emily: i'm emily chang, and this is "best of bloomberg technology," where we bring you all our top interviews from this week in tech. coming up, microsoft takes over six websites created by a group with ties to the russian government and plans to meddle in the u.s. midterm election. more manipulation on social media. facebook and twitter take down hundreds of a counseling to russia and iran. and as elon musk faces scrutiny from the sec, investors and the public, is he still the right person for the tesla ceo job?

first to our top story, microsoft said it thwarted an attempt by hackers tied to the russian military to disrupt the u.s. midterm election. the company's digital crimes unit shut down six domains that went to mimic sites victims might expect to get emails from. the group believed to be responsible is called strontium. we spoke with microsoft president and chief legal officer brad smith about the situation. brad: we are very confident that these six domains were set up and were put together to be used to harvest email credentials or passwords by this group. it is the 84th time since 2016. this is the 12th order that we have obtained to go address the activities of this group, which we now believe to understand very well. what we are seeing now is a pattern that in many respects is

similar to what we saw in the united states in 2016 when certain campaigns and political parties were attacked. it is similar to the pattern that we saw in france in 2017. we really saw every major candidate for the french presidency targeted. we are seeing it again. emily: now, you got to these particular websites early and there is no evidence that they were actually used to propagate any sort of attacks. but if they had been successful, how do you think they would have contributed, or could have contributed to threats against democracy, as you describe it? brad: you are right, we were able to act quickly enough so that we do not believe there were any successful attacks. what people attempt to do in this situation is set up an internet domain, create a website, use a name that looks very similar to the name that people would expect to see. three of them had the word senate in them. one had the letters iri, the acronym for the international republican institute.

employees or members of the senate might then start to receive emails. they would be told there is a problem, for example, with their account. they need to go to this website and it would look like the senate site or the iri site and they'd be asked to enter in their user name and password. once that happens, then it is off to the races for these kinds of attacks. the attackers will attempt to use that to access people's email, to download all of their email, to access the broader network in which sensitive documents might be stored. emily: one of the websites, the domain name was senate.group, for example. did any of this activity start, or has any of the activity that you have seen started or ramped up when that summit in helsinki between president trump and president putin? brad: i don't think we can link this to any specific even like the summit. i think we can see it as more generalized as taking place in

2018 as we approach the midterm elections. and i think it is also significant in this instance, as we've said, that this is a focus, not just on democrats, but the iri, the international republic institute, the hudson institute, more on the conservative side of the political spectrum we are seeing a broadening to address these think tanks in both political parties, which is exactly what we saw in france last year. emily: you are also announcing you are expanding microsoft's defending democracy program. you are providing cybersecurity for federal, local candidates, campaigns and political organizations. why is microsoft so active in this arena compared to other tech companies? brad: i think there are a number of tech companies doing more. at microsoft, we recognized first that we are in a business of insuring the cybersecurity of our customers. many of these candidates and

campaigning and political parties are our customers. we want to provide with this new initiative, state-of-the-art cyber security initiative at no extra cost so they are at par with our sophisticated enterprise customers. we want to do this both because these are our customers and i think we all have a responsibility to do more. emily: that was microsoft president, brad smith. meantime, facebook and twitter said they remove hundreds of fake accounts aimed at manipulating global politics. the twist this time? another country besides russia has been implicated, iran. facebook shut down 652 pages and accounts that originated in iran and also took down an undisclosed number of links linked to the russian government. facebook ceo mark zuckerberg described facebook finding in a call with reporters. mark: we believe these pages, groups and accounts were part of two separate sets of campaigns. first, a set of activity from

iran, including from some with ties to state-owned media. second, a set of activity that the u.s. government and others have publicly linked to russian military intelligence services. we have been investigating some of these campaigns for months. it highlights the tension we wee in every investigation face, and we are moving bad actors quickly and improving our defenses. emily: we asked our cybersecurity advisor to weigh in. jordan: this is a really good sign that these organizations, facebook and others, are taking active steps to eliminate these kinds of disinformation accounts. the fact that iran is getting in on the game of related to our elections and the election season is obviously not a great sign. what it shows is that we all continue to be vulnerable to dis-information on the web, especially on social media platforms such as facebook. these organizations don't do those things because there is no

value in them. a reminder that we are going into election season and we need to be vigilant about things that look suspicious online that might deserve further scrutiny. emily: is there any evidence, though, that these campaigns were specifically designed to influence the u.s. midterm elections, or to just go sow just sort of general misinformation? jordan: it is hard to tell, but it is probably a little bit of both. the way i look at it is, this is still a election season. whether these are campaigns that are designed to influence a particular congressional district one way or the other, that remains to be seen. we have not seen that from the data that has been released. but what does seem apparent is that election season is high tide for these organizations, these attacker groups, to soe their dis-information campaigns. this is when people pay attention to politics mai assessing their own political views.

