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tv   Washington This Week  CSPAN  July 5, 2014 11:30pm-1:31am EDT

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>> hamdi ulukaya came as a guest of a guest at dinner at my house and lo and behold i had chobani yogurt in my refrigerator. he is the most interesting person, who has revitalized a whole section of new york with his wonderful product. he will be interviewed by steve clemons, who one of these days you're going to open your closet and there's going to be steve clemons, the ubiquitous steve clemons. > thank you very much. don't be shy for those of you standing in the back.
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don't worry about the cameras. aggressively ram yourself through those aisles and get a seat because it's worth it for the lineup we have today. hamdi, thank you so much for joining us. you're a young man growing up in turkey. you came over here to study business and you said, aha, feta cheese. and we're not even at the yogurt story. but you were going to make your fortune in feta cheese. i need to know why feta? >> well, two things. one is, i came to learn english. i didn't know a word of english. >> and feta was a great english word. >> actually, we don't call it feta, we call it white cheese. [laughter] the reason i came up with that idea is my father came to visit, and the cheese, the white cheese, is very big in our breakfast dishes. when i brought the cheese i couldn't find in the supermarkets my father said, is this it? i said yes. he said why don't you make some. i grew up in turkey, in
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cheesemaking, yogurtmaking. so basically my father not liking the cheese that i brought for him for breakfast made me go into the cheese business. >> now we need to jump to the real story here. how many of you have lots of yoplait yogurt in your refrigerator? how many of you are dannon consumers? how many of you are chobani consumers? this was not set up. i had no idea. i thought it could go really badly for you. [laughter] i just didn't know. but you moved into yogurt. and the story is fascinating. i'd love to tell you -- tell us the story real quickly, not about why yogurt, but tell us the story about why "entrepreneurship" and how you saved the town, how you saved the factory. >> well, i was to make the story short, i started this cheese business. it was very small, you know,
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struggling with language, with running the plant, trying to sell, all the small -- all the big issues that small businesses go through every day that i did. and i was going through my junk mails one night in my office and i saw this ad and it said fully equipped yogurt plant for sale and there was a picture of it on the front side of it. i continued to throw it into the garbage can, still smoking my cigarettes and making garbage. about a half an hour later i went back to that paper and took it. now it's dirty and -- >> and it was a kraft yogurt. i didn't even know that kraft made yogurt. >> it was a brand called breyers. didn't even know it then. but when i went to visit, this was about a 90-year-old plant. they were making yogurt and cheese. actually, they said it was the original plant that they invented philadelphia cream cheese. >> wow. everybody knows that.
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>> i know. so i couldn't believe the price that they were asking for it. i thought they were missing one zero. it was like $700,000 or $7 million. i was afraid to ask one more ime. didn't want to look so surprised, so cheap. >> maybe you should have asked if you knocked off another zero. >> on my way back i called my attorney. i said, i just saw a plant that i want to buy. he thought i was the craziest guy ever. and he told me a million things why i shouldn't get it. one, it was the largest food company, that it was getting out of the category. this was a plant this they were selling as is. that means all the mistakes and crimes and everything that's been done in this plant, it was on this turkish guy's shoulders. and then he said s -- i'll tell you one more thing, the biggest problem, you have no money. [laughter] you haven't paid me for the last six months. >> ah. >> it was true. i hadn't been paying him. so that was the thing.
