emily: i'm emily chang. and this is "bloomberg technology." coming up, a major milestone for apple, becoming the first u.s. based company with a market value of $1 trillion. we will map it out and have reaction from a veteran apple analyst. sonos launches its ipo, but is this the right move for the smart speaker company? competition from apple and amazon closes in. we will speak to the ceo and an early investor. strava, the social network for

athletes, has 32 million users and growing. we will speak to the ceo about its popularity rise and concerns about security. first, our top story. just last week, it looked like the tech sector was in for a massacre this earnings quarter thanks to a disastrous showing by facebook, but then came apple, surging this week following its earnings report. as much as 9%. thursday, it happened, $1 trillion. apple became the first u.s. publicly traded company to cross that milestone. how did it get there? mark gurman has the answer to how it got there. mark: after months of waiting, it finally happened. apple has become the first u.s. publicly traded company to hit a $1 trillion valuation, leaving the likes of amazon, alphabet, and microsoft in its wake, but not far behind. >> 2, 1, whoo! mark: apple's milestone is significant and a testament to

the rapid growth spurred by the success of products like the iphone and ipad, as well as ceo tim cook's leadership after taking over for visionary cofounder steve jobs in 2011. >> and we are calling it iphone. mark: but let's not forget that what is now the world's most valuable company was on the brink of bankruptcy as recently as the late-1990's. that was until cofounder steve jobs returned to the fold. since then, it was one success after another. in the seven years since jobs' death, cook has steered apple to new heights, by launching new devices like the apple watch, iphone x, and airpods. he has pushed the company deeper into new services, like apple music. it is now a key revenue driver. cook and his team are not stopping there. they're keeping apple on the technological edge, delving into self driving cars, augmented reality, and health care.

what does he think about the latest milestones? cook told bloomberg in an interview, quote, "i don't really think about it. that's the truth. i still view apple as a pretty small company, the way that we operate. i know it's not numerically, but the way we function is very much like that, to be honest." to grow beyond $1 trillion, apple has to keep churning out cutting-edge smartphones while still finding its next big hit. a larger version of the iphone x and a cheaper model with many of the 10's features are on the way. a.r. could revolutionize personal computing once again, while a big online video push is coming soon to an apple screen near you. emily: here to tell us more, the voice you just heard, bloomberg tech's mark gurman. in london, caroline hyde. with us in minnesota, gene munster. gene, you have covered this company for years. what does this actually mean?

gene: i think it means that apple has become really the fabric of our lives. i think it is testimony to that, that this is something we don't even think about how much we rely on apple's devices. that means that -- i think that's one piece of it. i think it also means that the company is so big right now it has an unfair advantage over a lot of other companies, just given its market cap. the stock that it has, if they did want to acquire companies, they have more leverage on that. and last, i think it is a wonderful reminder to people to stick to doing one or two things exceptionally well. in apple's case, it has always been one thing exceptionally well. tim cook got a lot of heat over the years for not coming out with a cheaper phone and a mass-market. he got criticism for not doing m&a. he stuck to what he believed in and i think that was the third

piece i take away from hitting this milestone. emily: i do have this chart here showing apple at the top, but trailed by amazon, alphabet, microsoft, all in a pack, rising behind apple. mark, you also make the point in your story that tim cook has had a lot of successes, even though he also caught a lot of flack for not being steve jobs. mark: this is no accident. you remember when tim cook took over as ceo. was he going to be able to steer the company to new heights? was he going to do more than stabilize it? at the same time, there was a lot of talk, was he going to let the company go? is it going to become like the company became under past ceos who replaced steve jobs originally? the answer was a resounding no. this is at a market cap that is three x what it was when steve jobs passed away. that is just a number, but the number is representative of this historical marker that represents so many new products

over the years, smaller products, the apple watch, etc. emily: you point out that apple is not the first company to hit the $1 trillion in market cap. it was petrochina, which quickly fell. caroline, you've been digging into some other historical markers. having the highest market cap is not necessarily a recipe for success. caroline: certainly not. cast your mind to microsoft a keyey text player, -- tech player which hit the $500 billion mark, then had four successive years of downward trajectory. you mentioned petrochina. it fell off its perch as well. it doesn't always spell glory. what should be taken into account when it comes to apple is not only is it head of the pack when it comes to the other, in excess of $500 billion,