in that sense it makes perfect sense that this would be the time for those attacks. emily: now, on this call with press, mark zuckerberg took a similar refrain, security is an arms race. take a listen to what he had to say. mark: security is not something that you ever fully solve. our adversaries are well-funded and we constantly keep improving to stay ahead. the shift we have made from reactive to proactive protection is a big change and it will make facebook safer for everyone over time. emily: that said, facebook discovered these pages acting on a tip from the cybersecurity firm fireeye. we certainly know that they bungled their response to russian meddling in the 2016 election. does it make you wonder if china is doing this too? could north korea be doing this as well? could the u.s. be using facebook to do similar things in other countries? jordan: sure, yeah. to your first point, it is a great sign we are seeing a

different facebook now regarding this issue of fake news than we did before 2016. i think a lot of executives dismissed this idea of fake news as being something that would be kind of irrelevant. we are seeing a very different facebook. they are being proactive, they are promoting these efforts. and that is a really good thing. it reminds people these efforts are still out there. but there is no reason to believe that other countries are not using the platform for the exact same purpose. but from facebook's perspective, this is a hard problem to solve, like some of the russian examples that came out in 2016 where they pretended to be black lives matter activist pages. their propaganda did not look dissimilar from actual promotional materials from black lives matter events. the intentions and motivations were completely different. but is very hard to distillers -- distinguish sometimes between state-sponsored propaganda and legitimate activists. it all depends on the aim.

emily: bloomberg's jordan robertson, there. after three years of searching, uber has announced a new cfo. he will help guide the ride-hailing company through a planned public offering next year. he took over in september and finding an experienced executive became one of his top priorities. coming up, snapping back. how social media snapchat is hoping to regain success. listen on the bloomberg radio app and in the u.s. on sirius xm. this is bloomberg. ♪

emily: singapore's ride-hailing and food delivery company grab is rolling out its own advertising service. grab ads will be incorporated in its fleet of vehicles in over 200 vehicles in southeast asia. drivers can earn as much as 10%

in additional income. they will offer mobile billboards, in-car options and in-app advertising. after a disastrous redesign, and an inability to turn a profit, snap is trying to rebound. much of the blame of the troubles has fallen on the ceo. for four of its six quarters since its ipo, they have posted revenue quarters that missed estimates. in that time he has lost or replaced his heads of engineering, finance, hardware, legal, product and sales. we talked with the person who spent time with the ceo. sarah: he has read the critiques of his banishment style, including in bloomberg who says has a very dictatorial way of managing that he is the secret keeper, that he does not get everyone on the same page, he hates criticism. and his response to that is, well, i understand why you would think that because you do not know me.

so this is his attempt to say, listen, i am a shy guy, i don't really talk about what i like or what i do and i am trying to get better at that. he hired a management coach. use trying to do all-hands meetings with his employees. the basics of a company that has 300,000 employees. he is just starting to think about that, in terms of snap. emily: it is not just about the perception of him from the outside but the perception of him from his own employees. he told you, i had a serious christian upbringing, i was taught to be small, be a turtle. i remember thinking why would i go around the company and chat with people? like, that would be so awkward. now i go around and talk to people. that was so awesome you came by. do get a sense that the mood or the culture of the company is changing? sarah: the biggest thing that has changed in the culture may not be something that evan did

himself, but really the geographical, physical space that snap employees are working in. they used to be dozens of scattered buildings in the beach town venice where there was tension with neighbors, people barely saw each other, you were not allowed to visit each other and offices you did not have access to. now they are in a nice business park in santa monica with the same kind of free food and drinks that you would get in silicon valley. it seems much more corporate. they have those monthly all-hands meetings that you would get at another company. so, in those ways, it is getting a little better, but i talked to some former employees today who read my story and said, this is not going to change. like, evan is who he is. emily: you also write in your story, you make a very good point in your story that with facebook and twitter battling fake news and misinformation, online harassment, this could have been snap's moment to shine but they have not been able to take advantage of it.

