>> carried out by suicide bombers. 24 people have been arrested. the attacks on foreigners in churches mark a major shift in years of violence between the sinhalese majority and the north.amil

they say they will deposit half a billion in sudan's central bank and donate the rest for the latestel, offered by gulf countries. the trump administration plans to tell allies south korea, japan and turkey that they will no longer be exempt from u.s. sanctions if they continue to import oil from iran. the rules would also affect china and india. secretary of state mike pompeo plans to make the announcement on monday. trump's lawyers say there's nothing wrong with accepting help from russia. rudy giuliani told cnn that any political candidate would accept potentially damaging information doesn'tpponent and "it depend on where it came from." this is part of the trump

administration response to the mueller report into a vetted interference in the 2016 election. ukraine's most prominent elections,s won in tapping into popular dissatisfaction with the political class, winning 73% of the support with three quarters of the vote counted. incumbent petro poroshenko won just over 24% and conceded. it's a lighter trading day with liquidity and volume of little absent, given the easter holiday in a lot of countries. stocks trading fairly calm. a big week for tech companies, amazon, facebook and twitter, microsoft as well. meantime in the asian session, ae chinese stock market standout.

we pointed out, the big story, the energy markets at the moment with potential news around iranian oil sanction waivers. update shortly. this is bloomberg. ♪ ♪ david: he grew up in los alamos. his mother, a pediatric nurse, his father, a theoretical physicist. who took him to watch john wooden and the ucla basketball team whenever it was in town. kevin johnson drew upon his love of systems and teamwork as he rose through the ranks at ibm, microsoft, and as ceo of juniper networks, then a health scare changed everything and brought him eventually to starbucks, where he succeeded the founder howard schultz in 2017. now johnson is redirecting a global consumer icon, seeking to preserve the best of what has

been with the opportunities of what is to be, using tech and big data to transform, while always focusing first and foremost on the team of employees, customers, shareholders, and community. on "bloomberg big decisions," from starbucks headquarters in seattle, washington kevin , johnson. kevin johnson, welcome to "bloomberg big decisions." kevin: welcome to starbucks. david: so, doing things that are joyful with people you love, i heard that from you. take us back to los alamos, a power forward on a basketball team. what joy came out of that early experience? kevin: i grew up in new mexico. my father is a theoretical physicist. my mother is a nurse. my father had this great sense of focus on learning and intellectual stimulation.

with my mom, it was about compassion and empathy. so i feel like a lot of who i am was shaped by the differences in my two parents. and growing up in new mexico, i fell in love with basketball and big fan of coach john wooden, played on a high school team. i loved team sports, because it was a competition, and it was with people you trusted and you love, because you had to work together. david: that duality, did it continue in your career? kevin: it did. the thing i fell in love with software was it was a way to express myself. i can write software programs and show people what they would do and see the amazement on demonstrateor something they had not seen before. so in some ways it was a way to bring people together, but also a way to express myself

intellectually and emotionally. david: you mentioned coach wooden. kevin: it was my father that introduced me to the genius of coach john wooden. my father was a young man who loved basketball, and when i was 6, 7, 8 years old, he would tell me about coach wooden and the ucla bruins. so every saturday when college basketball was on television, i would find what channel ucla was playing on, and i started reading coach wooden's books. my father went to washington state university, and when ucla would play washington state university cougars, my father would sneak into gymnasium before the game and sit in the empty bleachers just to watch coach wooden run practice. my father described it as basketball poetry. coach wooden would walk up and down the sidelines, but every player knew they had a role to play and it was choreographed,

artful, and yet it was synchronized in a way that created this beautiful expression of the game. and so as i studied that, i said, how do you create that, something so beautiful with the team of people who have to work together, that want to work together? so the key themes i discovered in that is that attention to detail matters. if it is something you can work on an practice and do well, then do it, because that attention to detail when it is game day will come through. david: you went to ibm, then went on to microsoft. there is a fair amount of creative destruction involved in those companies, including when you were there. what did you observe and take away from those experiences? kevin: the technology industry has this unique property. it goes waves of innovation hit

the market, and the new thing disrupts the old thing, but yet it builds on top of the old thing. it's sort of reinforces the view that if you are not constantly reimagining what you are doing, consumer behavior, technology, changes in the world, a dynamic economy, a dynamic geopolitical situation can leave you behind, but it also reinforces, in the process of reimagining the future, you have to know what grounds you to the past. how do you have the wisdom of what to honor and preserve from the past and the courage to boldly reimagine the future? i believe it is that balance that is the most important thing. david: you worked your way up to in microsoft a senior position. at one point, steve ballmer brought you into a process with howard schultz to work on a project with starbucks. when you first met howard schultz, what did you think of him?

kevin: it was early 2000. howard had sent a letter to bill and steve asking microsoft to partner with starbucks on a project where microsoft would contribute money to help starbucks put wi-fi, internet connectivity, into all starbucks stores. so bill and steve said, hey, kevin, why don't you handle this for us? steve and i took the meeting with howard. he drove across the lake and we sat down in the conference room at microsoft, and howard painted the vision for what he was going to do to bring technology into starbucks stores in partnership with microsoft. it was clear at the time meeting howard that he had a clear vision for what he was trying to do, and yet he had this unique proposal. he wanted to bring technology to starbucks and wanted microsoft to pay for it. we found a way it worked out where we kind of both paid for it, but it had benefits to microsoft at the time. and i just thought that howard

was a very creative, very persuasive, and thoughtful person. that is when i first met howard. david: you left microsoft to become ceo for the first time. what made you make that decision and what was it like to become ceo? kevin: i received some outreach for an opportunity in silicon valley to lead juniper networks. the founder of juniper networks was there, the prior ceo, wonderful people. here was a small company that also had a vision of changing the world by bringing internet connectivity to the masses. it was just an opportunity for me at a time in my life where i thought if i'm ever going to do this, now is the time. david: then you got a curveball thrown to you with a health issue, i think it is fair to say. tell me about that and what to -- particularly did you learn from it?