companies, but also its price to earnings is still pretty darn reasonable. it is the lowest of those four pillar tech companies. it trades at about 18 times future earnings. when you compare that to amazon, nipping at its heels, it trades at more than 100 times future earnings. this is a company raking in $250 billion in revenue every cigar -- every single year. it makes money every single year. it makes money. no wonder its valuations are so high. emily: is there any risk that apple hits this mark and falls back down? given all the challenges ahead, even though it is relatively cheap compared to its tech peers. mark: there's no immediate risk. that always concerns me and i can't identify an immediate term risk --

probably over the next five to 10 years there will be the emergence of wearables, and this idea that it is augmented reality first, something apple believes strongly in. that will be a shift in terms of the devices that people are going to use. the good news for investors is we have a clean sailing ahead for the next several years, but the risk is down the road, relative to what can happen when we have the next hardware shift. i would remind people that's one thing that apple has done brilliantly well is this idea of embracing the innovator's dilemma. what that means is when they've had successful products, 2005, the ipod was just over 50% of revenue, they were very aggressive at creating a new product to cannibalize that with the iphone, in this case. in the future, apple will have to cannibalize the iphone and that will present some risk to the story. emily: wearables were up 60% last quarter in terms of revenue.

is it the apple watch or air pods that cannibalize the iphone? probably not. mark: it's going to be another product that gene alluded to, augmented reality glasses. that's apple's next big thing. emily: how big can that be? mark: we declare that apple's next big thing about two years ago. this is what tim cook is banking the future of the company on, in terms of hardware. the company has well over 1000 engineers working on this right now. they are working on an augmented reality headset that will eventually succeed the iphone. it will take some of the heat away from the apple watch not doing as well as some expected earlier on. this is their next big product. emily: gene, are you as optimistic about ar as mark is here? gene: mark has done a wonderful job of covering the topic, and i wholeheartedly agree that this is kind of the next thing in terms of the mobile device. it's going to be a long time

away. i'm very optimistic about apple's business over the next several years. i just want to emphasize that piece. their hardware business, the iphone business, is operating almost like a services business. putting it all together and answering your question, emily, i share mark's optimism about the future impact that augmented reality will have on consumers. emily: and, caroline, it's not just products that have led to this run-up. it's also share buybacks, correct? caroline: certainly when it comes to the share price. there is a fascinating chart that really highlights how much the ramp-up in share price has been driven by buybacks. they bought back phenomenal quantity of shares. billions spent since they first announced those buyback intentions. when you do all the math, basically 42% of the share ramp up is actually because of the share buybacks. that doesn't mean the market capitalization is driven by that.

when you buy back shares, there are less there. it halts your market capitalization, but also you drive up your overall price on each individual share, particularly when you are raking in the earnings they have managed to have. it is a complex realization to market cap, the share price ramp-up has a lot to do with buybacks. emily: bloomberg's caroline hyde for us in london. gene munster and mark gurman of bloomberg tech. we will be talking about this a lot. thank you all. all right. shares of square have nearly doubled this year, putting pressure on the company to outperform. i sat down with sarah frier to talk about the latest results. >> we want to invest, but do it with financial discipline. we maintained our guidance for the full year. 250 million, that stayed the same.

if you look at the back half of the year, we think that's the right balance of invest to grow, but do it with financial discipline. emily: more of that conversation ahead. if you like bloomberg news, check us out on the radio. listen on the radio. this is bloomberg. ♪ emily: when it comes to square,

investors expect a lot. shares have doubled after a 154% gain last year and that means pressure to outperform analyst'' expectations. investors got strong momentum, but a weaker forecast has the company spending for-profit. there's much more to square. the ceo, jack dorsey, made a push into bitcoin. that has helped fuel growth for

the square app in general. we caught up with sarah frier and asked what other points the company would be looking to include on the platform. sarah: we went with bitcoin because we felt it was the battle tested form of crypto, being around for the longest period of time. i think people feel confidence in us. if there's a need, we will always go with what our customers are telling us they want. right now i think there are other needs on that platform. that's why they've done more investment around loyalty programs, rewards programs. i think you will see us do more on that. the second thing we've done with cash is take it to the u.k. there is a need for all of these things -- utility pieces on a global platform. emily: as a cfo, does bitcoin crypto make you nervous? others have pulled back. some started to allow it, then they stopped because of the volatility. sarah: as a tender type or a payment type, it is still very early.

