♪ announcer: from the heart of where innovation, money and power collide. in silicon valley and beyond. this is bloomberg technology with emily chang. ♪

emily: this is bloomberg technology. coming up, tiktok under fire over a challenge that involves cooking chicken with nyquil. we have details on the stunt that led to a warning from the fda. plus, leonard hippeau is looking for the next biggest thing. after creating new funding, i talked to him about the next move. outgoing ceo -- talks about why he is stepping down. also, what he thinks about jamie dimon calling crypto tokens decentralized ponzi schemes. first, the markets. it is all about the fed, as expected. the central bank raised rates 75 basis points.

stocks, including tech and most major digital currencies swung between gains and losses. joining us to break it all down, ed ludlow. adco it was a roller coaster. we got the 75 basis point hike as expected. the surprise, the more hawkish element of the afternoon, was the forecast from officials on where rates go from here 4.6% in the terminal rate into 2023. the market laying up with the fed is prepared to do in terms of fighting inflation and giving the economy some pain. you look at the gyrations behind me, the nasdaq 100, there were big swings between gains of more than 1%. ultimately closing 1.8%. on that equation of -- here is what jay powell had to say. >> there is a possibility we could go to a certain level that we are confident in and stay there for a time.

but we are not at that level. clearly today, we just moved probably into a very low level into what might be restricted. in my view in the view of the committee, there is a ways to go. >> we felt the same gyrations go through digital tokens like bitcoin. beyond that, not a lot of news driving specific stocks in the market. we saw pain from mega caps. apple and amazon come of biggest point laggards. interestingly, one company that did hold on gains was nvidia. they've got a conference on and was bullish about their latest graphics chip and a deal with lidar to develop a simulation suite. at one point, up 17.5%. either way, that was its biggest jump since june. emily: we will see later in the show.

turning to the two big stories regarding tiktok. the fda has issued a warning that a new to talk challenge could be dangerous. the so-called sleepy chicken challenge is when people cook their chicken and nyquil. tiktok will ban fundraising and all other moneymaking opportunities for politicians and government accounts. hitter discuss, alex barinka. how big does this have to get for the fda to weigh in? >> it got big enough for parents and folks to complain, which is typically what happens with these companies. the platform plays a little bit of whack-a-mole searching down these challenges and these fads. we saw it with the really dangerous tide pods challenge earlier. but this one, the sleepy chicken challenge, it seems like tiktok has snuffed this one out. if you search for that term on the app, it sends you to a warning about dangerous

challenges and dangerous fads. i will say, there are a lot of scary challenges. weird information pops up on the platform that does not always get bad enough for the fda to get involved. this was one they felt like they needed to jump in on. sleepy chicken posts have been taken down. you search for some names that are misspelled or add a few letters and those are still up, which illustrates the challenge these platforms have when it comes to locking down misinformation. emily: we found some of them, but decided not to show them. for obvious reasons. perhaps even bigger news, this decision on politicians and governments not allowing them to make money on the platform. can you explain how this works? >> tiktok came out today basically with a pretty significant expansion of its ban on political ads and political

content ahead of the u.s. midterms. in the past, historically tiktok has banned advertisements from governments and politicians, now taking that a step further in saying these individuals also cannot fund raise. so, there is no soliciting of campaign donations, no asking for money if you are a politician or government entity. they also ban these accounts from accessing any of the -- -- gifting or things like the creator fund, which is a fund that pays out users with a lot of followers for the number of views and engagements they get. you have heard the argument before from tiktok, you heard tiktok's c.o.o. in front of a senate panel make this argument. tiktok likes to be an entertainment platform, not a place for politics. some of these prohibitions and

moderating of this type of content backs that up. but, it is a very notable piece of news, particularly in this election season and as we start to get fired up about the next presidential election which will come closely on the heels of the midterms. emily: how does this compare with what meta-, instagram and twitter have done as far as their stance on politicians making money? >> tiktok and twitter have completely banned political ads. there is no moneymaking there. facebook and instagram, those ads are still able to be up. i still see content on those platforms soliciting donations. it seems like tiktok is taking a step further than some of its big tech peers. but as this evolves and social media platforms tend to exchange ideas, it will be a place we will be watching more closely, particularly if there is any dustup with facebook or instagram in this election

season. emily: alex barinka, thank you very much. coming up, his firm just raised $230 million. where will that money go? eric hippeau joins us to talk about his big bets. this is bloomberg. ♪

♪ emily: lerer hippeau announced plans to invest 230 million dollars across a couple of funds. also back is a full-time investor, cofounded the firm before becoming the ceo of group time media. joining me now, eric hippeau,

manager at lerer hippeau. -- fundraising environment for these two funds given a challenging macroeconomic backdrop. >> good to be with you. the majority of these funds were in fact last year and we had this is our 12th year. these are -- and select -- early stage and late stage -- number four. [indiscernible] it hasn't been exceptionally hard. i would imagine that today, for new funds, it would be pretty difficult. emily: how is the changing macroenvironment changing your strategy and where you are going to place your bets?