kevin: i went to an annual physical one day and was diagnosed with melanoma. i did two or three surgeries to get the cancer, and with melanoma come there is always the question, did it get in the bloodstream, the lymph nodes, how far has this gone. there are treatments to go through to explore that everything is taken care of. one day i was still trying to do junipers ceo of networks, and deal with my health issues. i was sitting in the san francisco international airport about to board a united flight to europe to meet with customers. and i had just called and rescheduled my doctors appointments. and as i sat in the waiting area to board the flight, i thought to myself, why am i doing this? why through my actions have i prioritized meeting customers in europe over my health, my life, everything i love, my family, my friends?

so it was a clarifying moment for me, a moment i decided sitting right there in san francisco international airport that for the rest of my life i only wanted to do things that were joyful with people i love, so that was a moment i decided it was time for me to retire from operating roles. i worked with the juniper board and helped them to make a ceo transition and retired and my wife and i moved back into our home here in seattle and focused on my health, and spent time with my two sons that i wish i would've spent more time with when they were younger. i traveled with friends, focused on things, being present with people i love, so that was a learning that will stay with me for the rest of my life. david: take china, you are adding a store every 15 hours in china. something like that. how long can you keep doing that? kevin: we will build starbucks into 100 new cities in china.

that we are not currently in. and every one of those cities is larger than the population of los angeles. ♪ ♪

♪ david: you did go back into operating roles, first as the coo then ultimately the ceo of starbucks. when you took over as ceo one of the things you did is closed down teavana. big decision. did you come to that decision after you became ceo? kevin: i made that decision after becoming ceo, but view the responsibilities i have as one as having the wisdom to know what to honor and preserve from the past and the wisdom to boldly be courageous for the future. yet at the same time, i know that in a transition from founder-led to founder-inspired,

those transitions are the most difficult and most critical transition any company will go through. but it was very clear to us, me, teavana, we acquired them and suddenly we're selling $1.6 billion in starbucks stores, and these 300 stores in the malls are struggling, so why don't we close those stores down, write that off and let teavana thrive and succeed in starbucks. the realization that we are a branded house. we are not a house of brands. david: the transition from founder to the succession is a difficult one. how did you manage that with howard? kevin: the things i am staying true to are the most important things, the mission and the culture of this company. at the heart of it, that is who we are. we built this business. we are 30,000 stores around the world. starbucks partners who proudly 380,000 wear the green apron.

serving 100 million customers a week. we are about creating an experience in our stores that is grounded around human connection , over coffee. and so i am staying true to all of that. with the teavana mall stores, i am eliminating distractions so we can focus on a purpose, far beyond the pursuit of profit. it certainly includes the pursuit of profit, but also the pursuit of doing good. howard has been supportive every step of the way, as has the board. david: your strategy, as i understand it, in large part relies on growing the u.s. and china, two big priorities. take china first, you are adding something like a store every 15 hours in china. how long can you keep doing that? at what point is there saturation in china? kevin: we can do that for decades to come. i haven't calculated, but it will go beyond my lifetime. david: the demand is there on

the part of the chinese people? kevin: the demand continues to grow. the chinese consumers are primarily a tea-drinking culture who have been introduced to premium coffee. we will build 600 new stores a year in china off a base of 3500 plus stores today. there are 300 million people in china in the middle class. that is projected to double over the next few years. they are consuming more coffee, and that will continue to grow. i look at the fact that over the next three years, we will build starbucks into 100 new cities in china that we are not currently in, and every one of those cities is larger than the population of los angeles. and so, we will be building new stores in china for decades to come. david: you don't have that much headroom in the united states. at what point you reached saturation and how do you get around that problem?

kevin: we have used analytics and data to help us understand where to build stores. right now that is showing us throughout the sun belt many parts of the united states are under-penetrated, so there is headroom in the u.s., but we have to complement building the new stores in the u.s. with growing same-store comparables in our existing stores. that is the balance we have to strike. i would say there's three primary things we focus on. one, are we focusing on things that elevate the customer experience in our stores? second, are we invading around beverage to bring new and exciting beverages to our customers? over the last three years, the mix of beverages is now 50% cold and 50% hot, and that is because a lot of the innovation, the iced espresso beverages, shaking tea, cold brew, has opened up a whole new wave of customers.

it is innovation from the customer experience, innovation around beverage, and innovation around digital. in the u.s., we have 30 million digitally registered customers. we are approaching 17 million active rewards members. our stores orders in in the u.s. are paid for with the mobile app and the loyalty card. those are the key things. if we innovate in those three areas in a way that is grounded in what our customers are looking for, we have a long runway of growth ahead. david: it is the handcrafted beverages, but also the experience when you are in the store. kevin: that's right. david: my local starbucks, a lot of people order in advance online, come in, and go. that is not the traditional starbucks experience. kevin: the digital-mobile revolution over the last decade has amplified the need for convenience. that is true in every part of

society. you can make an airline reservation, seat selection, boarding pass, and check in on your phone and go through tsa with your boarding pass. you have to acknowledge that consumers are embracing it, so how do we embrace it without abandoning the needs of community? that's what we are getting better and better at each day. amount, aignificant fund of explain what that is $100 million. about. that is developing new brands apart from starbucks? that you would own or own part of? kevin: this is about accelerating the velocity of innovation. we have shifted from a long cycle innovation model that was just too slow. it would take us from 18 to 24 months from idea to getting something deployed in our stores. that is too long.

