>> welcome to "bloomberg businessweek." every week, we bring you the best of the award-winning magazine from the headquarters here in new york. we go into the conflict in alphabet. moonshot could get messy and expensive. while donald trump is probably the most excited about his surprise residential victory, nigel farage comes in as a close second. as we go into the holiday season , we will take you into a business that follows on the success of elf on the shelf. all of that ahead on "bloomberg businessweek." ♪

editorre here with the in chief to talk about this week's issue. i want to jump into a story you wrote about a storm donald trump caused when he tweeted about taiwan and china. vell us about how you don deeper. >> this tweet continues to reverberate. officially recognizing taiwan but giving the military support, etc. trump again shows he is not afraid. the most interesting thing about delving into this story is it seemed when it came out it was this amazing p.r. gaffe. this is actually a year-long lobbying effort with people close to trump, including bob dole, who have advocated for him to embrace the new approach to taiwan and a tougher stance on

china. the important thing about this call is china immediately has come back and said he has been criticized on the front pages. but when you think about the policies donald trump is advocating with huge trade tariffs, for your biggest first moved to be diplomatic call with taiwan, that shows people what this administration will look like in terms of foreign policy potentially. referendum.big it is not just about the political situation. i think the bigger story is what is going on with the italian banks. that is a problem that has to be dealt with. >> the referendum was interesting in the respect that while the markets were priced, in terms of the senate, you are right. the italian banks most important of the third-largest

bank in italy has had multiple bailouts from the italian people and others and is trying to go back and raise more capital to sort of stave off another run. this is a bank that has long been in trouble. it is always referred to and has been referred to in surveys as the capitalization of european banks as the weakest. there is not the issue of turmoil in terms of what is going to happen to the banking industry and is it all going to collapse but it puts the industry in a flux and a political vacuum of what we see in lee now. although we have seen italian bankshares rising it's what it means in terms of the euro for these sort of efforts to build european banking stability in europe. we have this referendum and wave of populism, that is what people

are looking at when they look at the italian banking sector. let's go from geopolitics to corporate politics. the cover story is a fantastic story about google working in one of the more kind of veiled businesses. tell us about the cover story. >> this is such a big good piece. there is a central tension in google between the group of engineers and the people who have long done moonshot's there. whether it is google glass, whether they are building an internet in the sky with balloons. a lot of the other ideas they in trulyonate about changing the world in a big way. google is in need of alphabet as a business to make it sustainable. they brought in the former c.e.o. of morgan stanley who is really saying, ok, how do we justify this. i think what google is going through is the existential crisis, this tension between

people who say what kind of business is is and what kind of company do we want to be. >> in 2015, larry page kind of shocked the world by introducing this new structure where google would be like a little berkshire have hathaway with all subsidiaries. how do you continue to do all of the crazy stuff that google has been doing and do you even kind of want to do that stuff, google makes almost of its money in a sort of specific way, advertising primarily, search and youtube. and it has like 100 other businesses, a lot of which make great products but very few which make much money at all. >> you are talking about the other bets? >> they are called the other bets. it sounds almost slightly derogatory. but yes. bets google glass , it is one of them.

it came out with a lot of fanfare but it is not around anymore. >> when you look at why they did the reorganization, it is partly because of the experience with glass. it was an adjusting product very badly marketed. you can imagine if they had not put the name on it maybe. if they had just said, hey we have this headset. show was a fashion week where they walked the runway wearing glass. there were skydivers. i think it helped heighten the sense of disappointment when people got the device and realized that they couldn't do that much with it. and if you look at the knock on alphabet and google, they have been awesome at making cool technologies but not so great at turning them into businesses. >> so it was a good idea but too soon? what is the thinking about why they are spending time and money on it and it fizzles?

