independence with peace of mind. ♪ taylor: i am taylor riggs in for emily chang. this is "bloomberg technology." coming up, effectiveness questioned. oxfordneca and the covid-19 vaccine is screwed highest as -- is scrutinized as one analyst says the 90% label is embellished and only part of a small sample. consumer spending patterns, no

one knows them better than the paypal ceo. from home.ng bitcoin and more. demand for electric vehicles. the evike rivian, startup. we hear from the ceo. markets ending the day near session highs. the notable out from -- notable out performers, the russell 2000, smaller cap stocks. vaccine in hopes of the , the astrazeneca trial, and of course that news that president-elect joe biden may nominate former fed chair janet yellen to be treasury secretary. it really is that record on small caps that catch my attention. abigail: so much news on the day.

another monday. so much news around the vaccine, which means we have another cyclical rally. it has taken a couple of years for small caps to get another record high. that is where small cops next small caps like this cyclical bent. the energy index up more than 7%. where we had the weakness is tech, and apple technically breaking down. it will be interesting to see what happens in the future. some are saying that the excitement around the iphone 12 is priced in, which means the buyers are stepping away. in the afternoon, the news that president-elect joe biden is likely to dominate janet yellen for treasury secretary -- likely yellen for janet treasury secretary. there was a moment when the market dipped slightly, there was some wobbly trading.

but janet yellen represents certainty. not only was she the fed chair, she was on the fed during the financial crisis. she is one that really favors certainty and messages her moves very clearly. market friendly. we have been watching this range over the past few months. markets certainly did respond well to janet yellen. taylor: i think the key thing for me, what i have been hearing from analysts, this stability that she provides. does the market like her stability? are they looking at her policies? abigail: i think what they really like is our messaging. she is very solid in terms of .he messages she delivered

i think it has more to do with the catch up piece of it. on the year, tech up in a big way. the banks are still down 20%. area,estors rush into an that is a piece of it. energy down, so that is where money can go. that everiting on elusive stimulus. abigail doolittle, thank you as always for joining. another vaccine is showing promise in the fight against the coronavirus. from the university of oxford and astrazeneca stopped an average of 70% of participants from falling ill. that is less than the vaccines moderna and pfizer. was sort of the

second sentence that, my attention, where there is 70%, neither of%, but that meets that really high bar set by pfizer and moderna. >> first of all, overall in the ,ig picture, good news different technology, pfizer and moderna. it is also working as a vaccine. you take all of the results together. a lot of different vaccine technology is unlikely to work. ,n terms of the actual results tesla only 62% effective. the second, they lowered the dose and only tested that one in a smaller number of patients. that one is 90% effective. -- whys a lower dose get

would a lower dose be so much more effective? they did not have a good explanation of that. explanationhere was of that, what does that mean, a big trial going on in the u.s., not as far along, may have to to a low dose. generally, people were not sure what to think or what number to believe. a wealthy country that has access to more effective vaccines might use less if the lower numbers turnout to be the right ones. taylor: despite some of that skepticism, we spoke with the analysts just a few hours ago, which really raised the confusion about that trial.

maybe it was inflated and the u.s. was not sure if they would legalize the vaccine order even have it in the u.s. the company saying, we will release the full data and analysis within a few days. what did you need to see the squash some of the skepticism? >> why the results are so divergent so you can think about, what are the results for efficacy? the u.s. trials are bigger than these trials and that is testing these higher dose things. the ones that need to be shown the two dose of regimen, now they might have to switch the u.s. trial also regimen.he lower dose what is approved if most people tested have been tested at the

higher dose? is this just a little bit less effective than some of the other vaccines or is it significantly less effective? and if so, why? this is one that has a long overhaul, they were not fully reassured about the safety. wanted to hear more about the safety data. there are more questions about this one because of the confusing data set. taylor: the devil is in the assume that -- distribution and equalizing the playing field? >> this vaccine does have advantages in distribution over the mrna vaccines.