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and i figured it out with a small bank. >> did you finally pay him? because this is on the record that it could be used against you, a confession. >> yes. he later said, i wish i was a partner with you then. so the first day i bought the plant with an s.b.a. loan, small business administration, was august 15, 2005. and i hired five people that kraft let go. and there was a bar across the street and people who were coming to that bar were bikers. i had only seen them on movies, and they're scary. [laughter] and when i saw them -- >> they said, hamdi, come on over. >> if i had seen them before, i probably wouldn't buy it. but that was the first day. and those five people and me and, you know, i could not describe how scary it was and
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how lost i was, and everything that the attorney said, it was true at that moment. i did something really, really crazy and i didn't know what i was going to do next. so my first board meeting with those five people, they, mike, rich, maria myself and mustafa and frank. they said, what are we going to do next? and the first thing that i recognized from the picture and when i went there the first time is the wall outside. it was white, maybe 15 years ago. no longer. it was horrible. and i said let's go to the ace store and let's grab some white paint and let's paint these walls. and mike said he was retired, and then came back to the plant. he's been in that plant for almost 25 years. he said tell me you have more ideas than this. [laughter] >> well, you know, i just want to -- i mean, we just had brian
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greene up here. he's one of the most cosmic conceptualizers and thinkers. did you think the universe of yogurt was just a universe of -- i mean, at the time -- i mean, again, you're clearly successful. but one of the questions is, i remember the yogurt. i liked yogurt then. i remember greek yogurt coming online and taking on more and more. it is interesting that a turkish guy is making greek yogurt. >> only in america. [laughter] >> yeah, only in america. you go back to istanbul and -- does that play well in turkey? >> no, no. the turks are angry, the greeks are angry, the turkish are angry -- >> we were going to come out here and take a selfie with all of you and then tweet everyone. but in any case, it is a big thing. but i mean, when i began
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thinking about talking to you today, i didn't know, where did you steal the market from? when you look at the absolute dollars out there for this sort of product, there's some finite null. i didn't know whether you were displacing velveeta cheese or displacing yoplait or whether the universe was getting bigger, or have you made the universe bigger? >> you summarize the the whole thing. actually, all of it. >> it was an accident, if i did that. >> all of it. we created a market. some of them came from the other categories and some of the people started eating more. but when we started, there was greek yogurt by a company who brought from greece 10 years before me, 10 years. i mean, you're talking 11 years actually. so they created this buzz of greek yogurt in the specialty stores and some fancy places, but not in the mass market. but someone who grew up with yogurt, yogurt was the simplest thing that you had. it doesn't matter if you're rich or poor, lived in the city or not, it's the simplest, purest food and you should have
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access to this. i couldn't understand why you have to go to new york city, a specialty store, and pay $3 to get a good cup of yogurt. so i worked two years to make that, and when i made it, i said i'm going to go to the mass market first. so my first store was shop-rite. my buyer went there and said, well, we have five know ban any's we want to put on your -- chobani's we want to put on your shelf. it's $30,000 to $50,000 to put on the shelf. he said we need that money to be paid. we didn't have that kind of money. we said, what if we paid with the yogurt? so then you sell, you can take some of it and for the weeks, we can pay it off. and then the guy asked a very nice question. he said, what if it doesn't sell? and we said we'll give you the plant. we literally said, well give you the factory. but that guy -- >> did they want the factory? >> no, he sold it.
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he sold a lot. actually, he called me two weeks later, he said i don't know what kind of stuff you're putting into this cup. i don't want to know. but i cannot keep it on the shelf. from that moment on, i knew this wasn't going to be about selling, it was going to be about, can i make it enough? i'm this tiny little guy in upstate new york who worked two years to make this cup. now it's selling and i'm going to make the big guys wake up at one point. so this is the destiny of every small food setup. you have a dream, you work hard, you don't sleep, you have neck pain, back pain, all kinds of pain, right? [laughter] you don't go to bahamas, you don't do anything. [laughter] >> yeah. he was in the bahamas last weekend, so don't feel sorry for him. >> i was there for two days. >> i was trying to track him down and he was telling me about the roosters on pink beaches. so he was doing fine. you then moved -- you've got
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another plant in twin falls, idaho. are there similarities between this edmeston, new york, which is -- chuck schumer loves you for saving this town and these people. ell me about twin falls. we have a lot of cover. i've got to get to vladimir putin and whether he either chobani. >> what happened is from those five people i launched the brand in 2007. this is something that people need to know what happened. the magic really happens in the small towns, like upstate new york. with those five people we created a brand that became number one in five years. and from that five, we have right now 3,000 people. in 2012 -- from 2007 to 2012, within five years, we went from zero to $1 billion in sales. [applause] and this is -- some people said, and i haven't seen anything otherwise.
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some people said this is the fastest growing start-up ever, including all the technologies. but one of the most amazing things is until 2012 -- 2013, actually, we all did it independently. so we stayed independent. and we invested in that factory that i bought from $700,000, almost $250 million. and then we built a factory in twin falls for $450 million. and we built it in one year. i and all the people working the company had never had this kind of business experience before. we were never marketers, finance people, operators or anything like that. so we figured it out along the way. and you know what the secret is? not a big deal. [laughter] it's not a big deal as much as people try to make it a big deal. what they do, when you talk about these things, it sounds like, oh, you have to go through some kind of schools or you have to get in with the big corporations, you have to have this kind of disciplines, you
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have to know all the textbooks and everything. b.s. you need to really be there and along the way, you figure it out. >> what was the biggest mistake you made at the beginning? [applause] what was the thing -- obviously you got beyond your biggest mistake. or maybe you're perfect and you've never made a mistake. but what was the biggest mistake you made from what you thought you would need to do and you changed course? >> the biggest mistake i made s a human mistake. it's towards -- as the business kept growing, you know, 500, 600 million, two brands and the plant in australia, the people that you start with is your friends. you share the dream together. and as business grew so fast -- >> those dreams become complex. >> and the capability of being able to handle that kind of business is a different one.
