♪ , one of theded tpg largest private equity firms in the world. start bytheir investing in a bankrupt continental airlines in 1993. today, tpg has its hands in everything from j.crew to movie studios. two of the most prominent tech unicorns, uber and airbnb. tpg's investment strategy is undergoing a new evolution. joining me today on bloomberg

studio 1.0 is the co-ceo jim coulter. tpg is an investor in uber, airbnb, vice, spotify, what did these companies have in common and what does it tell us about your strategy? jim: they are driving disruptions in their industries. we are often called a private , from the beginning when we started with continental airlines. have not done much airline investing in 10 years, but since that founding 25 years ago, we constantly specialized in finding where the economy is changing and where we can expose capital to it. tbg.: you cofounded

what was it in those early days that set the stage for what tpg became? jim: we came to the industry from a different place. it is aggressive to call it an industry and 1990. it was a backwater piece of the investment world. in those early days, there were a couple of small funds, but some of the largest players were families. as the industry grew up, the wallpools on one side street, other side families, came together to form the private equity industry. we came from that different gene pool that has affected how we behave as investors. the financial crisis change the way you do things? jim: what we learned last cycle his that the larger deals we did

often thought to be safer in areas like utilities or casinos actually did not do as well as the companies that were fundamentally growth companies. as we have come through the last decade and you look at what tpg has done, we have been focused on the midsize companies driving industry change. what are your investors asking you that they were not 15 years ago? jim: the venture capital market is active, but today more companies are staying private longer, so activity that used to happen in the public market are happening in the private market, and our investors are trying to understand how to participate in that and sort it out. emily: you've talked about this era of the private markets. is this good for the economy? jim: i think so. i am obviously an advocate for

private markets, but over time the public market has evolved to be more short-term, indexed, and the private markets have grown bringwhere we can a toolkit of value added that is difficult for public investors to bring. emily: softbank has about $100 billion to invest. it is the asteroid in the room. how dramatically is softbank changing the investment landscape competitively? have seen a lot of astroid scares over my career, so i am trying to take a balanced view of it. veryve a large fish in a large pond, so how is that large the going to change life in very large pond? i do think their appearance as a market leader will shift some of the tech investing landscape, more techl also shift

dollars into the private market over time and may actually set andhe opportunities affect the price dynamics. emily: what you think about the position uber is an today? what do you think uber is worth with the new ceo? jim: i'm very excited to have him in the sea. i think the market will tell us over time. if uber continues the growth that it has exhibited so far and continues to broaden what it is doing really well, i think there is an exciting path ahead for uber, but it has a lot to clean up. butn't comment today, success may surprise us all. emily: would you think the

potential is for uber eats? jim: local delivery starting with food, packages, etc., is a issue.nteresting once you get a network effect, what can you deliver? maybe there is more we can deliver in more markets around the world. emily: what do you think travis kalanick's role should be? jim: i think the board will decide that. emily: some people think he should not be on the board at all. jim: i think the board and travis will decide what his role is going forward. will remain ais larger shareholder and hopefully a positive player in the company. emily: has your position on ?ravis's role changed

tpd did not sign the letter asking for him to resign. amount ofve a huge respect for what was accomplished of the company and what was accomplished generally. companies have to evolve, so we evolutionin favor of positive ways, and i don't think that is necessarily a focus on indie individual -- any individual, but are pleased to see the company moving for conference they must. emily: what is the lesson tp has learned from the way uber story has unfolded? jim: uber works in reverse dog years. if i take away one message it is that governance and culture really matter. in the flurry of growth out here in silicon valley we need to keep focus on governance and culture.

emily: how is that? revenues, weild build the cultural aspects that companies what they are and it moves through its life history. uber moves through life history so quickly that the models have granted to keep up. i think there is a general lesson to make sure those models around governance and culture inr the same discussion companies as the business models but often drive them. tpg washe cofounder of on the board of uber and made an about women and resigned. is that remark acceptable, that kind of attitude? jim: david's remark was

unexplainable and inexcusable, clearly inappropriate. david immediately apologize broadly and deeply and immediately stepped off the board so that was not part of the discussion. there is no excuse for what was done. david's actions prove that we in fact understand that. there is obviously a broader discussion going on on these issues and i think it is not really about uber. journey that businesses everywhere have to move more quickly on. you thates it concern it could change the level of influence tpg has? jim: no, uber is moving towards regular governance and we are just one seat in the board room, but we live in the world of large-scale, international companies come and it has been a boardroom that has not had as many voices with that background