we shifted to that to a mantra going from idea to action in 100 days, then learn and adapt. we found we have great ideas, but we want to expand our view of ideas from outside of starbucks. there are many early stage, growth-stage companies that are innovators with great ideas that can help a food and beverage merchant like starbucks. so to do that we have partnered with valor equity partners, the -- and we are the cornerstone investor in the ventures fund, and what we do is we get a front row seat to all these new, innovative companies. if we see companies we think would be great and we can use their technology or ideas at starbucks, we enter into a commercial relationship with those companies and make investment into those companies. david: you had an incident in a store in philadelphia. tell us how you responded to that. kevin: this is a time as a leader when you show up. i met with everybody i could

meet with. i even had the opportunity to sit down with the two young men that we had arrested in our stores. ♪ ♪ david: howard schultz described you as a servant leader. early on in your tenure, you got a chance to demonstrate that when you had an incident in a store in philadelphia. tell us how you responded to

that, and what caused you to decide how to respond. kevin: when something like that happens, the first question i ask is how could this have ever happened in a starbucks. you quickly realize that we serve 100 million customers a weekend are a microcosm of society and we know this kind of thing happens in society. two young black men in our stores waiting to have a business meeting with another customer were asked to leave and the police were called and they were escorted out of the store. when it happened, i realize this is a time where as a leader you show up. it is not something you delegate or point the finger to. you show up personally. that first day when i happened, i wrote a letter to all customers and partners, and the next day i was on the plane. i had many great people give me advice on how to think about this, and one individual i spoke to before i was on the ground in philadelphia was eric holder. he gave me some wonderful advice.

he said, kevin, you will have extreme pressure to answer questions before you have the full opportunity to understand all of the facts and be intentional about your decisions. he said, i encourage you to get on the ground and learn as much as you can, and as you learn and make decisions, the intentional, -- be intentional be clear on , the but don't be pressured to answer those questions too soon. so i landed in philadelphia and met with everyone i could meet with. i met with store partners, the mayor, the police chief. i even had the opportunity to sit down with the two young men that we had arrested in our stores. and from that it became clear to me that there is an action here that we are going to take, because this is not who we are, and the actions we are going to take are going to put us on a journey to be a better company. by the second day, i announced we would close all starbucks stores on the afternoon of may 29 to go through anti-bias

training. that was just the beginning of the journey. since then we have built a complete program where we have educational sessions that we distribute to our 150,000 plus starbucks partners in the u.s. every month. and it is making us a better company. david: starbucks stands for certain values. you pay your partners well. you give medical benefits to people who work as few as 20 hours a week. explain the trade-off there between that and profitability. kevin: i get up every morning, and work in service of the 380,000 starbucks partners who proudly wear the green apron, because i know they are working in service of the 100 million customers we serve each week. to create that experience for our customers, it starts with taking care of our partners. i put that at the top of the list of my responsibilities. that means we will pay them a

good wage, provide health care for part-time workers, the starbucks college achievement plan -- we will help them get an education and graduate debt-free. we now have over 12,000 starbucks partners in the u.s. enrolled in courses through asu, so we will work first and foremost to take care of our partners. and by doing that, i can demonstrate that we have much higher retention, much lower attrition, than anyone else in the food and beverage industry. by having higher retention, that means that our partners in the stores are building relationships with the customers that visit their stores. that is what leads to increased frequency. that is what leads to loyalty to starbucks. so, much of what we have created begins by taking care of our partners. david: you also expressed values about the environment, sustainability. tell us about your initiatives with green cups and straws.

things that are much in the news. kevin: sustainability is a core pillar of our focus. and it starts with making coffee the first sustainable agricultural product. we have agronomists helping farmers around the world improving quality and yield of their coffee. we provided over 30 million disease-resistant trees to coffee farmers. we have contributed 50 million to the global fund to help farmers. it starts with coffee. then it goes beyond that, because we want to serve their coffee in sustainable packaging. that means things like our green straws. plastic straws don't get recycled, and so we invented a new strawless lid and are eliminating plastic straws by 2020. the cup is recyclable, but not municipalities have the equipment to recycle it, so we kicked off a next-generation challenge a year ago and we have entries from all over the world

on how to create a more sustainable cup. so we are on a journey to not only sustainably brew coffee, but sustainably package that coffee, as well as the stores we build. we are the largest builder of leed-certified buildings in the world. we go beyond that in our greener apron program. we are teaching partners how to operate the stores more sustainably. so we are on a mission. and i would acknowledge we have a lot more we can do and will do because we are committed. david: kevin, thank you so much. that was really good. kevin: thank you. david: great to be with you. ♪

