>> i'm taylor riggs in san francisco. this is "bloomberg technology." coming up in the next hour, not an endorsement. facebook ceo mark zuckerberg responds to a bloomberg spook -- scoop that he recommended hires for the presidential candidate -- campaign. it is the unicorn you probably never heard about. it hits the $1 billion valuation mark. we ask the ceo about raising

money amid public market turmoil. the public market, new york stock exchange president stacy cunningham discusses the popularity of direct listings and the atmosphere in a delayed wework public listing world. first, our top story. facebook has discovered four separate misinformation networks, three to iran and one to russia. zuckerberg says it shutdown the networks as part of an effort to counter foreign influence campaigns. this was on a press briefing call early on monday. zuckerberg also addressed a bloomberg scoop in which he privately recommended several potential hires to the campaign of pete buttigieg. >> this should not be taken as an endorsement. mutual friends from college who introduced me to pete a couple years ago. i did a facebook live event a couple years back. it is widely known that i met him. and when a number of colleagues

who i had worked with at facebook or my philanthropic foundation where interested in working there, they asked me or my wife, priscilla, to send over their resume. so i did that. i think this probably should not be misconstrued as if i'm like deeply involved in an to support their campaign or something like that. taylor: to discuss, i want to bring in iona college political science professor and applied economists senior advisor. and also with us, sarah frier. sarah, let me start with you. what did we learn about these emails and what zuckerberg said about recommending some hires to the campaign of mr. pete buttigieg? heah: we learned zuckerberg, has this relationship existing. and even despite becoming a punching bag for other democratic candidates, namely

joe biden and elizabeth warren and even despite concerns from the conservative side about whether he might be biased, he has chosen to give some support to a presidential campaign. i think whether or not this is an endorsement, it is still a rare move in the direction of helping someone out. that we should not over read into it but we should note this is a powerful person working behind the scenes on behalf of a presidential candidate to help them out. taylor: jeannie, you say while it is not illegal, it may not be wise. explain what you mean by that. >> it is a risky strategy. and i'm starting to have questions about mark zuckerberg and facebook strategy and some of these instances. we talked last week their response to the elizabeth warren advertisement where he basically walked himself into suggesting maybe they should be regulated like network news. now we understand that a few months ago, at least he is

suggesting people to work for a presidential candidate who, at the time, was a second tiered candidate, is now moving up. these are risky strategies for the company as a whole. it would be one thing if mark zuckerberg stepped aside as ceo of facebook and was doing this as a private citizen. he has every right to do it. there's nothing illegal. at a timealso risky when facebook faces so many headwinds from washington. and from both sides of the aisle, quite frankly. democrats and republicans who want to take a stab at facebook for what they suggest have been practices that they find problematic. elizabeth being primary among them, yes, pete buttigieg's primary opponent. i think it is risky all along. i'm questioning where this advice came from, if anywhere. taylor: in all of your years as study -- of studying this, what is the precedent? is it abnormal for someone in the private sector who is running a big company to be

doing this or are we reading so much into it because it is mark zuckerberg? jeanne: i think we are reading a little bit into it because it is mark zuckerberg. usually ceos at this level try to be careful. sure, they will donate two packs and political campaigns as private citizens. mark zuckerberg has done that, you see that across the board with big tech and other companies. but they do try to be careful about choosing favorites. when we see those donations, they generally try to play both sides of the aisle, or to donate to pacs in which they are donating military or others. i think this is a questionable strategy for mark zuckerberg. i think we heard that in the clip you played, where he said please don't read too much of this into this. this is not an endorsement. i think he knows he has stepped into it a little bit. i would not suggest this will be a huge problem for them if this is all it is but i think he has to be careful going forward. taylor: sarah, you have been covering a little bit about the policies of these candidates. this is notable that it is not

elizabeth warren, one of the bigger critics of big tech. what do we know specifically about pete buttigieg? why this individual? why this campaign? sarah: he has been a little lighter on tech. he has not said we should break up the companies. listen, this campaign is so unique because we have gotten to a point where the candidates understand facebook's dramatic influence on the outcome of the election either way. we are going to see a transition from candidates blaming the media for perception problems and transition toward a blaming facebook. we have already seen warren and biden campaign directly based on facebook. we've seen trump criticize facebook. it is correct to call this a risky strategy. buttigieg has not been as hard on the company. maybe a personal relationship is part of why. taylor: does this give you more