why not? sarah: the core of it is that snap has not communicated to the public how different they are from these other players. emily: isn't the product supposed to do that for them? sarah: yes. but the product is hard to use, they do not really advertise it. it is one of those things that it's coolness comes from trying to figure it out and understanding where to swipe and how to really communicate where the -- with it. parents are befuddled with it. they have added someone to the board. one of the people they think will help with the brand. siegel has been talking with his mentors on the board and his management coach who has coached other managers through tough times. and he says that he is committed to trying to make that point clearer to the public.

but so far it is not really quite worked. emily: i guess i wonder with snap users hitting a plateau, similar to what we have seen at twitter, if there is really -- re-accelerate growth? sarah: it is the same as twitter. people thought twitter would be the next facebook, now they have just become ok with twitter being a niche product than facebook. and snap is trying to prove that there is a hunger for a kind of communication that is not permanent. but of course, facebook has capitalized on that popularity and built snap functionality into its own product, which makes people even less likely to download the snap app if they think they are getting the same thing from an instagram. and the ads on snap, it's one of those problems where they have to put them in the media portion of the app. and their users are using it for communicating with friends. they have to make sure that the users also want to go and see

the stories from publishers. so it is going to be a very complicated road. emily: that was bloomberg's sarah frier. coming up, the former cisco ceo is making a big bet on the cloud. joining the board of the management company, we will hear from him and the ceo, next. ♪

emily: first lady melania trump told a cyber bullying conference this week that social media can be used in positive ways or can be destructive when used improperly. she was speaking at a conference attended by tech companies like google, facebook and twitter. the first lady user time to highlight her be best campaign to focus on the next generation conduct themselves safely and in a positive manner in an online setting. this, the president has been

accused of using twitter to bully his critics. the cloud data management company rubrick got someone to interest in the company and join the board. former cisco ceo john chambers launched his new venture at the start of this year to find the next generation of tech and has turned his focus to rubrik. we caught up with the rubrik ceo about where they go from here. >> what is exciting is whatever i do, i do it with a replicate of all -- replicatable innovations playbook. i do 180 acquisitions. the ceo's have been very kind. it has spoke to business model change in technology change. i would for a world-class ceo in the making want to be coached, who is wicked smart. i would for customers who say this is the company you should invest in. then i look for the key people i

trust. rubric has all of the above. it is right at the center of the cloud evolution and how you are inundated with data. and the ability to get that from various public and private clouds in a secure way. their customer list -- when you talk to the customers, they gush over how exciting this company is and how valuable it is. when you ask the vc's about this , they say, this is my favorite. i will make a prediction, this will be one of the hot stocks of this next decade. i hope that it goes public and we will share with you why i think that. that is job creation and i want to see more jobs created in this country. emily: you are taking on companies that are very established. what do you think is the unmet opportunity here? bipul: grappling with the data and data growth. as the cloud is coming into the picture, everybody is looking at the single platform that can

span from one premise to the cloud. rubric was born in the cloud era. all of the other companies we compete with were born before cloud virtualization. so we had a unique position to take advantage of cloud opportunity. our growth index in some ways compares to growth of the cloud. john: you look at the numbers, 5 million, 50 million, 150 million, over 300 million this year. it is a growth opportunity that will be really exciting. what is hard for your readers to grasp it is the future of data management. it is the next cisco or the next oracle.the next emily: that is a very high recommendation. one of your services targets ransomware, which is a process by which hackers take control of a company's data, then hold it

for ransom, essentially. it has been a very difficult problem for the industry. we have seen high-profile ransom attacks in atlanta. is it getting harder to stop this or easier? because now they are becoming more high-profile and hackers are seeing the impact. bipul: hackers are always fighting new -- finding new ways to attack. we looked at this problem at rubrik at the architectural level and said, can we build a platform that is immune to current attacks and future attacks. and that is what rubrik does. we based our platform that is a management system where hackers cannot get. we are helping hospitals and law firms and very large global businesses around the world to not fully detect ransomware through our radar platform, but also to mitigate ransomware with problems through instant recovery across all of the applications. emily: meantime, we are hearing new information from facebook and twitter about attempts to meddle in the u.s. elections.