it behooves us to be there. what would make me more nervous, frankly, is if square wasn't experimenting and iterating with new technologies, because that is our future. we've always been great at risk. that was the first thing that got us going as a platform. risk is not a destination. it's a journey. the back guys are always getting better and better, so you have to keep up your game. i think it's the reason why we've built a payments platform at the scale we have. it's why we've been able to do products like instant deposits. i said yesterday on the call, moving money quickly is somewhat difficult, but many folks can figure out how to do that. what's really hard is moving money quickly. we did $4 billion of instant deposits in q2, so you have to make sure you are managing risk well. emily: if the price drops in the process of that transaction,

where does that leave square? who is handling your bitcoin custody? sarah: that's one of the reasons we have set up the program the way we have. you make a purchase. we quickly go into the market to consummate that purchase for you. we hold the bitcoin for you, but it is your bitcoin. effectively, the risk on square's balance sheet is minimized. in the hundreds of thousands of dollars on purpose. ultimately, we want to make sure we put the risk in the right place in terms of managing what the customer wants to do. emily: this is a question we are asking all of our guests right now. what is the biggest downside risk to your industry and your business in the second half of the year? sarah: right now, business is good. we just got to 60% year-over-year. i spend a lot of time looking at macro data points and trying to figure out what's going on from an economic standpoint. what i see out there is small business optimism is at an

all-time high. the tools that we are bringing them are helping their businesses grow. that's our whole value proposition. right now from a macro standpoint, things are quite benign. emily: how about the trump, trade war, tariffs? is that concerning small business owners or any of your customers? they are not all small. sarah: they aren't. that is a great point that you make. we are serving sellers of all sizes. we are bringing on sellers that are quite large at this point. at the end of the day, people are focused on what can i do to make my business grow and not spending too much time on the noise coming across the transom. emily: what's the biggest upside trend? sarah: where we are focused. omnichannel is a massive unlock. if you are starting to see small businesses meet customers in online ways. food is often not talked about as omnichannel. with caviar, you can get a customer who walks into your full-service restaurant, but if they are sitting on their couch and want to make an order, you get to take that sale as well.

omnichannel is massive. i think there's a lot in this financial services for individuals. we know there are 25 million households in the united states that are unbanked or underbanked. they have not come on the system, probably because something like a debit account is really expensive for them. by rethinking what an account looks like and rethinking the economics of that, we can actually bring individuals on in the same way we did originally with sellers. emily: i think there is an under told story about how square is sort of democratizing access to financial services. sarah: that's exactly right. our purpose is economic empowerment. i think this is a mega-driver. people want to go directly to who are you going to compete with, who are you going to steal share from. if you look at the u.s., you still have 21 million small businesses who don't accept cards. effectively, folks like you when you go out to shop, you have your card. you often don't have cash.

they are missing a sale. it's a megatrend going on. i think people miss that a lot when they think about the square story. emily: looking forward, what do you think about the competition, paypal, venmo, apple pay, some of the less obvious or less discussed competitors? what do you think the biggest threat is? sarah: what i love about our business is it is a cohesive ecosystem. we do not put it to the business to stitch together all the different pieces. instead, we say come on square and we will help you always make the sale, give you a robust point-of-sale system, give you access to capital. we will help you do loyalty. they don't have to think about working with multiple other vendors. similarly, if you think about competitors, you mentioned apple pay. it is not a competitor. apple pay is a form of payment. i can take my card and swipe it. i can use apple pay or samsung

pay or android pay. for us, it is how do we make sure the shift continues to work even for the smallest of businesses? we love that shift. contactless payment is safer, faster, and people spend more when they are using a credit card. emily: our conversation with square cfo sarah friar. coming up, how safe is mark zuckerberg? we will take a look at how much security the facebook ceo really needs. this is bloomberg. ♪

emily: mark zuckerberg's spot in the limelight comes at a cost, $7.33 million to be exact. that's how much facebook spent last year protecting his ceo at his homes and during his tours across the united states .