>> it kind of depends on what product you are talking about. with google glass, there was some product issues, marketing issues. with the self-driving car, which is another one where google seems to be ahead of the game technology wise but in terms of business seems to be falling behind a little bit between uber and tesla. i think there is a question of whether they have a business strategy besides the technology. so i think that is what it comes down to. a lot of smart engineers and they're trying to get better about bringing products to market. oliver: let's talk about the fun stuff we have heard about google first. x which is shrouded in secrecy. at the end of the day, cool stuff. run off some of those. >> the core things are the self driving car, loon, balloon

powered internet. you can sort of think of them as little satellites floating in the stratosphere rather than space. the other big one is "wing" with is delivery drones and they are doing a test right now in virginia where they are delivering chipotle. but the plan is that they will deliver lots of things. and they are bigger than your average drone, kind of the size of this table. oliver: and there are probably a handful of other products that got killed along the way? >> we know there was something called foghorn, a plan to bring ned.ogen fuel that they can' there was a blimp, a cargo blimp like a cargo blimp instead of a cargo ship. and there was a plan to build giant tv's that they also seem to have killed. so what they're trying to do is

be a little bit smarter. in the past, google would just invest in cool things. they are trying to like look at these things and say, well is this cool and is it a business? if the answer's yes, they will keep going and if the answer is just that it is cool then they are trying to be smarter about their investments. carol: there has been no new moonshot for two years. is this a result of the chief financial officer? that people call it internally, ruthless ruth. >> they have said to my cowriter and i that it is just a coincidence. it does feel like there have been some con just efforts to pull back. we expect that the next moonshot will probably happen with robotics. they acquired sort of like this big mess of robotics companies.

and this is part of the weirdness of google in the past, they didn't really have a clear mandate it seems. and what they are trying to do now is get those into shape and i would guess -- if we hear from them in 2017, it will involve robots. although i don't know exactly what the robots will be doing. and again, because they are being more disciplined, it is possible that they will decide that the robot thing is not yet a business and we need to keep working. oliver: up next, a big box retailer has found a new way to ring money out of the small towns that they operate in. and the growing divide over what president donald trump says he wants to do about corporate taxes and how the rest of the republican party around him feel. ♪

oliver: welcome back. i'm oliver renick. in the "industry" section, make big-box retailers are finding a

new way to lower corporate taxes. but it does come at a cost -- just not to them. carol massar and i spoke to the reporter, shannon pettypiece. carol: you write about something called the "dark store theory." what is that? >> a new way that retailers are trying to argue their property taxes should be appraised. the traditional method that cities and towns have used to figure out how much the big-box retailer is worth, you look at much the land costs and how much it cost to build it and then they mark off a little bit for depreciation over time. that is the way they've done it over time. so lowes would build a store for $10 million. for tax purposes, it is worth about $10 million the next year when it comes property tax time. but what the retailers are arguing is that the store should be valued at what it would be worth if it were sold. so if lowes closed that store

and it sat vacant for two years an until another buyer could come in how much would that sell , for? and with the comparable sales data, they say no, that store of -- would sell for $3 million or $2 million. there are comparable sales out there that they are using. vacant stores that they are saying hey, that is how much it is really worth. it doesn't matter that it was worth $10 million for us to build. if you sell that on the open market, it is only worth $3 million. cities are fighting this. obviously, this is a huge difference in property taxes. they are saying that is not a fair comparison. those are closed stores in different communities. oftentimes they were closed because they were in a less desirable area. that is the battle between the retailers and municipalities. there's a lot of property tax money at stake for them.

oliver: tell us the specifics and the outcome. >> in marquette, michigan. it is in the upper peninsula of michigan. it is remote. it is a lumber, timber, mining community. this is an unlikely place for these battles to play out but they built the store around that amount, and years later they came back and said, we built this $10 million store and you helped pay for the infrastructure and the utilities based on the assumption of what we would be taxed at. we actually did some thinking. and it turns out based on what other stores have sold for hundreds of miles away, this store is only worth $3 million. lowes won the argument in front of the michigan tax tribunal. they won an appeal in the michigan court. judges agreed with them. and this town, marquette, michigan, has lost hundreds of thousands of dollars in property

taxes from lowes. and then the other big-box retailers said they would make the same case. so target, best buy, kohl's and even car dealerships in this town have made the same argument. well, i know it cost as much to build the store but comparable sales, you know, car dealerships do not sell for very much. in this town, the county has now , lost $2 million in property taxes. $2 million is a big chunk for them. >> this isn't orange county. they did not have an extra to lean so they have been dollars. tightening the purse strings and cutting back on things. they closed the library on sundays. the fire department is having to put off new equipment they were planning on buying like a new fire truck. the fire department will end in the red. they do not have any at the money. next year, they are looking at cutting back on the hours the