this can just be basically refrigerated and does not have the same freezer requirements as the messenger rna. if they can come up some dose that is maybe just a little bit less effective than the mrna vaccine, that would definitely be an advantage. my understanding is that the u.k. will get a lot of the first doses of this vaccine because it was developed in the u.k. i don't know what the roll up will be after that. there is definitely a deal with warp speed as well. nowemains uncertain right which vaccines will go to which countries. taylor: not only with countries, but you think in the cities and rural areas. moderna,of pfizer and these freezing cold temperatures

. >> pfizer says they are working on a system, they have these containers that can be used, it will be shipped to places that have freezers. from there, i guess it can be put in the dry ice packages they design. they said, yes, they can do it. difficult and complicated. the next thing to happen will be j and j probably early next year. more similargy is vaccine rather than the mrna vaccine. novavax using more traditional

technology. there could be a lot of vaccines out there. there could be confusion. it could get very confusing if there are four, five vaccines at work. and we are just parsing out the details of which one looks best for which people. theor: like you said, just technology behind this, the speed at which we have gotten years befores people thought it was possible. coming up, facebook, your member you rememberlion -- that $22 billion whatsapp acquisition. we look at how they may be having a more lucrative quarter. this is bloomberg. ♪

might justsaging prove lucrative for facebook. they acquired the popular pp in 2014app whatsa for $22 billion but since then, the app has not generated the kind of returns they were hoping. new reports that they may have plans to monetize the app even further. joining us, the executive director at m km partners. a buy rating on facebook. great to have you. talk to us about what you think about the whatsapp evaluation as it relates to the broader world of facebook. >> thank you for having me. it has been six years since facebook acquired the second largest platform on social media, that is whatsapp. whatsapp is the second largest

platform in terms of number of users. has not yet made significant inroads. we put out a note earlier this week saying that facebook is on the cusp of monetizing users in india and brazil, showcasing how they can make money off of not just advertising. we are going to see actuating revenues, actuating monetization. usemillion users that whatsapp regularly in india and brazil. taylor: india and brazil, why

have they been able to show progress there is that? -- progress there? does that translate into progress in the u.s.? rohit: whatsapp could be that one super app that is the the mobile ecosystem and those two countries. in the u.s., we still do not have a super app. where we use amazon for commerce, google for search, and so forth. outside of the u.s., countries such as china and india, there is this notion that there is one main app. in china, maybe two or three apps that most people use to find other services and products. brazil, a position

that unlocks many more ways for the company to make money. india, a license for all the users on the system that is a significant development. at the present, they have a license but there have been some false start. we have been monitoring that development. advertising,yond the market is huge. taylor: asked if it is that competition -- how stiff is that competition? wepay, companies that have already created that super app, are they already dominant? how does whatsapp make inroads? rohit: in india and brazil, we have been paying attention to a couple of things. google pay is used in india. threeprobably a number

player right now. number one is a company that is owned by walmart. chinese super app this largess whatsapp in terms of users. users a base of whatsapp could help whatsapp windy cumbence in- win in india. again, you are talking about thinking over the next five years, this is a company seen for many things.

taylor: rohit kulkarni of mkm partners, great to have you. coming up, we are taking a look at one cloud company. why they are forgoing the traditional ipo. this is bloomberg. ♪

