♪ emily: from pier 3 in san francisco, welcome to "bloomberg west," where we focus on innovation, technology, and the future of business. i'm emily chang. every weekend we bring you the "best of west," the top interviews with the power players in technology and media. now to our lead story. a surprise announcement from alibaba. daniel zhang has been named the new ceo replacing jonathan lu, who will remain vice chairman. the chinese e-commerce giant announced the news in its fourth quarter report where revenue was up 45%, and the company turned a $464 million profit. there are lingering concerns

about alibaba's ability to up international revenue. chairman jack ma just announced a hiring freeze. there are concerns about their relationship with the chinese government, which said they are saying alibaba is not doing enough to crack down fraud on the site. i spoke with the new ceo daniel zhang, a former accountant, who went from cfo to coo and now ceo. i asked him what he plans to do differently and when alibaba's management team will stabilize. daniel: we changed the leadership in our fields. we believe that today is the right time for us to bring the young generation to the leadership. as you know, alibaba -- this is a long journey. we need the young generation to participate in the leadership and lead the company to the next part of journey. emily: how will you bring more

talent into the leadership and management roles? daniel: today if you look at our key business units and all the leaders are out of 1970's. we're also trying to bring more and more 1980's, 1985, 1990 young generations to the middle class level and finally to the leadership level. we believe this will be the foundation for our future growth. emily: jack ma said he wants 50% of revenue to come from outside of china. currently that number is more like 9%. what is your target for that number this year? daniel: globalization is one of our core strategies in the future. we start with our cross-border strategies and help -- to chinese consumers. on the other hand, through our ali express retail platform we

help chinese suppliers to sell to customers all over the world. we want to build a global network. a global platform to serve all the merchant and consumers around the world. emily: if it is 9% now coming from internationals, what do you want that number to be? daniel: the business from international, from globalization will continue to grow. now is just a starting point. emily: so what kind of countries can we expect to see alibaba popping up in? where are we going to see a greater presence from alibaba abroad, more specifically? daniel: today through our retail platform, ali express we sell a lot of products to developing countries like

brazil, like russia, and in those countries the consumer product is very expensive. so we help get supplies to those countries. we will cover a lot more countries in the future. on the other hand, we will participate in the growth of certain countries, investment and m&a. we will try to help the young generations and the young entrepreneur in the local countries to do their own business. emily: how do you plan to do that? daniel: actually we have a strategy of globalization. today we start with the cross border, as i said. we will go further to build a global network. as i said, today is just beginning. it is a long journey for globalization. emily: we have heard about the hiring freeze, you know, capping employees at 30,000 employees today. how likely would layoffs be if layoffs are a potential next step? daniel: head count freezing is largely integrated by the market. we will adopt a zero net policy

this year for our head count policy, but we will definitely continue to hire talented people to join us and replace those guys that underperform employees. the purpose of this zero net add in head count is to improve our operating efficiency. we did the same thing three years ago, which gave us very productive results. in five years, we have a dream that we will have $1 trillion u.s. at least, and jack set a target for us at that day the head count in our group should be 50,000 people. today is a good time, we adopt a zero add policy to help efficiency. we are prepared for the future growth. emily: the chinese government has made harsh accusations against alibaba about bribes and knockoffs. what is the state of your relationship with the chinese government right now? daniel: like all global companies, alibaba has a very transparent conversation with

chinese government. we share our views and our plans of business development and also address their concerns. we do everything we can to make sure all of our -- all the business platforms are in compliance with the laws and regulations. emily: new alibaba ceo daniel zhang there. we will be right back talking with twitter ceo dick costolo. that is next. ♪

♪ emily: this is "bloomberg west." i'm emily chang. bloomberg television recently premiered season two of "studio 1.0." my first guest this season was twitter ceo dick costolo. we talked about his improv comedy training and how it prepared him for wall street his relationship with twitter's cofounders, and how he deals with the skeptics who say he should be fired. here is a bit from that interview. how do you and your team deal with that? how do you as a person do with that, when people say you should be fired? dick: i was invited to something a couple years ago and my daughter said, "you should totally go to that." i said, "i don't think i will go because i got invited to it because of what i am, not who i am. i got invited because i was the

twitter ceo, not because i'm dick costolo." i have never paid too much attention to the ceo of the year stuff because the worst ceo of the year stuff is right around the corner. i therefore don't get worked up or frankly care too much when people say those things. in fact, i have had to make myself care a little bit about them only after i started realizing oh, it could affect recruiting if people started thinking, i want to go to twitter, but what if dick is not there tomorrow and everything changes? so i have to pay attention to that and talk to people that i bring into the company and say that is not the case. emily: how does not being a founder affect your ability to lead? dick: jack dorsey could be here and ask him what he was thinking about when he invented twitter. you can't ask me that same question because my answer is i didn't invent twitter.

