intense, commandos fired 5000 rounds of ammunition. seven men and a woman were arrested. police are sifting through the rubble for more casualties. islamic state group says it has executed two hostages, one of them a norwegian and the other chinese. this after demanding a ransom for their release. most americans are against the president's relocation program for serious refugees. that is the result of our exclusive bloomberg news paul. more than 50% of those surveyed once the u.s. to abandon plans to resettle syrian refugees here. the nation is divided about sending ground troops. nigeria's boko haram is the world's deadliest extremist group.

increased 300% last year. i am emily chang and this is "bloomberg west." a crucial litmus test. a sunny forecast from a cloud computing giant. shares of salesforce.com had higher after hours. talk about a solid resume, i sit down with an interview with reid hoffman. waiting to big initial

public offerings this week, square and match both expected to price their ideas any minute now. what are we expecting? let's start with match. match group is the parent company behind okcupid and .ender then, of course, there is square. -- it hasthe company been a rocky year for the ipo market. these companies have what it takes to turn it around? is ang me now in new york reporter who has been beating the drum. alex, i want to start with you. some dispute about the square valuation. it is apple to oranges, you

cannot compare public to private. $5.7 --looking at a $5.7 million valuation. alex: the most telling thing, they're marketed range, they are looking at $11 to $13 a share. you there is some type of discrepancy. the whole conversation up to diluted share value, maybe that is time for another show. bottom line, that private valuation is not what they are looking at. it has cast a shadow over these companies and over investors who might be looking to get into the next big private round. emily: i do want to ask for your thoughts on match. we have not talked about it as much. tender is their most popular

business. alex: it is the really well known one, but it is not the moneymaker. you own two thirds or more of this online dating market, it is a fragmented market. what is next? obvious answer to what is next two years ago? permeated the industry. -- theych was under bought plenty of fish recently. it seems to be the best growth playbook for them right now. emily: match and square will start trading tomorrow morning. i want to ask you, what is the number one thing you will be looking for tomorrow? what theant to see

reaction of investors is. there is a poll from investors, so excited by the growth, the celebrity ceo, they should be interested in the stock. most people that follow square our payment analysts. we are all fairly skeptical of squares business. is it worthwhile growing fast? tol it be profitable enough be enough -- to be in the range that was set? emily: i talked to analyst yesterday who was very positive on square. this is not a tech company. this is a payments company. it is a strong solid business if you look at it as a payments company. gil: i dispute that a little bit. theirre losing money on

transactions every quarter. what all of their comparables are quite profitable. they are growing very fast because they are in a business that others do not want to be into. that is why square is losing money, they are serving the smallest merchants and giving them a very attractive price. that is why they own that niche. emily: interesting. alex, we were talking about the ipo market in general. how much do you think the environment will be playing a factor? environment-- the is definitely an overhang. this premium for this high-growth company, we have not seen that come through.

it is a bit of the overhang. that might be why we see a bit of a conservative price. it is -- if the business is solid and investors want in, it does not really matter so much the market conditions as long as we are not in a freefall. it is good enough to go out right now. that is why they are crossing their fingers. emily: we are waiting for that price. thank you very much for helping us cover square on the road to this ipo. another stock we are watching is salesforce. pioneerd computing reporting a 24% jump in fiscal third-quarter sales. it earned $.21 a share on revenues of $1.7 million. wall street had been looking for