>> you will ck flood -- you will see a flood of ipos between thanksgiving and christmas. if those are received well, that bodes well for 2021. orlor: going public via spac merger. the company is one of the largest microsoft 306 to five development teams outside of -- microsoft 365 development

teams outside microsoft itself. a traditionalsus ipo? >> on spac side, two main reasons. we looked at a traditional ipo as well as a spac. we are the largest developer for microsoft 365. at bothlly looked rounds. when we met jeff epstein, thatacle ceo, we felt their capital knowledge would help us with the next stage of evolution. second, in the spac world, everything is much quicker, so that would allow us to continue

growing our business, a market active users,on growing to 500. we have 7 million and there is much market to go get. taylor: on that note about the business, do you ever worry about customer concentration and not being diversified enough? a microsofteen partner and independent software vendor for the last years. it is the largest enterprise cloud today. we do follow our customers. by definition, many of our enterprise customers are multi-cloud. they could have microsoft office 365 for office collaboration but they may also have aws for for crm.salesforce

we already support some of our customers around cloud backup, aroundsalesforce, dropbox, and also supporting aws and google, around compliance. some of theing into financials, you generated $148 million in total revenue for the year. that is 26% growth year-over-year. can we expect those numbers in the next five years? >> it is rare to find a 90-year-old software company. we did the cloud transformation in 2011. we, out of the conversion, have high-growth, predictable growth. this is our second straight year of nearly 30% arr growth.

revenue wise, we are looking at 30% year-over-year as well. we are a high-growth company that is also cash positive and margin positive. we are well north of that rule of 40 as a key metric. the subscription business model is the pretty debility of our business. going into the year, over 70% of revenue is already spoken for. share in this market with continued high-growth. taylor: you are unique in that you have some real insight into customer behavior, i.t. tech spend at this moment. how is tech spend? >> there is massive acceleration towards cloud. saidicrosoft ceo famously

the digital transformation journey is now compressed in a matter of weeks. we see this as well. surveys of ceos of major fortune 500 companies also tells us that even after the pandemic with vaccines on the way here, the movement to cloud, a massive migration of data. now, customers are looking at data to innovate and collaborate faster. taylor: thank you as always for joining. consumers spend or save this holiday season as the pandemic battered economy continues to affect budgets? we will hear first-hand from the paypal ceo dan schulman. this is bloomberg. ♪ businesses today are looking to tomorrow.

adapting. innovating. setting the course. but new ways of working demand a new type of network. one that's more than just fast. you need flexibility- to work from anywhere. and manage from everywhere. advanced technology. with serious security. and reliable coverage, nationwide. forward-thinking enterprises, deserve forward-thinking solutions. and that's what we deliver. so bounce forward, with comcast business.

taylor: welcome back to bloomberg technology. i'm taylor riggs new york. as we head into the holiday season, resurgence of covid-19 cases around the world impacts consumer spending. paypal ceo sat down with emily chang to discuss how a pandemic driven shift to digital payments and e-commerce has transformed consumer behavior, and whether it'll affect the end of the year. >> i don't think it is an exaggeration to say the pandemic accelerated the shift to digital by three to five years and three to six months. it is not even hyperbole, it is

just the math of what we are seeing. you are seeing a huge shift from physical to digital and it is not even not just that shift from physical to digital but even in-store has gotten more digital. you are seeing blurring between online and off-line. obviously, more and more people are shopping online but not even when they are going into the store, they don't want to touch cash anymore. qry want to use cards or codes. the other thing you are seeing is that 40% to 70% of consumers don't want to touch cash anymore so you're really seeing a decline in the usage of cash which is why you are seeing a version and digital payments. emily: could this lead to the disappearance of cash, would you say? >> i think a lot of people predicted the demise of cash and

have been wrong over the years but there is no question that the use of cash and the prevalence of cash in transactions is dropping somewhat precipitously and whatever that trend rate was, it is now much more accelerated. emily: what are you expecting to see then as we head into the holiday season? >> yeah, well, i think there are a couple of different things we are going to see. over of all, you've got 50% of the population that is concerned further health about going into physical stores. by the way, that was a survey we did pretty all the explosion of the pandemic. it is probably a much higher number. people are going to move their spending online. 18 to look at 55-year-olds, about 75% to 80% , sayem, a huge proportion

they are going to do substantially all or at least half of their shopping online. you are going to see a dramatic increase from people shopping in-store to shopping online. you are also going to see more of a spread of the holiday spending. peaked fromwas very peak black friday to cyber monday. that is going to be elongated because the logistics distribution are such that retailers are trying to spread that as opposed to have it peak. the final thing we are seeing now, which i think is really encouraging, is two-thirds of americans want to shop at small businesses. and, that is really encouraging because small businesses have really suffered during the pandemic.