we are in the middle of a trade war. having run one of the biggest companies in the world for two decades, what are your big concerns about the state of the u.s. economy? john: first on the u.s. economy, it is stronger than most people realize. when you talk to citizens out there, their paychecks are going up and they know they have a good job or they can find another good job. the enterprise ceo's are probably bullish on the economy as i have seen them in a decade. emily: is trade war a good approach? no, trade war is an undesirable outcome. i do think we had to get a fair trading position with our global peers. for many years china was a great win-win partner. we have to crack that. but it is in china's best interest and the u.s.'s best interest to solve that. what is exciting is you look at what is going on in countries like india. relationships have never been stronger. you look at what is going on in

europe. i think we will work to these challenges. i think this is the new status quo. there will always be bumps and uncertainties that will occur at a faster and faster pace. world class will steer the way through that. emily: there are some pretty big potential bumps in the future. president trump said today that he thinks the stock market would crash if he is impeached. it is hard to believe we are talking about this, but we are. do you think there is any truth to that? the impeachment of a president, or even that kind of statement? is it scary when a president says such a thing? john: you know, one of the fun things about the job that i do is i coach -- that is a difficult question. [laughter] that is yours. the answer is the market does not like uncertainty. i think what you have seen his with a strong economy and finally getting gdp growth above 4% and full employment and people getting raises, it gets nervous when there is uncertainty. but i do think that is the new norm. our country has always been able

to navigate through that. and i think we are making changes on tax law that needed to be done. we are getting the average american to really have a raise, which we have not done before. my worry is different. i think our nation is losing its innovation image. we used to be number one in innovation. we didn't even make bloomberg's top 10 innovation countries. used to during the mid-1990's when we generated 2.5 million jobs a year, we took 700 plus companies public per year. now we are barely going to get over 200 a year. startups are almost at a 20 year low. so i think we need to become the innovation company again. that is what i lose sleep over. that is why i want to see role models, but also our company get back to the best of the rolled -- role of up startups in job creations. emily: that was john chambers, along with bipul, ceo of rubrik. coming up, tesla versus the sec. we look at how regulators could

stand in the way if elon musk's takes tesla private. check us out at technology and be sure to follow our global breaking news network tictoc on twitter. this is bloomberg. ♪ retail.

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simple. easy. awesome. stay connected while you move with the best wifi experience and two-hour appointment windows. click, call or visit a store today. ♪ welcome back to "the best of bloomberg technology." i'm emily chang. through elon musk's emotional interview, he made mention of his quick trip to spain for his brother's wedding. he even expressed having barely enough time to savor the moment, saying he arrived two hours before the ceremony and arrived at teslas a factory floor immediately after. bloomberg pieced together the data. -- the details. he attended his brother's wedding in spain then took his kids to belfast so they could see the set of "game of thrones." for five days of summer, tesla survived without elon musk on the factory floor. should his relentless work ethic be defended?

we spoke with the author of the best-selling elon musk biography. ashlee: if you go back in tesla'sistory and history, in 2008 at was a crisis that was like now where the future of the company was uncertain, it is going towards bankruptcy, and elon is under as much pressure as he was back then. he would give his employees a really hard time. he went after the press. he was not as famous back then. companies were not as successful so there was not as much attention on all this. this time around you have elon on twitter. this is the first time the public has seen all sides of him. you have tesla being this huge success and now there is a lot more pressure on him.

it is kind of this public crucible that is very strange to witness. emily: there is also the level of untruthfulness that he seems to be walking right into, not only tweeting something that could have been untruthful that funding was secured when it appears it was not, saying he dashed in and out of his brother's wedding, when his tweets show he did not do just that. how concerning is that? ashlee: it's pretty strange. he has always been a fundamentally truthful guy but there are moments when he chooses his words carefully and you can interpret them different ways. this time is definitely different. in makinging caught things up. there was an interview on cbs where he talked about, i would never go on vacation while my workers are suffering like this, but on instagram he had these posts where he took his kids to petra and jordan and israel. it was another strange thing where it is hard to match up.