$.19 a share. salesforce is raising its guidance for the year. oflysts had expected sales 7.9. an interview with reid hoffman. i asked him which of the biggest social networks would survive. ♪

they: this week, i had chance to sit down with linkedin cofounder reid hoffman for a wide-ranging conversation on everything from the future of social networking to the rise of artificial intelligence to the .ndgame for uber in china hoffman is a noted venture

capitalist investing in airbnb and facebook. i asked him the not so simple question, are we in a tech bubble? thing, it tends to be a private market bubble. it does not have as much public market impact. it is not something that when you hearken back to 2000, 2001, you worry about quite as much. emily: we are not in a bubble in the public market. -- quasi-s i bubble bottle. emily: mark andreessen saying we are in a long-term bust and tech is undervalued. why is there such a diversity of opinion? believew much do you that new things will be invented

that are not invented yet? from anbuild companies idea to something globally relevant in three years, four years, five years. dropbox.bnb, they can move very fast to global relevance. they can be important to a impact all industries. technology will be part of the solution and not part of the problem. on the other hand, ok, a lot of investors are betting on this broadly and you get valuations where you look at a specific valuation and go, why is that valued that way? people are not distinguishing sharply between which companies benefit in which companies do not. that is the key issue where breaks between the bowls and

bears.- bulls and emily: is it really subjective that we are in a bubble? reid: no one ever disputes bubbles in retrospect. clearly, that was artificially inflated and had a re-correction. the question comes down to, it looks like some of these valuations are high. when you can pinpoint specific companies, which i will not do because it is impolite, that one seems a little crazy. private valuations are much higher than one public -- that one companies go public. you get those kinds of things where look, clearly some elements of a private bubble. however, i think we are going to

see more of these companies that go from zero to a billion numbers in less than a decade that actually have global impact. emily: are you seeing down rounds? reid: not privately yet. emily: but we are seeing them publicly? is the ipo the new down round? reid: if private market valuations continue, we will see more of those. the inflection point you see is a protection. wese investors have said ok, invested at the current price x years ago. when you choose the company's going up, you went on up -- ies goinge compan up, you win on those.

it is not clear to me we have any actual real lay-ups because you have the financial needs. we need to regroup how we are attacking the problem. part of what a layout does is to communicate the message to the entire team to say, we are really shifting from this to this and we are playing a new game and we are in troubled waters. i have seen those. i have not seen, we will not the able to make payroll in two years, so we have to lay off. what do you make of that journey? reid: what happens is, and this is the reason why i think there is this quasi-bubble in private, public markets have a lot of

interdependent feedback. they can stabilize the price. private tends to be the player that puts the biggest check forward. it is very easy to get an inflated valuation. the upward trajectory of the market. that does not affect things like the internet bubble, the pension fund because it is a very focused small position. not a general public market position. we will see more of them because people are trying to figure out what are the next airbnb's? that really matters to them economically. sometimes, you get -- you guess wrong. emily: you are on the board of airbnb. do you worry about them living up to that?

reid: in the airbnb case, i do not worry about it. essentially, i think there is a lot of headroom for what airbnb guestsng the most two around the world. -- the most to guests around the world. over the long-term, the investors will make significant money. in that specific one, i am not that worried. i believe so much headroom where airbnb can go. emily: what about dropbox? reid: a killer team, great technology. how does their enterprise play out? they have some other plans i cannot talk about. if those play out, it will be great. if those do not play out, it

will still be great. is it the next platform for the internet or not? we will see. emily: dropbox keeps getting brought up as an example of a , ororn that might be dying certainly not living up to initial valuation. reid: i guarantee you that dropbox is not dying. the question is about expectation. their fundamentals are really strong. they have a broad subscription business. will they create -- will dropbox be a platform for a whole a lot of different applications? to thethey will live up high expectations. if not, maybe will be, it is only e-mailed -- a multibillion dollar company.

emily: our special coverage continues, hoffman dishes on one of his biggest missed opportunities as an investor -- snapchat. that conversation is next. ♪

continuing my conversation with reid hoffman. revisit a regret. reid: most of those stories came from public market investors, most notably fidelity. it is different than how private companies operate. if you index against a public market, you would end up with times where you would say, you would take a great company x and say we marked it down this quarter because there is a

variation of public market. that is not how the private market thinks about things. it is not the timeframe on which we should evaluate these companies. emily: do you find it alarming? reid: i do not pay attention to it. emily: what about snapchat in general? you are the guy who created the professional social network. where is all of this going? macro evolution to networks, mobile, people are spending a lot of time with it. those macro trends continue to be an upward direction. one of the things particularly great about snapchat, and i am not on the board or investor, they demonstrate an ability to