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so you need to change the skin and you need to bring more people, different people. and, you know, i struggled with it. i should have done it maybe a year or two years earlier, including myself, you know. i could have brought some different people in. these are the entrepreneurs and people like us struggle a lot, and i think all the issues are human issues, mistakes that are human mistakes. but i think i've done or we have done together, we've done more good moves and redistricted what was going to happen in two years or three years. so these are way overshadowing the mistakes that we've done. and i kind of try to keep it imple. but it became really big that it wasn't as simple. so we're trying to put a structure on it and make sure chobani goes on for a long, long time. >> before you answer this
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question, i was in a green room last week with a young man, he's an entrepreneur out of washington. i don't know if many of you are familiar with sort of the 15th and u street area in d.c. there's a place called cake love. and this guy created something. he brought in people from the neighborhood and he's just created a big thing and he was out there talking about his new product, which is cake in a can, which he's supplying to some various large chains now. it was interesting. i was thinking about the fact that i was going to be seeing you here. and he's really moving forward. he's struggling. he's not a billion dollar company but he's worked hard in the community. i was going to ask on his behalf, what is the biggest thing he can do to get on a road to more dramatic success? other than appearing on msnbc? i'm not sure that helped him. could hurt him with a lot of consumers out there. >> you really have to have a great product. i mean, i worked two years to -- people said, this is good.
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i said not enough. then they said, this is -- >> did it used to be crappy? >> it was good. then we made it the first month, it was still better than what it was in the marketplace. but my expectations are really, really high. and the cup, i mean, there's no yogurt cup left in the world that i haven't seen. when we launched chobani there was five bags of cups from china to colombia that they took off from my office. so you really have to -- once the product is perfect, then the rest is really your capability. i mean, there's a lot of stuff that you can do right. >> get it out there marketing. >> yeah. >> did vladimir putin not letting the official yogurt sponsor of the u.s. olympic team getting in, did that help? because we're all talking about it. it turns out that most of those people in sochi are sanctioned now in the united states and europe. >> we were really heart broken. the olympians were eating chobani when they were training in this country. it was in their kitchens, it
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was in their smoothies. they came to the plant. it was like a festival day. all the community farmers, the kids, everybody in the factory, we all made this palate together. we did this in 2012 after london and we were hoping this was going to go and, you know, it hit the wall. >> there was a lot of speculation that the change of the uniform from the under armour uniforms affected the performance of some of the athletes, but it was really the absence of chobani yogurt. >> that's right. we believe in that and we were sad. but the next olympics we believe we will do it. but, you know, it is food -- people forget a simple cup of yogurt or a simple loaf of bread or whatever you get from the store, it's available when you're in turkey, greece, italy and in your city. but you've got the supermarkets in twin falls and in new york, it's a shame what is in the supermarkets. and the manufacturers, they
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could definitely do better. they can do better. they can take the preservatives out, they can take the colors out. >> talk about that. we've got a minute and 22 seconds. i went on -- if any of you haven't done it, i'm not advertising for him, but you have a really great web page. i went on my iphone. you have this thing called "how matters." tell us about how matters. and about the issue of ingredients. can we really walk away from all the preservatives and everything out there? because i think it's interesting, because when you go through the stores, there aren't that many foods, i think, that i'm eating that are probably along the lines of the ingredients that you have. i'm pretty much of a bad eater. but you're telling me i can get on without all of that. >> yeah. and it's your choice. maybe you live in washington, d.c. you could, if you wanted to -- >> i need stuff that will survive a month in my refrigerator, maybe two. >> >> availability to good food is a human right, it's a basic
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right. who's going to make this? everybody wants better food, but it is too expensive, and t's not there. so guys like us, the big guys, they have to put the human in the center, meaning somebody is going to eat this, somebody's baby is going to eat it, somebody's friend is going to eat it. that's what how matters, how you make your food matters. and it goes beyond that, that when i started with those five people in that community, the culture of chobani became that everybody came to work and go back to their home and said they've done something amazing today. and then the promise that a certain portion of the profits go back to the community, first in our own community and then expand. so i believe business is the best vehicle to solve issues in the community and society, and it's the vehicle that is sustainable because it's a business. but the business has the right mindset that not only the
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founder or the c.e.o., but everybody in there, that when they walk into the plant or the offices, that they're going to do something right. and the return that comes in, it will go back and do something more right. and it will be the effect of going on and on and on. i'm proud that chobani, every act that everybody does every day -- they're not perfect, but we have the right mindset. we're not perfect, we're trying. >> well, before we thank you, we're right at the end. you just got a $750 million loan to expand. which food company out there hould really fear you? >> big guys. i love fighting with the big guys, you know. i think one thing that -- message to people in the food world is when they tell you, oh, these are people, they have a lot of marketing money, they have a lot of plants, they have a lot of people, you will find out that the big size that they have is actually becoming an advantage for you to be fast
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and smart, and it's really fun to play with them. [laughter] >> ladies and gentlemen, hamdi ulukaya. everybody wave. we're going to do our selfie. everybody waving? yeah? say hi. hold on. i'm going to send this to turkey and -- [laughter] here we go. >> send it to greece, steve. >> there we go, there we go. >> thank you. >> thank you very much. [applause] >> only in america. my favorite line. and you can walk into my house one night and i can serve chobani. it was great. thank you. next, we have david kestenbaum of npr. he's going to tell us what's happening to our money, where it's going, how we're going to spend it, how we're going to pay for things.
