♪ emily: welcome to "bloomberg technology." i'm emily chang in san francisco. over the next half hour we look at our biggest interviews in this unprecedented year. the tech sector seemed to do what it did best, adapt. 2020 themes are all about work from home and play from home. the covid cloud brought the silver lining to videoconferencing, food delivery and online gaming. with more people stuck inside,

netflix has seen subscriber growth soar. we caught up with the co-ceo and cofounder reed hastings to talk about how netflix will continue to meet the moment. reed: our culture is built around flexibility instead of efficiency. we have very few rules. we are inventive. we are on the edge of chaos. that happens sometimes, but that helped you adjust. we had to do a lot of adjustment, coming from dvd by mail in the u.s. to then doing streaming of other people's television, rerun tv, to then figure out after break into original series and later, original movies, and how to expand around the world. so now, about two thirds of our members are not in the u.s.. so a big, successful expansion there, successful expansion building our studio, "stranger

things," and that is due to the culture of attracting incredible people and being very flexible, so that we didn't stay focused on the dvd by mail business. emily: how is the pandemic changing the way you run the business and create a culture of maximum and or, when soapy that its only people work from home. some ceo's like jack dorsey say we will be working from home forever. is that ok in your book? reed: it is however employees are most productive. most of us want to get back into the office, have human contact, have debate, and the technology of zoom and google are good, but it is not yet the same as being in person. i am sure, like most companies, we will have more people spending more days from home, but for me, the human contact and interaction you can do in trying to understand some

challenging topic, it is great to be in person. emily: do you think working from home forever is an overreaction? reed: there are different companies with different cultures. i will bet that some will do that and it will be great for them to try, but at netflix, we are a very human company, we want to have human interaction, and it will be better to have that be in person that only virtual. emily: one thing i don't quite get is how you get through a day, sometimes months, without making a decision. when is the last time you did make a big decision, and where do you still feel the need to step in? reed: a month ago i made a big decision to promote someone as co-ceo at netflix. it was a great decision, we have been working together for more than 20 years and have been

acting as co-ceos anyway, and we wanted to give him the recognition and platform of his existing role. so that is big decision. but i try not to make decisions about articular titles, product features -- about particular titles, product features or marketing campaigns. i see myself as the power stimulating good inking amongst all our great players. emily: when it comes to tad, co-ceo arrangements often don't work, i have covered many that are not intact anymore. why do you think this will work? reed: it is dependent on the people. it is unusual, but if you think about every family, there are generally two ceo's running the family. and you have to be really close.

ted and i have been together for more than 20 years and i am confident it will totally work out. emily: the pandemic in many ways has played right into netflix's hand, you are in a perfect position for this moment. that said, production has come to a halt, projects are backing up, it is getting harder to find something new to watch every night. how do you think the entertainment industry looks different when it emerges from this? reed: there is definitely a challenge from the lack of production, particularly in the u.s.. in europe, they were able to go back to production, and much of asia. but the u.s. is still quite slow and challenging, and that is going to have an effect more year than this year, not only for us, but for our competitors also. emily: that was co-ceo and co-founder of netflix reed hastings. now, while some executives like

reed hastings would like to see employees back in the office, others are allowing mobile work to be the new normal. we asked lincoln co-founder reid hoffman about whether working at home will be a net positive or net negative. reed: it will be a net positive, but there will be challenges. for some organizations, it will continue to work well, i think reed is right, a lot of people need the office in order to work. we have proven our creativity and problem-solving within the kind of work contact us. context. and once you start having a workplace, in fact all the studies show there is a real impulse for everyone to be there, because the earliest promoted, who gets permission to do a thing, who is in the office meeting with people, so there is pressure to get back to that.