>> this is bloomberg. a of bombing in sri lanka. investigations are on the way with the colombo stock exchange closed until further notice. the explosions were carried out by suicide bombers. attacks on foreigners and churches mark a shift from many .ears of violence a small minority expect to move this week. economists we spoke to expect

more stimulus measures as the economy slows and inflation remains stagnant. the majority of those surveyed said they expected global banks to tighten. amsung is delaying promotional event in hong kong and china for its new smartphone. the plan to show off the galaxy for -- galaxy fold. early test models have come under criticism. check on these markets. we have liquidity. a good chunk of that off-line because of holidays around the world. markets that are open, including china, that is the standout. 2%. brent crude is on a tear. imminent 2.5% after possibility of an announcement from the united states on sanctions waivers when it comes to iran. a big week for gdp and

inflation. the u.s. equity futures are currently 51% higher. some of the tech heavy hitters are going to be coming through over the coming days. another update in half an hour. this is bloomberg. >> he is the son and grandson of rabbis. after thinking about a career as a journalist, he ended up at harvard law and prestigious private law firm. michael felt the need to serve a larger purpose. he went to be a federal prosecutor, putting mob bosses behind bars with samuel alito. his defining moment came the morning of 9/11 as the head of the criminal division, he rushed to fbi headquarters to handle the crisis with bob mueller, who reported to him. national security became his calling. he went on to serve a second

leader of the newly formed department of homeland security. sectorack in the private , working with major corporations on personal and cybersecurity. his focus remains where it has been for nearly 20 years. keeping america and its institutions safe. ." today's "big decisions have a career in public service and law enforcement. what brought you to that? -- i went to law school. as it to a law firm, and wasd to understand what attractive to the law, doing something that was more than shuffling assets back and forth and trying to deal with one company's business problems, something more was required. to me, issues of criminal justice, liberty, started to

look really appealing. when i thought about, how can i get involved, what can i do that would inject me into dealing with these issues, being part of the department of justice would be the most obvious way to do it. after a couple years in practice i applied to a few u.s. attorneys offices. i also had done trial work. i thought, this will be an opportunity to do more. that was what launched me on public service. david: your first job in public service was assistant united states attorney, southern district of new york. michael: correct. david: what makes the office so special? michael: the office has a history of high profile united states attorneys. part of that is that being in new york means you are in a place where there are likely to be the most sophisticated schemes that can be encountered

anywhere. if you are dealing with organized crime, which is what i did, the center of organized crime is new york. withu are dealing corruption, new york has more than its share of corruption. david: did you choose the mafia or did the mafia choose you? michael: i became an assistant u.s. attorney, you try general crimes, and one day my unit chief came to me and said, the u.s. attorney who was then rudy giuliani, has assigned me doing a big case against the u.s. mafia commission. the board of directors for the mafia. my unit chief said, he would , you will beeet his second chair. i wound up working on that case for about a year. four of the five

families. one got killed, so he never made it to trial. a number of other senior mob officials. six months before the trial, my unit chief came to me and said, you know, i always thought this was going to happen. rudy has decided he's going to try different case. that is at the same time as the commission case. you are going to be the first chair. that threw me into trying that case. david: that is a huge battlefield promotion. were you ready? michael: i had two other colleagues. you really learned to work hard and never let up. you also learned if you do work courtyou can stand up to with just anybody. it was a great lesson under fire

to see how that played out. the good news is everyone got convicted, so it was a total victory. i would say it taught me a lot about dealing with high-pressure situations with a lot of public visibility where you can't afford to lose. you must have been up against criminal defense lawyers. they must have known you were a junior. the defensehink attorneys were always respectful of the intelligence and the hard work of the assistance. we had some very good evidence. we had tapes. we had photographs. we had higher level mob people. it was more of a horse race. himself,y representing he did not help himself very much.

there was a dramatic period of time where the main witness against him, his cousin by marriage who had harbored him when he was a fugitive and crossied against him examined him. when you listen to the cross-examination and the summary, i thought to myself, if you want to have an exhibit of what i mob boss looks like, it's what i did today. time youat is the last were young for your job. in new jersey, you are one of the youngest in history. michael: i was in my 30's. after i did the commission case, i did more crimes. i got a call one day. this was 1987. in new jerseyney looking for a first assistant. he wanted somebody with trial

experience. he was samuel alito, now justice alito. i became sam's first assistant. we had some very interesting cases, including the mayor of jersey city who was convicted of bank fraud and some other cases. when he went up to the court of appeals in 1990 as the first , sostant, i succeeded him that must have made me about 37 years old. david: what would the current hertoff tell that new michael chertoff? >> enjoy this because it is the best job you will ever have. it was the first job where there was a significant public dimension where you announced cases, where you had controversies. we had the infamous kidnapping

of the exxon executive who was killed when some of his security people actually kidnapped him and locked him in a storage shed. maybe the most controversial was the chief judge of the state of new york, who was convicted of threatening his girlfriend in order to manipulate or into reinvigorating their relationship. he wound up pleading guilty. that was a very visible case. that were in new york shocked and not happy we were prosecuting him, that i had a very clear view we are going to treat everybody equal. schnook after some poor in new york for doing this kind of thing, we are going to go after the chief judge of new york. we are not going to create special favors for the rich and powerful. i believe equal justice as a fundamental tenant of the rule of law.

