THE MIDDLE AND DOES THE WORK OF HELPING THE SOFTWARE NAVIGATOR NAVIGATE THESE REGULATORY HURDLES. WHAT THESE LOOK LIKE GOING FORWARD IS AN OPEN QUESTION. CAROLINE: IRKS REPORTER WHO BROKE THE ORIGINAL STORY AND CONTINUES ACROSS THE -- BLOOMBERG'S REPORTER WHO BROKE THE ORIGINAL STORY AND CONTINUES. HIS JOB DISPLACEMENT CAUSED BY AI SOMETHING TO BRACE FOR OR IS THIS ALL HYPE? WE DISCUSS WITH THEM AND I.T.

ECONOMIST WHO GIVES US -- WE DISCUSSED WITH M.I.T. ECONOMIST WHO GIVES US IS MORE SKEPTICAL VIEW OF WHAT IS HAPPENING WITH AI AND THE JOBS MARKET. CAROLINE: THE SOFTBANK FOUNDER HAS SKETCHED OUT ONE OF THE MOST AGGRESSIVE TIMELINES FOR THE ADOPTION OF AI GET, ENVISIONING A NEAR FUTURE WHERE THE TECHNOLOGY WOULD RUN ENTIRE HOUSEHOLDS, FROM MONITORING THE HEALTH OF FAMILY MEMBERS TO GROCERY SHOPPING. IN A SPEECH EARLIER TODAY, KEY SAID ARTIFICIAL GENERAL INTELLIGENCE OR AIG WOULD ARRIVE IN THE NEXT TWO TO THREE YEARS. ED: NOT EVERYONE IS SO BULLISH ON AI, AT LEAST WHEN IT COMES TO JOB. A RENOWNED PROFESSOR AT M.I.T. SAYS BY HIS CALCULATION ONLY A

SMALL PERCENT OF ALL JOBS, AROUND 5% IS RIPE TO BE TAKEN OVER OR HEAVILY AIDED BY AI OVER THE NEXT DECADE. HE JOINS US NOW. WELCOME TO THE PROGRAM. THIS WAS ONE OF THE MOST READ PROGRAMS OVER THE NEXT 24 HOURS. THERE IS NO SURPRISE. IT HAS ALL OF THE FACETS OF THE STORY THAT WOULD ENGAGE OUR AUDIENCE ON BLOOMBERG TECHNOLOGY. WHY ONLY 5% OF JOBS IN WHICH SECTORS AND INDUSTRIES ARE YOU BASING YOUR THESIS ON? >> IT IS GREAT TO BE ON THE PROGRAM. I THINK RIGHT NOW THERE IS A LOT OF POTENTIAL EXCITEMENT, PERHAPS HYPE ABOUT AI. IF YOU LOOK AT ITS CURRENT CAPABILITIES, WE ARE VERY FAR FROM AI PERFORMING ANY OF THE TASKS THAT INVOLVE A HEAVY

LEVEL OF INTERACTION WITH THE PHYSICAL WORLD. CONSTRUCTION WORK, MANUFACTURING WORK, CARPENTRY, THOSE PERHAPS ONE DAY WILL BE MUCH MORE FEASIBLE IF AI BECOMES SO MUCH MORE ADVANCED AND RELIABLE AND TO BE INTEGRATED WITH BETTER ROBOTS. IT IS NOT SOMETHING THAT WILL HAPPEN IN THE NEXT FIVE OR 10 YEARS. THERE IS A LOT OF OTHER POTENTIAL FOR FUTURE AI TO PERFORM SOME SOCIAL TASKS, BUT THOSE WILL NOT BE POSSIBLE RIGHT NOW EITHER. YOU WILL NOT GO TO AN AI PSYCHIATRIST ANYTIME SOON. IF YOU STRIP OUT ALL OF THESE, YOU WILL NOT BE LEFT WITH MUCH MORE THAN 5% OF THE ECONOMY. ED: MAY I JUMP IN AND PUSH BACK WITH A POINT RAISED BY OUR AUDIENCE WHEN I SAID YOU WERE COMING ON, WHICH IS THAT AI

TECHNOLOGY IS EXPONENTIAL, MUCH IN THE WAY THE INVENTION OF ELECTRICITY WITH TIME LEAD TO ALL SORTS OF BREAKTHROUGHS. RIGHT NOW YOU'RE SAYING 5% OF JOBS. IN TWO YEARS OR FIVE YEARS WOULD YOU NEED TO RETHINK YOUR THESIS OR REDO YOUR CALCULATIONS? DARON: I SHOULD HAVE PREFACED THIS BY SAYING THERE IS HUGE UNCERTAINTY IN ANY FORECAST ABOUT AI AND APOLOGIES I DID NOT DO THAT. I TRIED TO DO THAT ALL THE TIME. THERE IS A HUGE AMOUNT OF UNCERTAINTY AND ONE SOURCE OF UNCERTAINTY IS EXACTLY WHAT WILL HAPPEN WITH AI IN THE NEXT SEVERAL YEARS. I DON'T THINK THE MOST OPTIMISTIC VIEWS IN THE INDUSTRY ACTUALLY WILL HOLD WATER WHEN YOU LOOK AT IT.

