increases will be gradual and in line with projections. the hike ends an unprecedented era of record low rates. president obama plans to meet with families affected by the terror attack in california. he will be stopping this friday on his way to hawaii for his christmas vacation. 14 people were killed and 21 injured in the attack on an employee holiday party. has declared age mistrial in the case of a police officer charged in the death of freddie gray. the jury was unable to reach a verdict after three days of deliberation. william porter is charged with manslaughter. he is the first of six officers to stand trial on charges stemming from freddie gray the rest and death. -- freddie gray's arrest and death. california officials say sell driving cars will have to wait until regulators are confident the technology is safe. new rules will require the car

to have a steering wheel and a licensed driver must be ready to take over if the machine fails. bloomberg first word news. i am emily chang. this is "bloomberg west." will the fed's rate hike put unicorns on the endangered species list? cloud hopping with oracle, the tech giant rides its cloud business to better-than-expected earnings. stewart butterfield on his new startup fund.

the fed rate hike and the impact on u.s. tech companies. the last time the central bank raised rates was 2006 and back then, the motorola razor was the world's most popular mobile device, the iphone was not unveiled until a year later. facebook was just two years old. twitter had just been launched. companies like snapchat and uber did not exist. since then, interest rates have tanked. making it a lot easier for startups to start up. that may be about to change. joining me now on what today's rate hike means to the tech sector is our next guest. with me for the hour is michael wolff. thank you so much for joining us. what exactly does it mean for silicon valley?

>> there are winners and there are losers. ironically, the winners in this game are going to be the unsung companies, the startups you have not heard of yet. they have been competing with the unicorns for talented engineers and product managers. life gets rougher for the unicorns. emily: does it make it harder to raise money? does it make it harder to go public? michael: the volatility in the market as well as what is happening in tech overall is going to make it more difficult to go public. a lot of the companies have already been prepared. you raise money when you can, not when you need. the larger companies already have large war chests.

from the venture capital side, most of the venture capitalists are making bets on companies that are three years or older. matt, are you prepared and what will you be doing differently? matt: we had our annual meeting recently where we present our strategy and results to the people who invest in us and we showed them the vast majority, well in next us 75% of our companies and 75% of all of the capital that has been entrusted to us, is backstopped by two years or more of funding. unless we are in line for another great depression, i think we personally feel pretty good about how her startups are going to do. -- about how her startups are going to do -- our startups are going to do. emily: what about the rest?

could this mean a shakeout for startups? michael: startups that have an idea that is more tenuous or have gone through their first round and are trying to get a second one, they will be under a great deal more scrutiny from investors were money will be harder to find for the investors themselves. a winners and be losers and winners will take a bigger piece of the pie. emily: does it also mean the big pension funds and mutual funds that have been pouring more money into startups, will they pull back? matt: there really are two ends of a barbell here. companies like airbnb who want to raise increasingly large amounts of money.

they will come under increasing green eyeshade scrutiny, how profitable are you, what is your real growth? that is a consumer centric problem. for the kind of companies we invest in their literally curing cancer or on their way to being , they have aex very different set of metrics they are being judged by. emily: as rates inch up gradually, how does this play out? we have been talking about a bubble and about winter coming. everybody says it is coming. how does the cycle play out? michael: earlier, you said, is this the end of the unicorns? stillg funds, they are

going to be very interested in a lot of the later stage startups. a lot of the write-downs recently have really been more technical. in reality, they want to be part of this market. this is still the less riskier side of it. the shakeout comes at the earlier stage, not at the later stage companies. emily: matt, you were nodding your head. thank you so much for joining us. michael wolff, you are sticking with us throughout the show. you are a former board member of yahoo!. watching,at we are uber and facebook teaming up in a way that might sound familiar to our viewers in asia. facebook messenger users will be able to summon and uber by tapping on a street address in a message. you can split the fair with

friends -- fare with friends. wechat's to uber, owner has blocked over. -- uber. butterfieldstewart why he is giving away $40 million. our exclusive interview is next. ♪

emily: new data shows amazon's dominance this holiday season. amazon claimed more than 39% of e-commerce spending in the u.s. from november 1 to november -- december 6. you would have to combined than web sales of the next 21 retailers to match amazon's share. shares of the company are up 8% since the start of the holiday shopping period. announcing an $80 million venture fund to invest in other startups. stewart butterfield says the company is contributing more than half of the total fund, the own coming from slack's investors. joining me now for an exclusive interview, stewart butterfield.

