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From the heart of where innovation, money, and power collide in Silicon Valley and beyond, this is Bloomberg Technology with Caroline Hyde and Ed Ludlow. ♪♪
Welcome to a special edition of Bloomberg Technology. I'm Caroline Hyde right here in Las Vegas. We are live from the Human X AI conference and we're going to be talking to some of the biggest industry leaders and decision makers in the AI space throughout this next hour.
as you can see a key lineup of expertise but let's move on to also the discussion of how the public markets feed into the private markets how does one think about the startup space as we contend with this growth anxiety as we contend with tariff anxiety let's bring in Alfred Lin Sequoia Capital Partners someone who thinks about seed about early stage investment has been at the forefront of artificial intelligence investment before many others and Alfred
Look, how does the public market feed into the private market from your perspective right now? Well, Caroline, thank you for having me on the show. This is a great honor to be here. To answer your question directly, we just think about building great companies and partnering with great founders and helping them from idea to IPO and beyond. And so in terms of thinking about the public markets, we just think about much, much longer term. We work with founders at the idea stage.
In a decade, that company can then be worth $1 to $10 million. In two decades, it could be worth
10 to 100 billion dollars in three decades, like for Nvidia's case, and Google's case, and Apple's case that we backed very early on, they become potentially a trillion dollar company. And so yes, markets can go up and down. There might be sort of bumps in the road, but I would just encourage your viewers to think about the long, long term. And when you're behind a megatrend such as AI,
it can last for a long long period of time that megatrend needs infrastructure and it needs electricity and power that's one of the key anxieties of Andy Jassy for example at Amazon saying his constraint on AWS is power is it something that your CEOs are contending with how to ultimately sustain their growth paths I think it's something that they think about and it's something that we we need to work on and there are a lot of great minds working on it it's not something that I'm an expert in but you're right power is something that we need in data centers and the
The bigger the data centers we've built, the more powerful the models we've been able to build, the more powerful the applications. And so I'm sure it will get solved. What's so interesting is, of course, you mentioned how Sequoia was early into Jensen Huang's vision for AI. You're now thinking about not just sort of moving away from LLMs. We're going into application layers. We're also going into physical AI. I know that that's really important to you at the moment, the application of robotics. Where is the next growth story in this long-term megatrend?
Well, I think that, let's break this up. I think there's still lots to do in the foundation layer model. They're not done. These companies like OpenAI that we backed early on, they're still continuing to build the foundation model layer. That allows the application founders to build applications that we have not seen before. And we will continue to see innovation there. Will you continue to see private rounds for those sorts of companies? Is there ever a point at which they've just raised too much money in the private markets?
It goes up and down, but the point is that over time these companies are always surprising us in the long run on what they're capable of doing. Sure, in the short term, technology tends to surprise us in the opposite direction, but in the long run it always surprises us in the positive direction.
In terms of many of the companies we work with, they're just providing automation to a lot of workflows today. That's what we see today. So companies that we work with, such as Clay, they're trying to help salespeople with their leads and automatically enriching their leads so that the salespeople can focus on actually growing their business and
contacting the right leads. And with Camura, their ambient scribe is helping doctors focus on care, not the administrative work. They listen in the background, take notes. And yes, they take the notes. It seems like something small. But then once you take the notes, they can code the medical codes properly for insurance claims. And that just allows the doctors to focus on care.
And we're going to see more and more innovation because we are left to do some of the more interesting things that humans do better than machines. So you're looking at still LLMs, still then looking at the application layer. What's been interesting is we have had this FOMO feel still in the latest...
alumni from OpenAI going up and starting their own company at Illya, for example, potentially raising it $30 billion without even really a product out there or any revenue stream. Would you still back him at that sort of valuation? Are you doing follow-on investment? I think the interesting thing is if you think that something could be worth a trillion dollars, whether it's what the entry price today is...
important, but not as relevant as what you think the order of magnitude is in the future. And I think the order of magnitude that we think about today will surprise us in the long run. Don't forget, a decade ago, two decades ago, we didn't think a trillion-dollar company is possible. If you compound what trillion dollars 20% year over year for the next decade, we will have 10, 20 trillion-dollar companies. So...
You just have to think about the order of magnitude that is possible. We need to change our mind space around that. Help change our mind space because you have been seeing around these corners longer than nearly anyone. How can you see that Illya is someone to back? How can you see that a founder isn't an individual you want to see the vision of and think that they're going to build a trillion-dollar company? I think that it comes down to the founders, and we've been very good at picking founders that are known by their first names. Jensen at NVIDIA.