pause for concern about tech's outside influence on politics? jeanne: it absolutely does. it plays into what elizabeth warren has been saying all along. quite frankly, not unlike what donald ran on in 2016. that there is this connection between big attacks, big pharma, these big money corporations and washington, d.c. that is what elizabeth warren's entire campaign has been built on. i would add one thing to this. we heard in the third quarter, elizabeth warren became the top draw for tech employees. in playing this strategy and this game, mark zuckerberg is giving to somebody who certainly is the number to draw of tech employees but not the number one. he also risks alienating his own employees. and that is a big risk for the company as well. i think almost from any angle, you have to be very careful when you walk down this path. i hope he knows that at this point. taylor: we push the story

forward to the 2020 election. earlier in the conversation, you brought up the ad, highlighting facebook's position of free speech. taking an ad, even if it is false, and not wanting to be a fact checker, but being a platform of which all ads, all political ads can be out on the platform. do you agree with facebook's position on that? jeanne: i think they have a really big problem when it comes to this. elizabeth warren has underscored that. i think they have every right to do this. but i think their response was problematic when they suggested they are doing it because like a networks, they want to remain neutral. they have said all up -- all along up until that remark that they did not want to be regulated by networks. you cannot have it both ways. this is where again i think they have to be very, very clear as to who and what they want to be. i think elizabeth warren, with

this ad, and she is not alone, she is the most well-known to challenge them on this, has forced them into a corner. i don't think it is going to be long regardless of who was elected until we are going to see some form of regulation that facebook probably is not going to welcome. taylor: sarah, did we learn anything else new today around election security? sarah: absolutely. we learned facebook has taken down even more misinformation campaigns from actors including in iran and russia. zuckerberg even mentioned china on the call, another entity that may try to meddle in the united states presidential elections. i think it is fair to say this is still a whack-a-mole problem, that they are still building up their defenses here. it is safe to say the problem has not gone away. whether it has gotten worse, i think the company has understood how to solve problems similar to what russia ran in 2016 but

they will keep coming up and they will change in their nature. the company is staying on alert. that said, i think we should not just look to the foreign misinformation that is spreading on facebook, but also the way that domestic players are using facebook ahead of the election. and the hyper-partisan context and misinformation and ads will become an even bigger question is we get closer and closer to the election. taylor: sarah, we are getting closer and closer to wednesday. what do we expect from mr. mark zuckerberg on libra on wednesday? sarah: it is going to be primarily about libra, but once he is on the stand, they can ask him about whatever they want. i expect they will also ask about some of these issues with misinformation ahead of the election, about things like problems with discrimination in their ad targeting. that was a big issue for their committee when it comes to housing paired once he is on the hot seat, this hearing could last for hours.

we could cover a lot of ground. stay tuned not just for libra, the on controversial cryptocurrency, but also on other things that have come up and we will continue to discuss with the election ahead. taylor: professor jeanne zaino and bloomberg technology sarah frier, thank you both for joining. coming up, softbank to the rescue. the latest on wework's latest plan to be revived that's next. if you like bloomberg news, check us out on the radio. listen on the bloomberg app, bloomberg.com and on sirius xm. this is bloomberg. ♪

taylor: more twists and turns for wework. bloomberg has learned to softbank is planning to take control of the company, one of

the japanese conglomerate's biggest investments. bloomberg technology's allen hewitt joins us with the latest. softbank taking control. is this what wework wants? >> we are not sure yet this is happening. this is more details that we have all and -- on the deal that softbank is proposing. to be clear, it is similar to what we reported on late last week but with some new details. it sounds like the package they are putting up for consideration will include a debt package as well as several billion dollars, up to $3 billion of a tender offer for existing investors and employees. this is something where the package, this is a way softbank would potentially get control of the company if the board agrees to it. again, they are still considering this as far as we know against a competing offer from j.p. morgan for a $5 billion debt deal. that could get them the cash they need. taylor: i'm glad you brought up that offer. every day it feels like they are

weighing the two. any sense of what the board finds most important to the company? ellen: i think there are competing interest at play. you have to imagine if you are, for example, a serious stakeholder inw but not softbank, you anticipate a softbank deal would mean you would get diluted. a debt deal on the other hand do -- get the company an injection of cash without needing to do additional dilution. that is risky. it will be a big burden on the company to pay back those loans over the next x number of years. taylor: walk me through that valuation. our colleague wrote about this in his latest opinion piece. softbank could still come ahead. every time they invest, they are lowering their average price. their ipo could benefit. the other stakeholders who got in late, they are not seeing their average price in which they are investing drop-off. what does that mean for them? are right, you are