. as the board expands and we bring in new members, it will be a positive thing for the company. emily: as you alluded to sexism is a huge problem in tech, investing, and business. what is tpg doing to improve its own culture in this regard? jim: to be clear it is the right thing and the smart thing to do. i have no doubt that more than 50% of the world's iq and 50% of the wisdom lies with the female gender, so we need that wisdom at this time in business and have to be more inclusive. co-ceo join tpg, he brought a lot of efforts that have been launched decades ago a to grow their commitment to diversity, and we have then traveling that path with vigor and focus for years at tpg. if anything, we have accelerated. emily: how so?

jim: to understand unconscious bias where it exists and encourage diversity of all sorts to enter our organization everywhere, from the boards we oinked to the entry-level recruiting we do. last year of the partners we made come over 30% were women. that for our industry is a high number, but i am embarrassed it is a high number for our industry, and we have a long, concerted effort ahead of us. emily: what is the single most important thing -- ♪

emily: are there other issues you think you will speak up about? jim: we spoke up on the bathroom bill in texas.

on another of issues. for most of my career in private equity, we did everything we could to keep our head down. there is a general shift in this business, and it is about doing the right thing. you can't stand on the sidelines like you used to. what's the most important issue? jim: the division in the country. government that governs. divisiveness, the political issues, the volatility, market uncertainty, is that having an impact on your investment decisions? things thatof the concerns me the most is how little people are concerned. you watch the public markets continually moving up, flirting with new highs for breaking that . it seems like what we see in the business pages and the front

pages aren't aligning as they have most of my career, so how that uncertainty plays through our investments is something we are discussing deeply and trying to express in the portfolio. our favorite way to express it is trying not to invest in the macro world. we are trying to invest in situations, companies and industries, that are interesting and changing. that is where our focus is. what are you most concerned about? emily: what are you most concerned about? jim: what i can't predict, geopolitical events. combined with the geopolitical events means life is more complicated than the low volatility in the market indicates. emily: when it comes to tax reform, what are you most concerned about when it comes to dealmaking? jim: i am not optimistic we will

have tax reform. , taxy have tax cuts changes, but tax reform is one of the most difficult things that governments do. my job is to take the cards as they are dealt and played them well. we cannot affect tax reform. we are anxious to see what will happen here and from there we will play our cards well. emily: what sorts of moves could impact tpg? jim: most notably for us would be changes in interest to deductibility. a portion of what we do, the use of leverage is important, and there has been various potential moves on the deductibility of interest that would change the relative attractiveness of certain capital structures. emily: carried interest has been an issue for more than a decade. and will that

materially impact your behavior? jim: i have no idea if it will change. it will arguably affect behavior broadly. one of the interesting things about carried interest is that it seems to be discussed as if it were particular to the private equity industry. it is something that has been in the tax code for 100 years, so if they decide to take it, they willchange it, but it affect the economy more probably than the discussion typically captures. has long been active in asia. what is the most significant investment trend there in china or elsewhere? my favorite trend in asia is health care. are not set systems up for growth in the economy or change in health care delivery. we own one of the largest maternity hospitals in china.

we are building cancer centers across hong kong and southeast asia. we are doing surgery centers across india, so this concept of catching the demographic wave, but also catching what is the global change in the delivery of health care, is a truly interesting investment area. emily: you were in saudi arabia recently. what you think those opportunities are? jim: you have an economy tilde on hydrocarbons pivoting to an economy involved in the global markets technology, a massive ball move. i think it will create investment opportunities in several ways. emily: any plans to open an office there? jim: i don't think they need us to open an office to help with the economy. i spoke with a number of local investors while i was there.