Steve at Apple, Larry at Google. - Sam at OpenAI. - Sam at OpenAI. Today's founders are Pithilia and Brian at Airbnb and Tony at DoorDash and the list goes on and on. So these founders are special because they have a vision of the world.
that the world has got viewed the world has sorry the world has solved a problem incorrectly and they want to go change it yeah and we get the front row seat to see how they want to go change the future is Mira gonna be a name that we know and one that you're gonna back you already know are you backing her
We're talking to her. You're talking to Amira. You're talking to Ilya on his latest funding round? We're investors in Ilya's company. And you'll do follow on because he's building something of big vision. We'll consider that too.
about the thesis when it comes to LLMs and then application layers and then the robotics and physical AI. What for you is going to be pushing us forward in terms of the next iteration of value coming from these companies? Is it going to, are we getting to the stage that we'll see one trillion across all of those spaces, do you think? I believe that's to be true. And if you sort of go back in time, when I started my career, we thought that
all the value would accrue to the software layer. That's why we invest in software companies. But today, the Magnificent Seven, all of them are both hardware and software companies and some of them in the physical world. I think the physical world is going to be the next boundary that we're gonna break, which is why I'm very excited to be here with Brad Porter from Collaborative Robotics.
And it's interesting, of course, you've backed ex-AI when it comes to AI. Elon himself busy looking at robotics from his Tesla perspective as well.
How are you thinking about who wins in the robotics space or is there going to be countless winners and applications? As you know that there are many, many winners when there's a Megatron. And so I believe there are going to be many winners in robotics. And yes, Tesla is building robots. They were building cars before. They also build software. And Elon is someone that we back across a variety of companies such as SpaceX.
and boring company and the physical world is something that we will continue to attack and make progress over the coming years. How frustrating or how illuminating is it when your founders are having arguments in public like Sam versus Elon? Does that bother you? You can ask them those questions but, you know,
Founders have a particular view of the world and they like to be, they like to express those views. So it's good that people sort of talk about what they believe and how they're going to sort of change the world through that. And I believe that
Discussion is always a positive thing. Who and where are they going to be from as changing the world at this moment when you think about China versus the US? DeepSeek, you wrote a very thoughtful blog about the impact of DeepSeek and the opportunities for learning from these powerful generative AI models that have come and the innovation and the data and the efficiencies we're going to see. Are we going to see a so-called winners on either side and around the world?
Well, I believe in humanity instead of one country over the other. I'm an immigrant to this country and I believe that the way we operate and build businesses here is much more innovative. And so I'm rooting for the United States, but even more than that, I'm rooting for humanity to continue to progress.
And the more progress we make here, the more progress the people in China want to make. And the more progress they make there, the more we want to continue to make progress. And so that just is the thing that I'm most focused on, which is we're going to just make each other better. Competition has always made us better.
And I believe in the United States and its ability and its free society to do things in much more innovative ways than almost any other country in the world. It's our innovation, it's our free spirit, and it's also our capital markets. You think about our economy,
place in the world. We have what approximately 4% of the world's population, but we have a disproportionate number of the amazing companies, the most valuable companies in the world. We have a disproportionate amount of capital that we have and control and are able to invest. This is why your viewers listen to you and this show because Bloomberg is the place where a lot of information about capital is talked about.
Alfred, thanks. But they're listening to you and they're listening to thinking about how the money comes back...
ultimately to your LPs and it's going to be about exits. How are you thinking about the IPO market? How do you think about M&A? Boy, we just had ServiceNow and Moveworks. M&A is still getting done. Yeah, so I think that's a great question. Lots of people ask that, but I just want to emphasize that at Sequoia over the last five years, we've distributed over $43 billion back to our LPs. And so this is a business that if done right can generate a lot of returns for our limited partners. On top of that, I just kind of
tell our founders it doesn't matter what's going on in the public markets or in the M&A markets. Just focus on building a long-term great business. If you do that, as did Tony at DoorDash and Brian at Airbnb and many others are doing today, you will always have options. And that option may come in at M&A. That option may come in at IPO. I would contend that the IPO market is always open for great companies. What's interesting is we first saw...
AI come into existence almost in a not-for-profit mentality. And now we think open AI thinking about trying to restructure and become a for-profit entity more clearly. Is that something that you back, that you support, that you want to see clearer division of for-profit and not?