sheriff patrols. all sorts of little things you wouldn't even think about. oliver: moving to corporate taxes. the editor takes a look at the proposals donald trump has said about corporate taxes through speeches but mostly through his tweets. >> he had a series of tweets, six, a lot for him, indicating it is important for him about companies that move jobs overseas. he said, if you're going to do that, don't expect you can just bring products back into the u.s. if you do that, we will put a 35% tax on you. and this kind of struck a lot of republicans wrong. people in his own party. including house majority leader kevin mccarthy, who said hey, look there are better ways to do , this. another jr. house republican said -- is this, make venezuela great? the problem is that republicans tend to be a party of -- look, set the rules and then let

business comply with the rules and get things done. not a party of let's have the president come in and make decisions day-to-day about who wins or loses and that is how things seem to be going under the future trump administration. carol: i love that you say that tax policy is complicated. both sides of the aisle agree something needs to be done but it is not something that can be done in 140 characters or less even if you tweet six times about it. this is a complicated issue. and it is where we need a leader to look at tax policy in a smart way. >> right. my article is not tax policy overall. business tax policy. which is complicated enough. i mean, it is broken as you said. we have the highest or one of the highest among major countries corporate tax rates. , and yet the amount we collect

as a share of gdp is actually below the average for the rich countries. so clearly, something is wrong. we know the well-known story of the profits being held overseas because people don't want to pay the high tax rate. carol: repatriation, yeah. >> something has to change. my article is about the house g.o.p. plan called "a better way." paul ryan always touting it. and actually, it makes a lot of sense, what they are talking about. it is moving to a tax plan that is new. it is called destination-based cash flow tax. a change from the corporate income tax. it would have some pretty beneficial effects. an interesting thing about it is it has bipartisan potential. a prominent economist wrote a piece for the center for american progress, a democratic think tank, a few years ago, endorsing this kind of tax. oliver: this is a big topic.

a ton of strategy reports i have been getting from equity market strategist talking about what this corporate tax policy could do in terms of earnings. but what is interesting is that paul ryan has a book and donald trump has tweets. so what is the in between? is it trying to figure out the math or trying to figure out the numbers? or figuring out another way? >> people focus a lot on the number. the house plan is at 20%. donald trump is at 15% and maybe we will end up at 17.5% and call it a day. that is the wrong way to think about it. these numbers are not even comparable. a conventionalis corporate income tax rate. the house g.o.p. plan is something different. it could have a substantially higher rate on it without causing the negative effects. but a high corporate income tax rate causes. oliver: up next, we follow the money and connect the dots. we put all of donald trump's

conflicts of interests in one place. plus, the u.k. politician who may be best positioned to work with the trump white house. ♪

♪ oliver: welcome back. you can also catch us on the radio. 99.1 fm in washington, d.c. and 960 in the bay area. and in london and in asia. in the politics and policy section, donald trump's presidency will be unprecedented in a lot of ways. not the least of which will involve his businesses and potential conflicts of interest around the world. caleb had the daunting task of putting this all-in-one place. carol: he has business interests

all over the world. how widespread are they? >> you have the will of been's businesses set up to do business , in china even though they are not doing business in china yet. argentina, panama, indonesia -- basically any place where donald trump has been able to find someone willing to pay for his name to put on a luxury building in an up-and-coming city. gray often asian or eastern european city. he is trying to do business there. oliver: where do we even start with this in terms of figuring this out? the previous reporting you have done has been that there has been no precedent for this. so how do the powers that be figure out where to begin? how do you handle this? >> so what we're waiting on now is december 15, donald trump is supposed to tell us what he

is going to do to handle this. that will be the first concrete sign that we have other than rudy giuliani saying the kids will run the business as to what , they will do to try to mitigate conflicts of interest. oliver: so the onus is on him right now to take leadership on this entire front? >> it is. and hisounting on him own hopes to make his presidency successful. if he doesn't do anything, all these questions that people have will follow policy. if he changes relationships with taiwan as he did this week why , is he doing that? is it because he wants to have a business there? that is the sort of thing that will dog every action his administration takes going forward if he doesn't create a credible barrier between himself and his business. cap how do you do that? : as president, your hand will touch everything.