you can be a non-founder ceo and have real, thoughtful opinions and even certainty about where something needs to be taken that is helpful to the company. i can tell you, when jack saw vine and loved it and knew it was right right away and we both realized we have to do this. i felt the same way when someone on my team came to talk to me about periscope. right away it was we have to make that part of the company. my daughter at the end of 2014 texted me and said, "i have bad news and good news. the bad news is an article said that you were one of the worst five ceo's of 2014." "ok, what is the good news?" "you are number five. the good news is you are number five." i view that as a lesson to not get too carried away one way or the other on the sorts of things. emily: my interview with dick costolo from the premiere of "studio 1.0," which you can find any time online.

from twitter to salesforce another san francisco-based company. people familiar with the matter say microsoft is making a bid for salesforce after the cloud giant was approached by another suitor. would such a deal make sense? we spoke with matt mcilwain from seattle-based madrona venture group. matt: i think their aspirations are to be a winner at both, the infrastructure in the cloud as well as software as a service. i don't think either of those would be enough to justify buying salesforce. i think the bet on salesforce is to say -- can we build intelligent apps together? data-driven apps are going to

be the smart apps of the future. for example, salesforce bought a company last year that used technologies combined with microsoft data and technologies like exchange, and that delivered intelligent services to companies. cory: i'm going to back you up for a second. you said microsoft needs salesforce's engineers and their imagination? matt: i think that is correct. particularly about software as a service application. there are things it has done not just engineers, microsoft hasn't fully figured out yet, and that together they could build this next generation of smarter applications for the enterprise. cory: that is interesting. my excel spread sheets on this deal have been burning over the last couple of hours. i've been trying to look at ways it makes sense. salesforce, it is what it is but it is also a compilation of

a bunch of recent acquisitions that have been very expensive to the company without delivering profit or free cash flow after the cost of those acquisitions. anyone in the industry can see that they are doing a lot of acquisitions to boost revenues but they are not getting the free cash flow that would result from it otherwise. they are just spending a ton on marketing. matt: i agree with your analysis. it is risky bet on a company that is already highly valued before the run up have seen in the last few days. that's why, you know, it is a big bet if that is something they are trying to evaluate here. certainly the rumors suggest they are. if so, it is not going to be just because cloud makes you better. cloud or microsoft is coming on strong and really the data analytic that you can embed into all of those solutions, that would be the bet.

part of the reason that matters, cory, is there is a lot of usage and understanding in both what salesforce delivers in its own products as well as things built on their platform. emily: cory johnson with matt mcilwain of madrona venture group in microsoft's backyard. up next, are we in bubble territory? i'll speak with parker conrad, the ceo of zenefits, which just raised $500 million. ♪

emily: this is "bloomberg west." i'm emily chang. the money keeps flowing to tech startups and shows no signs of slowing down. last week, payment startup affirm raised $275 million. the drone maker dji pocketed $75 million. and h.r. software startup zenefits scored $500 million.

are things getting a bit too bubbly here? cory johnson and i spoke with parker conrad, the ceo of zenefits. parker: basically a lot of businesses out there are going after a couple thousand of the largest companies in america to sell them business software. there are so many of these companies out there that there are a lot of people we need to have conversations with, that we need to give pitches to, and that we need to field questions from. there are a lot of folks we need to hire. long-term the business looks very profitable, but a lot of those costs are front-loaded so when you want to go very fast and very far, you're going to burn a lot of gasoline. this car that we're driving at high speed and we want to get a lot of customers, we have to make the mother of all pit stops to fill up on gasoline and beef jerky. [laughter]

emily: i appreciate the metaphor. we have been speaking a few time over the last year or so. a year ago it was a $100 million evaluation. is it scary to take on this responsibility? parker: definitely, you know there is a little bit of celebration. i think a lot of humility about what is in front of us. obviously investors are investing on the promise of a lot of future growth and execution in the business. we feel that, you know, what the market that we're going after is absolutely enormous. it solves a really big problem for almost any business in the united states. we think that, you know, if we don't screw it up in a couple of years, a lot of guys in this round will look prescient. cory: what kind of growth are you talking about, and what do you imagine they are going to be now that you have filled up on beef jerky? parker: well, you know zenefits is the fastest growing

business in silicon valley. it is two years old this week. we started off in 2014 with about $1 million in revenue. we closed having grown $20 million. the plan for this year takes past $100 million in run rate revenue by the end of the year. we want to keep growing at those kind of rates into 2015, 2016, 2017. when you want to grow that quickly, you need to really capitalize the business well. emily: let's take a step back and talk about what you do. you tie together payroll health insurance. all of these different kinds of h.r. things into one software. right?