emily: your job is to try to predict the future. are we out of this in five years, where we are -- where are we any year, what is your time horizon? reid: some of the other economic impacts will have a persistent, multi-year work through period. the question about inventiveness in technology and technology as it applies to life, technology as it applies to how we work, that continues to accelerate. entrepreneurs will do that, people invest in it, you will have growth stories but i think we also need to think about how we help bring the goodness of that to everything else. now, not on deeply inside knowledge, but i listen to a lot of networks and i think there is

a high likelihood that q1, q2, we will have a scale-back theme. and that will help us begin to put the pieces back together. emily: that was lincoln founder and greatbatch partner reid hoffman. coming up, 2020 closed with one of the biggest tech deals of the year, salesforce buying a work from home darling for $27.7 billion. we speak with the salesforce ceo next. this is bloomberg. ♪

emily: salesforce ceo marc benioff has done 60 deals in the

company' us 20-year history and ended the year with his biggest acquisition yet, buying slack, whose usage is soaring as employees work from home. one source called it a marriage made in heaven. marc: we could not be more excited about this combination, how it informs our custom-made -- our customer 360 vision and lets our customers work from anywhere. emily: many are looking at this as a defensive move against microsoft. marc: salesforce has never been stronger, phenomenal quarter, raised our guidance, $21 billion this year. we are doing 25.5 25.5 billion dollars in revenue next year. emily, it is the fastest-growing enterprise software company of ever, of all time. salesforce has never been stronger. and slack is a tremendously fast-growing company, but really

has breakthrough technology, the idea that you can collaborate on channels. we have integrated our products already, but this idea you could have this-generation work-from-anywhere environment, runs on my phone, runs on my ipad, it is amazing what is possible here. emily: you are no stranger to deals, 60 deals in your tenure at salesforce. that said, stop slipped when reports of this deal broke and folks say this is too expensive for a company that has the last -- that has less than $1 billion in revenue. what is your response? marc: a common narrative. i have done some of the largest deals ever done in the technology industry, including a company we grew from a few hundred million dollars to a couple billion dollars. we did an incredible transaction a couple years ago with tableau, same narrative then, but now, we can see a couple of billion

dollars of revenue and fermenters market share gains tremendous market share gains since we acquired the company, and again, deep integration with our customers and customer 360. here we are with slack, it is our customer playbook, we are going to execute it and deliver tremendous value to our global customers. emily: so, like you said, you are always looking. how long have you been inking -- thinking about buying slack? did you think about this before? marc: i didn't really think we were going to get any deals done this entire year. i am at home. you have been at home. perhaps this digital, work from anywhere environment, salesforce, slack, zoom is my life. and now, everything i use every day is salesforce, which is amazing for look, emily, i was totally shocked when stuart and rhett, our chief operating officer, they have known each

other for a long time, there were entrepreneurs at different companies and they said we can bring these companies together. they showed me a vision that is so compelling, and our customers are going to be so inspired by what they can do from productivity and the level of customer success. one thing that has happened this year is, our customers badly need so many of our core products. that is what we have had such tremendous growth, especially in sales, that is the ability for you to meet collectively, this is powerful, to be sales -- b2b sales or b2c sales, this week we processed millions of orders for our b2c customers. so we are seeing the pandemic accelerate the digital toll world and slack

is making every better. emily: good marriages require work and some don't work at all. i asked slack ceo stuart waterfield why he thought this partnership would work. stuart: there is an opportunity for something nonlinear. it is not just that we have software, they have salespeople and they can sell or software. of course, we will ultimately do that. they are an incredibly strong leader in crm, customer sets, marketing guy -- customer success, marketing and support. it is an opportunity to create workflows and productivity, and simple find people's work, but ultimately making organizations more effective and aligned. there is a unique synergy between the companies. emily: who will you be reporting to?