always great to have you on the show. you guys have raised $350 million. now you are putting $40 million of that into this fund. why? encourage -- to encourage developers to make apps for slack. emily: what will you do? deal size,pical investing alongside other investors. announced onore we the first night. time, we can do bigger and bigger investments. emily: corporate venture has been driven by established tech companies -- google, intel, salesforce. how do you make sure you don't lose focus?

stewart: we will not be active investors. we will not be traditional vcs. we just want to encourage the ecosystem. this could be perceived as a risky bet. we want to take that risk away. emily: you guys raised a lot of money. we have been talking about how winter is coming. is this the best use of your cash? stewart: we have not invested all yet. we get to make those decisions as we go. we will see more return from our investment then it will cost us. -- than it will cost us. the primary motivation is to encourage the ecosystem, more and more apps on the platform.

there is a winner take all dynamic. emily: the fed raising rates, how does that impact you? is it something you are watching? stewart: largely irrelevant. emily: it could impact borrowing costs. stewart: it could have an impact on where capital will seek a return. the dynamics of vc have not changed. we have been a beneficiary of that, but we raise a lot of money. to changeit going anything you are doing? stewart: it will not change anything. emily: i want to talk to you about diversity.

what are the concrete things you are doing to make sure this is not a problem you are dealing with down the line? stewart: that is a great way of putting it. the principal thing we have been doing is looking how, what the experience of working at slack is like. part of the problem is, a smaller pool of candidates to hire from. work a terrible place to and if people, are not falling out of the industry at our company, it means more people who are excelling. they can be mentors, bring more people in from the network. emily: are you doing things like hiring quotas?

we do implicit bias training. we have not looked at quotas yet. among the many things we have to do to make sure it is a good working environment, compensation and promotion decisions, making sure we are being equitable. here is one concrete example. we have a pair of interview panels. the first one was a man and a second one was a woman. classic -- is the man being judged on his potential to contribute and the woman being judged on her past accomplishments? neither of them were very experienced. it came up in the post-interview

panel. when we check things like that, we are likely to make a better decision. emily: good to hear. dost time we talked, jerod le onerrupted our conversation live television. how does a guy like him get into a company like slack? stewart: i was astonished. he came in through another one of our investors. slack andg user of has sent to me 50 to 100 bug reports. he has a whole bunch of ventures on slack. he is a rock star and a movie star and he is running a bunch of businesses.

when there is an issue, he himself gets frustrated and lets me know. he is a pretty helpful investor. emily: i have to ask you a question about yahoo!. what do you think about what is going on at yahoo!? can anything be saved? stewart: it would be a good outcome. it would be pretty hard to place sufficient attention to it -- it sufficient attention to giving -- given what else is going on at the company. they have a lot of things to extricate themselves from. pretty big project. it would be great to see that going to a good home. emily: you would like for it to be spun out on its own?

stewart: that would be the best outcome, but i am not going to do it. emily: stewart butterfield, always great to have you on the show. thank you for stopping by. data -- beta is an investor in howdy. has oracle come out from under the dark cloud question mark we will dissect the latest earnings report next on "bloomberg west." withclusive conversation warrior. helmhy she is taking the of a chinese carmaker. ♪

emily: oracle shares are falling in after-hours as the company reports revenue that fell 6.3%.