parker: that is the idea. basically companies today have all of these systems related to their employees. benefits, time tracking software creates an administrative nightmare for a lot of people. zenefits ties it all together. you get rid of the administrative burden and the compliance headache. we give the core software away for free because we make money on all of these different spoke and adjacent systems. cory: you're saying it is like a lead generation basically for those other businesses, right? parker: that is one way to think about it. it is almost like a premium model. emily: how does the affordable care act affect your business? parker: it does a couple of things in the insurance market that makes it simpler to price health insurance, which makes it easier for us to do it online. it also quite frankly adds to the compliance burden for a lot of small businesses. there is a lot of filings they need to make and compliance they need to deal with. what it does is makes it harder and harder for a small business to roll their own on this stuff. zenefits, we can take all of that off their plate and handle it for them. so it makes our value proposition really compelling. emily: do you watch the show "silicon valley"? parker: occasionally i watch the show. when i'm fundraising, sometimes it is a little too close to home. i stop watching it then.

emily: there is a scene in the show this season where the main character is talking about raising money, and someone tells him, look, don't raise that much money. you might go through a down round. he said maybe i'll raise less money at a lower valuation and says no to a lot of people trying to write him checks. would that ever happen in real life? do you as a ceo think maybe i shouldn't be raising because it is too risky? parker: it depends on the stage of the company. our view of our business is all of the underlying metrics are pointing in the right direction. every customer we acquire long-term we think is extremely profitable. all signs point towards us stepping on the gas. so for us, you know, we -- my goal is to run the company so that we never need to raise another round of financing. we want to capitalize the business in a way that lets us run the company in a way we want to run it, scale at the speed we want to scale, and go

out and grab this giant opportunity we see in front of us. emily: we just heard from zenefits parker conrad there about the company raising $500 million in its latest round. in light of the messaging app secret shutting down after it raised more than $35 million are these investments secure? i asked mike hirshland of founder resolute ventures. how do they make sure investments will be spent responsibly after one of them bought a ferrari? mike: i think it is very risky all around. emily: risky or irresponsible? mike: it certainly can be an irresponsible thing. i think the worry is that it changes incentives. emily: once you give these guys money, how much follow-through is there? how much are you looking at how are they spending it? did they buy a red ferrari? mike: the important thing is how are they thinking about spending it before they raise it?

ideally investors will spend time with the management team. emily: do you think investors knew they were going to take that much money off the table for themselves? mike: they agreed to it. whether they knew it was going to be spent on red ferraris. emily: why do investors allow that to happen? why would an investor allow that to happen? mike: i think the only reason is because they really want to get into the deal and that is the bargain the founders are willing to strike. emily: secret was extremely buzzy at the time. now 16 months later it is completely shut down. what kind of diligence is done to determine whether the company is going to be successful? mike: that depends on the company. a company like zenefits is different than secret. zenefits, you're talking to customers and understand the market. secret, you're looking at user behavior and tension. not just the number of users. how many users are coming back? how frequently?

is it something that becomes habitual behavior? emily: should we be concerned -- you see a lot of companies struggling. on the opposite end of the spectrum, you're seeing zenefits raise $500 million. what is going on here? mike: we should be concerned. i think these large valuations make a ton of sense as long as the tide keeps rising. we know every up cycle is followed by a down cycle. none of us know when that shift is going to happen, but when it does, it is going to be a painful thing. their burn rate grows into that capital raise. if a company gets in a situation where they are going through that capital very rapidly, the market turns, it is going to be difficult to raise more capital, and that can be a very dangerous place.

emily: you think this down cycle is definitely going to happen? mike: definitely. the market is riding a high, and it will not continue to go up. emily: how much longer do we have? mike: none of us know when. we all know that it will happen. emily: what do you think companies need to do in taking on this kind of risk? mike: i had this conversation with one of my ceo's. he raised $200,000 his first round and has done well. the conversation is be really, really thoughtful. raising the absolute maximum you can at the highest valuation often is not the answer. emily: really? you would do like the guy on "silicon valley" then and take less? mike: i oftentimes would. this ceo actually did that. emily: so it does happen? mike: it does happen. sometimes boards and ceo's and founders are very thoughtful and don't go for the biggest numbers. emily: mike hirshland, founder resolute ventures. up next, lending club ceo renaud laplanche talks earnings and whether he is worried about competition from big banks. ♪