watching the valuation of wework drop rapidly. as we talked about in january in their last funding round with softbank, at least it rounded up $47 billion. these deals we are talking about, floating the valuation around $8 billion. a huge drop. as you mentioned, softbank, if they go forward, this would be probably instake the secondary offering at a valuation of around $8 billion. whatever the number is, they are lowering their average price for the shares they bought while later investors who will be stuck at may be having bought in at 20 or higher. that is going to create may be some tension between different investors and depending on when they came in, they may be ending up with a raw deal compared to softbank who has a chance to lower their average price. taylor:that at the end of this,w will softbank be judged? throwing bad money at more bad money or if they can turn this around, be seen as a hero? ellen: if they can turn it around, that will be incredible for their reputation and for the financial outcome they would

like to see from their investment. it is in the tens of billions of dollars. above $10 billion at this point. reputational he, they are at risk. they used to have this halo around them that said if you get money from softbank, it means they are investing in you and make you the king of your industry. i don't know if people are feeling that way. that may affect their ability to get into deals in the future. taylor: we hear that every day . thank you. coming up, we speak to the ceo of silicon valley's newest unicorn, insta bait. we take you inside the company and how it got its valuation. that's next. bloomberg technology is livestreaming on twitter. check us out @technology. this is bloomberg. ♪

taylor: silicon valley got another addition to its stable of unicorns on monday, that is instabase. the business tools company

instabase says it has raised $105 million at a $1 billion valuation paired most people have not heard of the company. they offered only a single sentence saying it "help solve problems and create new breakthroughs." here to tell me more about the company and its latest valuation, instabase ceo, and also with me, sarah kanaan, partner at index ventures, and one of the backers of instabase. let me start with you. why does the world need another computer? answer that question, what is your business model? >> basically, the way to look at it, if you go to your iphone, you have apps you can find to get food delivered to your home. if you go to a service company, they do not have an app store where they can find an app that is income their vacation. the question is why is that?

we tried it answer that question. like, what is missing? what does the world need from the perspective? we look at what are the key building blocks and tools that needed to be built. that is what instabase is. it is a platform that gives you number of tools and building blocks that businesses can use to build new applications that help them launch their business. taylor: the business model, how do you make money? anant: currently, number of toog blocks that businesses can use to build new applications that help them launch their business. taylor: more than 50% of the companies are our customers. taylor: all the scrutiny of the public markets, how important is it to at least be able to see the path to profitability? is it five years, 10 years, what is that timeline? sarah: the key is to invest in a company with a great business model the great thing about what anant and his team has built at instabase's it is a rare opportunity to build a defining business. if you think about what apple did for people in their consumer

lives by giving them and i found where they could get everything on demand, that is what instabase is going to do through their products. enabling banks, health care companies, insurance companies to build all the processes they need to do their work to deliver more value to customers. to answer your question, we really do want to have business models at work today and in the future. the great thing about instabase 's we talked to a number of customers who already are paying millions of dollars for the product with a long line of others that wanted to do so. the company's cash flow positive today. that could change. there are fundamentals we feel good about today and in the future. taylor: has the pressure to see that path within a timeframe increased as of late? i think certainly, in a rich valuation market which we are in, value multiples are at a historic high. you want to invest in companies where the potential is large. you want to invest in outlier businesses that can deliver that return, even at those high

valuations. taylor: she mentioned valuation. $1 billion. what was the most recent funding round going to be used for? anant: mostly we will spend that money to scale market function so we can scale for different industries. customers come from banking and insurance. going into health care and we canent, and also so build the app score -- store. taylor: how careful do you have to be of growth at any cost is not acceptable in this market environment? anant: we have had really good business model so far. we have had cash flow neutral so far. we have not spent any money that we raised so far. belong as we continue to disciplined, we can grow without getting into trouble. taylor: you talked about the big valuation. as you take a look at your irr, how do you make sure that you are finding good businesses, but also being aware that there is a lot of cash chasing too few good