WITHIN THE NEXT FIVE YEARS OR 10 YEARS. DOUBLE THE AMOUNT OF DATA, DOUBLE THE AMOUNT OF COMPUTER POWER, AND YOU WILL GET DOUBLE THE AMOUNT OF CAPABILITIES. TO DO THAT, WE WOULD NEED HIGHER QUALITY DATA. IF YOU WANT AI TO DO THE JOB OF A CARPENTER, YOU NEED A COMPLETELY DIFFERENT KETTLE OF FISH WHEN IT COMES TO THE KIND OF DATA, AND SOMETHING LIKE THAT MIGHT BE FEASIBLE WITH A DIFFERENT ARCHITECTURE OF AI. BUT RIGHT NOW, ALL OF THE MONEY IS GOING INTO THE BASIC DOMINANT ARCHITECTURE, WHICH HAS ITS LIMITATIONS IN TERMS OF RELIABILITY AND HIGH-LEVEL REASONING. THAT IS THE BASIS OF MY BELIEF THAT, OF COURSE, GENERATIVE AI AND OTHER TYPES OF AI WILL IMPROVE, BUT WE WILL NOT SEE A QUALITATIVE JUMP IN THE NEXT

FIVE TO 10 YEARS. CAROLINE: YOUR BELIEF, WHAT IS IT BASED ON? WHAT HISTORICAL NORMS ARE YOU LOOKING BACK ON TO PUSH FORWARD ON THIS 5% TAKE? DARON: THIS IS WHY THERE IS SO UNCERTAINTY. THERE IS NOTHING IDENTICAL TO GENERATIVE AI IN THE PAST, AND THAT IS PART OF THE REASON PEOPLE CAN HOLD DIFFERENT BELIEFS. WHAT I AM BASING THAT ON IS OTHER WAVES OF DIGITAL TECHNOLOGY THAT PROMISED A LOT OF AUTOMATION, SOMETIMES A LOT OF PRODUCTIVITY IMPROVEMENTS, SOMETIMES A LOT OF CHANGES IN THE WAY WE WOULD ORGANIZE OUR OFFICES, AND AT THE END, ALL OF THOSE CHANGES HAVE BEEN VERY GRADUAL. AND ALSO, WHAT WE HAVE SEEN OVER THE LAST TWO AND A HALF YEARS WHERE THERE HAVE BEEN ADVANCES, BUT THE ADVANCES

HAVE NOT BEEN QUALITATIVE IN NATURE. THEY HAVE NOT EXCEEDED THE BASIC CAPABILITIES OF GPT-4. THERE WILL BE ADVANCES, BUT I DO NOT THINK ANY OF THOSE ADVANCES WILL QUICKLY CHANGE THE WAY WE DO VARIOUS TASKS IN THE ECONOMY. I DO NOT BELIEVE IN FIVE YEARS WHEN WE LOOK AT THE LABOR MARKET WE WILL SEE CERTAIN OCCUPATIONS THAT WILL HAVE COMPLETELY DISAPPEARED. CAROLINE: MANY WOULD SAY THEY WOULD BE AUGMENTED. THE OPTIMIST VIEW IS WE WILL NOT LOSE PEOPLE FROM THE LABOR FORCE BUT THEIR PRODUCTIVITY WILL BE SCALED. DARON: I THINK THAT IS A VERY INTERESTING AND IMPORTANT POINT. I AM NOT AN AI YOU NAYAR OR -- I AM NOT A DENIER OR AN AI PESSIMIST. THE FUTURE IS AI.

BECOMES A TOOL FOR WORKERS TO BOOST THEIR PRODUCTIVITY. MICROSOFT HAS A LOT OF COPILOTS. SOME OF THEM WORK AND THEY GIVE SOME PRODUCTIVITY IMPROVEMENTS. THERE ARE A FEW AREAS WHERE WE ARE SEEING PHENOMENAL IMPROVEMENTS. IF YOU WANT TO WRITE SIMPLE SUBROUTINES IN COMMON PROGRAM LANGUAGES, GPT 4 IS GREAT. THERE ARE SOME THINGS IN WHICH THAT SORT OF HELP TO DECISION-MAKERS IS POSSIBLE. YOU LOOK AT THE WHOLE ECONOMY, THAT MEANS HELPING CARPENTERS, ELECTRICIANS, PLUMBERS, CONSTRUCTION WORKERS, TRANSPORT WORKERS, PEOPLE DOING TEACHING, PEOPLE DOING JOURNALISM. THOSE ARE THINGS THAT COULD BE ACHIEVED AT SOME POINT BUT THE RELIABILITY AND THE REASONING

OF THE MODELS IS NOT UP TO THE TASK YET. ED: DO YOU SEE SPECIFIC JOB CREATION IN SPECIFIC INDUSTRIES FROM AI? DARON: THERE IS ONE CLOUD OF JOBS WHERE AI IS LEADING A BIG BOOST, WHICH IS PEOPLE WHO HAVE AI FLUENCY, PEOPLE WHO ARE AI PROGRAMMERS, AI INTEGRATORS, OR OTHER AI-RELATED SERVICE ACTIVITIES. IN MY RESEARCH, FROM A PREVIOUS WAVE OF AI IN THE LATE 2010S, WE DID NOT SEE ANY OTHER JOB CATEGORY GET A BOOST IN TERMS OF HIRING. THERE ARE OTHER JOBS RIGHT THINK THERE WILL BE SOME RETRENCHMENT. IF YOU ARE IN I.T. SECURITY, THERE WILL BE DECLINES IN JOB VACANCIES IN THAT AREA BECAUSE SOME OF THESE AI TOOLS CAN PERFORM THAT QUITE WELL. CAROLINE: WHEN YOU SEE THE HEADLINE THAT

OPENAI IS WORTH $157 BILLION. WHEN YOU SEE THAT NVIDIA IS WORTH $3 TRILLION, WHAT DO YOU MAKE OF THAT IN TERMS OF HOW THE CAPITAL MARKETS ARE ANALYZING THE GROWTH? DARON: I THINK THERE IS A DIFFERENCE BETWEEN NVIDIA AND OPENAI. NVIDIA IS RIDING A WAVE BASED ON THE BELIEF THOSE CHIPS WILL BECOME MORE VALUABLE BECAUSE GENERATIVE AI AND OTHER TYPES OF AI WILL CONTINUE TO BOOM, BUT THEY ARE GENERATING REVENUES. OPENAI HAS NOT FOUND A REVENUE MODEL THAT COULD JUSTIFY THE TYPES OF VALUATIONS WE ARE SEEING AT THE MOMENT. IT MAY WELL BE THAT IN THE FUTURE SUDDENLY THEIR API WILL BE SO VALUABLE THAT OTHER FIRMS WILL START BUILDING ON IT. IT DOES NOT SEEM LIKE THERE ARE THE KINDS OF APPLICATIONS THAT