create new products. here is a new social product that everybody pays attention to and starts building their own versions. that is very good evidence for a strong future. emily: do you see social networking as a much more disparate thing? will there be a few dominant players? andagram and whatsapp facebook and linkedin, it is just too much. it cannot possibly be sustainable because i will make a choice. reid: there are a lot of people in the world. if everybody makes the exact same choices, i agree with you. look, teens say the disappearing content matters to me.

it helps me create privacy. -- i do not snapchat, i presume that you do not snapchat. you can easily get to more than three to five companies because everyone's list is different in different cases. emily: what does worry you right now? reid: the primary thing i pay attention to is, we have seen a lot of great companies traded, what are the company's -- great companies being created, what are the companies being created now? we have not seen an interesting mobile breakout company in the last couple of years. is that because we are not finding them? as a venture capitalist, we are looking intentional --

intensely. companies is more car .n addition to tesla biology,section with other kinds of things that will have macro impacts. those are the two things. i am an entrepreneur and i am an optimist. emily: interesting that you say mobileere has not been a breakout company. that would concern me. reid: there are just cycles sometimes. maybe the right invention has not happened. maybe mobile distributions are difficult to figure out.

web, the mobile ecosystems tend to be more closed platforms. they are driven by a narrow aperture in the app stores. maybe someone will figure out how to make that happen. emily: my interview with reid hoffman continues. we will be talking about his , on his call that a third of unicorns -- a herd of unicorns can exist. ♪

i just had a horrible nightmare. my company's entire network went down, and i was home in bed, unaware. but that would never happen. comcast business monitors my company's network 24 hours a day and calls and e-mails me if something, like this scary storm, takes it offline. so i can rest easy.

what. you don't have a desk bed? don't be left in the dark. get proactive alerts 24/7. comcast business. built for business. tand that's what we're doings to chat xfinity.rself, we are challenging ourselves to improve every aspect of your experience. and this includes our commitment to being on time. every time. that's why if we're ever late for an appointment, we'll credit your account $20. it's our promise to you. we're doing everything we can to give you the best experience possible. because we should fit into your life. not the other way around. emily: this is bloomberg west. it is 6:30 p.m. wednesday here in new york. we are joined for a first word update.

heidi: good evening to you. we will be watching how markets in this part of the world react to the federal reserve minutes. cards next is on the month. it may well become appropriate to raise the benchmark lending rate in december. a couple of officials were concerned the wording could be misinterpreted as being too strong. it is decision day at the bank of japan. -- 41 economist said abe even so, there may be some action announced. backresorts have pushed the opening of its casino in macau and to the end of june. it has been hit by construction delays. shares falling almost 5% falling

the announcement -- following the announcement. qualcomm says the accusations are not supported by facts. quite a tangle. emily: how much of this regulatory challenge against qualcomm is about samsung? idi: one of their competitors, but one of their top two customers as well. it is south korea's largest company and revenues have been suffering. regulators are trying to give them a bit of a helping hand. it is currently based on how much a handset is sold for as opposed to what the chip actually costs. qualcomm is facing --

is similar -- facing similar actions in other countries. emily: this is bloomberg west. we continue with my conversation with reid hoffman. as a venture capitalist, he is challenge with identifying truly innovative ideas. i asked him if he was seeing any sort of low in the flow of -- lull in the flow of innovation. reid: i do not think innovation is slowing down. is it on the vector we anticipated? emily: what does that mean. -- it will bepps

specialized artificial intelligence for medical applications. the innovation will go off the charts. you should not be looking at all of this mobile stuff. you should be looking over here at how the increase in data take old machine learning techniques and open up new ranges of applications. inm very interested marketplaces, networks. i am always looking there. it is a scenario i know very well. i've been spending a lot of it more time on artificial intelligence, biology, other things. back toe will get