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with jeffrey alberts, phillip bruno, and nicholas carrow, c.e.o. of block chains. welcome. [applause] >> i'd like to tell you a quick story. a few years ago, a colleague of mine started hearing about bitcoin and i said let's go eat lunch with it. people are saying, this is going to be the future of money. we thought, great, we'll go buy lunch in new york with it. it turned out to be incredibly difficult. it took two weeks. you exchange dollars with bitcoin, got hacked and had to shut down. they doubled from $12 -- >> the ultimate high was about $1,000. >> it was a long time ago. we had to find a guy who had bit coins, happened him dollars cash. he gave us bitcoins, and there was only one place in manhattan that took bitcoins and it shut own.
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so the question is, where are we now and whether it was legal as currency, or what it was. so could you just sort of quickly -- maybe each of you could bring us up to date on one little part of that and tell us how far we are now. >> sure, i can speak just on the extent of the law that relates to bitcoin. and the short answer is, it is legal. but regulators are all still trying to figure out exactly what it is and how it can be used. you can use it legally and illegally. >> buying drugs is still illegal if you use it with bitcoin. >> afraid so so you've had some regulators come out and make statements about certain legal compliance. the i.r.s. has had certain rulings. >> and bernanke said the word. it's all significant. it is legal, but i think it's going to be a couple of years until people kind of figure out how all the pre-existing regulatory mechanisms are going to apply to it because it's constantly changing. >> nick, can i buy lunch in new york? >> a lot has changed since you
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went and tried that. i live my life 100% on bitcoin. my company pays all of its employees in bitcoin and we're a bankless institution. we have employees on four continents and there's an unbelievable amount of human and financial capital pouring into bitcoin projects. from the last year, just in our company alone, we've seen growth from 100,000 users to over 1.5 million. i think it's really important to remember that outside the confines of even this room, bitcoin is an absolutely global phenomenon. for example, in argentina, there are probably 400 or 500 times more restaurants, bars and services accepting bitcoin than here in new york. that's because there are real fundamental reasons there for why it's more interesting and an approachable financial solution for the people than maybe in the united states. >> is there a restaurant in new york that takes them? >> there are several. there's a bar not too far away from here called ever. the crep rein brooklyn and several others. >> i think what's interesting
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here is bitcoin is a currency or a store of value, so we're seeing some interest in that regard. >> explain what those two are. >> so a store of value is, do you want to hold your life savings or some portion of it in bitcoin as a means of keeping your money? the other is as a medium of exchange. so that's for like buying lunch and doing other things there. i think what we really find special, though, is thinking about it as a network, as a way to transact and to send money point to point without involving a financial institution or an intermediary. because most things up until now have been set up as these hub and spoke networks, where there's somebody in the middle and all the transaction goss through that. but this new phenomenon is a way to transact that doesn't involve those intermediaries
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and doesn't involve any of the fees associated with it. so it's incredibly low cost. >> in other words, these are kind of two visions of the bitcoin future. one is that it's a real currency. everyone talks about how much they have and they use it to buy lunch. and the other people hold on to the bitcoin. the other is that it's a way to send money from one place to another in a cheaper way than the credit card system or the banking system, right? and you're saying the second one seems like more of a go than maybe the currency. is that right? >> i don't know how to handicap these, but i would put more currency on the second one, which is the ability to have it as a low-cost exchange vehicle. and as a network. and, you know, it's interesting. i interviewed 20 years ago one of the founders of visa. this is when i got into the payments industry. and he said, look, the internet is going to revolutionize payments and we're going to be able to do point to point transactions. we're coming into that right now.