CAN HAVE DEEP IMPACT ON THE PRODUCTIVITY OF WORKERS OR THE PRODUCTIVITY OF FIRMS THAT WILL BE SOLD WITHIN THE NEXT FIVE YEARS OR 10 YEARS. ON THE OTHER HAND, OPENAI IS ALSO EMERGING AS A MARKET LEADER IN THE CURRENT ECOSYSTEM IN THE DIGITAL WORLD, AS FIRMS THAT TAKE OVER THE MARKET AND CAN USE ALL OF THE DATA AND INTERACT WITH THE CONSUMERS OR THE PROGRAMMERS DIRECTLY. THOSE HAVE BECOME VERY VALUABLE BECAUSE OF VENTURE CAPITAL OR OTHER DEEP-POCKETED FUNDERS. CAROLINE: CANNOT WAIT TO SEE THE RESPONSE TO THIS INTERVIEW. I AM SURE SAM ALTMAN HAS SOME THOUGHTS. WE APPRECIATE YOUR TIME. AURO DEBUTS THE RING FOUR. WE'LL TALK IT OUT WITH THE CEO, TOM HALE.

ED: -- CAROLINE: QUORA HAS ROLLED OUT THE NEW DEVICE. THIS COMPETITION IS HEATING UP. SAMSUNG DEBUTED ITS OWN GALAXY RING. THE CEO JOINS US. TOM: THE THING ABOUT THE OURA 4 IS IT IS SLEEKER AND BETTER. MORE IMPORTANTLY, WE HAVE TAKEN A BIG LEAP FORWARD IN SOMETHING WE CALL SMART SENSING. SMART SENSING ADJUSTS DYNAMICALLY TO HER BODY. NOT EVERYTHING IS THE SAME. YOUR PHYSIOLOGY IS NOT THE SAME. WE ADJUSTED DYNAMICALLY. EVEN AS YOU ROTATE THE RING WE ARE ABLE TO THE MOST ACCURATE SIGNAL. ED: WHO DO YOU CONSIDER TO BE THE COMPETITION FOR THIS RING? IS IT OTHER RINGS OR OTHER FORM FACTORS? I THINK ABOUT WATCHES, PARTICULAR HAVING JUST BEEN AT

APPLE'S EVENT. TOM: WHAT IS INTERESTING TO ME IS AMONGST OUR USERS, ALMOST TWO-THIRDS WERE A SECOND WEARABLE, USUALLY A SMARTWATCH. SMARTWATCH IS GREAT FOR DAYTIME NOTIFICATIONS, BUT IT HAS AN ACHILLES HEEL, WHICH IS BATTERY LIFE. THE RING DOES NOT ASK FOR YOUR ATTENTION, DOES NOT SEND YOU NOTIFICATIONS, IT IS JUST IN THE BACKGROUND, SEAMLESSLY PUTTING IN YOUR LIFE, CAPTURING YOUR PHYSIOLOGY SO YOU DO NOT HAVE TO PAY A TON OF ATTENTION TO IT. AS A RESULT, YOU HAVE AN EIGHT-DAY BATTERY LIFE WITH THE OURA 4. YOU DO NOT HAVE TO WORRY ABOUT YOUR HEALTH AS MUCH. THEREFORE, THE WATCH AND THE RING CAN BE COMPATIBLE. WE FIND THESE THINGS TO BE TWO DEVICES THAT CAN WORK TOGETHER ON ONE PERSON'S BODY. CAROLINE: YOU'VE BEEN WORKING WITH OTHER

COMPANIES THAT MAKE THE DEVICES. YOU'VE BEEN WORKING ALONGSIDE META, FOR EXAMPLE. HOW DO YOU SEE INTEGRATION WITH OTHER BUSINESSES GOING? TOM: WE HAVE SOME GREAT PARTNERS WE WORK WITH. WE HAVE NOT ANNOUNCED ANYTHING FORMALLY WITH META BUT YOU CAN IMAGINE A WORLD WHERE YOU HAVE A CLOUD OF DEVICES ON YOUR BODY THAT YOU ARE USING IN DIFFERENT CONTEXTS. HOW DOES YOUR PHYSIOLOGICAL STATE AND SOMETHING YOU HAVE ON YOUR BODY ALL THE TIME WORK AS A CONTROLLER, MAYBE AS A WAY TO GUIDE, MAYBE AS A WAY TO PROVIDE INPUT AND A WAY TO GIVE YOUR OTHER WEARABLES A SENSE OF WHETHER YOU ARE STRESSED OR WELL RESTED OR READY. THERE ARE A LOT OF INTERESTING OPPORTUNITIES TO EXPLORE WHEN YOU THINK ABOUT A PERMANENTLY WORN DEVICE ORIENTED AROUND

YOUR HEALTH ON YOUR BODY 24/7. CAROLINE: ED: -- ED: WE HAVE JUST SHOWN YOUR LATEST FINANCIALS AND THE TRAJECTORY OF THE COMPANY. YOUR FOCUS HAS BEEN TECHNOLOGY AND INNOVATION. WHERE YOU SEE THE COMPANY GOING FROM HERE? TOM: I THINK THERE'S A LOT OF HEADROOM FOR US TO GO IN THE RING CATEGORY -- FOR US TO GROW IN THE RING CATEGORY. PEOPLE ARE JUST LEARNING ABOUT THE BENEFITS OF LONG-TERM HEALTH TRACKING, LEARNING ABOUT THE BENEFITS OF GETTING SLEEP, LEARNING ABOUT THE UNDERSTANDING OF THEIR BODY. IT CAN TELL YOU WHEN YOU'RE GETTING SICK, TELL YOU WHEN YOU ARE DOING WELL, IT GIVES YOU LOTS OF INSIGHTS, EVEN AN AI COACH THAT HELPS YOU MAKE BEHAVIOR CHANGES. THERE IS A LOT OF HEADROOM JUST