they have upped the security $10 million. is this appropriate for a tech ceo? you have a chart that shows that zuckerberg gets the most for personal security than any other public company ceo. why so much? >> well, there are probably a couple different reasons. for one, he leads a company that is one of the world's biggest and most well-known. he is extremely rich himself. he is, compared with many other ceos, he is fairly open with his private life. he posts pictures from his family and travels on his facebook account. the company has been in a little bit of hot water this spring with regards to its privacy policy and potentially how the platform was used in the run up to the u.s. 2016 election. all of that kind of adds up to creating a risk profile for him that security experts say might warrant these high costs. emily: sheryl sandberg, also pretty high up there, $2 million and change on personal security.

how much do you think this increase has to do with what's been happening with cambridge analytica, russia, controversies in myanmar? posts that many say have led to violence? >> it could definitely have an impact. if a company gets bad press, typically it is executives that can be targeted for threats. we saw that in the aftermath of the financial crisis when many banks started upping their security. when herbalife was targeted by bill ackman. its ceoe also equipped with more security. there are also totally personal reasons for this. mark zuckerberg now has two young kids. he had his second daughter last year. it could be that he just wants to up his security for his little family. it could be that relatives or extended family members have gotten threats or are just not

feeling comfortable. it could fall on him to pick up the bill for that. emily: and you go into great detail about what these costs actually are, right down to bulletproof windows. tell us where the money is spent. >> it's quite interesting. i had conversations with a lot of people that work in the private security industry. going into the story, i figured that an additional $10 million on top of a $5 million to $7 million facebook has paid per year for the past few years, it seems like a lot of money. i was quickly told that is not necessarily that much when you have private security detail, security at your home, a special cybersecurity program set up for your devices. costs can add up very quickly. emily: thanks so much for that story. still ahead, selling consumers

on cool tech gear proves easier than convincing investors. sonos and the public market, next. this is bloomberg. ♪ retail.

under pressure like never before. and it's connected technology that's moving companies forward fast. e-commerce. real time inventory. virtual changing rooms. that's why retailers rely on comcast business to deliver consistent network speed across multiple locations. every corporate office, warehouse and store near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver. emily: this is "bloomberg

technology." i'm emily chang. shares of speaker maker sonos began trading on thursday. the company priced shares below the marketed range and raised $208 million, giving it a market value of about $1.5 billion. in april, the company was hoping for a valuation twice that. alex barinka caught up with ceo patrick spence after shares started trading. >> the quick reaction is always, oh, they make these great sounding, great-looking speakers, so they are a hardware company. we did have to spend a lot of time helping investors understand that we are a different type of

company that builds products that last for a long time. people come back and buy more of those products. we are unconventional in that sense. as far as i know in consumer electronics, we are the only company that approaches it the way we do. certainly some of that education was necessary as we went through it, so i think there is that element of it. alex: when i talked to sonos owners, they all of the product. when you talk about what you are pushing out to the street, where is the growth going to come from? is it convincing folks to upgrade to new systems, new speakers? is it the platform itself? where do you see that growth in the future? patrick: in this first phase, we have been successful in breaking into the traditional home audio market. people that were looking for stereo systems in their home. what we got most excited about is the fact that there are 176 million people around the world now paying for streaming music, paying $120 a year, they love music so much. it is $149 to start with sonos.

what our job is is to get people who have all that great music from spotify, apple music, pandora on their phone and get them listening to it out loud at home. that's where we come in because of our open platform supporting all those services. that's what we are talking about in this next phase of sonos and what i'm most excited about. alex: on the roadshow, you talked a lot about the opportunity that voice-activated speakers bring. we definitely pair amazon's alexa with the next age of voice-activated speakers. amazon is a partner and a company that tends to strike fear into other technology companies. how do you manage that relationship going forward if they decide to push more into the wireless speaker space? patrick: we've managed relationships with amazon, apple, and google for more than a decade. we have put alexa on the platform.

