♪ mark: you are watching "bloomberg west." let's take a look at the news. paul ryan ruled out any bid for the presidency even if his name was placed in nomination at the republican convention this summer. paul ryan: let me speak to the delegates. if no candidate has a majority on the first ballot, i believe they should only choose a person that has participated in the primary. count me out. mark: the comments come as a contested gop convention appears likely. front runners donald trump and a hillary clinton have double-digit leads according to a new wall street journal nbc news poll. trump leads john kasich 54% to

21%. ted cruz has 18%. on the democratic side, mrs. clinton leads bernie sanders 55%-40 1%. the new york primary is next tuesday. accusing the vice president of attempting to overthrow the government days before the full house is expected to start voting on her impeachment. without directly naming the vice president, they said a leak of a recording where he discussed a potential administration amounted to treason. global news 24 hours a day powered by 2400 journalists in more than 150 news bureaus from around the world. from the bloomberg newsroom, i am mark crumpton. next.berg west" is ♪

emily: i am emily chang and this is "bloomberg west." coming up, legendary investor and entrepreneur peter thiel speaking out about everything from marissa mayer's to the bubble that maybe everywhere. we will bring you the highlights of my exclusive interview. plus, mark zuckerberg lays out an audacious 10 year plan involving bots, drones, and virtual reality. we bring you the latest from f-eight. it may be the most exciting business at square and is also risky. and about lending to small businesses and her time at yahoo!. first, to our lead and my exclusive interview with peter thiel. we spoke earlier today at the lend it usa 2016 conference and had a far-reaching conversation. spoke about everything from marissa mayer to his fear of china. the lack of women in tech and the bubble that might be everywhere. and how he really feels about , college education. take a app listen.

-- take a listen. peter: the court thing has been focused heavily on silicon valley. i keep wondering if we should try to look at some places outside silicon valley. yet a travel a crazy amount to do that which is why most venture capitalists don't want to do it. should we be doing more things in other places? is there a point where the cost of living get so prohibitive that it actually makes sense to look at things outside? or are the effects just so powerful that they dominate everything? the last few years, the effect has dominated. that is a question we are looking at. we're certainly -- i do think that two thirds or three quarters will be next generation, i.t., consumer internet.

the enterprise software, all these kinds of categories. and we will continue to try to do things in all of these non-i.t. areas. there are very big challenge is investing in those areas. they tend to be fairly contrarian and fairly underexplored. so we want to be very open to looking at those as well. emily: you just tired your first woman partner. what is your take on the continued lack of women on the venture capital industry? why aren't there more? and what is the industry's responsibility? peter: we all have a responsibility to do more. we have two women in senior roles, but we all need to be doing more. i think that the context of this debate comes up. the disparities are really big. you had these really glaring disparities and something about

tech that matters a lot. it's not like a huge disparity in chess players or math professors. i think it's always in this broader context. people tell me that silicon valley focuses on this too much and i tell them it's because silicon valley matters so much in the disparities are really big. i was looking at the unicorn list of 150 startups. by my estimate, only two of them out of 150 had women cofounders. emily: yahoo! was very important to silicon valley and is excepting bids to buy all or part of the company. you said yahoo! is not a tech company anymore. what is the most plausible scenario?

peter: it is still a very big media company. i think marissa has done a terrific job there. it's just been incredibly hard company. probably the best one they've ever had. jerry was very good. and then marissa was far and away the best of all of the other people. i think it's in the context of how good marissa was. it is like, well,

even marissa can't quite get this restarted. you already have the best person you can get, then the logic is that if it's not working, look at other possibilities. it's a very difficult space where there is always this old media, new media dynamic that is quite tricky. if you are in the old media, you want to be in a place that's really old. doing radio, billboard advertising, or things so far away from new media that there is no competition at all. the parts that are most challenging are the ones that are relatively close to new media. newspapers and magazines felt similar to what you could read on the internet. and the challenges, yahoo! was a new media company in the 90's and is more of an old media company.

but it is old media that is somehow still quite close to new media which is the most challenging place to be. structurally it is in a very tough place. emily: you are five years into the yale fellows program. you're giving the commencement speech at hamilton college this year. what are you going to say to those graduates? how have your views on education involved? peter: i have to be careful what i say. i never said there is a one-size-fits-all approach. people mischaracterize my view that everyone should drop out of college and start a company. i don't think everybody should be starting companies. lead more people to start good companies. i think also the super track dynamics have gotten us to a very bad place where education has become a substitute for thinking about the future.