stuart: it is up to brett to decide. the important thing from our employee and customers' perspective is that i am ed will remain ceo of slack -- i am and will remain ceo of slack emily: emily: will you become one of salesforce's presidents? stuart: i think so. emily: the doc is languished -- compared to other work from home stocks. languished.s i know you are trained to tell me you don't think about that, but i am curious about whether that played into this deal. stuart: of course i noticed, but i don't think it played into this deal at all. when think that might have

gotten lost because we announced our earnings, salesforce announced their earnings and we announced the deal at the same time, a lot of information, is that we just came out of a big quarter and grew customers and added 12,000 new customers, and that is the heart of the business. that leads to future revenue. we are really pleased with the growth. part of that is increased awareness of the utility of the product as a digital hq and while physical hq's are less well used in the pandemic and working from home, but a lot of this is just improvements to our user experience, helping people understand slack and helping them get started. but the big burst is the ability is thebig source of that ability to communicate across organizational and respurred the last four quarters of growth, 100 40%, whenever 60%, 200 40%, 260% -- 140%, 160%, 240%, 260%. emily: what do you make of the

narrative this deal was done because of increasing competition and increasing threats from microsoft, that they were starting to be you in customers -- beats yo -- they in customers? stuart: i am sick of talking about microsoft. just look at the u.s., largest media company, largest issuer of credit cards, leading retailer, zoom out from that and it is two thirds of the fortune 100, three of the five biggest companies in the u.s., operator of the nation's largest integratoed -- largest integrated health care

system. i could go on with this list forever but there is an article of faith about the competition i am unable to overcome. emily: that was slack ceo stuart butterfield. up next, i work from home breakout star, up 500% from last year, but not without controversy. our conversation with the ceo is next. ♪

emily: weddings, funerals, school, work, if it wasn't canceled, it often happened on zoom. the videoconferencing company has kept families connected, but it was undermined by glaring

security issues. ceo eric yuan spoke with us about how the company turned a corner. eric: it is beautiful serving enterprise business customers before this crisis. and we learned for the first time from consumers that we could do more, not only offer this service but also give them very strict security tools. we took action over. the past several weeks emily: i want to get -- past several weeks. emily: i want to get a sense of what it is like when you go from a few million two 100 million users in a few weeks. what is that like, not just for the customers, but weddings and

funerals, schools, families, last night celebrating passover. eric: we have been working extremely hard for months now, every day looking at capacity, traffic, and working so hard is really challenging. not to mention the cost, and all the employees really working so hard and also having to deal with the privacy, pr issues, and it is not that easy. emily: you have been banned by school districts including the new york city department of education, the governments of taiwan and germany for official use, google, tesla, spacex, how many customers are you losing? eric: i ought to mention we are seeing the process, working with the new york city department of

education, so we have many public schools working together with us. we have an updated master account, and i think that seriously, some of the information has been misleading. i think we are making a change, we are doing all we can to focus on security and safety. it is very important for us. after they understand these facts, i think they will change to using us. emily: what are the true facts? eric: the first true fact is that zoom is secure, it is safe.

regarding zoom bombing, we have fixed all the problems. we have gone through all the problems, also the education of the security vulnerabilities. because we have a global distributive architecture, and some meetings are random, very random. but this is very minor. in the past, zoom was often for meeting work, and in the past we knew which customer, which account, which meeting had the problem. we had all the information. a lot of people have gotten misleading information about us. emily: various attorneys general are examining the service in different states. you have gotten warnings from the fbi and have been sued by a shareholder for allegedly concealing the lack of encryption. just today, senator elizabeth warren sent you a letter saying

she was concerned about kids. eric: the fbi is involved and we share the same goal. i am very excited to know the fbi is involved. regarding encryption, we do encrypt our accounts, as do other competitors as well. our internal process, since last august, we ordered changes in our meeting climate. because the internal process was done through a startup company, and we fixed that problem. it was more of an inconsistency, but from the data and the product, we know it is contributing.

emily: that was zoom ceo eric yuan. that does it for this special edition of "bloomberg technology," but stay whether us because "bloomberg studio 1.0" is next. i am emily chang. this is bloomberg. ♪

♪ >> it was a death heard and felt around the world. the killing of george floyd, and unarmed black man igniting a wave of historic protests. from corporate america to silicon valley. on this edition of bloomberg studio 1.0, we speak to some of tech's most up-and-coming black leaders about what is and is not changing when it comes to racism in life and business.