businesses? sarah: that's right the way i think about it is you need to be in a huge market opportunity that can sustain larger companies. even if you are entering in high valuation, if there is opportunity, you can generate a 10 extra return at these levels. taylor: we talk a lot about unicorns in san francisco. i wonder, is reaching that $1 billion valuation exciting or does that increase the pressure in the scrutiny and that is something that up until now you have tried to stay away from? anant: we try to be view the company as what it is. we look at what it needed for those worth funds and we continue to do with the same way. $1 billion valuation or the money we did did not significantly change anything. taylor: same question to you, helpful or hurtful? sarah: it will enable them to attract the best talent in the world and that is what attracted us to the business. given the demand we see, it

enables them to execute against that and expand into other industries. it enabled us to accelerate what him and his team were doing. taylor: what is the biggest risk in the market right now? we talked about valuation. is a competition from other cash, investors? what do you see is the biggest risk in the market? sarah: this may hark back to my previous life as an economist, but i think there are macro risks. i think the valuation environment has been what it has been for nine years. what is going to happen more broadly, are we looking at tougher times on how will that impact technology? it could be different this time. people have raised a larger funds. they have a lot of dry powder chasing deals. there could be a lag. that is the biggest risk. taylor: how much extra scrutiny have you gotten in the past six months over corporate governance? anant: we are certainly having brought -- board meetings. apart from that, nothing much. we try to be transparent, give all the details to the board and keep them aware of the progress

and all the updates that are necessary. taylor: and as those pressures increase given the focus on wework's corporate governance and you figured out you needed to have more board meetings? anant: no. i don't think it had anything to do with any external situation. every company has quarterly board meetings. that is standard procedure. taylor: instabase ceo anant bhardwaj and sarah cannon, thank you so much for joining us. coming up, bypassing the band. u.s. companies are waiting for the official go-ahead from washington to sell to huawei, but in the meantime, some are still supplying the chinese telecom giant. that's next. this is bloomberg. ♪ here, it all starts with a simple...

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this is "bloomberg technology." i'm taylor riggs in san francisco. five months ago, the white house band u.s. companies from supplying huawei. but licenses will allow some businesses to keep on working with the chinese telecom giant. today, we don't know whether or not they can work with huawei. despite the band, some companies like micron and intel are finding ways to continue supplying huawei with parts. here to tell us more is bloomberg's ian king. five months later, where do we stand? is: the way to summarize it neither side is happy with what is going on.

when i say neither side, i mean the hawks in washington who want this company which they regard as a threat and national security to be shut down, have not had their way. huawei is still arguably thriving. on the flipside, you have u.s. companies which are suppliers to huawei which get a chunk of their earnings from that company are saying can we do businesses, under what circumstances? they don't have an answer. taylor: you've been covering those companies from the u.s. technologically side -- technology side. what has been their biggest source of frustration? ian: they don't know how it is going to pan out. there was this order that came down, and entity with huawei. they largely shut down contact -- contact with the company then. they had their general counsels look at what the rules were and decided actually, we can do business with these guys to a certain extent. resumingtarted off contact started off supplying huawei again.

with other trade talks, we have more rules coming, when we will get a license to know what we can do long-term. they are deeply frustrated and believe they may be losing market share to these competitors. taylor: how successful have they been in skirting around some of the export bans, so that they still are able to do business with huawei? ian: i think it depends upon the company, the types of products they supply, and where those products are designed and made. it really varies from company to company. it is true that some of these u.s. companies, big names, have shown a negative impact to their earnings, the revenue growth, because of this traded dispute and because of directly what is going on with huawei. taylor: you said there has been a conflation between trade and huawei. from the chipmaker's, what have they said? is it a national security concern or trade concern? ian: they are very concerned

about that and they warned against -- they want specific guidelines. what can we not supply them with? because that would hurt american security interest. versus the interest of the united states in terms of a thriving economy and a thriving chip industry which means we need the revenue, we need to be able to supply so huawei can get from samsung electronics. want ant rules, they definition and they have not been given that. they have been promised it. we reported that the trump administration had a meeting with senior technology executives, promised them licenses are coming soon, it will be sorted out. it still hasn't happened. the concern is until china starts buying soybeans or something that is not connected to them, they will not get that clarity. taylor: what is that concern about market share? where they say, if we don't sell to huawei or to china, someone else will, and then we will end up just being hurt because we