I think that if you go back in history, AI has existed for way longer than what you're talking about, which is open AI. I mean, Jensen was building GPUs way longer than what we're talking about today. And the first set of applications that were AI applications were
something like AdWords that Google built, or trading platforms that many of your viewers and that work at large institutions have been using. Those were called machine learning. We just changed that term. For-profit, non-profit, those are just structures for accomplishing what the mission of the company wants to do. And I'm supportive of whatever the right model is to do that.
But as an investor, I want to make sure that the equity that we invest in has appreciation. And that's separate from the mission. Well, you have an extraordinary realm of portfolio companies. You sit on some amazing boards, Citadel Securities among them, as well as Airbnb, as you say. And you've had a long history of being a founder and a builder yourself.
Alfred Lin, we thank him so much from Sequoia Capital. I want to return now to the private markets and people building within that space. May Habib is a key founder, CEO, and indeed the co-founder of Writer, a generative AI platform for the enterprise. And I've got to ask at this time, May, when you're...
Really seeing the growth accelerate for your business when you're seeing more and more fortune 500 businesses want to work with you What are these CEOs telling you about the landscape about? Anxiety about putting money into generative AI when they don't know when the next tariff is hitting. Yeah There's no question that selling generative AI in the enterprise right now has to be an ROI first story because these are the same CEOs who are telling the street that they're cutting optics and you know, They're trimming down their teams. So it's
really puts a big focus on the kind of return. And the reality is, Satya said it a couple weekends ago, right? There has never been such a big gulf between what technology can do and then what's actually happening inside of the enterprise. We've got a survey coming out. Fortune 500 execs, 71% are saying that their generative AI efforts have been very disappointing, very disappointing. And so, you know, it absolutely is a big... Why? Why is it very disappointing? Why is it so hard to bring this...
once-in-a-lifetime AI exuberance to bear on your productivity? I think we are bringing knives to a gunfight when it comes to actually building with generative AI. People are taking these really long kind of software development cycles and IT is taking these projects to the business and the business is saying this is not really good enough to actually benefit my work. So we take a very different approach. Writer is
purpose-built for that kind of collaboration you need between the business and IT to actually deliver generative AI projects and applications and agents that work for the business. So is it sort of legacy software is the issue here? So it's the legacy tooling of building these products. And so the LLMs are very, very powerful, but you need to wrap it with data, with workflow, with know-how.
And that's just not happening right now in most IT departments in the enterprise. So help measure your success. How are you articulating to those you're going out and pitching saying, "You will get ROI with us"? It's a very solution-oriented approach. So, you know, we're not talking about, "Hey, buy a full-stack platform, buy our amazing LLMs, look at us, how great we are." We're talking about actual end-user productivity and end-user use cases. So it's very solution-oriented.
What's also interesting is you've set yourself apart from a pretty crowded field, I'm going to say, like agentic AI and generative AI in the workplace and enterprise seems to be everyone's lexicon right now. But you're coming at it from, look, we do something very different with the type of data we're using and the type of model
building that we're going through, you're almost saying like actually don't look at a reasoning model, look at our type of model. What is your type of model? Yeah, I mean look at this exhibition floor. It's literally hundreds and hundreds of startups and it's such an exciting opportunity. But when it comes to the enterprise, they are looking at the vendors that they trust, the ones that already have their data. But yesterday I was with a CIO of a Fortune 500 company where to hire an employee, they need to touch 100 systems.
Only 10, 15 of them might be a ServiceNow application, right? So we kind of see ourselves as that Switzerland that ties together a lot of disparate systems when it comes to building these agentic applications. And it really is that bringing together structured and unstructured data together to build the tooling. But when we had Jensen Wang come out with his latest earnings, he tried to paint the vision of a new scaling law that's here because of reasoning models.
But you're actually taking issue with reasoning models in the generative AI application right now. You think that self-evolving models is where we should go. Can you articulate what that is? Yeah, I mean, I love Jensen and he just wants more tokens, right? And he's absolutely right, right, in the spirit of what he's saying, which is the revolution is just getting started, right? The vast majority of enterprises are still not benefiting from AI. So imagine what's going to happen once they do, right?
When it comes to the actual LLMs, what we're saying is the path to superintelligence is through self-evolving models, models that can update their training data in real time in response to making a mistake and then getting nudged by a user, you didn't get our process right. If we need to go out and retrain or fine tune or rebuild a rag pipeline, every time a model is wrong, we are never going to get to the kind of superintelligence that's possible.