i think a really interesting thatthat i love seeing is as small businesses have moved sales they are seeing have gone dramatically outside of their local market. so, when somebody puts in paypal for a small business, 75% of their sales are outside of their home state. that is a pretty remarkable occurrence. so, small businesses are dramatically increasing their market. emily: so, what is all this telling you about the health of the american consumer? obviously, we have been in a recession. a lot of people have lost their jobs. there's also this increase in activity online. dan: i think we are clearly than evere americans before worried about the state of their financials. the pandemic, in my view, just

exposed more evidently the trends that you had almost two thirds of americans struggling to make ends meet at the end of themonth three thpre pandemic. we are living in a time where people are really struggling to make ends meet and this pandemic has only heightened that and brought more attention to it. i do think there are ways that the government has weighed in to try to help. i think you need to do more of that going forward. businesses like paypal have tried to help as well w. we should not underestimate the stress of the american consumer. emily: the pandemic has begun this conversation of working at home into the spotlight. you are at home, i'm at home. how is this changing how you think about your office footprint knowing if a vaccine

becomes available, we are still looking at at least the middle of next year at the earliest? dan: i think that is right. from our perspective, we are probably looking at the end of the summer into the fall before the vaccine can really take -- enough people take up the vaccine, which we are hopeful about. i don't think we are ever going back to what was. i think we will go into a new normal. new normal, based on what we are seeing and as with think about the future of work, is probably going to be some hybrid of people continuing to work from home and coming into the office. maybe working from home two to three days a week, and in the office two to three days a week. some people will forever be at home, and others will be more in the office. but, the vast majority will be some kind of 3-2 hybrid, i think. taylor: that was the first part

of her conversation with dan schulman. paypal'sn discusses embrace of cryptocurrencies, what he calls the demise of cash. that is next. this is bloomberg. ♪

taylor: bitcoin has been on a tear lately, crossing $18,000 last week and still keeping up the momentum on monday. this after paypal said in october it will not allow users to buy, sell and hold cryptocurrency. emily chang asked paypal ceo dan schulman whether the digital coin is finally going mainstream. dan: we knew we were going to

get high demand because we did research on this for we introduced any product or service. we try to work hand-in-hand with regulators to ensure anything we put into the market around cryptocurrencies was safe and secure and easily understandable by our consumers. but, the demand has been overwhelming for us. somewhere between two to three times what we expected on our waiting list. i think the really interesting thing that we talked about is not just being able to buy, hold or sell cryptocurrencies, but early next year, we are going to allow those cryptocurrencies to be used as a funding instrument, just like a credit card or a debit card or cash in your account, to be able to purchase at any of our 28 million

merchants around the world. i think that will fundamentally bolster the utility of cryptocurrency, really moving it from kind of an asset class today to more of an ability to use it in everyday transaction. emily: how long do you think before crypto goes mainstream? or do you see that happening now? dan: i think there are two things that are going on. one, as we talked about before, you are seeing the demise of cash. you are seeing more and more digital forms of payment, and forms of digital currencies. there are two forms of digital currencies that are very difficult and distinct. the first are cryptocurrencies. they are not backed by a fiat government currency. as we can put more and more utility around those and take advantage of some of the modern technology around that, i think working hand-in-hand with regulators, we can increase some of the utility of payments and