lose market share. is that valid? ian: it is absolutely valid in the case of some companies. let's face it, there is no real replacement for high-end. huawei cannot get that. memory chips, absolutely. micron had a huge business with huawei. those chips can absolutely be replaced overnight by just going simply and ordering them from samsung. taylor: we are coming up on earnings season where we will hear from a lot of these chipmakers. what do we know about the real impact on the top and bottom line, and perhaps more importantly, going forward, the impact of this still could have on their financials? ian: that is a good way to set things up. it is a massive asterisk. the promise the chip industry made, the promise investors bought into was that come the second half of this year, we will have cleaned out in victory -- clean out inventory. if the trade dispute was resolved, if we have clarity and what we can do in china, they

don't have that. we will continue to see that. taylor: any sense on when that resolution comes? does that, as part of a trade deal in phase two? what does the resolution look like? ian: that is a wonderful question. if i had the answer, i would be a lot happier. everybody thinks it is going to a quid pro quo basis as part of the negotiations. hopefully there will be some resolution as the year goes on. that's the best estimate we have. taylor: bloomberg's, thank you so much. there is a goer -- a growing chorus on the direct listings as a an alternative to an ipo. that isn't being led by venture capitalist bill gurley of the benchmark. with stewarte idea butterfield which listed in june. spotify led the direct listing trend in 2018 and so far, airbnb has indicated it is also leaning toward a direct stock listing next year. i caught up with new york stock exchange president, stacy cunningham, earlier monday on these topics.

stacy: if you think about why companies choose to go public, there are four reasons. one, access to capital so they can raise money. two, having the credibility of a public listing. in the visibility of that event. third, liquidity for early investors and their employees who often have been getting paid in shares or options of stock and want to be able to use that and buy a house. four, currencies so they can engage in m&a. traditionally, access to capital has been the primary driver in raising money. what we are seeing now is for many companies, because they are larger companies in the private market space, it is more the liquidity for their employees that is driving the public listing. it allows you to ask yourself, can we decouple capital raising from a public offering? that is what spotify started. the cfo of spotify asked that question. why do i need to go with a traditional ipo method if i'm not actually looking to raise money? that was really the genesis of

the direct listings. taylor: how does your role change between the direct listing and an ipo? stacey: we have been at this for 270 years. we've been helping companies come to market so they have access to capital for a long time. the ipl mechanism we all talk about so much in our -- and are familiar with has been around since the early 1970's. that doesn't change our job. our job is to help find it. we are positioned to do that with a new york stock exchange because we have a market maker assigned to trade the securities. with the direct listing, they are looking for that opening price in the morning to establish what the value of the company is. that is the job we do everyday. taylor: you are in san francisco because you are attending meetings and conferences about direct listings. in your conversations, what do you hear from underwriters who used to be profitable to help underwrite an ipo, now they are trying to get more involved in direct listings. what do you hear from those

conversations about how they get more involved? stacey: i think they are trying to serve their customers. as the needs have changed, banks are looking at how they can be helpful and provide resources to their customers. they are engaged in the process. we've seen them take a real leadership position on how we can use this as an additional tool, additional products they can offer their customers. that is what we are seeing happen. taylor: you had said you had recently gotten more tech companies on the nyse, which previously, they were listing on the nasdaq. because you modernized your rules and allowed nonprofitable companies to list. was that a good decision? do you consider yourself perhaps may be an enabler in those unprofitable companies? stacey: many people don't realize the new york stock exchange did and allow companies that were pretty profitable to list on the exchange. many of today's companies over the past several years have come to the public markets prior to being profitable.

we modernized our listing standards. the vast majority of text proceeds have been raised on the nyse as a result. the question you are getting at are those companies good for the market? for -- it important is not unusual for them to be pre-profitability when they list but then have a pathway to profitability. what is their plan and how will they get there? investors can share in that process and they do become profitable. we've seen that with tons of companies. taylor: finally here, how has wework changed the market? stacey: i think there is a conversation. there are conversations the market is having around discipline and governance and companies around the valuations of private markets versus public markets. this is not about some story about one specific company. it is a story about trends we see in the market. when there are fewer investors determining the valuation of a company, it is not priced at discovery like we see in the public markets where you have many investors. nobody can value, there are

times of smart people in the private market space. no one can evaluate company the way the private market does. that is real value the public markets give to investors and employees and all main street investors as well. that was nyse president stacy cunningham. coming up, we speak to the man leading the u.s. department of justice's china initiative. our discussion with u.s. assistant attorney general for national security, john demers. his next. this is bloomberg. ♪