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>> one of the criticisms of bitcoin is that it's basically digital version of gold. and economists left, right and center will tell you that the gold center was a bad, stupid system to have, mainly because you can't adjust the amount of money. there's no central bank that can say we can extend the supply. there's no way for the cash in the system to increase with population. so you get what's called deflation, which means that every day that goes by, what you're holding is worth more. that may seem great but it's also a disincentive to spend. if you say, well, why buy the car today? it's going to be cheaper tomorrow or the next day. in fact, bitcoin has gone up in value. if you were stupid enough to buy a pair of alpaca socks, which were some of the first things that were for sale, you basically spent millions of dollars for what's now a pair of socks. so why hold on to it? how big of a problem does that seem to you, that it's finite, it's sort of digital gold?
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>> look, i'm not an economist, but there's a couple of responses to that. one is that, i think i have the same general instinct that phil does, that a primary value of bitcoin is as a means of payment. so the criticism that you have is more focused on its value as a potential currency. the second is that i think we are so far away from the notion that bitcoin would actually be like a foundational currency for a country or a large percentage of people, that the deflationary aspect of it is not likely to be terribly relevant. it would have to be a high percentage of the economy before the deflationary aspect -- you would see negative effects. >> one is that you can't have a central bank for money supply and the second one is built-in deflation because you can't create more, right? that would still be a problem. you've seen the value of it shoot up just for different reasons, right? >> i would actually challenge this, because some of the research has been conducted on
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the block chain itself. so we can actually study transaction velocity in a way that's impossible -- >> a block chain is whenever you do a transaction, this is what records it. >> a professor at stanford has looked into this very carefully. interestingly, about 50 years of this kind of thought of deflationary currency would cause people not to spend it as quickly is possibly inaccurate in the context of digital currency. i believe that is from the reduction in friction and the payments themselves. what we've witnessed is that the transaction volume and the speed at which the money is moving in the bitcoin economy is at parity with the u.s. dollar. if this holds true, the research will most likely be incredibly informative as more currency innovation comes forward. >> you know, i think the other thing here is we need stability in the value. right now there's been some estimates that 80% of the transactions are actually more speculative in nature. and i think this has to get to a
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period where we don't have 10% swings in the value a day or even more over the period of a week, that people are going to trust it as a store of value. and to get from there to something that is less speculative and much more for currency and commerce is going to be a messy process to get there. but that's the bet that you would make if we were to see it to be a store value in the future. >> bitcoin can be used as an investment or currency. what we're witnessing right now, if you believe that payment network is valuable because it allows you to transact anywhere in the world instantly basically for free, in order to ride those rails you have to have possession of the currency, the bit coins themselves. so you basically need to buy some of those credits in order to play in the game and it's a little bit like -- imagine if we were having this conversation in 1970 and a bunch of people were sitting around the room and saying, man, i have this idea. we're going to revolutionize the postal system. we're going to let people send messages to and fro each other instantly for free. people said it's crazy, but we
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did it, and everybody uses email every day and they don't understand how it works under the covers. but it lets us correspond with our families and lets us send messages for free. that's the concept of the bitcoin. imagine in 1970 if you had the opportunity to invest in the credit system that lets you use email every single day. that's kind of what's at take with bitcoin. that's why there's a lot of speculation in it right now. it's totally a young experiment right now. i wouldn't advise anyone throw their life savings in it, but go study it. to be ignorant would be like putting your hand in the sands of the financial future. >> there are plenty of counterarguments that turned out to be stupid. but we'll move on. can i ask a question? it's hard to see with the lights. how many of you have actually used bitcoins to buy something? just raise a hand.
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>> for me, my credit card works really well. my credit card works fine. i don't notice it as a consumer. what is going to push me to deal with the hassle of bitcoin? >> i think you're bringing up a great question. the target example, there's protections. no one lost any money. except for some of the financial institutions that issued it. so it's great. bitcoin is irrevocable, the money is gone. that's great for certain transactions. you know, what you look for is around use cases. why is it good for you? and personally, i used it when
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i needed to move money to rent -- to rent a vacation house and i needed to transfer the money to sterling, it's great because there's less friction and it's cheaper. >> tell me what you did again. >> just to rent a house. so renting a house, they needed the money. i moved it to the real estate agent who was in the u.k.. >> who accepted bitcoin? >> yeah. >> there's a phrase i like, which is the best time to plant a tree is 20 years ago and the second best time is today. i think you just need to recognize that there's a lot more at stake here than revolutionizing shopping in new york city. when you think about the 2.5 billion people on planet earth that don't have access to a financial system that's completely ignored them, then today there's an opportunity for them with, a smartphone, to put a bank in their pocket, a bank that lets them interface and interact with each other and around the world instantly for free, basically. that's a really powerful thing, if you think about it. let's put aside the shopping portion of this as well, because there's a lot more that we can revolutionize around the world
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with this type of technology. and people have been ignored in a lot of ways. so that's something else to consider. >> so one of the concerns voiced early on was that most of the people wanted to be anonymous, because they thought they were doing something illegal. and in fact, they shut down silk road, a big online drug site. do we have any information about that, about what fraction was through silk road ? it's hard to tell from the data who's buying what we shut down one big company, but can we tell how many people were buying drugs from silk road? >> i actually don't know the percentage. but it was a very large amount of money. >> so silk road was in a marketplace where people could exchange and buy things from socks to narcotics. it was shut down by the u.s. government.