the point i made to them his they don't need chevron. they need aramco. emily: any plans to partner with the saudi public investment fund? jim: i would be happy to partner with them. we are happy to partner with sovereign wealth funds. as they transfer capital, i expect we will be active with them. will: do you think tpg still go public someday come and if so, when? ♪

and airbnb are often compared as two of the most highly valued unicorns. you are an investor in both. airbnb, how do you see the trajectory playing out and comparing them. jim: which of them do you love best? each has an opportunity. we tried to choose specific

places inthat has their industry which are special , and that is true of uber, airbnb, spotify, and vis. -- vice. they are now beginning to focus on experiences at airbnb. you don't just want the room. you want the concierge and its exposure around the city. i have been a big advocate of a general shift in the economy from things to it experiences, and i am interested in how uber is building uber eats, but airbnb is building its connection to experiences. china uber surrendered in . airbnb is pushing forward. they are not the market leader there. could you foresee a partnership with the local rival? jim: i would not use the word surrender for uber in china.

alliances and partnerships are smart. is anyone tries to expand at rates that these companies are, finding partnerships and alliances is smart business. emily: you're putting more money to work in content and entertainment when it comes to vice or caa. what is giving you the confidence? jim: over the top this one of the fundamentally changing elements of the consumer industry out there. we don't know where it will end. game of thrones would have been unimaginable a few years ago, from that have a move content to short form, so the idea of content and content shifting is to me one of the most interesting things happening. that tooe you worried much money is getting put into content? are we in a tv bubble?

jim: we are certainly increasing the number of scripted shows very rapidly, and the pendulum will swing back-and-forth, so for me i am passé about the concept of enjoy watching. how peoplengton iss will watch in the future -- watching his how people will watch in the future. it becoming some of the dominant dollars and content. spot: what makes you think if take on apple in the long run? apple isng on daunting, but spotify has shown rapid growth and effective is issuing doing that. interestingost things about spotify his that it is positioned as a data company, so its ability to evolve to meet the customer need, so i think it

will be one of the winners. we tend to believe there will be one winner in a lot of these industries, but generally spotify will clearly be one of the winners in the music business going forward, and maybe adjacent to music. emily: you brought in an outsider as co-ceo, your founder only yourself. that is a tricky position. how have you split up responsibilities? jim: now we have to invest to higher standards and manage ourselves well. those skills of investing in notging are sometimes present in one person and certainly take a broad set of efforts and personalities. my background is a little bit more as an investor come although i have been a manager for long time. a manager,more as , sohe had been an investor

it was bringing the best those two together. emily: you guys will start raising a new fund next year. we heard the cap is as high as $13 billion. can you share anything about your clients? jim: our goal is to have enough capital, but not too much. emily: tpg has remained private while your competitors have gone public. do you think tpg will still go public, and if so, when? jim: it is still unclear to me. we have no real desire to go public. emily: there were plans to go public, and those plans were shelved. jim: they were shelved because because to me said we will only do it if we think we need to do it, and what has become clear to me is that those who have gone public or maybe not as pleased with being public has they might have anticipated. there is now capital available in the private markets for companies like tpg also.

why go public when you don't have to or want to? cofounder coulter, and ceo of tpg. thank you. ♪ retail.

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near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver. >> it is almost 11:00 in hong kong. 2:00 p.m. in sydney. i'm david england. you're watching "bloomberg markets: asia." ♪ david: declines in the asia-pacific is global rally, the global equity rally as tech shares face the first weekly loss. economy remains on track with strong results in manufacturing and services this month. president trump targets north korea, discussing a range of

factions with chinese president xi jinping. admits that, there is so much to discuss. they came out with a rate decision. we want to talk about the data coming through. bitcoin is also very much in the mix, bitcoin. a lot of people have been asking how do you -- without getting exposure to the cryptocurrency? stocks if you did not already has a look at overstock.com. listed in the united states. as you can see, the stock prices moved up substantially along with the price of bitcoin which is your second panel. along with it, the higher the the stock and bitcoin. we also have short interest also moving up as well. this is one of the ways you can short bitcoin in case you did not know