What about the talent that's needed? At the moment we've got a new administration that seems to be cutting funding for science in the United States, for universities and next level education. Is that something that worries you or is talent still rich? I mean, talent is a struggle no matter what the political environment is.
We just opened up our London and Singapore offices for exactly this reason, to be able to hire outside of the United States. Most of our 400 employees are here, but as we look to double over the next year, we are definitely going to be growing internationally.
inorganic versus organic. Every time you come on I say who are the startups you're looking at? What other acqui-hires can you do? Is it still Rich Pickings for you to buy other businesses? There are literally hundreds of startups that are doing really really exciting things that are finding it difficult to sell into the enterprise. We have kind of risen above the noise and so there have been you know some really interesting things that we're looking at is bolt-on acquisitions to the writer platform.
Come on, when you can announce some of them. It's always great to catch up with her, the CEO of Ryter. Now let's return to where we're going next. Much more to expect from Human X Conference, but in the interim, looks what happened to Oracle shares after they had their numbers after the bell yesterday. There was disappointment. That 8% revenue growth that was hoped for was not quite matched. We're off by 5%. They did say, look, next fiscal year, the year after that, we're going to see 15%, 20% revenue growth. But in the here and now, the disappointment in terms of cloud infrastructure demand and sales return.
from Las Vegas this is Blue Mag Technology
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Welcome back to a special edition of Blue Meg Technology. I'm Caroline Hyde in Las Vegas. We're live at the Human X AI conference. And we are keeping abreast of what's happening in public markets because after the biggest sell-off for the NASDAQ 100 yesterday, since 2022, we want to see what the Magnificent Seven is up to. We're currently bouncing around, up now 0.4%. But this is not
the sort of bounce back that we anticipated after the hard sell-off of yesterday. Their anxiety is still there when it comes to U.S. growth, tariff pressure, and the latest that are being imposed, of course, on Canadian goods. Let's talk about what it means for the private sector vibes. And Rachel Metz is here in Las Vegas. Look, this is one of the biggest artificial intelligence gatherings.
Are they feeling exuberant? Are they worried about what's happening in the public markets and the sell-off that we've seen in the likes of Nvidia down a trillion dollars from its highs of market cap? I think it's a little bit of both things, right? I think people are a little concerned about what's going on with the stock market. But frankly, during the time that I've been here,
I see a lot of people excited about AI. I mean, this is a conference that has not happened before, so people are excited to be here to see what's going to happen here. And a lot of people probably haven't been together in this space, and there are so many people. The vibes are, I'd say, pretty good at this moment. Because the moon music had been still one of FOMO. We were just talking with Alfred Lin about how he's
Still speaking with Ilya, who's potentially raising it $30 billion. The ex-OpenAI alumni who are coming out, Mir Marati is raising money. We're expecting just these bigger and bigger valuations with fewer and fewer products actually being offered. People are getting in at such an early stage. Is that going to stay with these public market gyrations?
That is a really good question. I think it's a little bit hard to say, but it certainly is still the case that you only have, I think, a handful of people that are able to command these kinds of valuations, these amounts of money without even saying, look, here's my minimum viable product. You know, like Ilya's company in particular, they have said specifically, like, we're not going to show anything. We're not going to roll anything out until we get to this extremely high level.
of a product. So I think you're not going to have a ton of people like that, but you're right that people are asking questions about just in general, like how much money should be put toward these things, especially if it's not something we've even gotten a hint of what it's going to be yet.
You're speaking with international CEOs as well and leaders of AI businesses. How are they viewing the U.S. as a place to be building right now versus France and Mistral or what's happening in the Middle East or in Asia? Yeah, I mean, I think people are feeling...
It's not totally clear yet how things are going to shake out. I think there's probably a little bit of hesitation, but also I'm not sure that anybody is really saying like, "Oh, I'm not going to do that right now." And we're not worried about scaling laws?
I mean, I think people should certainly be thinking about it. And for a variety of reasons, it's getting more and more and more expensive to build larger AI models that also uses more and more resources. So I think you see people thinking about, well, how else might we be able to build these things and make them both powerful and not and cost effective and also decent for the environment? Rachel Metz is going on stage very soon. We thank her for joining us.