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but the interesting thing is that it was shut down by the u.s. government and immediately afterwards everyone called for the demise of the bitcoin and journalists said it would never survive and it was only used for bad things. two weeks later it started its fastest run-up in value in its entire history of the it's been called a bubble and it's been called dead before, and that's just, i think, the challenge that we all face in the industry is to continue to communicate the value that it serves and we're still here. we're building and innovating and there's more money moving into bitcoin-related projects. >> what can we tell about what people are using bitcoin for? you can see there are jumps in traffic, say in china, which you assume is people trying to get around currency controls. or they can change it for bitcoins and switch them out and put it into dollars. for those people, that's serving a real need. they're not using it to buy lunch, but it's serving some need.
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how much do we know about what people are using bitcoins for? >> i'll try and talk about it just a little bit. so people with tag addresses in the bitcoin network. it's a way to verify that transactions are going where you'd like. if you're into doing donations for a charity, you can made immediate international transactions happen without having to take fees for a cause, for example. if you are doing payments for vacation homes and things like that, that's a huge case, gaming is a big one for sure. and i think remittances will be a big story later this year. now there is an innovation that can take advantage of that and do cash in. people will start using bitcoin without even really realizing it.
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>> you meet with one of those people who would be coming to the table. i understand you can't name names. what is the feeling there? >> there is a great deal of interest in this. i would say financial institutions are in the mode of studying it right now. just something in passing. i think they are very serious about it. i have talked to some regulators around the world and central --ks that are looking about less from a currency standpoint andmore from the innovation how to design networks. their view right now is this too adopt this. and >> the idea is this is a way for
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anybody to send money to anybody. >> they are looking for a way not just to design the payment system but how do they reach other areas. what is the social good you would have from getting unpainted any market into the banking system. making that more advantageous. as an example. we see paper payments, cash countrieswe have seen .dd to their gdp growth would there be more impact on gdp growth globally. >> in terms of an everyday transaction, like if i were to do this instead of a credit card
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fee, how much cheaper would this be? >> it depends on what the merchant fees are. right now they are quite high for except the record, but there are certain use cases. >> a typical credit card fee is between 1.5-2 percent for the physical world. the institution has to stand in and make the payment. >> if i buy a cup of coffee and >> if i buy a cup of coffee and it is two dollars, they pay four cents. how much cheaper would be with bitcoin? >> the fee is less than 1/10 of a penny. the payment goes to the merchant. they can spend that money right
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away if they choose to. ok cupid, overstock.com, that will be a story that continues all year long. we you will see a lot more online merchants accept bitcoin. they can do it without taking any of those fees. overstock.com has not had a single fraud case related to bitcoin. >> they probably spent years in rooms trying to figure out how to save a few percent. if they're going to hold on to bitcoin, the coin are very volatile in value, much more than the dollar. yes, the transaction costs are lower but they are taking on this other risk. >> that can convert the transaction or they can choose to keep it. what i've witnessed, is the story is different outside of the u.s. than it is internationally.
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i met a woman who is in shanghai who accepted bitcoins and does not accept credit cards because it is too slow. there are lots of examples like this where they are keeping it. it is a different way and they believe in it. >> could the government still shut it down if it turns out that most of the traffic is not -- >> i don't think it would be possible for the u.s. government to shut down -- from a practical or legal perspective? >> i don't think they have the practical ability to do it. so much of it functions outside of the united states. they could criminalize use of it, but they could not stop the network due to its decentralized nature. >> by the way, if you are using bitcoins, here's how you should treat them when you file your taxes.
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you must do that now, right? >> they acknowledge that it exists. >> you are obviously responsible for your taxes wherever you live. i pay my taxes. you have to do it based on property rights. every time i buy a copy -- a couple of coffee, i have to talk to light my capital gains. bitcoin is tricky. sometimes it looks like a new digital commodity and sometimes it operates a lot like a digital currency. just like light it is sometimes a particle and sometimes a wave. but they are at knowledge and the working. i expect more thought as it goes forward.