♪ emily: you are watching the best of "bloomberg west," where we focus on technology innovation, and the future of business. some big banks are taking on startups. should leaders in the area be worried? the property reported a loss for the first quarter on revenue of $81 million. it facilitated $1.6 billion in loans. for more, i spoke to lending club's ceo renaud laplanche. renaud: out of banks are competition. our competition has been to compete with banks. we want to partner and sit down in the marketplace. i think the banks are increasingly realizing that

they can earn higher yields by their own customers through the lending club platform because they have lower operating costs and more technology than the banks. now we are seeing larger banks with a partnership with citibank. an announcement from goldman sachs about partnering. emily: do you consider goldman sachs competition? renaud: not at this point. we are good at different things. we have succeeded in the space and become the leader in marketplace lending.

we grow 100% year-to-year. the results you saw yesterday are guidance. we have a low-cost operation. we are very consumer friendly, approachable brand. we have a deep expertise in consumer marketing. goldman sachs is not known for that. they have other assets. i think goldman sachs, other banks are very complementary. it is with everyone's interest to drive down the cost for consumers. emily: you have been cutting rates. how long can you maintain that? renaud: we don't feel we need to lower rates. we are very competitive. we offer to borrowers. many of our customers use our loans to pay off an existing credit card balance. the interest is 17%. the average interest rate on a lending club loan is 5%. it is a significant value. we take advantage of the network effect and an appetite from investors to have lower interest rates. i think we are at the right place right now. we have a good balance between investors and borrowers. borrowers are getting a great deal, and investors are happy

with the returns. emily: you have been public for five months. what is different about being a public company? do you enjoy it? renaud: it has been positive so far. it was a big marketing event. we had ipo in december. since then, we have continued to grow. we are getting the benefit of better brand awareness and brand credibility. we see that with incoming traffic. we are seeing it with retail investors in greater number in the first quarter. we are benefiting from the momentum of the ipo. we are seeing it in our ability to attract customers. we see it in the partnership strategy with citibank as well as sam's club and others. we benefited from a public company and the transparency that goes with it.

emily: lending club founder and ceo renaud laplanche. up next, how technology could help political rookies on the presidential campaign trail. ♪

♪

emily: i am emily chang, and this the best of "bloomberg west." there are now six candidates in the race for the 2016 republican presidential nomination. two of them have never held political office, former ceo carly fiorina and dr. ben carson. how can technology help them gain an edge in the race? i spoke about it with zac moffatt, digital director for mitt romney's presidential campaign and cofounder of targeted victory. zac: the challenge is to create communities to be successful in november. what they are looking to do is remove any barriers of entry to make this a simple as possible to participate. that is the goal of every one of these campaigns, to make it as easy as possible to add value to the campaign. emily: what kinds of things are you seeing in the digital trends that unfold in terms of how the presidential candidates are managing their digital strategies?

what sort of trends are you seeing solidify here? zac: a much more mass adoption of digital as a platform of choice. even four years ago it was hard to get everyone to focus on twitter and the hardware and software, the bandwidth wasn't there. you could not have had a periscope or a meerkat four years ago. we were carrying massive backpacks around to allow people to participate with the campaign. social media provides a level of access to the campaign that would be impossible otherwise. you can leverage those platforms and it improves the process and improves one's success. emily: should campaigns be spending more on social media and digital than they do in the past? should they be allotting more of their budgets to this? zac: i would argue that they should. there is the investment in human capital. an investment up front.

i think every dollar you spend now comes back fourfold in the long run. i think it's difficult for campaigns. technology is very disruptive. i think that is on the set up front. on the paid media component, we are still disconnected from how people consume a content. we still spend on broadcast heavily. 80% was spent on broadcast even though it has only got 40% of the viewership. a lot of this has to be fixed in the cycle. emily: you managed a budget of $100 million with mitt romney. how would you spend it differently today? zac: the hope would be that instead of being 10% of the budget it would be 25%. i think you would spend earlier. you have to win a primary. not everybody gets that coordination that hillary clinton is going to right now that allows them to invest in the future.