he has businesses all over. how do you avoid talking to officials in scotland where even in golf courses or the united states where he did the post office? the government owns the post office so how does that work? >> it feels very overwhelming. when you talk to the ethicists who have been commenting a lot on this, that is why they say he absolutely has to sell. he has to put it in an ipo or lgo and get rid of it because otherwise there is no way to separate. from what we have seen, i don't think we're going to get that. carol: so much of his business is licensing deals. somebody pays to put his name on a building. how do you put that into a blind trust? he talks about his brand and how it is even more valuable now. that is a lot of his financial

worth. >> that is the fascinating thing. those deals cause the most conflict. they do create a pretty free and ready stream of cash flow for him while the deals are in effect. but even if he were to sell that small portion of his business, the majority of what makes the trump organization take on a day-to-day basis the most boring , assets, stakes in new york office buildings and trump tower, and the american golf courses, you could do a lot to mitigate a fractional loss by in revenue generating capacity by getting rid of the international licensing deals. but who wants to own the ability to license the trump name when they don't get to control what he does? oliver: up next, a researcher turned whistleblower. and a potential advisor to the trump administration.

plus, the drug that could help kick opioid addiction without the risk of addiction. ♪

oliver: welcome back to bloomberg businessweek. i'm oliver renick. still ahead, venezuela has a lot of enemies in washington. we will take a look at a drug for opioid addiction. is it a drug in his own right? plus, israel's most prolific start up hype man. all of that ahead on bloomberg businessweek. >> we are here with the editor in chief of bloomberg businessweek. so many must-reads. we wrote about something called cratom, some say it is a

medicine, some say it is a deadly drug. >> it is a fantastic story because it really gets behind the scenes of what plays out in this regulatory battle between people who have a product or use a product that they find is currently helpful, that reduces their pain in this case. this is an opioid substitute. it has been a huge and emerging crisis with people being addicted to opioids. here is the substitute that some people take and say has allowed themselves to wean themselves off opioids or make their pain go away even more effectively. the regulatory battles that have gone on over this, and it really follows one woman's journey as she became a kratom user and roleg this public activism in making sure she would still be able to get it. glimpse intonating how regulatory agencies can change your life in ways you never expected. oliver: let's shift to another great story about an interesting character.

nigel farage, tell us what he is up to now. megan: nigel farage, this is a great story. obviously, nigel farage and donald trump struck up a very quite unlikely -- not unlikely -- a natural friendship, so to speak. two popular speakers -- figures from both countries. nigel left as leader of the u.k. he is vaguely lampooned in the press as a -- frequently lampooned in the press as a buffoonish type character, led a populist revolt, the man who was a big, big force behind driving brexit. donald trump likes to call himself brexit times five. what is fascinating in this piece is that it is the nigel we have come to know, telling the reporter he needs to leave to go smoke. but also, the real world, which is that he is really pushing for a bilateral trade agreement with the u.s. and u.k.. famously obama said during the brexit talks, some people in

britain said he had overstepped his diplomatic parameter when he said you could go to the back of the queue if they vote for a brexit. in fact, they did vote for brexit and theresa may is working to force trade relationships not only with america but with other countries. you have nigel farage, who was one of the leaders behind the brexit movement, saying i want to play a real diplomacy moment, want to really force this trade agreement with the u.s., and it is a great story that shows how the unlikeliest of characters is putting on a whole new face to the public. carol: another story has to do with another interesting figure, a guy who was a low-level researcher at the imf and is now at the epicenter of uncovering the things bad in venezuela. megan: as you said, someone who did not cultivate this and did not look for this, just became this almost receptacle of people coming to him with stories of corruption. throughout venezuela and venezuelan industry, and it

really shows what i think is so nice about the stories. it shows this is a personal thing for people. yes, maybe they are looking to leave the country, but what made them come forward to talk to him with what they knew was that they were disgusted by what they were seeing. it is well worth a read to get a behind the scenes look at how upset some people are in venezuela. oliver: they did indeed, a lot of great interviews in the story. we spoke to reporter ethan. >> we started out looking at how it helps you understand how venezuela has fallen apart over the last couple of years. we found ourselves with him and found ourselves completely fascinated by his world. he has become a kind of broker , bringing people who want to give testimony or feel they have no choice but to give testimony to u.s. officials who are pursuing cases of corruption and drug trafficking. carol: i feel like he is thick