>> we are quite well-known for our consumer companies. warby parker, casper, many others. in more recent years, we have been very focused on enterprise software. we are less known for that, but we do over half of our investments in those areas. those are very exciting and we are looking forward to balancing our consumer business with our b2b business. emily: venture capitalists announcing big funds left and right. it seems there's not a lot of places to put this money. there's a lot of dried powder sitting on the sidelines piling up. while valuations come down and the economy resets. >> there is a record amount of dried powder, as you say. we are finding that funding at

the precede level, which is our specialty, continues at the normal pace. -- as well is our companies are getting funded. where things are much more is in the later stages. that has to do with the fact that investors are really not sure about how to price, how to value companies. as soon as the market settles, there will be plenty of money. emily: are you waiting for evaluations to come down? is that what i here? >> where we invest -- valuations have -- have not yet come down to pre-2021 levels. we take the very long view. we invest in a good year and a bad year. our companies are going to start maturing years down the road.

we find valuations to be more attractive today for sure. but more importantly, we have more time to do our work. there is into the frenzy that existed last year where people wanted to -- in a matter of days. now we are back, giving us plenty of time to do our due diligence. emily: what is your take on rate hikes seem to be continuing. how is that impacting your outlook? >> the biggest impact for venture capital at the moment has to do with the fact that the ipo market is dead in the water. companies that wanted to go public this year are postponing. that always has an effect of the m&a market as well. if the ipo market is slow, the m&a market is slow.

last year, we saw record amount. we returned records of -- back to our limited partners. this year it is much slower but we take the long view. you will have a down year, you will have an up year. it is over a period of time it does not matter. emily: eric hippeau of lerer hippeau. always good to have you here. coming up, jesse powell stepping down. what does it mean for the future of the crypto exchange? our conversation with him is up next. this is bloomberg. ♪

emily: quick check of the markets. i want to bring back ed ludlow who has been watching a few more things. what else is catching your eye? adco so much happened wednesday. the fed did raise rates by 75 basis points. the hawkish surprises where rates go from here. official software .3% by the end of 2022. 4.6 percent terminal going into 2023. behind me in the corners of the technology market, the mega caps and some of the u.s. shares of chinese tech companies. -- index down 2.6%. and then we talk about why do we keep going on about interest rates? why every day do i stand in front of you and say rates are

projected to do this? higher rates discount to the present value of future profit. for a lot of tech companies including meme stocks and not profits, they haven't got profit anyway, they are trading at high multiples. that would narrow the market. an interesting part of the market wednesday was aerospace and defense. you heard president putin talking about mobilizing troops and annexation of certain parts of ukraine. that were ongoing. at first, -- stocks had been higher. post fed. there gains to be a decline of 9%. breaking headlines in the last few minutes, one of the companies you and i discussed more often is up more than 3%. the company saying it has a four year revenue target of $50 billion. why does that matter? to give you context, salesforce

had revenue of around $35 billion. as part of their investor day presentation in the bay area, san francisco, they have been telling investors with their longer-term expectations are. that expectation is to boost revenue on a four year basis, in a very meaningful way. over the coming days and weeks we will keep an eye on that. applico absolutely. i am actually interviewing salesforce ceo tomorrow. we are going to get his thoughts on the market moves and his broader outlook. i am curious what he thinks about the big segment deal. adobo buying sigma for $20 million in the middle of the downturn. interesting to get his thoughts. i believe it was the biggest tech deal ever. at the time. it will certainly be interesting to get his thoughts as the fed

continues to make decisions. ed: he is not a guy who is short of opinions. he's got an opinion on everything. not just that deal you mentioned. i think the camille stock. -- has been quiet. you and i used to cover them a lot pre-pandemic and during the pandemic because this is obviously a company that has decent sales but also a high-margin business. at the same time, -- as a man with many passion projects that i am sure you will discuss emily: it is going to be a great one. thank you. meantime, as climate week is in full swing in new york, california governor gavin newsom spoke about the state's climate challenges and how to avoid blackouts like those we have seen in past years. in the state. he spoke with david westin from the sidelines of united nations climate action rates to zero.