the company is beating analyst estimates. oracle also announcing it has named outgoing president to its board of directors. is cory johnson. still with me is michael wolff. cory: i used to work for this hedge fund manager. it is possible to change a fan belt while the engine runs, but it is harder that way. to move their customers to a cloud-based model without screwing up their quarters. what you saw today, what you see in this quarter is significant progress. oracle, from the ceo of she said we are right in the

trough of earnings during this transition. they offered some guidance going forward suggesting things are getting a lot better a lot faster. a lot of different ways to look at this company. emily: michael, where do you see oracle in the landscape of cloud players and upstarts? you have salesforce and microsoft. is, there isfact only one company that has truly been able to make this transition and it is adobe. if you look at what is happened with oracle, over the last 10 years, they have bought over 100 companies, and at the same time, they are trying to transition their business. they have a long way to go. less than 10% of the revenues are cloud-based. big companies will continue to buy enterprise systems, but they

will be more focused on cloud and oracle has to rush to where they will be in order to be able to sustain its business. cory: michael is right. difficultyhown the in making that change. adobe had a couple of bad quarters. oracle has managed it a little bit better. to counter what michael said, i am not saying he is wrong, one never says michael wolff is oracle wasink what doing was buying different types of software companies. they were not necessarily buying cloud companies. they were buying big companies and enterprise resource planning. -- in enterprise resource planning.

to transfer all of those businesses onto the cloud and stitch them together. things that competitors cannot do. emily: when you look at 2016, what are the big cloud trends we should be watching? michael: it is going to be companies like salesforce, where it is a broader suite of services, not just about keeping track of customers, but integrating with all sorts of other pieces of your business. it is going to be companies like dropbox, where they have moved away from just being storage into true collaboration. they are going to be bolting into businesses like slack. the third piece of this is going to come down to applications that are more consumerist. ized.nsumer

wolff, thank you so much. we will see later. we will talk about later -- we will talk a little bit later about yahoo!. cory johnson, editor at large, thank you. my conversation with padmasree warrior. hear how she is taking on tesla and elon musk. ♪

emily: i am emily chang. this is "bloomberg west." eckert withd by zeb a look at stories making headlines.

zeb: markets here in asia-pacific are following wall street's lead and response to the fed rate rise. janet yellen signaled patra more hikes next year -- four more hikes next year. it came seven years to the day after they dropped to zero. china expects growth to slow next year, but should hit the 6.5% growth target. between 6.6low to and 6.8%. it has called for more exchange rate flexibility. the pboc should adopt structurally loose monetary policy. --india, the supreme court new diesel engines of two leaders are above are banned until the end of march -- two iters or above are

banned until the end of march. division isry acura aiming to celebrate its 30th anniversary by releasing the successor to its iconic supercar. honda hopes the $150,000 machine will help the overall acura line. acura has beaten cadillac and lincoln in japan this year. how does honda think this new vehicle will take things to the next level? it is priced at more than $120,000. it is hotly anticipated. acura has stayed on top, beating out every premium american brand and not home market for years now. and achievement the other would likein japan

to achieve. we will watch very closely to see how this car, this $150,000 rival to the big names in japan in the luxury space, will do. emily: zeb eckert in hong kong for us. check out more asia stories at bloomberg.com. emily: one of silicon valley most powerful women in technology announced her next move. is the newarrior

u.s. co and global chief development officer at a chinese startup best known for its formula e racing car. the company has plans for a commercial electric car. i sat down with warrior earlier today and asked her about the decision to take her job building electric cars. padmasree: i was looking to do something completely different. i did not want to do the same job twice. sure i was make applying what i learned to make a difference to tackle a big problem. i was looking at the global problems and a big issue that technology can help solve. a common colleague i used to know at cisco reached out and introduced me to the founder and

xtev.man for ne as was traveling in silicon valley one weekend. we had breakfast one sunday morning. he was talking about the company he envisioned and passionately described what he wanted to do. this is exactly what i have been looking for. emily: they are working on a supercar, going after tesla. they are going to be working on a mass-market model. padmasree: the vision is not just a car. if you think about it, there is an inflection point that will happen in the automotive industry. the shift from internal combustion gas vehicles. if you think about the supply chain and experience you have is