in the middle of it. take a step back, a low-level employee at the imf, how did he come to be at the epicenter of the bad in venezuela? ethan: he was, he had come here as a young graduate to study english and expand his horizons. from venezuela, he is venezuelan. and he came in 2000. and he started working and he met a guy at a party, an israeli guy, who went to work for a consulting firm that was hired by a big bank that was worried that money coming through a bank they wanted to buy in panama had uranium money which would violate u.s. sanctions against iran. >> from there, he became a freelancer and found that he kind of had a knack of looking at these things. where did his business start to prosper? where did he start getting

contracts? ethan: what happened, he had been an intern for several months at the oil company for coming to america, and when this guy called him and said we're looking into whether the company is involved in uranium money through panama, he called a friend of his at that company and it all started to open up. a whole bunch of documents and he worked the story. it was partly out of patriotism, he was not making money. but then ultimately, he realized that u.s. agencies would pay him to bring these folks and he could act as sort of an intermediary helping the people who wanted to talk cut a deal with u.s. agencies, and u.s. agencies paid him and then, those folks, some of them who were wealthy, were willing to pay him to help get them out and ultimately he went to work as a consultant for big banks and hedge funds. carol: what is interesting is you say he brought two dozen elites from venezuela to the

united states to kind of tell about what was going wrong in venezuela, specifically with their giant oil company. you're talking about former generals. you are talking about a former -- ethan: former ministers, absolutely, very serious people who some of them had been involved or seen bad stuff. some of them were suddenly being pursued by the regime in venezuela. and martin became a guy they know who had links to u.s. agencies and became their intermediary. he also has a very charming manner, he would sit you down. often they would meet at a caribbean island and he would download what you knew as someone who wanted to get information out and he would figure out where it could go, and he ended up being this amazing intermediary. carol: you met him? ethan: i spent many hours with him. carol: what is he like? ethan: he is a very interesting guy. because you know, this world we

are describing feels almost gang-owned or like an underworld. but martin is very charming and i think he is both sort of a bulldozer and a pussycat at the same time. he is a guy who can get his way but who also sort of moves you through his sincerity. you don't have the feeling that he is out to screw you, to be perfectly honest. you have this feeling he wants to move this thing along. part of it if he is very upset at what has happened in venezuela and he wants to have the government be moved out. oliver: up next, the length to which one fast-growing startup is going to build a diverse workforce. then after that, the energy drink that is all the rage in brooklyn and hollywood. ♪

oliver: welcome back. i am oliver renick. in the "focus on small business" section, flag technologies opens up about the challenges of quickly building a robust and diverse workforce. carol massar and i spoke with reporter ellen hewitt. carol: silicon valley has been under pressure to have a more diverse workforce. if you look right now, that is not what they have.

>> it is a story that started a couple years ago. in 2014, there was a lot of pressure on big tech companies, google, apple, facebook, to release demographic data of their workforce, something people in the industry were calling for, going to shareholder meetings and asking for. google was the first to do it. in mid 2014, they put out their numbers, slicing and dicing by different racial groups, gender, , and leadership roles and technical roles as well as the company overall. and a bunch of other, you know, large tech companies followed, and their numbers all of kind of the same -- major representation of white people and asian people and very few black people and latinas. and a lot of men. it was usually around 70 men to 30 women. even more in leadership and technical roles. oliver: let's talk about slack technology, a startup going pretty quickly that plays a major role in this story. why did you focus on them? ellen: they are interesting when it comes to discussing

diversity. you know, they are run by a man named stewart butterfield who has been around the valley for a long time and he cofounded flickr. he has done a bunch of other things. slack is a fairly new project that started in 2014. it had been built before. that is when the product came out. they were a small team when this was going on, and they saw these large companies -- google at the time had almost 50,000 people -- releasing their numbers, and they thought, we have 30 to 50, maybe we have a chance to start early and start hiring from a much wider range of people, which can make it easier for us to continue in that pattern later on. so they are kind of an example of this -- what i would call a second guard of companies that started prioritizing diversity when they were much smaller. oliver: and a focus of small business section, a small maker maker in brooklyn with big ambitions. here is the reporter. >> it is a startup company that makes energy drinks and tea from