you know, and the k-12 system is geared towards college. the problem is life does not end in college, you know? hopefully you will, you know, for a long time after that do many things after college. and there is a strange way where we live in a society where there is a lot of anxiety about the moree and we put more and money into education as a way to deal with this anxiety will stop -- anxiety. with the anxiety. if you get into the right college, you will be saved. if you don't, you are in trouble. colleges are as corrupt as the catholic church was 500 years ago. charging people with a system of indulgences. you have this priestly or pastoral class that does not do much work and then you basically tell people that if you get a

diploma, you are saved. otherwise you go to hell. you go to yale or you go to jail. you go to yeah lori go to jail. [laughter] we need to push back on this idea that the only way you get saved, catholic church 500 years ago or today, the only way is by getting a diploma from college. i hope in the future, there will be many kinds of productive things for people to do. my goal is not to start a new church. it's not to have an alternate one-size-fits-all thing. i think the future system will be much more heterogenous. many more ways for people to be successful. emily: my exclusive interview with investor peter thiel. he also spoke about the candidates. he said if he was involved in politics he would and i quote,

blow his brains out. you can catch the full interview at bloomberg.com. alibaba with a deal to buy deal is on a group, the amazon of indonesia. four $1 billion. it gives alibaba access to six southeast asian markets. alibaba has a focus on selling close in electronics. the british supermarket chain and the swedish investment group. the move is seen as part of the strategy to reduce reliance on the chinese markets. coming up, the social network's big bet might be antisocial. why we would all be texting robots in the future. explained by facebook's head of messaging. and later, a russian billionaire, famous physicist, and the founder of facebook team up on a mission to find life in our region of outer space. it is not science fiction, folks. details later this hour. ♪

♪ emily: the chinese internet giant baidu is seeking a $1 billion loan. it wants to borrow from a group of lenders. their rival started to syndicate a loan of $4 billion last month. both have enjoyed a rush of interest from the state owned enterprises for fear of default risks. meantime, the chinese developer raising about $200 million, valuing the company at more than $3 billion. it makes apps for editing selfies and accounts for millions of monthly active users and is getting into facial recognition technology and smartphones. according to people familiar itu is alsotter, me

planning an overseas ipo as soon as this year. the company's annual developers conference is underway this week. mark zuckerberg laid out a 10 year plan that included drones, bots, and even a jab at donald trump. mark zuckerberg: we can give more people a voice. instead of building walls, we can help people build bridges. and instead of dividing people, we can help bring people together. emily: the big announcement was the highly anticipated messenger platform. software that will enable businesses to use artificial intelligence to chat with customers using humanlike responses. cory johnson caught up with the vice president of messaging products for more. >> we have weather forecast bots that are different. >> is it going to rain today? >> if you find the right bought -- the right bot at the right time, you can interact with buttons.

if the developer once to make it available, it's a really rich interface. it's an important distinction that most other people have not managed to build. it is a rich experience that comes to life because you can use the ui. cory: you are supplying the tools by which developers will create businesses. services that will run within messenger. >> if you look at what we have added in the last 12 months, we can hail an uber or lyft straight from messenger. and you have the ability to get news and interact with businesses and shops. all of those interactions you generally have over the web or over the phone, it is a much easier and better way. today, on stage, i announced the launch of the personal shopping assistant which is basically a bot that will make recommendations and you can swipe through the recommendations it makes for you. cory: is there a lot of commerce

happening on messenger? all you're doing is messaging. there is no one else bothering you? >> it is important that it remains that way but it is convenient you can tap on a bubble and you don't remember your username or password. a user number is usually gibberish. you can go tap on the bubble and be on with your life. as long as we keep a very high signal and high utility and make the lives of 900 million people easier every day, it is all good. cory: what is the ultimate revenue driver? i have not heard the cash register yet. >> today, there is no revenue.

we want to build experiences that people love every day and we will build monetization on other platforms. when you look at the ecosystem, we have 15 million businesses active. and on the other side, 900 million people using messenger and they send over one billion messages a month. there is already a lot of great organic interaction happening and making it easier for developers to add value. emily: the head of messenger with ourok editor-at-large, cory johnson. we will continue the conversation with the head.

and we sit down as f8 continues. more on "bloomberg west," next. ♪

♪ emily: a story we are watching, doma working with credit squeeze to prepare for an ipo. they said the company would sell shares by the end of 2015 but they put the plans on hold due to u.s. stock volatility. docomo was valued at $2 billion a year ago. it competes with companies like tableau and good data. in turning back to the facebook developers conference, we heard from the head of messaging about their big bet on chatterbox. and ceo mark zuckerberg emphasized other focuses. virtual reality and getting the next billion people online. joining me to discuss is angel investor and ceo of operator, one of the companies working with messenger. and former evernote ceo. i want to start with you and this partnership. how will operator work within facebook?