in the resilience supported by bloomberg philanthropies. >> we were stress tested in the most extreme. we had no blackouts. we were challenged, but we kept our wits and we are keeping our agenda and maintaining policy principles that i think will allow us more resilience in the future. so no, i do not think you have to sacrifice one for the other. i would argue not transitioning is the bigger risk. transition is the important word. it is not all of one or the other. a lot of experts say we have to get to renewables, but you can't just give up on natural gas. we were able to keep the lights on because we kept a lot of our -- plants online. we were able to do backup generators. situational challenges. that doesn't mean we don't accelerate. in areas like battery storage, we had the largest installed battery projects on planet earth.

250 megawatts. it is close to 4000 megawatts. it is our largest flower mesh power plants to date. look at what we can do in five to 15 years. i think people are naively assuming we are not capable of doing much more with the innovation and entrepreneurial spirit that the -- that defines this nation. >> you said you could go, where you need to go? >> we have very ambitious goals for carbon neutrality. we have established interim goals. 90% clean energy on electricity grid by 2035. of course we have the 2035 and eight which is the most aggressive in the united states. so, we have to do multiples, probably six gigawatts a year. here is how we do it. it is not just putting unprecedented amounts of money to back up these technologies. -- new incremental investments.

studying the most aggressive policies, getting the private sector to invest, but also the biggest issue we face is time to project delivery. not just from a supply chain perspective, but a permit perspective. so, we did something profound this year. we completely knocked out all of those barriers and we put in rigid timelines to get projects permitted and go through the judicial process. that is a game changer. >> carbon capture is critical and that is an important part of your strategy, but we have -- have we really taken carbon capture to scale? >> not yet. a number of companies in california are demonstrating that. we worked with the oil industry. [indiscernible]

frustration, we want to invest in that. that is an important point you may, we were able to find valid said that years ago. others are like no, we do not want to have that conversation. we have been accelerating on all fronts, recognizing we need to de-risk, including our nuclear for five years in order to stress test this grid as we transition and to de-risk and look at initial costs, which is profoundly important. emily: california governor gavin newsom with bloomberg's david westin. india wooing chipmakers under a new $10 billion plan. the government will increase incentives for manufacturers. india is the world's second-biggest global filmmaker. -- will become co-ceo in

january. kinkel has spent the bulk of his career at youtube. he was also part of the team at netflix that introduced original streaming programming. beyond meat has suspended chief operating officer doug ramsey come rested on charges that he bit a man's nose at a college football game in arkansas. this is another blow to the plant-based protein company which cut revenue forecast last month. coming up, how latin america's -- digital economy has bounced back in a bigger way than the united states. this is bloomberg. ♪

>> welcome back. when it comes to the digital

revolution, latin america is catching up fast. a venture capital firm which backs latin american companies shows how the digital economy in that part of the world has skyrocketed as the result of the pandemic. let's dive deeper with our guest. you have warned so many hats. your perspective is -- you have worn so many hats. your perspective is very valuable. what surprised you about this? >> there's definitely a lot to unpack. in this report that we just published yesterday, probably the key story that underlines investing is that the pandemic tech boom has been sticky in latin america.

it's a huge deal. in the u.s., we saw a bit of aurora slid in the trend or back to the historical -- trend. there are some interesting and borderline absurd steps that we are talking about. one of them is part of the e-commerce branch, it is grocery delivery. grocery delivery in brazil measured by the largest player locally saw a six time jump right at the beginning of the pandemic. since then, his grown an extra 10 times. 60 times jump between the

beginning of the pandemic and now. that is basically a sustained new level. a new one is -- another one is telemedicine. that's understandable, but the virtual appointments are measured by one company. 10 times at the beginning of the pandemic then doubled. so it is like a 20 times jump from the beginning of times and these are sustaining levels which is exciting. emily: i'm curious how this is influencing how you you are placing their bets. you are learning about these new trends at the same time we are going into a massive macro economic downturn and i wonder how that is uniquely impacting latin america. >> a few things are shifting. i would probably look at the venture investing seen specifically.