emily: i am glad he is taking his kids on vacation. you should be able to take a vacation. he should be able to sleep. ashlee: this guy definitely works harder than just about anyone. people are entitled to vacations. all ofike, why is he, -- this stuff is shooting himself in the foot. why would you say this when you know it is relatively easy to stitch things together? this is the difference. he has been under this pressure before but this time it seems to be too much or there is too much going on in his life and it is overwhelming him. emily: at the same time he was supposedly doing this quick dash in and out and was not on the factory floor, i have a chart in 5000brary, tesla hit that model three's cars a week. so there is a question, how much does tesla need him to be there 24 plus hours a day? ashlee: it is hard for me to separate tesla from elon and to

imagine these two companies apart. it is hard to imagine them keeping up this pace and hitting these milestones without him being this figure. even though he is away for five days, the aura of elon continues to goad over the company. i'm sure he was checking his emails and letting people have it from far away. i do not know if he has to -- i think he takes a lot on where he feels this personal responsibility to make the company succeed in this cross he has to bear. i do not know if he has to be there as much as he thinks he does, but i think the company would push itself as hard without him. emily: he talked about trying to hire a number two including sheryl sandberg. you and i talked about this a couple years ago. he looked a few times for a number two and has never been able to find one. does he really want one? why hasn't that happened? ashlee: i do not think so. even before cheryl and tony

bates, the ceo of skype. he had a meeting with elon. before that, tony fidel was brought in at one point, and possibly be what he thought was the ceo. you have this disconnect on who is doing what. that was 6, 7, 8 years ago. this has been going on forever. you get the feeling that elon is setting the bar incredibly high and has some sort of hangup about being able to turn over control. which is funny because if you look at the president of spacex, she has been doing that for many years and it has worked great. spacex, which should be the harder company, is the more reliable company of the two. emily: that goes to show the value of a number two. at the end of the interview, he talked about if you can find another coo who can do the job better than me, they can have it.

he doesn't mean that. ashlee: i don't think he really means it. i think he probably does mean it but he does not believe that someone could do as good or better than him. he has gone through a lot of pr people in the past. he has brought in the top people from all over the industry. people in the car industry and other people in highflying jobs, and he does the pr himself. he wants to take it all on. emily: let's talk about his relationship with the board, because a number of members are also on spacex's board. or investors in spacex. people who he has personal friendships with. does this board have any control over elon musk and will they call him on his mistakes, of which in the past couple of weeks it seems there have been a few, or does he just get to run free? ashlee: i think he probably gets to run a lot more free than most ceos. it is only recently that the board has taken on some people that are considered more independent.

the people that were there were the ones -- the biggest chunk of the board are people who have been with elon since tesla was going to go bankrupt and get blown off the face of the earth. they put a lot more faith in him than a lot of board members would because this company would not exist without elon. i think they give him an extraordinary amount of leeway. at this point, you have to say get off twitter, stay out of the press, stop doing these self-inflicted wounds. you have so much on your plate. let this other stuff go. emily: a huge part of your reporting was driven by former and current tesla employees. what do you imagine they think of all this controversy along with the idea that their company could be going private, or he wants it to, which means they would lose their liquidity? ashlee: the feeling i get from a lot of former tesla employees is the feeling of shock.

they have certainly seen hardcharging elon, flamboyant elon, but they think there is a different tenor to what is going on now. i think for them, and the bigger picture overall, he has put himself in a real difficult situation now after saying he is going to take the company private and setting all these wheels in motion. if this doesn't work out, if tesla cannot hit these manufacturing targets, the company is in a fair amount of peril. it would be sad to see it crumble. emily: if it does not work out, which most people have told us they think there is zero chance, what happens to elon musk? is he still the right person to run this company? ashlee: i am sure a lot of people would argue no. i think the company could definitely benefit with somebody who -- the biggest problem tesla has faced is this manufacturing

problem. if you look at something like apple, you had someone like tim cook. steve jobs was the visionary and tim cook made sure all the factories were humming along, apple was doing good deals. tesla clearly needs someone of that caliber to come in and fix the machinery of the company, and elon can do his elon thing. it is impossible for me to imagine tesla without him and for it to have anywhere near the same value or cachet or brands. emily: bloomberg's ashlee vance. one of the most anticipated questions since musk tweeted "funding secure," what is the sec doing about this? since that tweet, there have been multiple reports of ongoing inquiries. for an insider's view, we spoke to teresa goody. she served as an attorney for the sec.