IN THAT CATEGORY. BEYOND THAT, NOT ONLY INTERACTION WITH OTHER DEVICES, BUT IT MIGHT BE OTHER DEVICES YOU SEE. WE'VE SEEN PROTOTYPES FOR A LOCKET, PROTOTYPES FOR THINGS THAT LOOK MORE LIKE DESIGNER RINGS. WE INTRODUCED A PRODUCT WITH GUCCI WHERE WE HAVE SOMETHING THAT LOOKS MUCH MORE LIKE JEWELRY AND LESS LIKE A PIECE OF TECHNOLOGY AND FITS INTO YOUR LIFE. THE FUTURE IS VERY BRIGHT FOR RINGS. LOTS OF HEAD TO GROW THIS BUSINESS. MORE IMPORTANTLY, I THINK PEOPLE BEING AWARE OF THEIR HEALTH AND UNDERSTANDING HOW TO MANAGE THEIR HEALTH IS A BIG OPPORTUNITY. EVERYONE ON THE PLANET SHOULD HAVE ONE OF THESE THINGS. ED: TOM HALE, GOOD TO CATCH UP. A NEW ETF LAUNCHES TODAY FOCUSING ON CHINESE TECH STOCKS.

CAROLINE: WELCOME BACK TO BLOOMBERG TECHNOLOGY. ED: AND I AM ED LUDLOW IN SAN FRANCISCO. IF YOU'RE WAKING UP TO FINANCIAL MARKETS, THIS IS WHAT IT LOOKS LIKE. THE NASDAQ 100 IS KIND OF FLAT. A MODEST OUTPERFORMANCE IN SEMICONDUCTORS. BITCOIN HAS COME IN UNDER PRESSURE. IF YOU ARE AN INVESTOR, IT IS ABOUT WEIGHING AN ESCALATING CONFLICT IN THE MIDDLE EAST WITH ECONOMIC DATA, A LOT OF HYPE AROUND AI, BUT NO STRONG MOVEMENT IN EITHER DIRECTION APART FROM A FEW SINGLE NAMES. IN AN INTERVIEW, THE CEO SAYING DEMAND FOR BLACKWELL, THE LATEST GPU, IS INSANE. NO DIRECT CORRELATION OF THE STOCK AT ONE POINT TRADING AT ITS HIGHEST LEVEL SINCE AUGUST.

EV GO TRADING AT ITS HIGHEST LEVEL SINCE MAY 2023. IT SECURED A LOAN FROM THE DEPARTMENT OF ENERGY. THOSE ARE TWO MOVERS. NVIDIA ON A DAILY BASIS IS STILL THE NAME PEOPLE ARE TALKING ABOUT. CAROLINE: BECAUSE IT IS WORTH MORE THAN $3 TRILLION. INSIDERS HAVE BEEN CATCHING IN ON WHAT IS A HUGE VALUATION JUMP. THEY HAVE SOLD MORE THAN $1.8 BILLION IN SHARES SO FAR THIS YEAR. YES MENTON IS HERE TO PUT THIS INTO CONTEXT. WE OFTEN SEE INSIDERS SELL SHARES AND IT SEEMS A LOT WHEN THE MARKET CAP IS UP SO MUCH. JESS: THIS IS A GREAT STORY. WHENEVER THIS HAPPENS PEOPLE WANT TO QUESTION WHETHER OR NOT THERE IS GROWTH CONCERNS. THE CEO, THIS WAS PREPLANNED.

WHEN HE DID THIS THROUGH MID-JUNE UNTIL LAST MONTH, THIS CORRELATED WITH THE DRAWDOWN WE SAW IN THE STOCK. IT IS STILL UP CLOSE TO 150% YEAR TO DATE. IT IS STILL DOWN FROM THE JUNE PEAK AROUND 9%. IN THE S&P 500, HAS BEEN ABLE TO RALLY. AT A CERTAIN POINT, IT ECLIPSED MICROSOFT AND APPLE IN THE MARKET CAPITALIZATION. MOVING FORWARD, THERE IS SUPPOSED TO BE ADDITIONAL SALES. IF HE IS DIRECTOR, SUPPOSED TO SELL 3 MILLION ADDITIONAL SALES. THAT IS A QUESTION OF WHETHER WE WILL SEE THE STOCK HELD BACK, WHETHER WE WILL SEE IT RALLY AND COME BACK FROM THE LOWS WE SAW EARLIER THIS SUMMER, OR WILL IT KEEP THE GAINS AND CHECK? EVERCORE MADE A CALL FOR CHIPMAKERS AND IS MORE

OPTIMISTIC WE WOULD SEE A REBOUND IN THE FOURTH QUARTER THIS YEAR. ED: FOR 70 PEOPLE WATCHING, IT WILL BE A FAMILIAR STORY. IT IS A CLASSIC IN SILICON VALLEY. WEALTH CREATION FROM STOCK COMPENSATION. YOU SELL SHARES AND YOU GET MORE MONEY THAN YOU COULD HAVE DREAMED OF. THERE IS A PARAGRAPH IN THE STORY THAT RAISES THE QUESTION OF WHETHER THE SALES INSPIRE CONFIDENCE IN THE STOCK. DO THEY INSPIRE CONFIDENCE OR NOT? JESS: THERE IS SOMETHING TO THAT WHEN IT COMES TO PORTFOLIO MANAGERS THE REPORTERS WERE SPEAKING WITH. JIM MAHONEY WAS ONE OF THEM AND HE WAS TALKING ABOUT YOU SHOULD NOT READ TOO MUCH INTO IT. SOMETIMES IT IS NOT JUST REASONS OF GROWTH CONCERNS ABOUT THE COMPANY.