in the primary, you have to build things that have value to you right now. i would invest heavily in the technology side and the human capital to build that out to be prepared not just for the primary but for the general and have those resources be successful. emily: more broadly, what you think has changed in this digital arena since you have worked for mitt romney? what can candidates tap into? zac: there is such a greater adoption of online. i think we are seeing that from everyone else. there is greater participation and people are more comfortable giving online at. they are much more conditioned through amazon or netflix. they are used to living online. we found one in three likely voters did not watch live television except for sports. if you want to communicate with them, you have to be online. i think the model has changed and presidential's are the way people see that scale. emily: you are seeing a lot of infighting between the candidates over social media. how does that play out, and how does that affect their digital strategy?

zac: that is somewhat generational. also seeing the way campaigns are being run now. i think it is a lot more -- people are inserting themselves personally into the process. you see reporters insert themselves into the story and share point of view. that is to be expected. we are still comprehending how social works. there is a lag. it's interesting that staff is driving as much of the story as it is the candidates themselves. emily: zac moffatt, the digital director for mitt romney and cofounder of targeted victory. up next, technology and city planning. we learn about a high-tech hub being built in saudi arabia. ♪

emily: this is the best of "bloomberg west." i am emily chang. silicon valley may be the heart of innovation it, but a new mega-city in saudi arabia is fusing urban planning and technology. the country is building a high-tech city on its coast, kaec. 80 companies, including ikea and pfizer, are going to be in the plan. i spoke with fahd al rasheed the kaec ceo, about it. fahd: it has been in the works for nine years. by the end of next year, we will have the largest port in the red sea. it will be the largest private port in the world. we have the largest developer in terms of residential units. we wanted to be the most innovative.

emily: $100 billion to complete this city. it may be larger than washington, d.c. by the time it is done. how do you ensure that this place is going to be the future? fahd: we want to make sure that the 2 million people live there are going to be engaged. we want to give them applications that enable them to help us run it and keep the streets clean. emily: we are talking about housing and health care. how do you prioritize? fahd: it's not about the technology, that is the enabler for the resident. the idea is simple. you will be able to manage things. we are going to introduce smart applications into the home to let you know how much energy you are using. we are talking to everyone in silicon valley. emily: like who? fahd: i can't tell you. emily: what do you want silicon valley? fahd: there is the network and the applications that will run the hardware. that is why i am saying that the small companies are as

important as the big ones. we can actually scale. we have 400,000 units that are going to be built. we can actually scale them. emily: when is this going to be completed? fahd: you never complete a city, it is always renewing, but by 2035, think we be 2 million people. 3000 people have moved in. by the end of year it will be 10,000. emily: what kind of demand is there to live in a place like this? are people uprooting themselves of other parts of saudi arabia? fahd: 55% of the population is under 30. they are the biggest users of youtube and twitter in the world. they are very mobile. we are giving them the opportunity to live and work in one of the most progressive cities. emily: what is the sales pitch out there? fahd: come. find a place to live. emily: what are they going to do for work?

fahd: we have great jobs from all over the world. there are so many companies that are invested for the first time it. they are setting up in the country and they can build a great career and have a great home. the red sea is one of the most beautiful places in the world. emily: king abdullah economic city ceo fahd al rasheed. to real estate close to home google's plan to build a new campus in mountain view has suffered a big setback. the city council awarded linkedin 1.4 million of the 2.2 million square feet available for its own campus. is it game over for google's big plans? i spoke with "bloomberg businessweek's" brad stone. brad: the city of mountain view and other cities in silicon valley, they look for economic diversity. they don't put all their eggs in the basket of one company.

\in the basket of one company. they are worried about one company getting too powerful. they are into student traffic congestion. it is a mess right now. matthew created this artificial -- mountainview created this artificial limit on the amount of space to can be developed. there is a fight for that space. it's not like it was awarded to linkedin. they have to pursue other avenues to try to develop these incredible pictures you are seeing right now. emily: let's talk about the googleplex. it is incredibly innovative and futuristic. brad: all of the technology companies are trying to build iconic headquarters that rethink the relationship between them and the surroundings. google hired two european architects.