>> we have a live product available in november and we have a simplified version with that experience. we activate an experience that allows you to do in and to and shopping experience. emily: i need to get a gift for valentine's day. what do i do? operators, start looking at the menu of choices, type in things, and we provide recommendations. emily: you just made one of your first investments. in a bot. >> i think bots are going to be the next generation of technology that changes the world. but just like with apps, a lot of the early use cases are going

to seem pretty trivial. the things that people think they are going to use bots for now probably won't have a big impact. emily: explain the technology. how do you refine the experience? >> this topic hasn't been brought up. you'll hear a lot of noise about bots and similar to the first wave of apps. when will we see a messaging first bought. and you start to see interesting innovations and derivative experiences. and we will have to sift through it and find something really powerful.

emily: take a listen to what he said about virtual reality today. mark zuckerberg: we are working on a whole new set of social experience as well across all of these different dr platforms. i think virtual reality has the potential to be the most social platform because you feel like you are right there with another person. emily: i recently got to try oculus and it is very early stage. what is the future of virtual reality beyond gaming? it was a very elementary gaming experience. >> over the next couple of years, it will be primarily about entertainment. gaming and videos. but the real high-quality experiences are the ones that are created entirely for vr. the first generations of things that exist outside and inside, they show you the potential but are not really fully fledged. >> facebook announced a lot of brands like cnn and large retailers to educate the market about the potential of this media. it will take six months or longer for a very pure experience where you finally see something that's original.

emily: facebook says they are not going to make cameras but they want us to shoot in 360 video. which is very, very expensive. >> the prices will fall like everything else. i am personally not looking to shoot a lot of 360 video myself. i do not even take that many photographs. but i'm looking forward to the first experiences. emily: apple fought live photos would be huge but it hasn't taken off. >> take a step back about how they will have their next enormous franchise mvr is going to be where they take a lot of risk. experimenting with the technology. emily: the internet.org situation that mark zuckerberg is continuing to invest.

continuing to invest in drones, satellites, airplanes that will deliver around the world. do you think internet.org is paying off? will it pay off? >> i think it will pay off because it is starting the conversation about giving the whole world internet. it is going to succeed in the mission in the sense that almost everyone on the planet will have that experience soon. it just may not be facebook. emily: should we be worried about facebook owning the internet? >> i will think there will be a single company that dominates. emily: former ceo of evernote. coming up, i sit down with the head of square capital talk about risk and wall street. does he think the company should sell? that's next.

♪

>> this is what $3 billion of fresh market cap looks like. is ledingle second dirt

by cyclicals. energy and commodity producers. down across markets. doing this. 30 minutes left. fingers crossed. ♪ emily: with all of the buzz, the lending conference is underway. i had a chance to speak to the woman spearheading the potentially big business of lending. i started by asking how she plans to manage risk while scaling up. take a listen. >> there are a bunch of different kinds of risks. first, there is credit risk. we use a machine learning model to underwrite merchants so we can provide them with a loan in

the first place. data onuse we have the how big they are and how they are growing and how seasonal their sales are, we are able to offer the right sized loan. our goal is to help merchants grow. from a credit quality point of view, we want to make sure it is the right loan to the right merchant. the second risk we see is market risk on the investors side. on the market side, we are part of wall street. we sell our loans to investors and we take a small portion on our talents she. we are not a balance sheet heavy business. what amount of loans should be sitting on our balance sheet relative to others.

emily: net lending clubs, shares are down 50%. they say wall street does not understand the business. publicre only recently a company. we went through the ipo process. i cannot say whether wall street understands us or not. what we can spend the most time on his building a good as this. a newlogy for this is business, particularly on the lending side and there is an evolution for models that work and do not work. i believe there will be a bifurcation as we come through the credit environment of businesses that have stood the test of time and are evolving as strong business models. emily: square capital is a relatively small part of square's overall business. how big a business does this have a potential to be?