google assistant will come later this year. it has been beneficial for both sides in terms of them being able to get their services into our 7 million homes and us being able to offer that voice control as a music experience. based on our experience and our decade of history, i expect all of our partners will continue to want to bring their latest and greatest service to sonos, and we will bring that into millions of additional homes. it will be beneficial for both sides. alex: looking forward to the latter half of the year, you are a public company now. some of the macro trends will undoubtedly impact how your stock trends. whether it is tech earnings from the broader group, or political tensions with the likes of china. what are the biggest risks for your business in the second half of 2018 when you look forward? patrick: after 20 years in the tech space, i feel it's much more about what you are doing and executing in your own business. i am a realistic watching things

around the tariffs, things like that, but it's much more where we are in the market with a huge opportunity in front of us. i'm much more focused in how we execute, the products we need to bring to market, the new countries we are opening, and attaching to all those people paying for streaming music. at our size and scale, some of those macro trends we will watch and be mindful of, but it's also the opportunity ahead is so big and we are so early in the game that a lot of those i think we can maneuver around. emily: sonos ceo patrick spence with bloomberg ipo reporter alex barinka. sticking with sonos, we are speaking with one of the largest holders. mike, lots of people love sonos products. one venture capitalists wrote a love letter to sonos this morning, but investors were not that excited about it. where is the mismatch? >> emily, thanks for having me on again. thanks, fred, for the wonderful love letter he sent. the storyline around sonos is an uncommon one.

as you know, there have not been a lot of consumer hardware companies that have excited investors as of the recent past, at least. sonos is one of those things where you can't judge the book by its cover. if you look underneath sonos, the way that consumers use this hardware product is very different than traditional companies. the average household has 2.8 sonos's per household and 93% of sonos's that have been sold since 2005 are still in operation in people's homes. that's a very different kind of product than a traditional consumer hardware product. a lot of the process this last couple weeks has been about educating investors in the broader market than just vc's like us on why it is that sonos is such a special product. today there are 7 million homes that have sonos.

i think he will see investors begin to appreciate the value proposition of this company and understand it is more than just a speaker maker. emily: what about alexa, google home, all these things that do more than just play music? mike: all of those things do run on sonos as well. sonos fundamentally gives consumers a choice. that's the beauty of the product. in the early days of streaming, you could get pandora, so no -- pandora, spotify, etc., on sonos. today, and you can get alexa and google and airplay. we accommodate the union of all of the benefits. even for those companies, at the end of the day, it's useful to have a company like sonos that sells music systems throughout the home. essentially, it enhances the exposure that a software offering like alexa has. fundamentally, even though there is obviously some degree of competition at the margin,

overall, i think all three companies, as well as sonos, benefit from the overall partnerships. emily: you've had six recent liquidity events. today, sonos. also today, cisco announced it security for $3.5 million. not bad. mike: it's been a very good year. it wasn't always this way. we had very humble beginnings at index just a few years ago when we opened up our san francisco office, and we've come a long way from that. fundamentally, embedding in companies that are a little bit contrarian, like sonos, for example. we've begun to find our stride. not every year will look like this year. but we are humbled by the work these entrepreneurs do and thankful we have gotten here. emily: what does the future hold?

do you see as many opportunities for investment? do you see more opportunity in the public markets with uber and airbnb? mike: this is an exciting time in the investment business. one, the landscape is changing. we are seeing an influx of capital. the likes of sequoia and softbank are raising new funds. we are seeing new names show up in the business that historically in venture was mostly dominated by a small number of well-known brands. at the same time, investing is becoming more global. you are finding companies in europe, like one of ours that did incredibly well, or spotify. you are seeing a rise in china. los angeles and new york are creating terrific venture opportunities. i'm very optimistic. you never know how markets will behave, even this week as we went through the roadshow with sonos. it was not the easiest way to

take a company public. those ebb and flow. broadly speaking, the spirit of entrepreneurialism and the value proposition of what venture companies can do continues to grow. you can never predict those short-term, but over the long term, we are very optimistic about what we see in the tech landscape in the future. emily: coming up, a startup that claims it can extend the life of fruits and vegetables just closed a $70 million funding round led by one of the largest hedge funds in the world. we will ask the ceo how they got attention of the investors. this is bloomberg. ♪ emily: one of the world's

biggest hedge funds is joining the fight to keep avocados ripe for a longer period of time before they go bad. apeel sciences claims it can treat avocados with a solution to stay ripe twice as long as its usual shelf life. for more, we are joined by the ceo of apeel sciences. i probably get rid of one avocado a week that has gone bad. how does this actually work? >> we use food to preserve food. we make plant-based products that extends shelf life.