it is for a much directed by larry page. emily: there are no floors? or there is one. brad: right? you can avoid the stairs because it slopes upward. there are these huge canopies that can control the climate. they reduce glare. you work more in the open and it is open to nature. there are lot of ideas in this proposal. the idea is to create a flexible space to can be tailored to suit a company's needs. emily: how big of a blow is this? do they have more options here? brad: it's a temporary setback. it also owns a lot of other land. it wants to build near the current googleplex. i think this process will play out and google will find a way. emily: so the googleplex will happen, you are saying? brad: i definitely think so. emily: "bloomberg businessweek's" brad stone. up next, former j.c. penney ceo ron johnson joins us. ♪

emily: this is the best of "bloomberg west." he pioneered apple's iconic retail strategy, led j.c. penney, now he is taking the tech experience to your home. ron johnson has launched a spot that allows people to shop or technology products and have

them delivered and set up at home for no extra cost or it can he reinvent the retail experience? i asked if it will be like apple's genius bar. ron: it is a great way to buy a new product. you just go on enjoy.com and schedule a time and place. we will deliver it and spend an hour getting you up and running for the same price you would use at the store. emily: it sounds like something i would use. this is just electronics. tell us about some of your partners. ron: we have a lot of partners and we have -- in two weeks you'll be able to buy your new smart phone. just go to the website. then you can schedule a time and we will hand-deliver your smart phone. we have gopro cameras. we have hp computers, lenovo computers. we even have a ride like a boosted skateboard. emily: sprint does something similar. they will bring you a phone on demand. you say you will bring it in an hour. on average, how long will it take me to get a phone to my house? ron: you can go on at&t's website, and within four hours we will hand-deliver the phone. it could be here in the studio if you wanted. emily: i could think of a few things i would like. a big screen tv, for example. you obviously have a deep knowledge of the retail industry. i wonder how you came up with this idea? why you see this as an opportunity? ron: i was in retail for a lot of years. i want to rethink how we experience products. i noticed that the world is going mobile. young people today want to work mobiley, they want to drive for

a company like uber. there is a lot of delivery becoming a big part of our life. we are moving toward mobility. that is where things get complicated. and so, someone has to take on the complexity. if you want to have a smart home, who is going to help you put it all together? we think it's time for someone to go through the door of your home to help you navigate this new world. emily: how big of a threat is amazon to retail in general? it just seems like they are eating everybody's lunch in trying to do everything like same day delivery.

ron: it is a great company and they are in their 20th year. they are the inventors of e-commerce as we know it. their hallmark is convenience. they are a great place to buy and have something delivered. but that is really their strength. emily: what is their weakness? ron: when you need help. we live in a world where you want personal service. that is what stores do well. we are trying to take a digital purchase and pair that with service. we've been in business for six months. when you change the location you change the game. emily: you revolutionized the apple experience. j.c. penney was another story. why is this going to be more the former than the latter? ron: i have had a chance to learn from everything i have done. i have been in retail for 30 years. overall, my batting average is pretty good. the most important thing that is going to make this successful is people are clamoring for personal support. you want a human connection. you want to bring that to people everywhere.

it's going to be wonderful. emily: what you think about the apple watch? ron: i like it. i think it's a great first generation project. people are learning how to use it. i think we will look back and that will be the first wearable that we wore. emily: have you tried it? ron: i have. i don't have a today, but i do have one. emily: how you think about the way they are selling it? ron: they are showing people how to use it in stores. there is such demand for their products. they want to make it fair for customers to get it. if everyone goes online, it is a first, first-served approach. emily: you think it's a good call of angela ahrendts? ron: i'm a huge fan. angela and i have known each other for years. they love her at apple, and she is doing a great job.

emily: speaking from your apple experience, what have you learned that you will do differently at enjoy? ron: it takes a long time to build a business. it seems like they happen overnight. it takes time. i keep telling my team, we are going to build this one visit at a time. we will learn from each one and get better and better. there really is no race here. it's about building a great company that lasts. you go on our website, enjoy.com, and to see our brand come alive on the internet. we handpick -- i know everyone of them personally so far. emily: you've got 127 employees, and you are just launching today. how will you make money? ron: it's simple. today, most products are priced to go through a store. stores invest in a lot of things that don't help a customer -- big buildings,

rent. we invest in our people. if the investment is in a person, you can deliver that for a lot lower cost. emily: enjoy ceo ron johnson there. he is the former head of apple's retail stores. that does it for this edition of the best of "bloomberg west." we will see you next week. ♪

stephanie: stan druckenmiller has one of the best records and now he is sitting down with me. what he is worried about, what he is betting on, and where does he see the markets heading. find out straight ahead on this special edition of "encore." druckenmiller: why does the economy need holding up now? it would be remarkable to me if the run in the euro is over. there is good debt growth and there's bad debt growth. stephanie: welcome to bloomberg "encore," i am stephanie ruhle. it is hard to find anyone with more insight in investing. he spent years working under george soros. we sat down recently for an