artificial intelligence. i want to close the loop on this private versus public conversation. privatere in a quasi- market bubble, do you see it affecting the facebook's of the world? focused ond to be series a and series b. linkedin is a public company. what are the new initiatives? what are the things we are building at a five-year to seven year time frame? emily: you wrote that post, a herd of unicorns can exist. say there are 150 unicorns right now, how many of those survive? reid: survive and thrive? -- becausess given

of the quasi-private bubble, i would guess a third to half have a good outcome. emily: if you look at the list percentage, a large have valuations at a billion dollars or nara billion dollars and some -- or near a billion dollars? reid: who is going to win the bid to lead the next round? just like all psychology of -- there isperson a a natural tendency. one of the good things about the private market, you are trying to deal with much longer time frames. out innd of thing comes the wash over time. emily: what is an entrepreneur to do?

should they always go for person b? easy, most most natural, most human to use the number two benchmark how they are doing. select the partners who build the company you will build five to seven years from now. people are equivalent , take the higher valuation. you should really think about, when you take an investor, you are taking a serious partner, committed to making your company into something real and much bigger than it currently is and that is what matters. the current valuation does not matter at all. itly: sam altman called uniform -- unicorn fraud, this

financial engineering that may or might not be happening. would you go so far as to say unicorn fraud? reid: given the number of companies, he may have better visibility into that than i do. not go for we do that at all. we never offer term sheets like that. emily: your competition is. reid: and that is fine. if an entrepreneur does not want to partner to build a great high integrity massively good company and five to seven years, we are the wrong partners. emily: are you concerned about late stage investors? reid: we are cautious about them. where we see the fraud is in

those later stage private companies. we have gotten very careful about when we do those investments. emily: having lived through the last bubble and seeing the diversity of opinions, how do you think we will look back on this moment in silicon valley history? reid: i think we will look back you just come through a decade where interesting network oriented companies are built, everything from facebook and linkedin and twitter to airbnb, uber, and dropbox. all of those became significant companies. kind of a little indecisive at the moment. clearly charging in a particular -- where the valley is charging in a particular direction.

if you are looking at joining the company, consider joining a company like that. right now, it is pretty indecisive. emily: what are you investing in? what are you not investing in? reid: my last two investments are stealth. the kinds of things we have done, communications, some things on mobile market places, couple of those. -- i think that matters less in a long-term. if you bet right, it all comes out in the valuation. you still build -- you still get a good return on the company.

investing is less directly tied to that. emily: my interview with reid hoffman. what do uber and airbnb have in common? the need to go global as fast as possible. we will pick up that idea, next. ♪

emily: a live picture of the nighttime manhattan skyline. bloomberg west is live in the east today. we continue our conversation with reid hoffman. one of its biggest focuses is

teaching stanford students the art of blitz scaling. reid: most silicon valley people, when you ask them the secret of silicon valley, they will give you a start up story. necessary, story is but inefficient. when you look at all the unicorns, a huge number of them come from silicon valley, a region whose population is 4 million people. why is that? thatnswer lies in the fact there is an embedded knowledge, playbook, talent base, collaboration game for how do you build global companies very fast. speed is both necessary for the expansion market and competition. silicon valley has built that

playbook about how those go to market, financing, technology construction. what we are doing for the stanford class, bringing in a bunch of people who have done that and interviewing them in a disparate set of various. -- set of areas. here is what i know and here's what people i talked to know. emily: startups should focus on going global early on. how does that square with this idea that you are supposed to focus on the product and get the product right? reid: there is a whole set of products where you are naturally global. when we launched linkedin, we put 13 countries in the drop-down. we started adding countries from the very first day. it was a personal geography