Welcome back to this special edition of Bloomberg Technology. We are live from the HumanX AI conference in Las Vegas. Apple down 2.8%, even as they unveil, well, as Mark Gurman unveils that they're going to be bringing us a whole new world.
updated operating system across Macs, iPads and indeed iPhones come WWDC in June. Not enough to settle some of those worries about the Siri implementation with AI and indeed what's happening with the Google DOJ investigation as well. Yesterday, it seems as though the current DOJ in this current administration still looking at stopping any flows of money going from Apple, Google to Apple. But let's dig into just where the
the mindset is right now. How are CEOs feeling? How are HR departments feeling? How's the labor force? Sarah Franklin is the person to talk about it. That's a CEO where it's bringing artificial intelligence within the HR spectrum and ultimately helping companies navigate progress within their business, culture within their business. But right now I have a feeling maybe the AI output is have fewer people.
I mean, Caroline, we are in a new economy. It has transformed from a data economy to an AI economy overnight. And you're seeing the questions of like, what does this mean for my jobs? What does this mean for my people? What does it mean for my business? And everything you were just talking about as well, how it's impacting public policy, tariffs, everything with electricity to fuel the economy. The AI economy is real and it's very much about jobs.
And at Lattice, we want to put people at the center and the success of people at the center so that AI can be helpful for a people-powered future. And what are you seeing there? You are one of those people and voices who, against the grain, came out and said, we are going to have new co-workers and they're going to be artificial intelligence. What does that mean for disruption of the labor force? What does it mean for the...
ultimate labor force data we get, we can wake out, which currently is starting to see a little bit of a bump up in unemployment. Yeah, I mean, Caroline, in July, we had this vision. We saw what was coming with AI and we wanted to get ahead of it because we believe that we need to put the success of people as a primary. How do we help people understand how to work together with AI where they are your coworker? And how do you manage AI when it's not just about automation, it's about autonomy?
People need to understand that AI will be acting on your behalf, on your brand's behalf, on your business behalf. And so we are ahead of this and we're helping HR leaders be the people that are helping their companies bring AI in responsibly so that we can make sure that every career, every job that's changing,
We can put AI into it in a way that helps people be successful in the future. Mehra Bivaraita was just on saying they've got a survey coming out showing that at the moment CEOs are really disappointed with generative AI, with the productivity lack of gains. How are you measuring success? How are you starting to show up?
that it's helping in the world of HR. Yeah, so this is a thing. This is new. This is an unwritten book for us and people don't know what to do. People are saying, okay, let me just bring in AI, but then you have blank slate problems or you don't really know how to use it. So we need to invest in education. We need to invest in the career pathways. We need to invest in how people can be successful. Are CEOs willing to do that in this anxiety-ridden market where they're just trying to think about the bottom line? They're willing to invest in their people?
CEOs are, and this is where HR leaders have an opportunity to be that rock for them to lean on and for them to really go forward and know what to do to invest in their people and their performance. Because the ultimate judge is how performant is your company. And performant companies are that way when their people are performant, they're engaged, they're passionate, and they know what to do and they know how to use the tools. You can't just throw AI.
at them, you have to say, this is how you're going to use it. And we want to do this in a way that puts the people's success as the primary. Look, I'm going to ask a kind of uncomfortable question with two women sitting here in an AI conference and thinking about who generally is in HR departments.
How are women adopting it in particular, generative AI versus men? How is it disrupting women more in the workplace than men? Or is that just a too basic, simplistic idea? The truth is we're too early to tell. This is all new. What I do love is that as two incredible women here, I'm a big fan, is that women have that curiosity. They have the resilience. They have the ability to adapt to change. And they say, okay, great.
this is new. Let's bring this in and figure out how it can help me, how it can help me and my team. And having that mindset of how we can use this technology to be helpful is the mindset. We don't want to just automate people out of work. We want to bring people into the future that we're creating. This is a massive responsibility that we all share because we can't just create technology for technology's sake. We have to create it for the better of the world and for the better of
business and for the better of people. But will people be automated out of work? Jobs are going to change. It is no question. There is a massive reshaping that every CEO is on their mind is how do I reshape my business? How do I reshape these career pathways? How do I put this in there? And we don't. There's so many questions we don't have the answers to. It's why we need courage in the leadership.
And we need to be responsible, accountable and transparent in the decisions that we're making. And that's what Lattice helps all HR leaders do as they're bringing AI into the workforce. What about your own talent and bringing on people into your own business at the moment? Is it rich pickings as people reorientate their own businesses? You came from Salesforce and they're busy trying to get rid of some talent to bring in more AI talent. Is it fierce to get hold of the people you need?