taylor: it is no secret the u.s. has been after china to stop ip

theft and force technology transfers. those are key parts of the department of justice's china initiative. the man leading that effort is john dummer -- john demers. on tuesday, he will be part of a discussion in san francisco on that very topic. today, he joins me. thank you so much. john: thank you. taylor: we have a great list of your initiatives you have been doing. when can we expect corporate espionage, technology issues that are most important to the companies that have the most to lose when it comes to china? from theyou see initiative itself, the initiative was started in response to what we see as a concerted, very well resourced and funded effort to take intellectual property from american companies including companies here in the san francisco area, and transfer that intellectual property to china in what we call a real replicate and replace approach

to technological development. you are robbing an electoral property of an american company, you replicate the prospect in china, then you replace the american company on the chinese market first. if all goes well on the global market. that is what we were seeing in the intelligence and why we started this china initiative. taylor: a lot of this has been done by the doj. what are you doing that is new to help companies with the most to lose with china? john: what we are trying to do is a lot of outreach to companies. and to show them the benefits of coming forward and telling us when they think some technology has been told -- then stolen early. sometimes what may seem like an employee misbehaving is in fact somebody who has been co-opted by the chinese intelligence services and stealing on their behalf. we don't want companies to just try to handle this on their own because they need to understand they are up against a nationstate. just don't have the

knowledge thathe nationstates do to combat that. taylor: do you feel like you have the knowledge and the staffing and resources to take on a huge state? john: a lot of what the china initiative is about is really empowering and harnessing the u.s. attorneys offices around the country, which is where most of our prosecutors are. really focusing their attention on this problem and letting them know from our main justices perspective, that this is a very important priority where they should be putting their resources in order to help companies tackle this problem. taylor: what about future issues? a lot has been said about ai, robotics. do you end the state attorneys as you mentioned have the resources to expand to all of those future issues? john: i think there are different areas of technology. the problem remains the same. the core problem of chinese, what they feel in the area of ai and robotics technology,

biopharmaceuticals, etc. their tactics are all the same. if we are ready and we are empowered to reach out to companies, to work with them on defending themselves, i think that technology will work regardless of what the chinese are after. we know what the chinese are after because they have laid it out in they are made in china 2025 plan. they are after basically 10 very large technological areas, everything from commercial airplane technology to new materials, to biopharmaceuticals, on and on, that they think will be at the forefront. they are probably right about this, of technology in this century. taylor: what is the solution? visit export bans? sanctions? what is the right solution to solve the problem? john: there is no one solution and our cases by themselves are not this over bullet. the solution is working together with the private sector and government to watch out both for cyber intrusions which is one tool, but also what we see

increasingly our cases insider threats. many of these cases as the chinese have shifted their resources to use their intelligence services to do this, a lot of these cases are now the result of insiders having been co-opted by the intelligence services. and then sending information or stealing information and bringing it to china. taylor: we've talked about sify is the committee on foreign investment in the u.s.. do you expect to see more involvement going forward? john: sophia's was expanded just last year by congress. looking at new technological areas. thealso, guarding against theft of sensitive personal data which has also been an issue. the chinese are very interested in personal data of government employees and others. we saw that as early as the office of personnel management hacks where everyone who had a security clearance, their data was stolen. we see the chinese continuing to be interested in personal data. it is a great value to them when

they figure out how to target people. the more i know about you for instance, the easier it will be for me to target you if i were an intelligence officer. i could pretend to have areas in etc., then. . develop a relationship and that we have to talk about huawei. is it a national security issue or part of the trade fight? john: i'm a national secured guy. for me, it is a national security issue. we have two cases going on against huawei now. one involving the theft of a notional property, one involving a sanctions and bank fraud case which is also a national secured case. the broader concern on the national security side with huawei is the influence of the chinese government on huawei. we have to talk about huawei. is it a nationalanother large cs -- and other large chinese companies. the use of the technology on the telecommunications network we are using every day for everyday activities, and whether the chinese government can take advantage of the fact that huawei is on american networks