teresa: the inquiry is serious that they are issuing subpoenas, so there is a formal investigation in place. after the voluntary request, once there is a formal investigation, that is when you get the subpoenas. the sec is acting very swiftly and quickly and pursuing this investigation full force ahead. emily: what is the most problematic part of the tweet? is it those two words, "funding secured?" teresa: there is a few different steps here of problems. the funding secured thing, that you have funding secured when it is not. that is problematic because it is not true, which is fraud. that would be a fraudulent statement. says is another rule that you cannot make a tender offer unless you have the funding or reasonably leave you do. saying that was problematic. the blog indicating that funding was not secured. and then "the new york

times" interview was also alarming in the fact that it appears that the $420 per share offer price was arbitrary, was not based on any kind of analysis, and it is better karma for 2014 rather than 2019. that was problematic. additionally, what was alarming to me in that interview was that elon musk does not seem to think he has done anything wrong and does not regret his tweets. which i think the sec will look at that as someone continuing to act in this reckless manner without any idea or concern about what he has done. emily: what penalties could musk himself face, as well as the company? as i understand, each violation or each false statement, to each person to whom it is made could

count as a separate infraction? teresa: you are exactly right there. every time he made a false statement, that is a separate violation. fraud carries with it civil penalties with the sec and potential criminal wrongdoing with the doj. you have the shareholder lawsuits here. another impact that this could have with the sec is if they bring an enforcement action against him and they settle, they could require admissions. admissions of guilt, which would have an effect in the shareholder and criminal suits as well. emily: can each person to whom it is made, does that include multiple different shareholders? is one statement one infraction, if you will? teresa: the one statement would be the infraction, but the egregiousness and the impact of

it is based on all of the various shareholders who were injured. here you have a very dramatic and extensive harm, financial harm. we saw the wide swings with the share price. you have tons of money lost by the shorts, tons of money lost by those who bought shares thinking there was funding secured for taking this private, and it seems as though funding is far from secured. you have them losing money. there is each violation of the statements, but the collective financial, huge financial ramifications from this. emily: the subpoena demands information from each of the board's nine directors. could any of them be liable? teresa: indeed, they could, and the company could be liable. we have here elon musk who appears to have gone off on his personal way of doing this and saying all of these in his personal capacity, but also he is the ceo. once he makes the statements,

the board collectively has fiduciary duties. i was surprised i did not see them make a quick corrective disclosure as soon as these tweets came out, to clear up the confusion and chaos. they could have some liability there. the sec does not look at anything in a vacuum so it will be looking at everything, including these communications. what they were aware of this tweet before it happened or what was going on afterward if there was any intent, you can see if there was anything untoward whether there was some effort to have an impact on the stock price and there was an intent, whether or not they reacted reasonably and responsibly. you also have the board having these responsibilities and acting on behalf of the company and could have liability itself, as well as elon musk. it is noteworthy that chairman clayton of the sec indicated that to him it is more important

to go after the individual wrongdoer, but by no means do i think that excludes the possibility the sec could bring an action against the company as well as elon musk. emily: when you say there could be criminal ramifications, what could that mean for elon musk personally? could that mean jail time? teresa: it is possible, that is a possibility, and with fraud comes the possibility of jail time, as well as fines. fines are generally the means that the doj takes more often than jail time, but it is a possibility. emily: that was theresa goody. ceo of the goody group. coming up, the u.k. based marketplace for high-end fashion far-fetched have confirmed plans to go public on the nyse. we will look at the year of tech ipos so far. this is bloomberg. ♪

emily: apple and google face a brewing revolt over the app store tax. a number of companies say they are charging too much. netflix is one of the companies trying to bypass the app stores. if the movement picks up, it could put a dent in apple and google's profits. we are halfway through the year and we have seen a number of tech companies hit the public market. dropbox, spotify, making their debuts. if the pace holds for 2018, the number of tech ipos in the united states will return to levels not seen since the miniboom in 2013 and 2014. how will the rest of the year play out? jackie kelly and alex barinka weighed in. jackie: technology in particular has been exceedingly active, and we have been waiting for this to come back here at last couple of quarters have been exciting.