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>> we want to build a safe home for people to explore that. that is what we are looking for in the industry. >> there is a certain extent to which it is a vote of confidence, simply to issue regulation. they may be good and bad, but they decrease the risk for major financial players when they're thinking about moving in to the space. there is no regulation, they have no idea which way it will go. there's a certain value to that. one of the related developments we have seen over the last year is major financial players have started to move into this. they bring their background at knowledge of people from the banking industry who know about
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customer regulations and anti-money laundering regulation. they bring that knowledge to companies that have incredible coders that think creatively about compliance. if you bring these more sophisticated players in, you will see a lot of development that will rapidly expand the industry. >> how would you feel if the system decided to offer bitcoin banking services? >> i would be thrilled. i think that would mean they have discovered a reason to be innovative again. i think the challenge is on everyone to build better systems. i hope they get involved, because they're been working in finance for 50 years and we don't know everything. >> do you see any interest in anyone doing that? >> no comment.
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they're all looking at this and trying to figure out what to do. it think there are any commitments at this point on what to do with it. there is old technology in cards. that technology does nothing for an online transaction. this is also a solution for the online space. >> when i think about the disruptions over the last 10-15 years in technology and the digitization of things, we used to send mail and now we send e-mail. we are to buy records and now we download songs. to not expect the digitization of money would be a little naïve. >> some small part of the money exists in forms of paper and coins. >> i think one of those questions you asked earlier is that we get to watch this money
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supply grow constantly. sure, there's an argument that maybe that helps control the deflationary cycle, but the money supply grows every single year and we get to spend less of that income. bitcoin can be spent different ways. i don't think that is a big problem. i think people have to vote with their confidence. >> recently, we moderated a bet between two people on bitcoin. one was a columnist for reuters who was betting that bitcoin was going to die and no one would remember it in five years and the other is a venture capitalist who is very bullish. they bet that in five years time, one in 10 people polled would say they bought something with bitcoin. i want to ask all of you which side of that that you would take. do you think that five years from now if we did a poll of
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americans, one in 10 would've bought something knowingly with bitcoin. >> i think your caveat is important, because one in 10 will have spent some form of virtual currency. it might not be bitcoin. it might be bitcoin and they don't know it because they deal with an app with which they buy things online. i think speculating about whether they know how the guts of the transaction is going to work is hard. >> he meant literally like them thinking of it as a currency. >> i think it will. just because of how widely known bitcoin is now. >> yes, within the previous month. >> the other part of that, the common part is really important.
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paypal, which is come up in a serious way to transact, it has about 80 million accounts now in the u.s.. how many people really use it, it is really important and 15% plus of e-commerce transactions. that is only a small part of everyone's life. >> five years? would you take the bet? >> that is a little tight. >> if you look at the speed at which the growth is happening, it is absolutely hockey puck and it is growing faster. hockey stick, sorry. >> thank you very much, this has been fun. [applause] >> thank you, guys.
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i am holding on to my wallet. thank you for coming. next up, we have the founder and kickstarter. i could make a lot of jokes about what we are going to kick start, but i think you have already heard all of them. he is going to be interviewed by andrew sorkin of the new york times. i will give this to him when he completes the interview. these are your cronuts. >> high yancy, how are you? >> i will go quick be have -- because i have a lot of questions.
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i want to try to understand what this whole kickstarter thing is really all about. what was the inflection point? what was the thought that got this to happen? what was the story behind kickstarter? >> kickstarter the website is five years old as of a week from yesterday, thank you. it was launched in april 2009. the original idea was eight years before that i might our dinner. chan -- before that by my partner perry chen. he wanted to propose a concert to people. it was a way to test an idea publicly and allow things to only go forward if there were people who would support them.