and the networks of our allies around the world. taylor: when you look at china in the china initiative, what is your biggest concern? does it cybersecurity, ip theft,h? what is the biggest issue when it comes to china? john: i think there is a variety of issues. the biggest concern is they are using their intelligence services to target american companies the way they have used them to target the government for years. and american companies will find it difficult to defend themselves against the intelligence services of one of the most sophisticated nations in the world. taylor: u.s. assistant attorney general for national security, john demers, thank you for joining me. john: thank you. taylor: when it comes to a crisis event at a school or city center, sec. can make the difference between life and death. we speak to one company using technology to make sure every second counts. that's next. ♪

taylor: mass shootings at a school is a nightmare for any

parent. schools across the country are looking for ways to help ensure safety across their campuses in an event of an emergency. one company working to leverage technology to notify on-site personnel and first responders is raise mobile safety. their products like their panic button app are being used across u.s. by law enforcement, schools, and more. most recently, all kindergarten through 12th grade teachers in louisiana will have access to that technology. todd, thei bring in ceo of raise mobile safety and he joins me from boston. thank you for joining me. talk to me about the business model of the app. how does it work? todd: sure, taylor pair thanks for having me on. the thicket is important to understand our business is safety. we believe you have a right to be safe where you live, work and play. all our solutions are revolving around that. for the panic app in particular, we license to this technology to

public safety agencies and/or school districts. we are deployed in almost 10,000 schools across the nation. it is software as a service, there is an annual fee. we handle all the training, tenants, deployment services. in louisiana, we work closely with the state police department to roll it out across the state. taylor: what are some of your future initiatives to further integrate with first responders? todd: that's a great question. we are pretty broad and our footprint, well beyond just school safety. we do a lot of in -- a lot in 911 centers. we, view our customers and anybody that is looking to better connect with the populations they protect. between 10,000 schools, we have half the colleges and universities in the country and a lot of 911 centers and responders agencies. we enhance communication and collaboration. activethink about an shooter situation, it is not handled by just the resources at

the school. you need to involve local responding agencies, ems, potentially other schools in the area, to let them know there is an incident going on. there is a lot of information that needs to be shared in that context, whether it be a floor plan, simple communications about where the shooter is, better location information, or whether it be streaming video. that all needs to be done in the context of all the individuals together working to resolve the issue. downsame issue translates to a much smaller incident whether it be a heart attack, or a student having an asthma issue. you need to make sure the responders know the nature of the incident and how best to get to the location of that incident. taylor: and what does the data show you about how effective this is? todd: you know what, it is humbling to be able to speak to people that we have helped save. we had an incident in one place where the responders claimed they saved 11 minutes -- shaved 11 minutes off a response time. i was able to meet the father

that was commenting about how he could hug his children because our software helped. i want to make everyone understand the responders are the ones that are implementing and doing this. we are not kicking down the doors to a fire but it is gratifying to know our software can be used to help in that process. we have helped thousands of school incidents across the country and shaved minutes, if not seconds even off of a response that can be the difference between life and death. taylor: how are you protecting our data? todd: that is a great question. clearly one we are asked often. we do a lot as most companies that have sensitive information, we do a lot of things to protect and encrypt the data and regular audits. it is a major part of our business in a significant investment for us. taylor: talk to me about the biggest concerns you get from investors. outside data privacy, valuation, or profitability? add: we are blessed with

fantastic investor and technology crossover ventures. when they invested in us earlier this year, they saw the opportunity to disrupt white in many ways is a static industry and public safety. the questions were probably the same ones that are asked of any enterprise. what are our retention rates? they are phenomenal. how do they see growth internationally? how do we expand the product portfolio? we have really great loyal customers. all those metrics added up to a significant valuation for us. here, whatseconds are those international expansion plans? can look in the news and see natural disasters and incidents across the country, we are actively looking to expand into multiple markets. a lot of our solutions are applicable. some of them left so internationally. we are working to deploy those internationally now. taylor: todd piett, ceo of rave mobile safety. thank you for joining me. that does it for this edition of "bloomberg technology."

bloomberg technology is livestreaming twitter. check us out @technology. follow us on tictoc on twitter. this is bloomberg. ♪ ♪ devices are like doorways

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>> welcome to "daybreak: australia." kathleen: i'm kathleen hays in new york. sophie: i'm sophie kamaruddin in hong kong. we are counting down to asia's major market open. haidi: here the top stories we are covering in the next hour. president trump raises hopes on the chance of a trade deal next month. he says the word from china is things are going well. boris johnson tries to fast-track his