transactions. the other is central bank issuing digital currencies. i think based on my conversations with regulators and presidents of central banks around the world that is no longer a matter of if, it is a matter of when and how they begin to issue cbdc's. they are exploring that very seriously. there are some trials underway but i think the intersection of digital currencies and digital wallets like paypal and venmo are natural. emily: bitcoin has been on a bit of a bull run, in part because of the paypal news. i wonder what you see the biggest risks being. obviously, there is government acceptance and regulation. what about security? what are the things that could prevent cryptocurrencies from getting to the point of being truly mainstream? dan: i think there are some base foundational elements for any type of digital currency or

instrument toial gaining mainstream acceptance. there needs to be trust. that is really the foundation of the entire monetary system. that in the value of underlying asset and currency. and that trust comes from security, which is incredibly important and paramount. it comes from regulatory usedight to be sure it is for the appropriate purposes and not used by cyber criminals, etc. privacylly, that your as an individual is respected. i think those are three crucial things. i think it is one of the reasons why we introduce cryptocurrencies the way we did. hand-in-hand with regulators, putting it on the paypal platform so we can ensure security, that trust, and we can

work hand-in-hand with regulators. emily: a lot more services are adding the buy now, pay later option. paypal is not adding this to its wallet. does this concern you that it means more people will spend more than they should right now? so, because ihink think the way we are doing this is that we're assuring somebody has the wherewithal to go and do these kinds of purchases. just like we do today in any of our credit offerings on paypal. this is a response ability we take quite seriously. one of the things we do, emily, that is very different than others is we use our own proprietary modeling to look at this. fico people look at just scores. we look at a lot of her own modeling, the history consumers and merchants have, and base credit conditions on that.

i think i now, pay late gives consumers a ton of flex ability. i love our value proposition on that. we can offer that to merchants without additional fees and give consumers flex ability to pay interest-free payments which i think should be helpful for consumers in this holiday shopping time. taylor: you and i last spoke when paypal went public and spun off from ebay. emily: it has been a few years since then. where do you see the innovation coming in payments over the next few years? dan: there is no question in my mind that as we move into the digital economy, digital wallets are going to evolve substantially. and we are putting a tremendous amount of investment in the past year and next year into transforming both our paypal and venmo app into much more

expansive, everyday use cases. they are not just going to be for checkout online. but they will be for checkout online and off-line. but, they will also include financial services like being able to directly deposit your check onto the platform. savings capabilities. investment capabilities. taking all of the capabilities from our honey acquisition. shopping tools, like what is your wish list? price monitoring, coupons. deals that can be offered directly to you. and putting all of that capability into our digital wallets because that is what people want to do right now. they are using it in the digital economy and our services and products need to expand dramatically to serve our 360 allion consumers today in much more expansive way. taylor: that was paypal ceo dan schulman speaking earlier with

bloomberg's emily chang. three have some news we would like to bring your coming from the u.k. that relates to huawei. it falls into the technology theme. you case is to be weighing a huawei installation band in 2021. they are trying to do this to appease some lawmakers. there has been some rebellion within the party, so this would help appease some of those lawmakers were looking for huawei installation ban in 2021. we do know that lawmakers are set to debate a security bill next week. that would really look at stricter rules on how companies can use huawei 5g gear. so this, of course, further developments coming as they weigh what could be a huawei installation band in 2021. electric vehicles are taking center stage as more and more people are looking to save fuel costs. one ev startup focused on off-road and adventure vehicles. that is next. this is bloomberg.

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taylor: the electric vehicle market is getting recharged today with stocks continuing to surge, some nearing a 300% gain this month. the ev startup is having a tough time meeting demand for its battery electric pickup truck, warning it sees supply constraints through 2023. despite that, the company has its eye on markets outside the u.s. the ceo spoke with bloomberg's ed ludlow about the company's strategies. gas poweredo get vehicles off the roads and replace them with much more efficient electric vehicles. to do that, it means we need to focus as a company on the industry. we see electrification happening

strongly throughout the world. we see it throughout asia. for us, these are important markets and these are markets that our product portfolio is going to. as we launch future variance in our portfolio, we see those very nicely in europe. the whole business, the vehicle platform and architecture is set up from the beginning to support sales across the world, not just the united states. ed: finally, president-elect biden has some clearly stated policies when it comes to clean energy and electric vehicles. what do you think a biden administration would mean to the vision you just outlined? do you see a biden administration putting the united states into a quicker timeline for electrification? >> in terms of electrifying, we have two views.