YOU ARE JUST MENTIONING HOW THE CEO WAS TALKING ABOUT THIS INSANE DEMAND FOR THE BLACKWELL CHIPS. THERE WAS A LOT OF SCRUTINY IN RECENT WEEKS BECAUSE INVESTORS WANT THE VALUATION OF THE COMPANY TO JUSTIFY FUTURE EARNINGS. THE EXECUTIVE DIRECTORS STILL DID 11 MILLION SHARES SO FAR IN 2024. THAT IS THE MOST SINCE 2020, WHEN YOU ARE EXCLUDING DIFFERENT STOCK SPLITS LIKE COLOR THIS YEAR AND IN 2021. YOU DO HAVE PORTFOLIO MANAGERS ARGUING IT IS NOT JUST BECAUSE OF GROWTH CONCERNS. ED: IT IS LONG SHELF FOR THE LONG HILL CHINA DRAGON ETF THAT TRACKS AN EQUAL WEIGHTED BASKET OF CHINESE TECH COMPANIES. BLOOMBERG'S ISABEL LEE HAD A STORY THAT HIT THE WIRE.

WHAT IS THE IDEA BEHIND THIS ETF? ISABEL: THIS TRACKS A BASKET THAT ROUND HILL MADE. THEY QUALIFY AS THOSE THAT EXHIBIT GREAT ECONOMIES OF SCALE AND COMPETITIVE ADVANTAGES AND COMPANIES THEY BELIEVE IN. WHAT SETS THIS APART FROM THE OTHER ETF'S THAT TRACKED CHINESE STOCKS IS IT IS MORE TARGETED. WE HAVE THE BIGGEST SHARES, WE HAVE WEB SHARES. THIS IS JUST FIVE TO 10. THAT IS WHAT THEY SAY. HE DID NOT WANT THE COMPANY IS DILUTING YOUR CHINA EXPOSURE. CAROLINE: THESE MEGA CAP TECH NAMES, THE TIMING IS KIND OF BEAUTIFUL. IT IS IN LINE WITH EVERYONE GETTING OVER EXCITED AND A FOMO FEEL AROUND CHINESE STOCKS. WASN'T ALWAYS PLAN TO COME OUT? ISABELLE:

ETF'S FILED EARLIER THIS YEAR. THEY SAY THE TIMING COULD NOT HAVE BEEN BETTER. THEY ALSO JUST MAKE PRODUCTS WHEN THEY SEE INVESTOR DEMAND AND THAT IS WHAT CAUGHT MY ATTENTION. EVEN WITH ALL OF THIS NEGATIVE RHETORIC, THERE ARE STILL INVESTORS. THERE ARE TWO WAYS TO LOOK AT CHINA. IT IS TOO CHEAP SO LET'S BUY IT, AND IT IS TOO CHEAP. THE ECHO CALLS ARE ALLOWED. TO LAUNCH AN ETF LIKE THIS SHOWCASES THE DEMAND OF CLIENTS. FOR NOW IT IS TRADING TODAY. IT IS ALSO CHEAPER THAN SOME OF ITS PEERS. IT IS ONLY A 59 BASIS POINTS. ED: HERE ON THE SHOW WE OFTEN LOOK AT THE NASDAQ GOLDEN DRAGON INDEX AS A BAROMETER OF SENTIMENT TOWARDS CHINA TECH. HOW UNIQUE IS THIS ETF IN THE LANDSCAPE OF PRODUCTS?

ARE THEY THE FIRST OR ARE THERE MORE TO COME? ISABELLE: THEY ARE ONLY GOING TO LIMIT IT TO FIVE TO 10 AND CAN DROP THE STOCKS THEY DO NOT THINK SHOW ECONOMIES OF SCALE OR COMPETITIVE ADVANTAGES. THAT IS VERY INTERESTING BECAUSE IF YOU LOOK AT THE BLOOMBERG MAGNIFICENT SEVEN INDEX, IT ONLY TRACKS THOSE MAGNIFICENT SEVEN STOCKS. THE NASDAQ 100 TRACKS ALL OF THE BIG TECH STOCKS. SOME INVESTORS WANT THOSE FOCUSED. YOU DO NOT WANT A BROAD-BASED INDEX, YOU WANT A LITTLE SLICE OF THE MARKETS. CAROLINE: THANKS FOR BRINGING IT TO US. WHERE IS THE VENTURE MONEY GOING? YOU CAN PROBABLY GUESS GIVEN THE OPENAI NEWS. THE LATEST DATA FROM PITCHFORK

ANALYST KYLE STAFFORD AND WE DIG INTO IT ALL WITH DENA SHAVER. THIS IS BLOOMBERG. ♪ THE TERMINAL AND ONLINE ON SPOTIFY, APPLE, AND I HEART. THIS IS BLOOMBERG. CAROLINE: POOLSIDE IS A STARTUP BUILDING AI FOR PROGRAMMERS. ROUND WAS LED BY BAIN CAPITAL. POOLSIDE SAID IN A STATEMENT YESTERDAY. THE NEW FINANCING GIVES THE STARTUP OF $3 BILLION. ED: VENTURE DEALMAKING HOBBLED ALONG AT A BETTER PACE THAN A YEAR AGO. INVESTORS ARE GETTING MORE SELECTIVE AND CASH WENT TO A HANDFUL OF COMPANIES. OPENAI'S LATEST FUNDRAISING BODES MORE OF THE SAME TO COME. THAT'S THING IN KYLE STANFORD FROM PITCH BOOK.