>> between being a judge and running homeland security, the tempo must have been different. which do you prefer? michael: more of the constant turn. -- churn.

david: being assistant u.s. attorney in new jersey may have been the most enjoyable of your jobs. where did you feel like you made the most difference? michael: homeland security, in terms of reach. in terms of a single episode, september 11, 2001. i was newly sworn in as head of -- there was no homeland security. any to mystic terroristic vent was handled by the department of desha domestic terroristic event was handled by the apartment of justice. i was going to work. i had one of those car phones.

i was talking to my deputy and a plane just hit the world trade center. like a lot of people, i thought this is some pilot who got turned around. he said, another plane hit the world trade center. we immediately realized it's not an accident. a few minutes later when i arrived, we went to the fbi operations. i went and met with my old friend bob mueller. out we had to do was figure , how do we stop the next thing? we heard about the plane hitting the pentagon. then there was a fourth plane we were tracking. we did not know how many more attacks that were going to be. that day in the next, it was all about doing everything we could to follow every thread to make

sure there was not going to be another attack. say to the president attorney general, don't let this happen again, you got thousands of lives in your hand. else got say, no one killed that day after those planes went down, and we managed quite successfully to cut back on terroristic -- the terrors threat, -- the terrell wrist -- terrorist threat. david: we were prepared for the wrong war. we did not anticipate hijacking. what is the risk we are doing the same thing today? michael: that is a great point. we did focus on the issue of wmd chemical weapons, biological weapons, and we built some capabilities to deal with that. one of the reasons it was very important to knock al qaeda out of afghanistan and to attack

isis where it has territory is because when you have territory and you are a terrors group, you can start to -- a terrorist group, you can start to experiment with weapons of mass destruction. i make a different point. attacks, there was a little bit of a sense the cold war is over with, we are not dealing with a threat. mitt romney was asked, who is our biggest rival? he said russia. barack obama made fun of him. turns out russia is back. we are now needing to go back and look at all of the national security plays we had back in the 80's and see how did this translate to where we are now? ofan age of computers, artificial intelligence, and an age where we are dealing with great power rivalry. david: china may be a bigger rival than russia. there is an investment out of

the eastern district of new york for huawei. how great is the threat from china on cyber? michael: the chinese are our most serious rival when it comes to cyber. cyber is an important piece, but not the only piece. if you look geo strategically at the world, the russians do not have a long game. demographically, economically, they are in decline. notprices, but people are clamoring to buy russian technology for telephones. , although it is not these tools as weapons in geopolitical conflict. themselves position to become dominant in the region and maybe globally,

economically, and in terms of their potential. we need to view them as a serious competitor. it does not mean they are an enemy. it does mean we need to be wary of putting ourselves in a position where we are relying on for criticalogy infrastructure or critical national needs. the integration between commerce and security is much greater than it was during cold war days. can you do that without going after trade relations and supply chains? michael: that is exactly right. articulatet you see it by chinese and russian figures is information control is a critical element in geopolitical struggle. the chinese do not regard the distinction between commerce and government or commerce and security as we do which is two

separate spheres. they view commerce as an element of a toolbox you could use to achieve parity and maybe even dominance. usedu go back, the west commerce as a geopolitical tool in order to advance itself. what's really happened as we have discovered the chinese are playing go and we have to change our game if we are going to match them in terms of the global position. are you on social media? michael: i don't do social media. david: at all? michael: i don't.

david: what were the management challenges? what prepare you to manage 200,000 people? michael: my training as a trial lawyer stood me in good stead. what i had learned as a lawyer, what i put into practice, was the ability to digest facts and understand issues quickly and efficiently. i also learned to listen to both sides. maybe most important, i learned how to make a decision. so many people told me afterwards, even when they did not get what they wanted, to walk out of a meeting at the cited we are done, people feel relief. what they don't like is the sense of, i've got to think about, let's put it off.

very few decisions get better with age. you know you make mistakes sometimes, then you have to recover and adjust. from a management standpoint, the ability to make decisions withly and confidently probably the single most important facet. judge andween being a running homeland security, the tempo must have been different. one is contemplative, relatively few people around. a constant demand for your time. which do you prefer? michael: probably more the constant churn. i had been head of the criminal division, i was used to things happening quickly. after i became a judge we got a call from the clerk's office. i was an appellate judge so i was not even doing trials. they asked my assistant, could the judge handle and emergency?

i said, sure. i will stay as late as i need to. they said, not today. but in the next few weeks, will you be able to get around? i said, you are not in kansas anymore. , fastk temperamentally things are more my style. david: now you have created a business. explain what that experience was like. that is something you have never done before. michael: i have never done it before, but i will say i had in mind principles. i wanted to be successful economically, but in addition to doing well, in my partners wanted to do good. we wanted to do what we felt was meaningful. the idea was to use that set of skills and that set of intentions and find clients and customers that would see value in having that security, always making sure they were ethical, that we are operating in the

interest of the united states, and we can really add value. he has been rewarding to do that. david: an important part of what you do is advise ceos about risk. what is the biggest blind spot ceos have fiasco >> the biggest -- ceos have? michael: the biggest challenges some of the problems seem so complex there is a tendency to throw your hands up and go, too much to deal with. i just hope i'm lucky. part of that is a misunderstanding of what is a reasonable expectation when it comes to managing risk. i have found both in dhs and my private activities, this may be the biggest misnomer. many people think i have to eliminate risk. i have to eliminate the security threat. you can't. even if you stay in bed, there is a risk the ceiling will fall. you have to manage risk. you need to understand what is a college -- tolerable level of

consequence. on the other side, what are you prepared to spend to lower that? with -- where those lines cross, that is where you want risk. david: investors often think in terms of sectors. as you have experience across different sectors, are there some that inherently have a higher level of risk than others? michael: the financial sector obviously because so much of what it is engaged in his online transactions. the consequences of a disruption of that in terms of trust would be enormous. they are very focused on the issue of security. critical infrastructure. things like power grids are very focused on security. there could be loss-of-life of life or serious damage to property. and then the health care industry is getting more focus pacause they realize with hi and other regulations, if there they i can get stolen, it can be a corporation-threatening event. those are three sectors where

