Live from Bloomberg Tech in San Francisco, Part 2: Hatch's New Device, AI Fear, Grammy Winner Hit-Boy

**SPEAKER_1** (0:02)
Bloomberg Audio Studios. Podcasts, radio, news.

**Carol Massar** (0:07)
You're listening to Bloomberg Businessweek with Carol Massar and Tim Stenovec on Bloomberg Radio.

**Carol Massar** (0:14)
We're here in San Francisco at Bloomberg Tech, and we've been talking to a lot of great voices. But what's really also pretty cool is, what's up on the stage is so many members of our Bloomberg team, including our own Ed Ludlow, having great conversations, we get to talk to him about what he's heard, and also the conversations he had.

**Tim Stenovec** (0:34)
Yeah. Ed Ludlow is the co-host of Bloomberg Tech. He joins us here on-site at the summit.
I mean, I'm a little biased, but I have to say, I feel like every year it gets better and better. This is the third year we've done it. Yeah. The energy here is unbelievable.

**Ed Ludlow** (0:48)
Yeah. I mean, it helps Anthropic filing confidentially on Monday for an IPO in SpaceX pre-pricing last night. It helps.
That's what people are talking about, right? But also, how interdependent all of the speakers on stage are in those industries. Founders fund, they're a huge investor in SpaceX. The founder of Anthropic on stage having filed, kind of crazy. So that's the reality of why people come to this. It's because of who will be in the room and who's listening.

**Carol Massar** (1:19)
Listen, you spend so much time, you and Caroline Hyde on Bloomberg Tech every day, trying to go through the hype versus the reality. What do you feel like the mix is here? Because when it comes to AI, there's a lot of optimism as we know, a big spend, but there's also some cautiousness. We've got a lot of speakers around here today.

**Ed Ludlow** (1:36)
Yeah. Well, what I would say actually through the lens of somebody who was on the show this morning, which is a Paul of Agrawal, he works at Altimeter, works with Brad Gerstner. They are investors in SpaceX, Anthropic, and OpenAI.
And so the way that he explained it is that all the people that are here and all of the conversations we're having, you have to allocate yourself into one of two buckets. Are you in the role of backing companies that are the capital expenditure deployers or are you backing the capital expenditure receivers? That's what's so interesting. So think about Cerebris last night. Are they a capital expenditure deployer or receiver? They're a receiver, a potential beneficiary of what's going on. So that's how the mindset of some of these attendees is working.

**Tim Stenovec** (2:24)
What about even taking that one step further, Ed, and extrapolating that out to what venture capitalists are finding interesting right now?
I mean, certainly the IPOs are getting a lot of the attention and getting a lot of the oxygen of the model makers, hyperscalers getting a lot of attention. But then what happens when those companies are public and AI creates this layer of technology that then other companies can build upon? We're going to talk to Katie Hahn in a few minutes over at Hahn Ventures and we're going to ask her the same question, but-

**Ed Ludlow** (2:53)
Great conversation to have. Yeah, so like, well, first of all, it's not as simple as IPOs. So, you know, I'm aggregating all the conversations we've had, but yes, okay, it's very exciting that SpaceX and Anthropic and like the Open AI go public this year. It's not a race to IPO, it's a race for capital, right? It doesn't really matter if you're a public company already or not. Case in point, Alphabet, $84 billion equity offering. Yeah. NVIDIA right now, don't forget that the story with NVIDIA was to declare the dividend and use cash for buybacks. That is the opposite of what an Alphabet is doing, you know, raising equity.
And so the main point, like Carol, I think I literally verbatim said this to you in the last 10 days.
There is a limited, finite pool of capital and liquidity in the world. It's not infinite. So to facilitate those IPOs, to bank Alphabet's equity offering, you have to make a conscious decision of which one you think in the end will win.

**Tim Stenovec** (3:53)
It sounds like he's talking about data centers using power, because there's also a finite amount of power, and it's like all about allocating that power.

**Ed Ludlow** (4:00)
Yeah. Yeah. I mean, you know, so there's also news that comes out of these conversations, right? So Andrew Feldman, the CEO of Cerebris last night, the headline is kind of weird. We are working with everyone except NVIDIA.
What? Aren't you a rival to NVIDIA? The point is that the industry is massively supply constrained. Demand for AI hardware can't keep up. Supply can't keep up with demand. His point is, we're going to have to make concessions where we take components from rivals in our server design, and that allows us to actually get the thing built. Apart from NVIDIA, of course, who are the biggest rival in terms of compute.