-- y: >> there a a lot of ways to frame the question. small business lending is a potential multiple hundred billion dollar industry. i think the most important part is, what type of environment is there for what square serves. largent a picture for how those businesses can be is really the last two. after the credit crisis in june 2011, that was the time when there was a marked bifurcation of lending between those businesses that did $1 million or more in sales and those that did $1 million or less. i do think that for those loans to very small businesses, you really haven't seen any growth, and i think that part of the business has been absolutely left out of the market. so i do think there is an opportunity to provide

responsible credit to small businesses who, frankly, have not been able to participate in the market since 2011. emily: yahoo! is accepting bids to sell its core business. deadline is next. verizon, potentially some private equity firms, even maybe the daily mail is looking at making bids on yahoo!. what is the best, most likely scenario here? how does this play out? >> so, i don't work at yahoo! anymore, so there is very little i can say about what is happening. i think it would be wonderful to see yahoo! in the hands of a strategic acquirer. that is my own personal opinion because i do think there is a core business there that can be fantastic, and it would be wonderful if a telecom provider who would appreciate the assets that sit at yahoo!, the brand, the iconic nature of the business, and two would appreciate that and help foster

the business within yahoo! which is really able to grow going forward. emily: marissa mayer has said she could turn the company around if she had more years. do you think it's possible to turn yahoo! around as an independent company? >> there are a lot of really good businesses at yahoo!, i don't work there anymore, but i do think there are a lot of good businesses at yahoo! that are ripe for growth, and you are really seeing the overall growth within the context of yahoo! sales. i hope they have the opportunity to take the good that's there and separated from some of the declining assets, which are in a structural decline and will, over time, be challenging for anyone to grow. emily: what is it like going from somebody who is running one public company to two public companies, jack dorsey? >> i think square is very lucky to have jack as our ceo. i think he is a unique visionary. one of the things he is amazing at is making all of us stayed

true to what square is. emily: jackie lee speaking with from square, speaking with me at the conference in san francisco. people who live in ethiopia say messaging apps have not worked there for more than a month and smartphone owners have not been able to access services like facebook messenger or twitter on the state owned telecommunications service provider. one area in the blackout was at the center of fatal protests that started in november. ethiopia denies that it blocked access throughout the region. google is scaling up its tech skills training program to accommodate one million africans in the next year. it's an effort to deal with high unemployment numbers on the continent. google plans to train one million people on the continent. plus, a single power source that would give the world enough energy to give up call and gas -- to give up oil and gas

entirely. we are focused on the untapped potential of the ocean, next. ♪

♪ emily: the oceans generate

enough energy for the world to give up coal and gas completely. the problem is, no one has figured out how to harvest it. in this edition of the spark, sam grobart shows you what may be the key to unlocking the power of the ocean. >> the amount of energy generated by waves could supply a third of the country's electricity. the problem is, we can't get it. every conventional approach to producing electricity off the oceans waves has fallen short. maybe it's time for an unconventional approach. ♪

sam: here at the university of maine is a 350,000 gallon tank of water capable of simulating almost any ocean condition. but what has everyone's attention is the little yellow device in the middle of the pool. this is the triton. the triton is a prototype wave energy harvester and its facilitators are testing it here in maine to see if they can finally make ocean power a competitive source of energy. not example right here is what the full-scale triton would look like. >> know, the full-scale device would about 30 meters in length. the triton is what the known as a two body wave energy device. we have at the top a surface float that provides the balance, and hanging below that, in our case, is a ring. as the top body moves, the bottom body resists that motion, and that creates energy.

if you just look at the quantity of energy, it would give us more than we need is a country, but of course, it is not all economically accessible, and that's the bottom line. >> wave is the wild west of renewables, so no one design has broken out of the pack. economic feasibility has also partned elusive, and because of the very types of hazards posed by the very source of the energy. the ocean. >> the challenge with wave energy is to be able to build a device that is going to extract energy from ocean waves that is not going to break and that is going to do it affordably compared to other solutions. >> oscilla has zeroed in on what they believe is the problem with pretty much every design so far, moving parts. this is something generators usually have a lot of.

and, every part that moves is a part that can write down or corrode in the ocean. this generator can harvest energy from waves without actually moving anything inside the triton. most electric generators use displacement or rotation to create electricity. but with this, power is induced by squeezing metal alloys. this means minimal maintenance after cheap installation, but that does not mean it is easy to design. by 2020, they hope to build and deploy a full-scale triton. if and when they do, it will add the force of the world's oceans will be added to a growing list of resources that will bring us closer to a truly sustainable future. emily: bloombergs sam grobart. coming up, facebook's partnership strategy in india. much more as we continue our coverage of the developers conference.

and tomorrow, from the developers conference, we will sit down with facebook's cto. more of "bloomberg west" next. ♪