a plant that comes from ecuador. it is a brooklyn-based company and they are trying to create a more natural energy drink option. oliver: of course it is brooklyn-based. tell us about the science behind the plant. jennifer: it has a whole lot of caffeine but the way it hits you, so i've heard, is slower, so the way coffee hits you right on, the plant is a slower build. it has been drunk by indigenous populations in ecuador near the amazon for a long, long time. the founder of runa, tyler gage, experienced this in his studies when he was in college and said , this is an amazing plant and i need to bring it to the u.s., to this market. carol: he went to the farmers in ecuador as said here's what i want to do and they laughed at him. jennifer: he said i want to set up a supply chain and bring the plant in the u.s. and i want to

pay you to grow it for me. they laughed, they said, this is -- something would have had forever and not something valuable to the u.s. consumer. oliver: how come nobody tried to commercialize it before? jennifer: you know, i think it was just kind of out there and nobody had taken advantage of it. oliver: how did tyler stumble across it? he was basically in the area, so to speak. jennifer: he was working for an s&l botanist and costa rica -- in costa ricaist and he tried the plant. he went back to school and then kind of you know traveled back and forth to peru and ecuador and ended up, he was in a class, he went to brown university. he was in a class where they were focusing on entrepreneurship, and basically the goal of the class was you have to come up with a business plan by the end of the semester and they decided to go for it, and make a business plan turning this plant into a beverage. carol: he has the ecuadorian government, they have invested a lot of money.

jennifer: they were the first major investor, they invested $500,000 right at the beginning. eight years in and you can see runa at whole foods, in certain corporate headquarters like google and amazon, and they are rapidly trying to expand. they really feel like they are still in start up mode. they could hit a lot more places. but you know, to the growers, they are kind of like you know, this is a huge american company now. oliver: let's get to the glamorous part. some of their backers are bigger names, channing tatum, leonardo dicaprio, olivia wilde. something for everyone there. what is up with hollywood support? jennifer: i think it is the story behind the brand. i mean, tyler gage started a nonprofit alongside the company from the very beginning. they are supporting these indigenous growers who would otherwise have to, you know, grow other plants in kind of less humane environments.

and so i think these -- it is kind of like -- it is a great beverage, the stars have bought into the product, but it is also a great story because it is a humanitarian effort and i think celebrities really like that. oliver: up next, israel's most prolific startup evangelist has a new product that may be a tough sell. plus, if you are a fan of elf on a shelf, why not try mensch on a bench? ♪

oliver: welcome back to "bloomberg businessweek." i'm oliver renick. you can listen to us on the radio on sirius xm channel 119 and on a.m. 1130 in new york. a.m. 960 in the bay area. and in asia on the bloomberg radio plus app.

in the technology section, a kingpin of israel's red-hot tech scene. carol massar and i spoke to reporter gabrielle. carol: gabrielle, you write about israel's most prolific hype man.e man -- who is he? gabrielle: he is many things -- an entrepreneur, a venture capitalist. he is somebody who comes from sort of outside of the elite of the israeli tech scene. he is from the south. he never went to college. and yet, he has had tremendous success in getting tons of money and attention from his ventures. oliver: he sounds like quite a character. as you described him, entrepreneur, hype master. i think that is like a title at character gives himself on seinfeld. it is not really what you think about as a venture capitalist, but he seems to be sought after

and doing some of the big deals in israel, which is a huge area. a booming area for entrepreneurs. tell us exactly what he is adding to these businesses. gabrielle: i think what he adds is marketing prowess and he is kind of a rainmaker guy who can bring money and attention . and celebrities. although one of the things i kind of talk about in my piece is that no one had really sort of gone in and see what goes on behind the scenes of how he does this. what i found is that he does not always raise as much money as you think he does. one of the examples i give in the story -- he had a startup that was a would-be instagram thei really believe he had idea on his own before he ever heard of instagram. its first round of funding raised $4 million and leonardo dicaprio was one of the investors. in my reporting, i showed a