lesson. a whole stack of products which are naturally global. tweaksond part is, small or small things that allow you to go global sooner. whatsapp was not dominant in the u.s., but was very dominant globally. the last one, you think about, global matters in terms of critical mass. some companies say look, we know huge amount of work and capital to go global fast, but that is important to do. other companies are just domestic right now, a different product market. emily: interesting that uber is a company doing it well. uber and airbnb have different

strategies. what do you make of the difference? globalirbnb has a network effect that is useful. people travel between countries. if you have a whole bunch of residencies in europe or in the u.s. or singapore, people who travel there, that is a global network affect. they naturally expand globally. they do not have to do as much specific hard-core work as uber does. emily: interesting. i was wondering when you use the word natural, how much of airbnb -- the beast just feeds itself? how does it capitalize on its

own momentum? reid: it is the way the world should be. things where of having a unique experience, a inial experience, staying generic hotels is not the only travel experience. it provides economic liquidity for hosts. it creates a more cultural and connected experience for the travelers. all of that is the way the world should be. all kinds of questions about making sure zoning is done right. that is the way the world should be. of -- the- part establishment of the community, right? establishment of belonging that

is the mission statement of airbnb and that compounds naturally because it compounds through human social connection. emily: why does uber have to work harder? reid: the uber network is much more naturally local. that means it is easy to say it .ould be a halo of london there,r to establish they have to put intensive effort into growing in each specific city. that is what uber developed, launching city teams. emily: you have been spending a lot of time in china. linkedin has been relatively successful in china. linked the same investors to airbnb. why those investors?

china is a very large, it unique market. you need to address the needs of the local market specifically. you need help with understanding, are you on target or not, you need help recruiting talent, you need help figuring out, what is the competitive landscape? as a vc myself, we did a fairly thorough study of who would be the right venture partners. hire a president that is

an on-chip or newer. -- an entrepreneur. we run it like a startup. edward, very strong vcs. emily: final thoughts with hoffman, next. plus, his advice for jack dorsey. ♪

emily: tomorrow, do not miss blackstone group vice chair. 5:00 a.m. eastern. and later, fashion powerhouse tory burch. we continue with my conversation with reid hoffman. as we wrapped up the interview, i asked him for some parting thoughts on the challenge ahead

for jack dorsey as he leads both twitter and square. reid: jack is very strong. he has had a depth of experience with both companies. he has a strong bench of executives. it is super hard, two public jobs is super hard. i do not envy the task ahead of him. emily: do you foresee him being able to do it over the long term? reid: for his own sake, i hope you find a successor at one or the other. he is the product founder, and that is helpful. i understand -- i have not talked to him about it -- i understand what drove him to that. emily: how optimistic are you about the future of the business? reid: i am not an investor and i

do not really know. emily: i would like to end with ai. the ethics of ai. mindis on your question mark everyone is scared of robots taking our job. reid: i do think we are having --ious translocations translocations. a lot of the workforce in various forms of transportation. i am less worried about the whole near-term ai, what is i think there are some very big steps between here and there which make it hard to evaluate. technologymes of development within artificial

intelligence could play a lot into medicine. people say, is this a huge disruption? maybe it means better medical care for a lot more people. it is a question of how it reconfigures. it is worthy of a lot of attention. what are the ways that given all of this technological change, we can continue to help invest in people? answer ishe key things we have not invented yet. as long as you are creating citizen, that is

what i keep thinking about. emily: my interview with linkedin cofounder reid hoffman. you can catch the whole conversation online at bloomberg.com. tomorrow, we will be all over for the square and match ipo's. still waiting for the pricing. vetsont, steve jur joins me for studio 1.0. that is 9:00 eastern. ♪

♪ announcer: from our studios in new york city, this is "charlie rose." charlie: we begin with continuing coverage of the paris attacks that killed 129 people. outce has carried airstrikes against isis targets in syria for the third consecutive day. security forces revealed there might have been a ninth suspect in the attacks. questions have been raised about the ability of crisis to commit several attacks in the u.s. joining me is john miller, the deputy of counterterrorism of the new york police