the owner, it is almost -- the whole process has been set up 100 years ago. dealerships, and who we interface with who we buy the not designed for the mobile internet era. the vision is more than just a car. how do you build a user enterprise? how do you engage the users more? emily: how do you feel about taking on elon musk? padmasree: i have a huge amount of respect for elon. i consider him to be one of the pioneers, really bold ideas in the valley and industry. not just tesla. he has bold ideas. he is an inspiration and i would

love to talk to him about lessons learned. emily: i know you own a tesla model s. what do you like about it and what can you improve? padmasree: it is a great performance car. it is great in california where we have wonderful weather. people in shanghai, beijing, york, or chicago, places like this where there is not a lot of space. i think there is an opportunity to think about a different kind of a vehicle. emily: how different? padmasree: it is not just performance, everything around that. not just being optimized for the driver, but for people in the car. if we leverage the mobile internet.

i think just a progression of technology and how you can think about applying that, it opens lots of doors. emily: consumers in the u.s. have been slow to adopt electric cars. it is different in china. is our firstina priority as a market. it is a huge market. in 2009, it passed the u.s.. summitoff of the climate and the environment, that is a big problem we want to tackle. market is big. the automotive industry, there is never a one player takes all. automobiles are very personalized things. emily: there is also google,

apple, uber. there will be a lot of competition for talent. what is your recruiting strategy? padmasree: we are not just a silicon valley company. we are not just a shanghai company. emily: you are running the u.s. -- padmasree: i think the kind of ,eople we will be recruiting automotive industries, software companies, data scientists. there are plenty of smart people out there and this is a place where people want to come and live. it is attracting talent from outside silicon valley. emily: what about apple? do you have any concerns about competing with apple? padmasree: who knows what apple

is doing. they have not really said. it is a great company. i was instrumental into rhyming the partnership between cisco and apple. companies.ll great when you have many companies supplyhis, it drives the . if there is only one player, it becomes unaffordable. having lots of companies doing this is a great thing for consumers and a great thing for the industry. emily: you are watching our exclusive interview with padmasree warrior. ♪

emily: welcome back. more now with my exclusive interview with padmasree warrior. her career in silicon valley has spanned three decades. how much progress does she think still needs to remade when it comes to diversity? padmasree: it is sad that we still talk about how few women there are. doingsion is women technology jobs, leading engineering in the tech industry. we have a long way to go. you know the numbers, they are dismal and trending the wrong way. we have to figure out how we create the right kind of environment and companies that to stay in the

industry. i have stayed in the tech industry for three decades almost. compared to how technology -- how fast technology is changing, you wonder why the ratio is not changing. emily: i recently sat down with mike moritz. he said some things that became very controversial. they were looking for strong women, but they were not prepared to lower their standards. he did a mend his remarks. -- he did a meant his remarks -- amend his remarks. what are your thoughts? there are some very talented women. emily: what he said, does that bother you? padmasree: of course, it bothers

me. who feelsother anyone they are competent and capable and can do the job. we have to be careful that we do not think that women have to do more to be recognized. we have to create an environment where talented women can accomplish what they want to accomplish. so many women i know and you know in the valley and in the a lot of women start their careers in the tech industry. they leave in a few years because they do not find the environment fostering or inclusive. emily: do you think you are treated differently? padmasree: of course. people notice the fact that you are a woman. to me, that is a good thing. the fact that people remember my

last name. emily: it is the best last game ever. padmasree: i tell women, use that as a point of advantage. do not think of it, people are thinking -- treating me differently. use the fact that they had issue to express your point of view. emily: what are some things you are going to do to create the culture that you want? a culture hospitable to women and minorities. padmasree: the company is already diverse. it is a global company. the first time a company starting off from the get-go in different parts of the world. that makes a very tolerant and inclusive, working with engineers in china, europe. related to gender and women, i

will go look for great women to come work with me and be my partners. reach out to me. i would love for them to be part of the company. emily: you just joined the microsoft board. do think the next era for microsoft will be different and better? absolutely. i have known him for two years. i was working with him before he became the co. -- the ceo. he has a clear focus on what the company needs to be doing. i think microsoft has a huge amount of reach and a lot of talent. i am very bullish on the company. bloomberg reported that you were approached to be the ceo of twitter? padmasree: i looked at so many different ceo opportunities.