document that showed that leonardo dicaprio had put in $9.54. technically, he put money in. could argue that having the endorsement of a super celebrity , if your startup is a photo sharing mobile app, it is soluble. but it gives the impression that it was a lot more than that. oliver: a great anecdote -- he had a little problem with dicaprio and how he used a photo sharing service, right? mobli is: right, basically on his last legs and basically got crushed by instagram. one of the things he talks about, why didn't mobi go well? he is like well, you know, leonardo did not really post -- you want him to be posting selfies on the beach or something, having that celebrity paparazzi thing. but leonardo, who is very into saving wildlife, would postop

related to his philanthropy stuff around saving animals. moshe hogeg did not think it was enough to kind of bring the, you know, eyeballs. carol: talk about the other startups he created. a luxury phone. the yo app. these are some of these businesses -- oliver: i heard about the yo. it was in internet sensation. gabrielle: everyone has heard of yo. i think there is a certain amount of genius. i mean, it is so simple and it has been derided the sign of a bubble or the stupidest thing ever, how can people find this? but we are all talking about it. i have it on my phone. i think it is hilarious. he has a knack -- what is going to get attention? oliver: in the focus on small business section, the next product that wants to be the big hanukkah toy, mensch on a bench. carol massar and i spoke to reporter matt townsend. >> this guy named neil hoffman was in a story couple of years

ago with his son and he said, i want elf on a shelf and he said , no, you are jewish, maybe you can have mensch on a bench. it sparked the idea. carol: he just came up with that idea? what is elf on the shelf? >> elf on a shelf was created a decade ago by a mother and her two daughters. basically, the elf watches over the kids and reports back to santa if they are naughty or nice. it became a big hit. carol: it is effective. >> each night, you move the elf to a different part of the house, so the kids wake up, where is the elf? that is how the elf is reporting back to santa. oliver: this goes on a couple weeks in advance of the holiday, whether it is the elf or mensch. carol: they show up after thanksgiving. >> yes, they shop after thanksgiving and it is a brand that is really taken off. it has expanded into clothes.

all kinds of different product. and it has become a sort of christmas tradition. like the advent calendar was for a previous generation. so this guy, neil hoffman, worked in the toy industry and was at a nordstrom department store a couple of years ago and his son -- by the way, he is from an interfaith marriage. his wife celebrates christmas, she is christian. he is jewish. his son said, i want elf on a shelf. he said you can have mensch on a bench, it came out of nowhere. he thought, maybe there is a business opportunity here. he did a kickstarter, created the product, and it kind of took off. the big thing was it got a -- got on "shark tank," and got 2 investors. it got a lot of exposure it took off from there. this story i did was that, would you do from there? you get a big boost from "shark tank", millions of people watch the show, then you get a big boost as retailers get interested, what happens next?

so basically, he is trying to expand the brand. this year, there is two new characters. hannah the hanukkah hero and a jewish grandma. oliver: i want to touch on the funding. i am already on amazon buying it. i am curious because the funding process is sort of tech savvy and modern funding as you can get in terms of getting recognition. it turns into a business through mediums like "shark tank" and facebook sort of getting the word out. it seems very interesting -- kind of a case study of building a company in the 21st century. map: he basically used a kickstarter. put ined $22,000 and he $10,000 to get the initial sort of product launched. he was a pretty savvy guy and he realized "shark tank" had a christmas special each year and he knew they usually wanted one

jewish product. he said, i have a good idea because i already kind of have this social media buzz, so he got on "shark tank." he has a marketing background. he knew with social media and he knew his product was a quirky thing that will probably get a lot of buzz. he got it on facebook and a local tv station picked it up in boston, and before you know it he is on "the today show." it goes to show you do not need a bunch of money behind you. this guy had an idea that son,ally sparked from his he had $10,000. the company is projected to make $1 million in revenue next year. oliver: "bloomberg businessweek" is available on newsstands. more bloomberg television starts right now. ♪

scarlet: coming up on "bloomberg best," the stories that shaped the week in business around the world. italy's prime minister steps down. the ecb adjusts qe. china's stock markets open a little wider. and a few trump tweets make a whole lot of news. >> we have seen the offshore yuan versus the dollar trade slightly lower following these tweets. >> we do not really know what the whole backstory is here. scarlet: it has been a monster month for markets since the election of trump. investors tell us what they expect when he takes office. >> the consensus breaking down will be good for some markets and bad for other markets. >> i'm looking for a 2% economy.