what happened in the corporate world and how they are helping. the products they create. then, you have the regulator policy andrking in accelerating that. we're seeing increasingly across in world, many major markets countries that have lots of sales driving targets towards 100% electrification. we have seen that across europe, china. i think that's a good thing for the world. i think it is a necessary thing to make this shift faster. of course, we are watching closely to see what happens in the united states. we hope the u.s. will be a leader in helping create policy that makes it easier for consumers and makes it easier us tonufacturers, all of drive towards that future. taylor: that was the rivian ceo

speaking earlier with ed ludlow, who is also joining us now. ed, not just rivian, but the whole ev space on a tear in the stock market. ed: today's driver was a note from wedbush's analyst dan ives who raised his target for tesla at $1000. he sees ev demand really taking off over the next 18 months to two years. hitting 10% of new passenger car sales by around 2025. what is so interesting, think about the big picture. you see on your screen, the blue bars are factory electric vehicle sales. they are a tiny proportion of the car sold around the world. it is not until 2014 that you see battery electric vehicles becoming 15% of new vehicle sales globally. we have a long way still to go. that is bloomberg new energy finance data we are looking at. what we are seeing is some optimism, some enthusiasm and

change of psychology from investors. not just looking at tesla, the market leader, but also looking at these other startups and legacy players like general motors and ford, and thinking this is a good thing to make. they are addressing demand with new vehicles. taylor: what is interesting when you talk about pickup trucks, we think of them as a higher-margin, bigger business. maybe something that differentiates yourself from tesla. what does an ev pickup truck mean to you? ed: it is really interesting because here in america, is a clear preference to the pickup truck or figure vehicles. about 80% of vehicle sales in the u.s. if you look across the models out there, particularly tesla and chevy, but they are not in line with the type of cars americans like to drive. it is always puzzled me why they are not more bigger factory electric vehicles. now in 2021, is he the likes of forward, general motors, rv

ivian, bringing electric pickup trucks the market. look at wall street notes, you see some of the names. they think that will be a driver. consumer demand for these products, i talked about price parity but it's also about performance. can your electric vehicle do the same thing that the gas equivalent can do? until that is the case, i don't think we will see much ev options particular in the u.s. which has lagged other markets like china and europe. taylor: we only have about a minute left. what struck me as earlier, you were talking about dan ives of wedbush and the price target upgrade. me.sent $1000 and it struck this is a huge call. how do you think about what is really driving these upgrades we continue to see? ed: tesla may deliver 500,000 vehicles this year. by comparison, toyota and vw

will do 10,000 vehicles a piece. morgan stanley is looking beyond the vehicle and looking for the topline growth tesla could see, which is an area where they could lead in terms of robo tacxis. other automakers are looking at that space. in the future, there are other products that come along with electrification, the computing capabilities of these cars. there's a lot in the valuations that investors are finding in companies like tesla that go beyond producing cars with four wheels with a battery electric powertrain. taylor: thank you to bloomberg's ed ludlow. one day you will give hius more than just tesla on this program, but i love it. continue to stay with us because it is done with this edition of bloomberg technology. i'm taylor riggs. and bloomberg daybreak: asia is coming up next. this is bloomberg. ♪

♪ haidi: good morning. we are counting down to asia's major market open. shery: welcome to daybreak asia. our top stories this hour. asian stocks set for gains with astrazeneca, the latest pharma company to deliver positive vaccine results. some analysts question the data, saying they fall short of the high bar set by competitors. joe biden set to name janet yellen as treasury