understandably there is increased sensitivity to risk. michael chertoff and chertoff group are involved. do you use social media? michael: i do not do social media. we use social media at the company but we are very mindful of security. i don't believe we will never or somebody trying to hack do something -- still credentials, but we build backup systems. we monitor. hing.ain people about phis you know not to do that without getting some kind of a confirmation. i frequently call our security folks, i'm going to send this to you, i did not click on it. nine times out of 10 it is something bogus. a foreignn you go to

country, do you not take your phone with you? what you do? europe, if i go to take my device. if i go to china, i bring a separate device. david: i think it is fair to say you are an authority on risk. what is the riskiest thing you have ever done? --hael: i'm sure some of the when i went to the u.s. attorney, some people say, why did you do that? you left day good law firm job. -- you left a good law firm job. i weighed the positives against the negatives and there was not that much downside risk. i'm sure i traveled some places that turned out to be risky. but i have tried to be prudent about it. david: you made a conscious decision to go into the u.s. attorney's office. how many of these moves you have made have been because you said, i want to do that, and how many because somebody came to you and said, here is something you might have thought about --

might not have thought about. michael: i have always been open to the latter. although i have had a plan like everyday does, if it seemed like it made sense and it was something i wanted to do, i would deviate. in the mid-90's and late 90's, i was in practice and i was asked to be the council iia new jersey senate committee investigating racial profiling. that is not normally what i would have done. but something worthwhile in public service oriented. i accepted and it was a rewarding experience. there is a great bipartisan effort by republicans and democrats to get to the bottom of why there was racial profiling. there were positive results. i did not look for being a judge . i certainly did not look for homeland security. , because oft came my experience, i felt i was

committed to saying i could do anything. david: thank you. michael: great to talk to you. david: thanks a lot. ♪

yousef: these are the first word headlines from around the world. the number of people killed by bombings in sri lanka has risen to 290. the colombo stock exchange shut until further notice. the government says some of these were carried out by suicide bombers. attacks on foreigners and churches spark -- are a major shift from violence between the majority and the hindu minority. carlos ghosn is facing the most serious allegations yet. he is indicted in tokyo on new charges of misdirecting company money for personal use. that will keep him in jail

longer. ghosn won his freedom last month after posting bail. he was arrested and jailed again on new allegations. the administration is supposed to tell five nations including japan, korea, and turkey they will no longer be exempt from u.s. sanctions if they continue to import oil from iran. the move would affect china and india. mike pompeo plans to announce on monday the administration will not renew sanction fair -- sanctions waivers. provident --t prominent tv comedian has won the election. voters vented their frustration at the lack of progress. he tapped into popular dissatisfaction with the political class, winning 73% with three quarters of the vote counted. 24% andmbent won just quickly conceded defeat. sent tof investigators

china after reports on social media claimed spontaneous fire in shanghai. clip supposed -- posted on the carclaim to show bursting into fire. tesla acknowledges there was some kind of incident. there are no known casualties at this time. we've got a little bit lighter volume, a little bit less liquidity after in many countries, a holiday. stocks are back online. they are down 1.8%. brent crude on a tear after news there could be an imminent announcement on iranian oil sanctions waivers from the united states. currently we are 2.3% up. it's a big week for the bond markets. pc inflation. u.s. equity futures on the s&p 500 called a little bit lower. it is a massive few days for the

world of tech. some of the heavy hitters like amazon, facebook, twitter, and microsoft. what are we going to see from these earnings reports? this is bloomberg. >> hello. i'm haslinda amin in singapore. the son of a factory worker at the head of an e-commerce giant. at $7dia has been valued billion and counts alibaba and softbank among its biggest investors. indonesia's e-commerce revolutionary william is today's high flyer. a hails journey has been

of serendipity since he began tokopedia to a marriage proposal in tokyo backed with good fortune. softbank.including his mission is to democratize commerce by shrinking the differences that divide businesses and indonesia's 17,000 islands. it is the largest online theetplace in one of world's fastest-growing internet economies. emboldened by what he calls the indonesian dream.

♪ >> welcome to high flyers. it's a pleasure to have you with us. >> thank you for having me. boat all started with a ticket your father bought you to attend school and hopefully change the fortunes of the family. what do you remember of that day? >> i'm very excited. it is the first time i can go outside. >> it was a difficult journey. it was a three to four day trip. this is the year of 1999. still --e >> but the pressure was on you. your father spent the family's

life savings to send you to school to make -- >> my father and my uncle gave me the opportunity. >> where did the inspiration come from? >> long after them. i did not have capital to start. tokopedia failed for two years. of tokopedia, inspired by the google founders and facebook founder. years, i tried to get the idea, but i failed. life,ing that changed my

he said to me, william, you are still young. you only have your youth once. don't waste your time. find something else to do. stop daydreaming. you are not like silicon valley founders. you are not. that is the moment i relize he -- indonesia does not have the american dream. people always question my past. the future is still on hand, so i believe in that. that day i also remember about our founding father. the first president of indonesia. he once said to dream as high as the sky. if you fall, you will fall amongst the stars. so we did actually have indonesian dream. i find the purpose of my life. haslinda: it was a difficult journey. you spent nights in the internet cafe where you worked to save money. it was a difficult journey. no doubt this success is great now, but the struggles are real.