I POINT OUT THE DATA DOES NOT INCLUDE THAT OPENAI ROUND. WE CAN GET TO IT. SUMMARIZE THE DATA AS OF THIRD QUARTER. KYLE: IT DOES NOT INCLUDE THAT OPENAI DEAL. VENTURE CONTINUES TO BE A SLOW MARKET. WHEN YOU LOOK AT FUNDRAISING YOU CAN SEE WHY THAT IS. THERE IS NOTHING COMING OUT OF THE MARKET RIGHT NOW. IN THE U.S. Q3 THERE IS ABOUT 37 POINT $5 BILLION INVESTED WHICH IS LOWER THAN THE QUARTER BEFORE. THERE IS NOTHING EXCITING HAPPENING OUTSIDE AI IN TERMS OF INVESTMENTS BEING MADE. CAROLINE: WHERE IS THE INVESTMENT IN AI? KYLE: IT IS HAPPENING IN SAN FRANCISCO AND THE U.S.. THE DEAL SHOWS THE INCREDIBLE AMOUNT OF CAPITAL AI NEEDS AND THE COST OF THESE COMPANIES ARE INCURRING AND ALSO SHOWS THE

EXCITEMENT AROUND AI AND TECHNOLOGY. IF YOU LOOK AT WHO IS IN NVIDIA, MICROSOFT, SOFTBANK, ALL OF THESE INVESTORS ARE LOOKING AT THIS DEAL IN THIS COMPANY AS SOMETHING THAT WILL PROVIDE HUGE RETURNS DOWN THE ROAD. THAT IS HOW MANY OF THESE INVESTORS HAVE LOOKED AT AI UP AND DOWN THE VENTURE LIFECYCLE, SO THAT HAS DEFINITELY BEEN THE AREA OF INTEREST FOR INVESTORS IN THE U.S. AND GLOBALLY TO THIS POINT. ED: IF WE GO ON THE BASIS THE DATA WE ARE SHARING ON THE SCREEN AS OF SEPTEMBER 30 DOES NOT INCLUDE THE OPENAI ROUND, HOW DOES IT CHANGE THE TRAJECTORY FOR 2024 AGAINST PRIOR YEAR'S WHEN WE DO TAKE THAT ROUND INTO ACCOUNT? KYLE: I THINK WE CAN LOOK AT IT AND SAY OBVIOUSLY IT WILL MAKE 2024

LOOK MUCH BETTER. IF IT IS ONLY ONE DEAL, IT IS NOT CAPITAL AVAILABLE FOR THE ENTIRE MARKET. THAT IS SOMETHING WE'VE BEEN SAYING WITH PAST QUARTERS. THESE ARE VERY EXCITING, INTERESTING, SCALING COMPANIES. THAT IS NOT WITH THE REST OF THE MARKET IS SEEING. VALUATIONS ARE 40% HIGHER THAN OTHER VERTICALS. DEAL SIZES ARE MUCH LARGER. $6.6 BILLION IS NOT A TYPICAL DEAL THESE COMPANY SHOULD EXPECT ANYTIME SOON OR EVER. IT IS WHEN YOU TALK ABOUT THE TRAJECTORY OF THE DOLLARS GOING INTO THE U.S. FOR THE GLOBAL VENTURE MARKET, THAT NEEDS TO BE TAKEN INTO ACCOUNT. CAROLINE: IF YOU ARE NOT AI NATIVE OR AI ADOPTING AND YOU HAVE A DECENT RUN RATE IN TERMS OF REVENUE,

DO WE NEED MORE EXITS TO SEE THE MONEY COME BACK IN? KYLE: EXITS ARE STILL THE DAM OF VENTURE ACTIVITY. WE KNOW THERE HAS BEEN VERY LITTLE FOR THE PAST TWO YEARS. EVEN THE IPO'S OF Q1 AND Q2 WERE NOT ABLE TO SUSTAIN THE VENTURE MARKET. WE TAKE HOW LONG THE LIMIT HAS GROWN AND CONSIDER ALL OF THAT IS STUCK PRIVATE AND LPS HAVE NO WAY TO USE THAT CASH FOR MORE INVESTMENTS OR TO RECYCLE IT BACK INTO VENTURE. YOU CAN START TO SEE WHY THERE IS SUCH A SLOW MARKET OVER THE PAST FEW QUARTERS AND SOMETHING WE SHOULD EXPECT FOR THE COMING QUARTERS. CAROLINE: I'LL STANFORD, WE THANK YOU. LET'S GET MORE ANALYSIS FROM THE HORSES MOUTH. LUX CAPITAL PARTNER JOINS US NOW.

DOES THAT FEEL LIKE WHAT YOU ARE SEEING? DENA: IT IS IN MANY WAYS A TALE OF TWO CITIES. I WOULD NOT AGREE WITH THE SENTENCE THERE IS NOTHING EXCITING OUTSIDE OF AI. WE JUST HAD OUR AI SUMMIT IN NEW YORK ON TUESDAY. WHAT YOU SEE IS A LOT OF AI INTERSECTING WITH SCIENCES, WITH PHYSICAL INTELLIGENCE, COME INTERSECTING WITH HEALTH TECH, EVEN WITH MEDICAID CARE DELIVERY. WHILE I DO THINK AI IS VERY EXCITING, IT IS AN AREA WE HAVE BEEN INVESTING IN FOR SOME TIME, IT IS NOT THE ONLY AREA WE ARE SEEING EXCITING INVESTMENTS THESE DAYS. ED: THAT WAS THE POINT WHEN YOU LAUNCHED THE NEW FUND, RIGHT? I REMEMBER ALL OF THINGS I GET EXCITED ABOUT, ROBOTICS, LIFE SCIENCES.