we are definitely seeing technology companies themselves and tech enabled businesses in general just really eager to get out. i think a lot of this is driven by the fact that we have been in such a strong economic market for a number of years, everybody wants to access this window. emily: will it continue? jackie: q4 and q1 will be busy markets for us. alex: this bull market has been going on for so long. those conditions have not changed outside of the hiccup in 2015. why now? why are these companies deciding now is the time, when i think back to last year and the year before when everyone was saying, it will be next year? what is actually different? jackie: valuations are higher and they are almost up to that level again. i think folks are saying, what is the chance this will happen again? these markets are great. i am hearing it from a lot of companies. they are watching their competitors and saying now is the time to move.

people have said this economy has been so strong for so long and cannot hang on. we are talking about hitting the longest run in history. i think there is a feeling of will the market be this good a year from now? i am not sure. let's go now if we can. emily: yet you say 2019 is the year of the unicorn. what do you mean by that? alex: we have been talking, when are the unicorns coming? i believe in 2019. emily: uber and the airbnb? jackie: we will see a lot of unicorns, see who is ready to go. we work with a lot of those companies and they are really preparing themselves. emily: i want to talk about the dynamic in the financial market and how that is affecting the pipeline. you did an interview with bill gurley and talked about how venture capitalists have given -- because of the competitiveness they have hesitated to put pressure on companies to go public at all.

take a listen to what he had to say. bill: hyper competition has made it so that the majority of biggest fears is missing out on the next investment. they are afraid to have a reputation as someone who asks too many question or pushes too hard. there is a situation where there is not a lot of stewardship for discipline and results and that kind of thing. emily: are we in that same state? alex: it seems like people are coming to a reality check. i do not know if that is because the venture capitalists have made out so well. people are coming to the realization that that comfortable space going private, people are probably not pushing you to go public. the ceo of dropbox was in last week and he told me he is really happy he went out. he is ok with the scrutiny. that is a different message than the silicon valley groupthink was a few years ago.

emily: at uber we have a changing of the guard and who knows if 2019 would be the year that travis kalanick would be in charge. what is the role that you see venture capitalists playing in encouraging or discouraging, or hands-off approach? many are encouraging their companies to see if they are ready to go public. especially those where they have been in the deals for seven to 10 years, many of these unicorn companies are starting to reach that range. they are challenging management to be ready. we do a number of things like ipo readiness assessment where we say, are you ready to operate like a public company? that functional readiness combined with, do you have a strong growth story, which obviously management and leadership on that, can you execute on a strong growth story and operate a predictable business? if those things are in

alignment, yes, you are ready to go. emily: that was jackie kelly and alex barinka. coming up, we hear from an analyst who warns a slowdown is coming to apple next year. why? we will discuss. this is bloomberg. ♪

emily: this week, apple was issued it's only celebrating on the street. an analyst downgraded apple from neutral, saying he believes the iphone x has been so successful sales next year are likely to be disappointing. we caught up with him to explain his outlook. >> what is going to be disappointing is the aftermath of how successful 2018 has been. our perspective is that the iphone x has been successful and well received. to such an extent that we think between 10 million and 20 million consumers actually --

the refresh of the iphone because they were attracted by the iphone x. we have sold 65 million iphone x. we think 10 to 20 million of these -- when you fast-forward to 2019, what happens? people just bought an iphone x and do not replace their phone every year. are not going to buy a phone. we see a significant risk on expectations for 2019 in terms of iphone shipment units and also in terms of asp because the iphone x is high-priced. investors realized we are not done with the weakness in iphone demand. we are in a transition where

iphone users very much like their phone and use it every single day. they replace it less often. this transition happened in the pc market between 2012 and 2015. pc shipments declined by 30%. it is a very long and tough headwind that weighs on iphone shipments. this is something investors -- in 2008 because they did very well with the iphone x. most of the performance has applications in 2019. emily: that does it for this edition of "best of bloomberg technology." we will bring you all the latest in tech throughout the week. tune in each day 5:00 p.m. new york, 2:00 p.m. san francisco. bloomberg tech is livestreaming on twitter. be sure to follow our global breaking news network on twitter. this is bloomberg. ♪

♪ >> the lessons from jackson hole , signals no change in rate policy. >> vasso talks may be poised through a break. mexico and the u.s. may have an announcement. >> steady as she goes. renews -- renew stability. for john mccain from both friends as well as foes. in national memorial service will be held in washington this saturday.