>> during the college years i did not want to go back to my hometown. i wanted to find a way to stay in jakarta. it was in the school, so i tried to find a job, and my job was to become the internet cafe operator. i liked to read books. having access to internet is like having the world at your fingertips. that was life-changing for me. for me, the internet changed my life in a significant way. haslinda: the english language, few people realize you taught yourself english because of necessity. you have been speaking the language for only the past 10 years or so. i really learned about perseverance. perseverance and serendipity changed my life. 2010, i feel like tokopedia

needs to raise capital from global investors. when i met with them and i am very excited. unfortunately in the first five minutes, i get rejection because they say we don't understand what your trying to say. i understand english by reading and listening, but never had an opportunity to practice conversation. i learned about perseverance, so i know i cannot give up. i am lucky enough through that serendipity that i met with early investors from japan and korea. they also speak broken english, so they have empathy to my very broken language. they believe in the vision. they give me the trust. they give me the opportunity. from that, the journey continues today. haslinda: what changed your life and the fortunes of tokopedia where the three proposals that happened in one week. and japan has a special meaning

for you. talk to us about that. william: i met my wife two years before i started tokopedia. she practiced medicine. when she graduated, i started tokopedia. she said to me, let's have a holiday. she really wanted to go to japan. the problem is the year is 2014, the company, we run out of cash. my wife invite meet to japan. the invitation comes in june or july. i said to her that i am sorry i really can't because i need to raise capital, otherwise the company will bankrupt. but then i think about it. i take my relationship for granted. i think about it and i asked the permission of her parents, can i secretly follow her to japan for a proposal? when i reject that invitation, she went with her friend. i scheduled to meet her on

october 1 for the proposal. by the end of september, i got a call from softbank. tokyo office. they asked if i could meet with masayoshi son. i cannot just go to tokyo without a visa. the invitation from softbank comes three to four days before the meeting, so it is is impossible to get that visa. i am lucky enough because i plan for that proposal that i already have the visa. i already plan to fly to japan. on the day i need to fly to japan, i got a phone call from my early investor. he says, william, one of the managing partners of sequoia is in japan. can you meet with him? i met with him and the partners of sequoia for two hours. one hour becomes two hours, and by 7:00 p.m., i am on the way to the airport and i got a call

from sequoia. they ask if i can meet with them tomorrow. i say to them i am on the way to the airport. they asked where i am flying to. i am on the way to osaka. first october morning, i land in are already there waiting for me having a discussion with me until 5:00 p.m. at 5 p.m. i said to them, i am here because i'm about to propose to a girl. i need to end the meeting. then i bought a flower and tried to find my wife. my wife is happy. luckily it is a yes. then i say to her, sorry, now i need to fly to tokyo. tokyo, second october morning, i met with softbank for one hour. that is the week that was really life-changing, that the three proposals happened. luckily, everyone said yes. ♪ haslinda: you have a lot of big-name backers. masayoshi son, sequoia,

alibaba's jack ma. william: from jack ma, i was her remember if always the crocodile fights in the ocean, he cannot win. if he fights in the river, the crocodile can win. ♪

tokopedia started with just two employees and now 1.3 million applications received a year. everybody wants to be a part of this company. what do you make of the interest in tokopedia? william: this is a privilege. the thing about it, the thing i first did when i started tokopedia is come back to my university, of course because i always know that technology companies need other people. i tried to convince university

students to join the company. i stood there for two days, and no one applied. the thing about it now, one .3 million applications a year is -- 1.3 million applications a year is life-changing for tokopedia. when i started that experience and stood there for two days, i thought about steve jobs. i always learn from the business stories. in order to build a great company, you have to hire great people. people,tart to hire "b" "b" people will hire "c" people, and your company will make a mediocre product. how can i hire "a" people? that moment was a turn to the inspiration from comic book. my favorite comic book is one piece. it is a japanese manga. it is a story about a young kid.

he always wanted to be a pirate king. everyone laughed about him. how can he be a pirate king? he can't swim. but he just starts. he takes a small boat and starts his journey. tokopedia like building a pirate team because of that first failure. how do you build that ship, find the treasure island? the treasure island is the mission of the company. our mission is to democratize e-commerce. so everyone in the ship knows where we set sail. at first, you only have one, a ship, a couple of team members. you are the captain. your teams grow. we will no longer be able to fit in one ship. when you have multiple ships, you need to things. -- two things. one is a compass and a treasure

map. compass is the company value and dna. treasure island is the company strategy. if you communicate that strategy and company dna values no matter what the ocean will be like to weather the storm, even when the ships are going in different directions. in the end, they would join in the treasure island. haslinda: the average age of your worker is 28 years old. that is pretty young dna in the company. how do you choose? you have 1.3 million people wanting to be in tokopedia. do you hire those with harvard qualifications? do you hire those with grit, a reflection of how it was for you starting out? william: until today, i interviewed by myself, i do a blind cv. i never read the cv. i always start the conversation, if you can choose one word to describe yourself, what will you

choose, and why, why, why? just more about them. i recently have a discussion with our personnel department. so many applications, i challenge them, if william tanuwijaya applied to this company with a blind cv, with my own resume, i'm not sure i get an opportunity to be interviewed by my own company. this is an unfortunate situation. when you have millions of buticants, unfortunately -- a resume is just one piece of paper. you need to continuously view it as a work in progress. it does not stop with the interview. it does not stop when you hire the person. the best person is the person you train. i always remind team members we should not hire by the best cv. we should hire the right person. haslinda: you have big-name backers. masayoshi son, sequoia, jack ma. what is the key takeaway you get