even when they are sitting on the grocery store shelf or at home. emily: what's the science behind it? >> most people don't think about it. when you harvest the piece of fruit, it is still a living, breathing thing. by creating barriers on the outside of produce, we are able to create an optimized microclimate inside the fruit which makes it stay longer on the shelf and sitting at your home. emily: you are back now by a hedge fund. what are they so excited about? >> this is a big problem. estimates in the u.s., somewhere between 1/3 and 1/2 of what we are growing ends up in a landfill. globally, this is a $2.6 trillion issue. we literally have money evaporating off of store shelves. this technology really addresses that. emily: what else can this be used for? >> every single piece of produce on the planet spoils by the same mechanism. it is water evaporating out of

the produce. this barrier allows us to control the rate that those things happen and give you better quality, more nutritious, longer-lasting fresh produce you are less likely to throw away. emily: it can be used on anything? >> yes. emily: what makes this proprietary? why couldn't someone copy what you do or copy your formula? >> there's a lot that goes into it. at the core of what we are doing, we are using food to preserve food. we are using plant material to create these formulations. there's a lot that goes into this. it is about understanding -- again, going back to this element that fresh produce is a living, breathing thing. you need to understand the produce and the science that goes into creating that little microclimate for the fruit. emily: as amazon pushes into groceries and many different chains are pushing into online grocery delivery, there is obviously an increasing importance for things to be fresh. one of the things i encountered using amazon fresh, a lot of the produce wasn't fresh by the time

i received it and i had to throw it away. talk about the potential given other technological shifts happening. >> it's a big challenge. you hear that the interior of the store is dying because a lot of this is going to online delivery. folks don't need to go to the grocery store and buy their paper towels, but the fresh perimeter, that part of the store is growing and evolving quite a bit. there is a war that's happening right now at retail. it doesn't matter which grocery store you go to that you will pick up your paper towels, but if you know you can get your favorite produce at a particular grocery, you will elect to go to that store instead. emily: how many suppliers are using this? >> we have a handful of suppliers that are installed today servicing programs. we will be making more announcements shortly. emily: what is the competition using? if they are not using your formula, what's on my avocado? >> the competition is the way

that things have been done for the last 100 years in the supply chain. supply chain in these situations actually built up around this intrinsic idea that the produce is going to spoil at a certain rate. what we realized is that, using this formulation, we can slow down the rate that that fruit is spoiling and you can actually reconfigure your supply chain differently. that results in all kinds of value creation opportunities. emily: i know you have seed potential internationally. in africa specifically, what do you see there? >> estimates are between 1/3 and 1/2 of what we grow going to landfills. in sub-saharan nations, those numbers can be 80% to 90%. it all comes down to not having the cold chain infrastructure installed in these regions to support the supply chain

necessary to get fresh produce from where it's grown to where it's consumed. our technology works without the use of refrigeration. it works without the need to install cold chain infrastructure. we are extremely excited by the opportunity to deliver this technology to places of the world that are not fortunate enough to have the type of cold chain infrastructure that we have here. emily: how profitable do you think this technology can be? how do you make money? >> food waste is a $2.6 trillion problem. making any significant dent in that is a really good business. emily: james rogers, ceo of apeel, thank you so much for joining us. coming up, can social media make you an athlete? one company sure seems to think so. our chat with the fitness company app, strava, next. this is bloomberg. ♪ emily: it may be the only

airbnb that you can see from space, and it could be yours for a night. the great wall of china is a possible airbnb destination for a sleepover. on the great wall. the promotion is in with the development committee, and a few people will be chosen to spend the night there. just one catch, you have to write an essay about why it's more important now than ever to break down barriers and build new connections. one more rule, winners have to make sure they keep their music to respectable volumes so as not to disturb the ancient wall's guards. fitness tracking means big business. the market could hit $62 billion by 2023, up from $18 billion in 2016. strava is the social media app that wants to get you moving and wants to make sure you're safe when you do it. the fitness tracking app claims 32 million athletes in its community. it just released its newest three-tiered membership service, called summit.