i am very active on twitter. i love jack and i am happy he is back. there is potential for the company to become a greater company. emily: our exclusive interview with padmasree warrior. bloomberg was first to report that google plans to make a self driving car a stand-alone business under the alphabet umbrella. the project currently lives within the research division google x. it is the clearest indication of how google plans to make money on this technology. the fleets will be first rolled out in confined areas, like college campuses, and military bases. the man best known for hacking sony's playstation, taking on some other tech giants. he built his very own self

driving car-based on inaccurate sedan. -- and acura sedan. company as itsh short of the year. elliott gotkine has more. why are they so down on mobileye. says it is the most overvalued stock in the history of nasdaq. even after the stock has lost a third of its value. e trains at 90 times this year's earning. d, basically bringing a.p.

shooter -- a peashooter to a gunfight. it has raised $1.8 billion, including at its ipo. $1.6 billion went to investors. there is competition. -- citron reckons that it was just first to the punch. i reached out to the founders. they are 10 hours ahead over in israel. perhaps they did not get the message. they will say their technology is good, superior. i have driven with their technology.

they will be facing more competition. emily: thank you, elliott gotkine. up next, michael wolff telling us about his time on yahoos board and what he thinks should be next. ♪

emily: still with us with a few final thoughts is michael wolff. i want to talk to you about yahoo!. this is the story we have been talking about every single day. michael: you cannot avoid it. emily: what is your take on marissa mayer and the board's decision to look into spinning off the company. it will take another year. versus all of these other plans put forth by investors.

michael: look at what is going on in the technology business. there has only been one turn around in the history of tech and that is apple. when you look at today, there are three companies where there is an attempted turnaround. hp, ibm, andt marissa mayer at yahoo!. all three of these people are trying to turn around these businesses. meg whitman went to hp around 2001. it is very tough. they are all facing the same challenges. revenues are falling. each of them are trying to turn around these businesses. the comparison to apple was an area -- with an extra nearing co -- extraordinary ceo. they did not release the ipod until 2001.

a lot of the criticism is generated by impatience. it is really not about operating. it is about financial engineering. investors want to get their hands on the money from alibaba and yahoo! japan. emily: do you think marissa mayer has any dry powder left? -- i am verystors limited on what i can say about yahoo!. i went on the board as part of a proxy fight. . am subject to a standstill she has shown herself to be fearless and if you look at those other two women trying to turn around tech companies, the street is seeing a lot more patience than they are with marissa mayer. emily: the board is getting a lot of heat for making bad decisions. what is your response?

michael: it is a different board . when i came on the board in 2012, most of the old board members left. emily: when you left, did you think a turnaround would happen sooner than now? did you see more trouble coming? michael: i think this was -- everybody viewed it as being difficult. we appointed a product person versus a business person because the boards help was that to bring in somebody who could focus on growing the company, transitioning into mobile, versus cutting a lot of heads and taking the business apart. emily: does a proxy war happen? whatel: i cannot speculate is going to happen from an investor perspective. what i can say is i am still

hopeful that there is a turnaround for yahoo!. something to be said for the second-largest site on the internet. a site that has so many pieces part of people's everyday lives. , alwaysichael wolff great to have you here on the show. i appreciate you sharing your thoughts. that does it for this edition of "bloomberg west." you can get all of the latest headlines 24 hours a day at the new bloomberg.com. we will see you tomorrow. ♪

♪ >> from our studios in new york city, this is "charlie rose." charlie: he plays a transgender woman on the msn show. the new york times causes performance of revelation. it has and him numerous awards including a golden globe. -- starredly started in "arrested development >." and pleased to have him. having seen you and that you on the