from them? i know that you have always admired jack ma, for instance. william: i idolize some of them even before i started tokopedia and during the journey to start tokopedia. from jack ma, i always remember being the crocodile. early days, alibaba needs to face global competition. they called him crazy jack. he said we need to be a crocodile in the river, because all of these global giants are in the ocean. if the crocodile fights in the ocean, the crocodile cannot win. but if we fight in the river, the crocodile should win. that is the underdog spirit. only six months after we launched tokopedia, we need to fight with ebay. we only have very small capital, we start with two people, we need to fight ebay. i want tokopedia to last my

lifespan. how i can with more than one hundred years company? this role model, i can even met with them, and today become the partners. it has been a privilege. haslinda: how do you think tokopedia can be relevant in 100 years? so many companies like xerox, polaroid, all irrelevant to customers. how do you think tokopedia can do that? you are competing with the likes of amazon, alibaba. what is your strategy? william: we need to evolve. any specialist in the world, the evolution, if we believe in the darwin theory, humankind is part of evolution. a lot of companies also like that. they have one service and continue to do that service better and better, but they fail to become something bigger.

if we see a great company today like amazon, alibaba, where they where theyone and are today is a very different product. they continuously evolved. how they evolve, we need to continue not only to learn, but to unlearn. haslinda: you have secured $100 million in funding. now $1.1 billion. you obviously don't need the money right now. as an ipo something you would have to think about? for employees with options, one day we need to liquid their investment. of course go public is a goal of the organization. yes. i actually don't know how to ride a bike because i don't have a bike at home. i don't know how to swim because i never learned how to swim. haslinda: has money changed you? william: we now have capital to spend, but we no longer have time to spend.

i realized time is the most valuable thing. ♪ haslinda: now, william, you are from a small city with 200,000 to 300,000 people. what was growing up like there? william: my family went to bankruptcy early when i was a

very small kid. my father got very busy. i barely met with my father. my childhood was a normal childhood. i actually don't know how to ride a bicycle because i don't have a bike in the home. i don't know how to swim because i never learned how to swim. never have a car, never have an auto bike. my wife always say you not living in an internet era. you are useless. but now because of the internet era i can go from one point to another point very easily using my mobile phone. i cannot dive. i cannot swim. haslinda: you did not have much access, but you love reading. william: i loved reading. i loved reading all kinds of things. yeah, you are at home.

i just read everything i can find. haslinda: has money changed you? if you look at the forbes ranking, you are the top 150 in indonesia. a country of 260 million people. how do you view money now? william: money is a very powerful tool if you know how to use it. tokopedia cannot be tokopedia today without the capital we continuously raise and how we efficiently use that capital. for my personal life, it has been challenging. the way that i was raised, money is more important than time because we never have the money. i just walk everywhere because if i can save 30 minutes by taking public transportation, i can save money for that by just walking. because i cannot earn money

during that 30 minutes. that is tokopedia's early days, because early days we don't have money, but we have time. tokopedia continuously growing, hustle, hustle. we now have capital to spend, but we no longer have time to spend. i realize time is the thing we will never be able to raise. everyone only has 24 hours. the organization continuously thinks about how we can have harmony, how we can be disciplined of the time, how we can juggle these five balls of life. life is a constant game where you are juggling five balls at the same time. the five balls are work, family, , andds, your health integrity. four our glass and only one is rubber. only work is made by rubber. if you fail with your work, like

a rubber ball, it will bounce back. if you fail with your family, your friends, your health, you -- your integrity, you will break and cannot juggle them for the rest of your life. haslinda: you could work before family for a very long time. one of the first things you did when you made money was to buy a house. few people know you were living in a house that costs only $1000 a year at that time. william: yeah, so i only lived with my mom, so i am taking care of my mom. when we get married, it is a family of three. me, my wife, my mom. we start in a very small house. yeah, so for me, before that, i just lived in -- i rent just a room. from my room, it has become a house. one day in 2015, is a very big

rain and a block off the roof actually falls. so i realize i need to plan properly and not take the relationship for granted. so, yeah, finally i have a house. haslinda: it is a great investment. 10 years in the making for tokopedia. when you look back is it like a fairytale to you? william: i never see it that way. when people ask me where you are today, actually, 10 years ago when we were starting tokopedia, it is like we are seeing the tip of the mountain very far away. i say to my cofounder, how about one day we climbed that mountain? today, where we are, we have finally reached the base of that mountain. we finally can touch the mountain, but we have not climbed yet. we have to be careful with the

capital we raise . we finally have the tools to climb that mountain. it is really life-changing for me, and it is like one day at a time. we just follow that life journey. for me, i really like to become a student. for me, life is the best teacher. haslinda: william tanuwijaya, thank you for being on "high flyers." it has been a pleasure. william: thank you so much. ♪

yousef: these are the first word headlines from around the world. the number of people killed by a wave of bombings in sri lanka has risen to 290. investigations are on the way with the colombo stock exchange shut. some of the explosions were carried out by suicide bombers. 24 people have been arrested. the attacks on churches mark a shift from many years of violence between the majority and the hindu minority. saudi arabia and the uae are pledging $3 billion to sudan after the toppling of president al bashir. the nations say they deposit half a billion