♪ emily: suncor, the japanese pinball maker tied to the forensics company that reportedly helped unlock the san bernardino iphone says it plans to stay on the front lines of national security. they want to expand the work in the space and could be willing to spend as much as $185 million to acquire or merge with related companies. >> as for the next step, we are open to the idea of teaming up with companies that possess unique technology in forensics. we will continue to search for an appropriate partner. emily: yamaguchi also told bloomberg he thinks cell bright could grow as much as to when he percent annually in revenue.

and getting back to facebook's epic developers conference, ceo mark zuckerberg lays out his plans for the next 10 years we , caught up with the man working with developers across the globe to pull of the ecosystem facebook will need. there are 2.5 more users in asia than in the u.s. cory johnson asked what kind of partnership facebook is pursuing in india. >> india is one of these places where the majority of facebook developers outside the united states come from outside india. -- come from it india. you see people trying to get access to jobs to doing payment infrastructure. >> surely, it's mostly mobile. >> it doesn't even reside within the facebook app. a lot of the reasons we built platforms was to extend tools, apis and systems to their websites.

cory: again, mobile-rochus. mobile-focused. >> yes, when you look at the users across our ecosystem, the majority are using on mobile these days, and increasingly so as time goes on. in india, a billion people have yet to become connected. as they come online, the majority will experience that on a mobile device, not on the desktop. corey: you just call both of us old. and you hear that? >> older than some of the folks who may be getting into this now. cory: i imagine part of your gig is like, selling the notion of, hey, we met a year ago, we couldn't do anything, but now we have a new thing for you to check out.

is that how it works? >> in this case, you probably did hear a lot about messenger and the messenger platform. 900 million people around the world use the messenger platform. we are really excited about the framework. cnn and traditional media companies are figuring out how they can push content to people instantaneously. we have companies like spring that david talked about earlier saying the same thing. you probably open your messenger app a couple dozen times a day if you sit down and think about it. if you can do things you're naturally doing off-line there, it makes sense for it to be that simple. we want to make sure we can get developers and businesses the opportunity to meet you in the media you are using right now. emily: that was facebook's head of product speaking to cory johnson at the f8 developers conference. russian president vladimir putin on tuesday highlighted the ability of russia and the u.s. to cooperate closely in space.

despite all the difficulties the two countries face on earth. putin spoke by video link with the american and russian astronauts aboard the international space station. the occasion tuesday is , cosmonauts day, a russian holiday marking the date a russian became the first man in space in 1961. speaking of space, who is having the best day ever? perhaps a russian billionaire investor. yuri milner has enlisted stephen hawking and mark zuckerberg in his quest to find life in outer space. milner announced a $100 million project that will send a swarm of tiny spacecraft to the star system that is the next-door neighbor to earth's solar system. the goal is to find a faraway planet capable of sustaining life. bloombergs eric shatzer caught up with him today about the project. >> we will know much more about the planets and the nearby systems before we launch.

i don't think we are going to fly blind. at the same time, we might discover something unexpected. so it is unlikely that there is an intelligent civilization in the near vicinity to the sun, maybe in the near vicinity of the sun, but it is likely there is a planet in the zone and it would be amazing to fly by and send back images. >> those are some expensive pictures. >> expensive but also exciting. i think someone might pay a lot for one picture. >> even if the technology works as envisioned, it is going to take a generation before this project even gets off the ground. it's going to take 20 years for these miniature spacecraft to get to alpha centauri, and years

more before the images are beamed back to earth. >> four years. >> will you be here to see it? yuri milner: i don't know. some of the other developments in the area of life sciences might make it easier to see that happening. but i think the most important thing is that we push this thing forward, and maybe we can pass the baton to the next generation so they can realize the results of it. i think we don't remember it is much, but the cathedrals were built by many generations, and i think that this is the kind of project that will take a lot of effort. we've had a lot of technical challenges, but the challenges are not insurmountable. >> this is a philanthropic

effort, but richard branson and jeff bezos want to take tourists into space. elon musk, who is behind spacex, wants to colonize mars. is it right in your mind that space is kind of becoming a playground for billionaires? yuri milner: well, i honestly historicrom an perspective, it is not going to matter. because nobody remembers right now who funded columbus's exhibition. was it government funding? was it a combination of private donors? was it a public funding of sorts at the time? what we do remember is the result. so, i think all those details and nuances on who is funding what at this point will not matter in the next few hundred or thousand years. emily: russian billionaire yuri

milner there. tomorrow, we are joined by keith rabois. coastal ventures and former square part her. that is all today from san francisco. ♪

larry king: welcome. aam here to report and significant health related investigation has been taking place for that last couple of years. the information i will pride