We are hiring at Lattice and we have a great talent pool that's coming in and we invest in our people. And this is something which I'm proud of as a CEO that I know that my company trusts me and I know that they know that I will be transparent and accountable to the decisions that we make. And yes, investing in the people. We need to also as leaders invest in ourselves. We are not immune to this. I mean, who's to say that we'll have AI salespeople?
people, or AI CEOs, who knows what the future will be, but we all have to embrace this change and we all have to embrace AI in a way that it is just a reality. It is in the workforce and the question is how do we make people the primary benefactor? What about globally speaking? Is there as much adoption and willingness to bring it into the HR space in Europe, in Asia, as there in the United States?
You know, again, it's early days. What I see is from my vantage point as a tech CEO is that the globalization that AI provides us, it really helps us to
battle the misunderstanding that we have when language is a barrier, when culture is a barrier. And that's something that I personally am optimistic about is if we can use this technology in a way to help us collaborate better, remove misunderstanding, understand nuance better. And that's something I'm hopeful that bringing AI into the workforce, it can help us have better understanding. You've been ranked as one of the fastest growing companies, private companies out there.
What is holding back growth at the moment? If you could ask anything of the administration, of the markets, of the environment, what would it be? Uncertainty. We are in a very uncertain time right now. And so the way that we...
get everyone together and go to growth is by being very certain in our pathway and just calming the fears that we're going to eliminate people from all jobs. Say we are committed to a people-powered future and we're committed to building your success. Yes, it's a change. It's happening fast.
We can't be living in that movie, don't look up. We have to know that this is going to happen, embrace it and have the courage and the support of each other to together go into this future and be responsible, accountable and transparent because trust is really the currency of the AI economy. Sarah, it's great to catch up with you here. Great to be here. Have a wonderful time at HumanX. Sarah Franklin, that is CEO. Here in Las Vegas, the music is pumping because we've got a mixture of euphoria around our
for shill intelligence, we've also got a healthy dose of anxiety around these public markets. Andrew Feldman joins us now, Cerebra CEO, who is in the market of updating ultimately access to compute with a whole new way of thinking about bringing the data center to life. Andrew, I asked you in this time where we're worried about
electricity state of emergency you need power for your data centers I know you've got efficient data centers a whole new way of powering that means less power is necessary than the usual architecture and GPUs but does that worry
Why are you in an electricity state of emergency? Look, I think as a nation, we've underinvested in our infrastructure, including electricity infrastructure. And AI uses a fair bit of power. And even companies like Cerebrus, who have the most efficient computes...
In the market, we use a fair bit of power. And so it's not unreasonable that the administration recognizes that power is fundamental, AI is fundamental, and that they have taken some steps to, I think, to eliminate some of the red tape. It takes a long time to bring up new power plants and to deliver those to new data centers. Has it been holding your growth back? I know you've just been deploying in places like Oklahoma City and Montreal, but has the power
infrastructure been an issue? Absolutely. Where these facilities are and how limited and how scarce they are is limiting everybody in the industry right now. These are hard to find, they're expensive, they're driving up the cost of AI. About half of the cost of AI is attributed straight to power. And so I think if we can do a better job at the infrastructure level, then as we provide more compute, right,
across the country, we will benefit from AI as its price drops. Well, let's just remind people of your CS3 system. Ultimately, this is a way of
bringing compute in a different way with a much smaller surface area ultimately than usual tech stack and the usual set of GPUs. How is that selling into this narrative? How are you able to distinguish yourselves because you need less power, because you need less space as well within a data center? That's right. So we chose a very different strategy. We chose to build the world's largest chip, 56 times larger than any previous chip.
That meant we had to move less information and that allowed us to use less energy. And we are awash in demand. Yeah, we're buried in demand right now. Where from? Well, we just announced large customers like Hugging Face, like AlphaSense, like Perplexity, like Mistral.
Remember, AI is made with training and used in inference, and right now everybody wants to use it. And so there's tremendous demand for blazing fast, low-power inference, and that's what we're bringing to market right now. Mistral, a global player over in France, you have had a lot of exposure to a Middle Eastern player, G42. How are you changing that exposure? Because there have been some anxiety you were too dependent on them as a customer. Well,
Well, I think the way you catch three very large customers is to begin with one very large customer. And we began with a strategic partnership with G42, and that's been an extraordinary partnership. And they've been everything we could have hoped for in a partnership. We began deploying with them in the U.S., and through this deployment, we proved to the world that we could build some of the largest data centers, train some of the largest models, and deliver some of the fastest inference in the world.