HAS IT BEEN EASY ENVIRONMENT TO CUT CHECKS IN BECAUSE YOU HAVE TO FIND WILLING PARTNERS THAT HAVE THE SAME LEVEL OF EXCITEMENT YOU DO IN THOSE FIELDS? DEENA: THESE ARE AREAS WE ARE STILL EXCITED IN AND ONE WAY IS YOU'RE SEEING THESE SEASONED OPERATORS WHO ARE ON THEIR SECOND OR THIRD COMPANY WHO MAY BE BUILDING AI OR OUTSIDE AI THAT ARE GETTING THESE VERY LARGE MEGA ROUNDS AND OTHER COMPANIES THAT ARE STRUGGLING TO RAISE THOSE EARLY DOLLARS. THAT BEING SAID, WE HAVE COMPANIES ACROSS DIFFERENT STAGES AND SECTORS CONTINUING TO RAISE STOP THE BIG QUESTION IS WHAT THE EXIT MARKET LOOKS LIKE. AS WE SAT HERE TALKING ABOUT 2023 BEING THE YEAR, 2024 BEING THE YEAR.

WE ARE ALL LOOKING AT 2025 BEING THE YEAR WE SEE MORE EXITS. ED: DO YOU GET THAT QUESTION AND THAT PRESSURE FOR THERE TO BE EXIT OPPORTUNITIES? DEENA: WE HAVE ALWAYS HAD LONG LIFECYCLES. WE LIKE TO INVEST IN THE IMPOSSIBLE AND TURN IT INTO THE INEVITABLE. WE HAVE PATIENTS WHO KNOW THESE COMPANIES TAKE TIME AND WE LOOK FOR THE GENERATIONAL LARGE COMPANIES THAT TURNED INTO VERY BIG OUTCOMES. CAROLINE: DID ANY OF THOSE LPS WANT YOU TO BE IN THE OPENAI ROUND? DEENA: [LAUGHTER] WE WILL SEE. CAROLINE: SOME OF THE NUANCES AROUND THAT LOUD -- SOME OF THE NUANCES AROUND THAT ROUND. THEY ARE NOT ALLOWED TO INVEST IN COMPETITORS. IS THAT USUAL, WHEN YOU INVEST IN A RUNWAY, WOULD YOU

ULTIMATELY NOT GO OUT AND REALLOCATE TO A COMPETITOR IN THAT SPACE? DEENA: I WOULD SAY THAT IS NORMAL BUT NOT EVERY FUND APPROACH IS THAT THE SAME WAY. WE DO NOT INTENTIONALLY INVEST IN COMPETITIVE COMPANIES. WE LIKE TO PUT OUR RESOURCES BEHIND OUR INVESTMENTS. OFTEN TIMES COMPANIES WILL EVOLVE OVER TIME AND EVENTUALLY END UP INTERSECTING. WE TRY TO BE CAREFUL TO PUT OUR EGGS IN A BASKET AND DOUBLED DOWN ON OUR WINNERS. ED: I MENTIONED A MOMENT AGO THAT IS TRUE WHETHER YOU ARE INDITEX OR AI OR INDUSTRIALS OR OTHERWISE, THE TYPE OF INVESTOR IS DIFFERENT. YOU SEE THE LARGE MUTUAL FUND BEING A PLAYER AND NVIDIA COMES IN. YOU ARE A SIZABLE VENTURE FIRM BUT IS IT DIFFICULT FOR YOU TO

GET IN ON ROUNDS BECAUSE OF THE NEW TYPES OF PLAYER? DEENA: OUR CURRENT FUND IS OVER $1 BILLION. WE ARE INVESTING IN EVERYTHING. WE HAVE THE ABILITY TO CONSTRUCT A PORTFOLIO ACROSS DIFFERENT STAGES. THE JOB OF ANY GOOD VC IS TO BUY LOW AND SELL HIGH. EARLY BELIEVE THERE IS A MASSIVE OUT, WE WILL DO THAT AND WE HAVE THE ABILITY TO DO THAT. WE ALSO HAVE THE ABILITY TO START COMPANIES OURSELVES LIKE EVOLUTIONARY SCALE WHICH IS APPLYING AI TO LIFE-SCIENCES WE WERE REALLY INTO. APPLYING AI TO THE FERTILITY SPACE. CAROLINE: WHAT ABOUT THE COMPANIES THAT ARE NOT AI NATIVES. THERE IS A LOT OF EXCITEMENT IN THE AREAS OF INTERSECTION. OUR SOME OF THE COMPANIES IN

THE ORDER PORTFOLIOS ABLE TO COPE WITH THIS CURRENT ENVIRONMENT. ARE THEY MANAGING TO ENSURE THEY ARE CUTTING COSTS AND DIALING IN ON REVENUE GROWTH? DEENA: IT IS THOSE THREE THINGS. AI IS A WAY OF DOING THINGS. IT IS NOT AI FOR AI'S SAKE. HOPEFULLY IT IS ENABLING EFFICIENCY. IT IS ENABLING BETTER PROFIT MARGINS. EVERY COMPANY NEEDS TO HAVE AN ANSWER FOR THAT. ALSO BECAUSE IT IS WHAT THEY NEED TO SURVIVE IN THE WORLD. THIS IS A HUGE PARADIGM SHIFT. ALL OF OUR COMPANIES ARE DOING THAT. SOME OF THE MOST EXCITING APPLICATIONS ARE IN COMPANIES THAT ARE STILL HUMAN ORIENTED, WHICH IS LEVERAGING COMMUNITY HEALTH WORKERS TO DELIVER