without a doubt, investment has gone down as compared to what happened in 2021 and 2020. as a result of this new economic reality. investment slowed down in latin america. in particular, we noted that born american -- foreign investors remain active, but they are pulling back a little. the local funds are making up the difference. if it is directly in response to this lasting tech boom post-pandemic, the excitement remains as you will. so valuations have gone down, but investment in earlier stage companies in particular continues. there are other unique things happening that i think will continue to fuel investment in a big way. fintech is extremely well developed in latin america. i would argue much better than north america.

first off, we saw one of the most successful fintech companies go public recently. it's a world-class story. there is another thing that relates to the investment climate which is what's happening with mobile payments and brazil. it's a skyrocketing example. the central bank launched these new things recently called tics. -- pics. it's similar to upi. it got to a billion transactions per month and just under a year. that changes consumer habits, it

makes it easier for e-commerce and online to off-line to play out. that has affected the way in which the fintech sector is growing and it affects investment in fintech specifically. emily: given that you work at so many big tech companies and you are more recently the head of virtual-reality at facebook now meta, we have seen this big shift in the public market, investors seem to be really skeptical about this whole metaverse thing. facebook's market cap is now 1/6 of apple and that was a very different story when you worked there. do you think this whole metaverse pivot was the right call for mark zuckerberg? >> it's is usually important question. i do believe that virtual and augmented reality are in the

future as the next major computing paradigm. i think it was the right call. the rate of investment is where we could spend some time debating. should it have been half of the investment level that has been so far? history has kept us objective here. as a society, we are going to go through the competing paradigm shift in the next 10-15 years. the companies that have made the early investments in the platforms in the core technologies are going to be the ones, the winning forces in the next platform race. the thing about meta is it is starting for much further behind than google or apple because they don't have an operating system of major platform investment in the competing

paradigm. it requires to a degree a disproportionate amount of investment. strategically thinking 20 years forward, i think this will have been the right call. emily: you have work and so many different markets. china, india, now latin america. closer to latin america earlier in your career. there's a lot of concern about the global economy, the smartphone market in particular. there's a new iphone out. do think people will upgrade now when you're paying so much more for literally everything from gas to groceries? are you concerned about the health of the smartphone market? >> i am and i have been for a couple of years. i think the industry has run out of things to do and innovation space.

i am sort of dying for google and apple to jump on the folding phone bandwagon. i think that sort of unlocks the formfactor. emily: interesting. >> i've equal going to see a stagnation in upgrades until we see the next wave of innovation. i'm concerned and watching it closely. emily: you think the next iphone should be foldable if they want to sell more of them? >> i think there is a humongous amount of potential if you explore new form factors and i think foldable's have a lot of promise. i'm happy that samsung has led the way here, but we need to see everybody else. particularly apple jumping on

board to make that work. fingers crossed. emily: that was unexpected. we appreciate that and thank you for bringing us those new numbers from latin america. good to have you back. coming up, a cofounder on the ethereum merge and what it means for her blockchain tezos that's going to get an upgrade of its own. this is bloomberg. ♪

emily: in the coming weeks, there will be another big upgrade to the blockchain. tezos considered a competitor of ethereum is under growing -- undergoing an upgrade. how difficult -- how different will this be from the it theory emerge? >> we have a formal mechanism for making upgrades to the protocol. meaning upgrades have been made seamlessly without the use of a hard fork which is why the theory emerge took so long. with us the reason we've been able to upgrade 10 times almost

seamlessly is because the blockchain was made with upgrading itself in mind. there is a formal met -- mechanism that makes this pretty straightforward and seamless. hopefully the 10th time is beginning this friday. emily: what kind of technical issues are you preparing for? i wonder if perhaps not because there was all of this concerned about the theory emerge and if it would go off as planned and it seems to have been kind of a nonevent. >> i think this has been an excellent marketing effort. if you prepare, these things tend to go smoothly. maybe they will learn that on their next upgrade. >> how substantial are your upgrades compared to the theory emerge considering that you have done this 10 times?

parts one of the benefits of tezos is that when you have upgrades that happen on a regular cadence, you don't have to boil the ocean in one go. these things can happen piecemeal. what i mean to say is tezos algorithm has been changed wholesale twice and it has also had a number of different improvements that ensures scaling which is going to be the next big challenge for any blockchain including ethereum of course. a lot of these networks don't scale very well meaning they can't handle all the transactions which is why you see congestion and fees rising because of the cost of competition getting higher as more people use it. scaling is something we have incorporated with the last two upgrades.