And that's opened the door for others. And now we're in conversations with the largest players in the world. They were a door opener for us and have been an excellent partner. Is that door wide open when you've got such rules as the AI diffusion rule, which potentially limits you selling into allies as well as so-called adversary countries? Look, we've been a big...
a big proponent and work closely with commerce. That's a confusing rule, to be honest. And if I understand correctly, it's not quite a rule yet. It's a recommendation to be a rule, and it will come in in June, I think, as a rule. I think there are other ways that we could have achieved the same goals. But we support what the Department of Commerce says, and if that's the path, then that's the playbook we use. Do you think it will be, or do you think they'll navigate a way?
My view is I think we can achieve the same objectives with slightly less intrusive approach and I hope they navigate away. But we weren't as cerebral selling China long before the rule said we couldn't. We thought that was the right thing to do and so we chose to follow our ethics. So we will do whatever's right. How will you do whatever's right within these public markets who of course are eyeing an IPO? Is now the right time?
You know, I think there's a lot of things when you go public you can't control, right? You can't control what the president says. You can't control sentiment. What you can control is how you run your company every day.
you can build extraordinary technology, you can treat your people well so they want to stay, you can hire some of the best people from around the world, you can deliver and keep your customers extremely happy. These are things we can control. And whether you go out in a month or a year, those are things I think that fall into place if you build an extraordinary business. And that's what we can focus on. You can't control others' innovation. And I'm interested in the innovation that DeepSeat brought and the idea that
maybe we'll have more and more powerful models with less and less compute need. Are we ultimately just going to scale the applications? I think that wasn't exactly what DeepSeq showed. I think what DeepSeq showed was that several hundred people
and a fair bit of compute, maybe less than others had used, but a lot of compute could produce a very interesting result in the open source community. So building on the work of others, right, work could be moved forward, innovations added.
And I think that the public markets have almost always taken the wrong first step when the cost of compute comes down. When the cost of compute comes down, our market grows. And it's done that every single time for the last 50 or 60 years. And every single time the public markets have thought, oh, the market's getting smaller. But that's not actually what happens. When the cost of compute, when we can do more for less...
New applications burgeon. And this is making the market bigger, not smaller. And you'll be there with the offering of inference and compute? We will. Andrew Feldman, Cerebra CEO. Delighted to have him here. Thank you. Now coming up, so much more. Poolside CEO going to be discussing the future of his business as he focuses in on coding with generative AI. Jason Warner joins us.
Now we return to what's happening in the Nasdaq and the SOX right now. As we know, tumult has been upon the tech sector. We're now up about a tenth of a percent on the Nasdaq 100 after its worst days since 2022. Yesterday, we lost almost 4%. We wiped out a trillion dollars worth of market cap. We see a slight recovery, but still worries there. The semiconductor index down six-tenths of a percent. Here's the Bloomberg Technology.
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Welcome back to this special edition of Bloomberg Technology. I'm Caroline Hyde in Las Vegas. We are live at the Human X AI conference. And there is a tone of anxiety in the public markets that maybe plays into the private sector a little bit. When you look at a magnificent seven actually managing to be now unregulated.
a percentage point having been in the red in earlier trade. We try to understand what the impact of an energy state of crisis is for the United States, state of emergency, how that implicates data center demand. We try to understand what the latest tariffs on aluminum, on metals coming from Canada means for broader risk sentiment. But for now, some reprieve after a harsh sell-off yesterday as people sold their winners. And those winners in 2023 and 2024 were the magnificent seven names.
We want to think about the impact on the private stage and indeed what's happening in terms of innovation. It's not stopping, it's not cooling down. Jason Warner is here, Poolside CEO of course, previously CTO of GitHub, which is now so embodied within the area of helping coders, helping engineers. You are building basically super intelligence for engineers going forward. How are you doing that?
Well, first, great to be here. Thanks for having me. And yes, we're building towards a human intelligence future where artificial intelligence and humans live side by side. But artificial intelligence can do most of the things that humans can do. The way in which we do that is we have some proprietary research techniques. We have dubbed them reinforcement learning via code execution feedback.