besides is training and analytic modules, they have included one called safety that helps athletes stay in contact with a friend, who can track you in real time and make sure you haven't veered too far off course. here to tell us more, strava ceo james quarles. you are saying one million new users are joining every 30 days. what's the motivation here? do you believe that just being part of a social network can turn you into an athlete, can make you fit? >> you said 32 million members globally. 82% outside the united states, so it's a global phenomenon. when we hear social network for athletes, we wonder what that means. sports have always been social. people hold you accountable. they get you out of bed in the morning. they push you a little bit further when you are racing or recovering from injury. that's what strava embodies for people. if you want to track your runs, swims, rides, it's the place to share it with people and get encouraged. emily: the app is really popular among certain kinds of athletes,

like cyclists. who else? >> cyclists, runners, swimmers. i also use it for hiking. i use it for skiing. we have up to 32 different sports. increasingly indoors. we have partnerships with studios that are doing indoor cycling. we have apps who do yoga. you can have counts back on your strava feed. emily: we've had you on the show in the past when this was more of an idea. where are you now when it comes to actually making money? >> we are not profitable yet, but as you talked about today, we are announcing our upgrade to our subscriptions business called summit. we are breaking in the three packs. we have raised $70 million to date. we are focused on growing the community. size of the community is our primary metric. over time, because we have such an engaged community of athletes -- that's our mission, to create the most engaged community of athletes in the world. emily: and it's going to be

driven by subscription? >> it allows us to have content and potentially licensing. emily: you had leadership roles at facebook. what do you think of the idea -- i know it is not just a social network, but the idea of niche social networks and the potential there? where else are you seeing that work? >> i certainly think that the world has -- the pendulum is swinging away from big, large networks to things that are qualified, like ours. if you are active, committed to sweating, you should be asking questions about which device to own, which shoes to buy for a race, which bike you love, of people who also share that passion. those questions, i do not think fit on twitter or face that. they are better suited for hours. i think if you see the rise of groups and messaging services, there is probably a strava for food, for pets. these niche networks i think will become more popular over time.

emily: do you think this could be a longer-term backlash against facebook as a result of everything going on, in addition to what you just talked about? >> i think your last guest highlighted the need, that people are paying more attention to what goes into their food, and i think people are paying more attention to how the data that they share with these apps is being used, and i think it's a good thing. i think we need to give more transparency to people, about does this company so my information to third parties, which strava does not do. i think consumers would benefit from more transparency and, frankly, we are trying to lead that effort. emily: what do you do with the data? we talked to a start up yesterday, an investor in a 3-d body scanner. the data stays on the scanner. how do you collect the data, and where does it go? >> people come to track from a device. we partner with over 380 different kinds of devices that can read and write to strava.

apple watch, garmin, fitbit, they can all write and read to strava. that data is used for people. that's why the subscription service makes so much sense, in order to analyze their performance. you mentioned the safety feature, and i think it is a great one. so, if you are in a race and your spouse or significant other is wondering where to find you, if you are commuting and they want to know what time you are coming home, these are great instances of using that data. primarily, people use the information to analyze their own performance. that is largely the use cases. we do have a business where we partner with city planners to make better bike and pedestrian infrastructure. i think our community loves this ability that they opt in to contribute to better commuting, safer biking. we want to support that because it ties to our mission. emily: all right, james quarles, strava ceo, thanks for stopping by. we began by talking about apple's historic day, and that is how we are ending.

yes, apple became the first u.s. publicly traded company to cross the vaunted $1 trillion threshold. but ironically being first is not what apple is all about, so says tim cook. this is what he told me last june. tim: for us, it's not about being first. it's about being the best and giving the user an experience that delights them every time. we don't let that impatience result in shipping something that is just not great. emily: well, for this time at least, apple was indeed the first. that does it for this edition of "bloomberg technology." i'm emily chang. we will be back tomorrow. this is bloomberg. ♪

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