HEALTH CARE AND USING AI TO HELP PREDICT EMERGENCY ROOM ADMISSIONS AND HELP STREAMLINE THE OPERATIONS OF HEALTH CARE PROVIDERS. ED: YOU HAVE BEEN BUSY. YOU ALSO BECOME AN AUTHOR. TELL ME ABOUT IT. DEENA: LEENA MO, CEO, IS A STORY ABOUT A YOUNG GIRL WHO BUILDS A ROBOT TO SHOVEL SNOW OUTSIDE OF HER HOUSE AND GO THROUGH THE PROCESS OF BUILDING A TEAM AND RAISING MONEY AND WAS INSPIRED BY MY OWN JOURNEY AS A PARENT TRYING TO EXPLAIN VENTURE CAPITAL TO A BUNCH OF PRESCHOOLERS, WHICH IS JUST AS HARD AS EXPLAINING TO FULLY GROWN ADULTS. ED: FOUNDERS ARE GETTING YOUNGER, BUT THAT YOUNGER I DON'T KNOW. THANK YOU VERY MUCH. COMING UP, CRACKING DOWN ON THE

MIDDLEMAN. INSIDE THE SUPPLY CHAIN ISSUES THAT LEAD TO U.S. DESIGN CHIPS INSIDE RUSSIAN MISSILES. A TENSE BUT INCREDIBLE STORY. CAROLINE: TODAY'S BIG TAKE. HOW GLOBAL SUPPLY CHAINS ARE THE LATEST CONCERN IN THE UKRAINE-RUSSIA WAR AS CHIPS ARE FINDING THEIR WAY INSIDE RUSSIA MADE MISSILES. STEPHANIE JOINS US NOW, THE AUTHOR OF A NEW BOOK, PUNISHING PUTIN. YOU ALWAYS TELL STORIES WITH SUCH DEPTH AND HUMANITY. IT IS A DIFFICULT STORY. WHAT WE BRING TO OUR AUDIENCE IS THE INTRICACIES OF WHAT CHIPS MADE BY WHO ARE FIGHTING THEIR WAY INTO RUSSIAN MISSILES. STEPHANIE: AFTER THE INVASION, THE U.S. JOINED WITH EUROPEAN ALLIES TO IMPOSE EXPORT CONTROLS ON

RUSSIA TO DENY THE RUSSIAN MILITARY ACCESS TO WESTERN SEMICONDUCTORS AND OTHER TECHNOLOGY, AND THEY TIGHTENED TO THOSE RESTRICTIONS AGAIN STARTING LAST YEAR. THERE HAVE BEEN VARIOUS REPORTS OF TRADE DATA ABOUT COMPONENTS GETTING THROUGH, SEMICONDUCTORS GETTING THROUGH TO RUSSIA. WE WANTED TO DRILL DOWN AND DO A DEEP DIVE ON ONE MISSILE ATTACK WHERE UKRAINIAN INVESTIGATORS HAVE DOCUMENTED WESTERN COMPONENTS BY SPECIFIC COMPANIES, AS WELL AS EXAMINING THEIR DATABASE. WHAT WE CAME UP WITH IS THERE IS ONE COMPANY WHOSE COMPONENTS KEEP GETTING FOUND AND ARE MOST FREQUENTLY FOUND ON THE BATTLEFIELD, AND THAT IS ANALOG DEVICES. WE WANTED TO PUT A HUMAN FACE ON WHAT WAS A TRADE DATA STORY.

TO SHOW THAT RUSSIA IS VERY DEPENDENT ON WESTERN TECHNOLOGY TO GUIDE ITS MISSILES ON UKRAINE. ED: WHAT WAS THE RESPONSE FROM ANALOG AND FROM THE UNITED STATES TO THE REPORTING? STEPHANIE: ANALOG SAYS THEY REGARD THIS AS AN ILLICIT DIVERGENCE OF THEIR PRODUCTS AND THEY DO NOT CONDONE ANY OF THIS TRADE. WHAT WE TRY TO GET INTO IS EXPLAINING THE COMPLEX SUPPLY CHAIN FOR SEMICONDUCTORS. THERE IS A LOT OF PRODUCTION IN SOUTHEAST ASIA, THERE ARE A LOT OF MIDDLEMEN ACTING THROUGH HONG KONG USING SHELL COMPANIES TO DO THIS TRADE. IT HAS BEEN VERY HARD TO CRACK DOWN. THIS IS NOT ANALOG SELLING DIRECTLY TO RUSSIA. THE U.S. HAS TRIED TO ENFORCE THESE CONTROLS THROUGH THE COMMERCE DEPARTMENT.

THAT HAS PROVEN DIFFICULT BECAUSE OF THE GLOBAL NATURE OF THE SUPPLY CHAIN AND THE MANY LAYERS SEMICONDUCTORS GET TRADED THROUGH BEFORE REACHING RUSSIA. ED: BURKE STEPHANIE BAKER IN LONDON. THE BIG TAKE IS TITLED RUSSIAN MISSILES, AMERICAN SHIPS. FIND IT ON BLOOMBERG -- RAWSON MISSILES -- RUSSIAN MISSILES, AMERICAN CHIPS. IT IS A MUST READ. CAROLINE: A LOT OF NEWS WHEN IT COMES TO THE PRIVATE MARKETS, THE DEBT MARKETS, THE PUBLIC MARKETS AS WELL. ED: PROBABLY A HISTORIC DAY. WE WILL RECAP ALL OF THE PODCAST. YOU CAN FIND IT ON THE BLOOMBERG TERMINAL AS WELL AS APPLE AND SPOTIFY. SHOUT OUT TO THE TEAM IN NEW YORK CITY AND EVERYONE IN SAN

FRANCISCO. THIS IS BLOOMBERG TECHNOLOGY. ♪

OpenAI's Historic Funding Round, AI Dominates VC Deals | Bloomberg Technology

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OpenAI's Historic Funding Round, AI Dominates VC Deals | Bloomberg Technology

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