But for the layperson, what they need to understand is we're just going to give them the superpower to write software in the future. And anyone who currently knows, it'll feel like being augmented by 100x.
Will that displace the number of engineers we need or ultimately free them up to do more? How are you thinking about augmenting versus replacing? Yeah, I mean, I think the conversation of replacement is always one that pops up. But I tend to look at these things about what we're going to be able to do more of, what we'll be able to do faster. And this is where I get excited because I think about what software does currently in 2025. It underwrites almost the entire economy that we have.
But if you think about what it can do in the future, is it can take something that might be five or six people months of 10 humans to do this, and it can reduce that to compute hours. And that's great for someone like the biologist, or the physicist, or the person doing cancer research. And this is the thing I think about, compressing human knowledge learning into compute hours.
You're not the only CEO we've recently spoken to who's thinking about giving superintelligence and superpowers to an engineer. And look, we just had reflection AI on the show yesterday.
How is the space? How is there an awful lot of startups trying to do the same thing or different things? Distinguish yourselves from the competition. They're all slightly different. The idea here with Poolside is more akin to OpenAI and Anthropic in that we are going after the thing that we might call AGI and eventually ASI. And so what we are at our heart is a frontier AI company similar to OpenAI and Anthropic.
and we are pushing the boundaries on that. We're going via software for technical reasons. We don't need to get into that, but it's very technical reasons. And then many other folks end up in what I would call the AI consumer camp. There will be five or six very large winners who build out the core infrastructure of artificial intelligence, and the rest of the folks will consume the artificial intelligence produced by those companies. So you see yourself as an infrastructure player? I see myself just right next to OpenAI and Anthropic.
Okay. Do you see yourself as a valuation perspective right next to them? Because tell us about where you are and your funding needs and whether you're out there raising money to do this. Well, building artificial intelligence models is a capital intensive game. So at some point, we always have to consider how much compute capacity we have. And that is a proxy for how fast you can go or how big you can go.
So that's always going to be a topic, but right now we're really happy with where we sit. So you're not raising money? We're not raising money right now. What about compute? And what is holding you back right now? Is it energy infrastructure? Is it electricity? Is it access to data centers? What is it?
I would love more time. Yeah. I would love more time for us to go do more experiments. But for the thing that I think about holding us back is really where we are in the world. If I connect this out into a different way, which is if we were in a world of infinite, infinite access to energy, infinite access to compute, and infinite access to data, we would be at AGI or ASI already. Already. Already.
But we don't have an infinite world. We have a constrained world, so we must make different choices. So my main choice that I have to make is how I spend my compute budget. So if you were to ask, my primary concern is always access to more compute. At the moment, where do you get your compute from? We have partnerships across a wide variety of folks, although our primary cluster is with Amazon, AWS Web Services. And is that largely U.S.-placed? What's interesting about you is perhaps people got you modeled up with a French company at one point. I know that you had team members there.
Are you U.S. domiciled? Where are you thinking about your future? We are and always have been a U.S. company. Though we have a presence in France, we have primarily hired our AI researchers across Europe and in the U.K. And so we have an office in Paris, which the entire team happens to be right now because they're doing an onsite, which we do once a month. But we're a U.S. company.
U.S. company and wishing for more compute alongside a lot of other U.S. companies. Jason Warner, it's been great to have him, the poolside CEO, keep a track of that company in the private sector. Meanwhile, back in the public sector, we are looking at shares, the Nasdaq stocks that are in the chip sector, Nvidia as well, a very volatile day. We're currently up a quarter percent on the Nasdaq 100 after a brutal sell-off yesterday, the worst we've seen since 2022. The semiconductor index is still underwater by some four-tenths percent. Remember, Oracle numbers as well, perhaps giving a bit of a dampening spirit
ultimately the demand for AI and how quickly we can get data centers on track. Interestingly, they're still pointing towards 15 to 20 percent revenue growth for the next fiscal years. So pointing that really the demand still remains insatiable when it comes to infrastructure. But thus far, it didn't live up to expectations. NVIDIA, though, rebounding 2.6 percent after it's lost more than a trillion dollars from its market cap in the last couple of months.
Now, that does it for this edition of Bloomberg Technology. Developers like you are building the future, but you need the right tools to move fast and go further, right? That's where Microsoft comes in. With tools like GitHub Copilot, VS Code, and Azure AI Foundry, you have everything you need to push the limits and bring your ideas to life faster. And with security, compliance, and responsible AI built in, you can focus on what matters most.
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