the one on friday introduces some concepts and technical abilities that lean toward having a lot more people use the blockchain. emily: it is climate week and we been talking a lot about the -- the energy problems of crypto. how much does tezos use and have you been working to combat its carbon footprint? >> are blockchain has been stake -- proof of stake which means it has a lot less energy usage and smaller carbon footprint than proof of work. it theory and went to proof of stake with their merge. this has affected a lot of people it would otherwise be neutral. wire using a bunch of energy to use your pretend internet, that

seems to be useful. with ethereum using proof of stake, now we can focus on more interesting questions in the cryptocurrency space. >> we will be watching out for your 11th upgrade. always good to have you. we will be right back. is bloomberg. ♪

emily: the outspoken and controversial cofounder of a cryptocurrency has stepped down. he has encouraged some employees

to leave. the companies -- how did you come to this decision, stepping up not down? >> i like to think of it as i am taking the higher-level role at the chairman level. i will have ultimate oversight over the entire company. dave has been doing all the hard work for me, so thank you dave. i am excited for this next chapter. i'm extremely confident in david ripley and his ability to lead this company. he has been with us since we were 50 people six years ago. now or in the mid three thousands. he has seen it all and i am super glad we have such an advantage and someone who is able to step up from the inside. we came around to him after running an external search and

talking to over a dozen other people and he was clearly the front runner after that. i think it's in great hands and i will still be actively involved day-to-day. hopefully, this will allow me to go deeper into the product and user experiences which is what i enjoy doing. emily: we are in the middle of a massive broader market downturn. it is definitely leading into crypto. crack and's market share -- kra cken's market share has dipped by a third. >> we have been thinking about this for over a year. i thought the time was right with the company being in a good decision -- position right now the culture, the engagement of the employees. after the jet ski program and the woke employees left, people are happier and more engaged and

more satisfied than ever. the company is in a great spot. we recently aligned on our five-year strategy. it's a great time for me to step away after planning for a long time. we are looking to hire a new coo to backfill dave. it will be a handoff time but everything is great. i hate to go out at the bottom of the market. david's performance is gonna look amazing when everything bounces back, but there's never a perfect time. emily: let's go back to those woke employees. this was controversial when you said it. i'm worried if you are worried about facing any backlash? >> not at all. after that whole thing happen, we had a tremendous amount of support coming. record-breaking numbers of job

applications coming in. i think a lot of people were just waiting for somebody to say it and they're waiting for a place where they can be themselves and not have to walk on eggshells. they're looking for a place where they can get to work and work on important things and not be distracted by petty grievances that people have. i think it attracts people and deters the wrong kind of people that are really not cut out to be working in a professional environment. >> jamie dimon just had this to say about crypto. take a listen. >> on a major skeptic on crypto tokens which you call currency like a bitcoin. they are decentralized ponzi schemes. emily: decentralized ponzi schemes. what's your reaction to that? >> i feel like it's better than a centralized ponzi scheme which is the stock rocket and natural currencies. [laughter]

it's an upgrade right? is it an improvement? you can point out problems with anything and is it not perfect but is it an improvement over the existing system? crypto helps a number of people in the world and it might be hard for jamie dimon to understand that running a bank in the united states, but there are billions of people around the world that don't have tank accounts are access to financial services and crypto is a real lifeline to those people. emily: i have to revisit some of your predictions that you made right here. one bitcoin for lambeau. to infinity and beyond. do you think it will still get there? how much further off is 100,000? >> i do think we will get there. i look at this rainbow chart for bitcoin. we are at the bottom, at the extreme by territory right now. i would buy it again at 18,000.

i am still very long-term bullish. i haven't sold one share of mccracken stock in 11 years. -- i haven't sold share of my kraken stock in 11 years. things keep getting stronger for crypto. we keep proving that we can do these upgrades to these networks in a secure orderly fashion. everything keeps looking better over time. the macro is playing a big role in what's happening with crypto. people don't know if they will afford gas or groceries next week so that affect someone's discretionary income or a bill -- ability to invest long-term. aside from the speculative value of crypto, and solving real problems for people. it does have a functional use case in many parts of the world. i think we should look at it more from that perspective. what is the goodwill that this is doing? can we measure the value that

this brings to the world by some other means? beside the financial value, the appreciation in the asset. what problem is it solving for people? emily: one lambeau maybe some day not sure when. it's still going to happen according to you. we will be watching you in your chairman role and whatever else you do next. thank you for joining us. that does it for this edition of bloomberg technology. thursday i will be interviewing the salesforce co-ceo. also the ceo of impossible foods as well. this is bloomberg. ♪

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