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he had that concept and didn't know what to do with it. he was working as a recording engineer and a preschool teacher and a waiter. he moved back to new york in 2005. i was a rock critic at the time and he was a waiter at a restaurant in brooklyn. we met there and became friends. he brought in a friend who is a designer and tried and failed to make this website for four years because we were a waiter and a rock critic and a designer. [laughter] then we finally managed to get a group of technical people to work with us and then in 2009 the site was finally launched. it was a long journey and just a lot of guesses and mistakes, but somehow it managed to come out. >> who is it for, though? there are probably people who get e-mails from friends and others to try to get them to give them money. who is supposed to be using it on one side and what sort of
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base case is there for me to actually hand over the dough? >> at this point, 150,000 people have lunch projects with kickstart her. they have been supported by 6 million people from 218 countries and territories around the world. it is very global. if you went to kickstart her now, you'd see people making movies, starting restaurants, making comic books, pieces of design, putting on plays, canning preserves, anything creative for you or making something to share with other people. we don't have any sort of demographic box that we put people into, it in fact we have zero democratic -- demographic info about the people who use kickstart her. it is a canvas for people who want to create something with the support of other people. >> it is not an investment. oculus just sold itself to facebook for $2 billion. these are goggles are you aware
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in the future. we won't even come here, we will just wear goggles. that started on kickstart her. there are people today who gave money to them who are pissed, right? >> i will respond to that. a lot of really cutting edge stuff that is happening in society is starting on kickstart er. people here are funding the future. you're getting a glimpse of two or three years from now and crazy things that may or may not happen, just like really wild ideas. i saw yesterday a man who's trying to build an underground park in new york city. there are people trying to build a pool but you can swim in the east river. they are saying it will be there in two years. the future is what happens here. oculus rift is a virtual reality that was started by a 21-year-old kid named palmer
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lucky. i couldn't make it up. he basically put up the project saying he created his goggles that brought virtual-reality to a height. you could get an early prototype for 300 bucks. they raised $2 million from kickstarter and it started to take off and became the people's tech, the internet's favorite thing. people will go to videoconferences and lineup for an hour and a half. they would throw up and be blown away. it is totally worth it. it is incredible. so it got bigger and bigger and they raised a bunch of venture capital money. building hardware is expensive and hard. then about two months ago, facebook had bought them for $2 billion. >> so if i give them money, how my supposed to feel about her? >> i gave them money. i gave them $25 because i thought it seemed really cool.
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i thought this is awesome and it should exist. and now it does. i think that for me, i supported because i thought the world do -- would be a lot better if oculus rift was real. i don't want to wear one all the time, but if i want to wear one it would be great. it gets complicated when you have facebook involved and huge sums of money. what i thought when i was watching the debate was nirvana. i used to be a rock critic. music was my primary love. i wondered how it you felt if you bought the first seven inch and then suddenly smells like teen spirit happened and its on mtv. then you think, wait, that's my band. what does that mean? it is a complicated thought. there is this thing of cultural ownership or emotional ownership.
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those feelings have largely gone away. wes anderson makes the most twee movies ever. we have just given up on this. the grand machine of capitalism has won. and yet, you see the same notion come out about a piece of technology, something made in a plant in china. design is where the culture has shifted. i don't know that they would've been successful if they were trying to raise money from investors. they came to kickstarter because he wanted to take an idea to the public. >> does that make kickstarter a form of charity? to some degree, you aren't happy when people try to sell things on the site. people give rewards on the site.
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there are different kinds of ways like credits or passes or stickers. but it really is charity. >> there is a mantra that we say a lot is that kickstarter is not a store. we're trying to set the right expectation for backers. your supporting expectation of something, you are not buying it. you are the reason why it is going to happen and you're going to learn about it and see videos from the factory or in the lab and exotic. you get the relationship with the. it is about expectations. there always is a return. generally a return is a copy of the thing being made. the question of what kickstart it is is very interesting. it is not directly one-to-one. i don't think it is charity
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because there is a return, but there are elements of altruism, absolutely. it has similarities to investment and that the money is upfront and it is going to create something later, however, there is no financial return. i think it ultimately might be a fourth way of transacting. i think this way is distinct and it is ultimately about creating a human relationship and money serving as a mechanism of that. it is about fostering something new, but really doing it out of a desire to shape the world into what we wanted to be. there's a really pure spirit to it that we try to uphold and on her as best as we can. >> so far, we have talked about startups. people who didn't have much and had a vision for something and people got behind that. most of them did not start with
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success. increasingly, you see people like spike lee, zach braff, the people who decided that they wanted to have a tv show or movie and they want to get funding. there's been an argument that the bigger names to some degree have even begun to crowd out the smaller names. what do you make of that? >> in the last year, spike lee, neil young have launched kickstarter. it is strange when i see kickstarter listed on a video. i think it is great that that happens. this is a tool for people to take an idea, share it with the world, invite people to become involved and go through the process of creation according to their rules. you do if you are spike lee and
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have made do the right thing and malcolm x, you still have to answer to somebody. when somebody writes a check, there are demands it and with it. sometimes it doesn't fit with someone wants to do. at that moment we are a great opportunity. if you are zach braff and you have a rabid fan base on the web, go to them and say let's make this movie together. they get to see the movie first, they get to be an extra in the movie, they get all these cool things. can you imagine martin scorsese letting you visit the set for 500 bucks? that is awesome. that is not scorsese begging you for money, that is him giving you the opportunity to be harder some anger you love to do. i think a lot of the cynical perspectives seem to think that audiences are sheep. but i think audiences are smart. these are things they would always have liked to have, but the entertainment industrial
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complex to not allow. it was about moving a singular product. a movie is 120 minutes of a moving image on the screen. i think it is shifting that. we see exactly the opposite. this is bringing tons of new audiences to kickstart her, tons of new creators supporting the project. if the platform grows it is benefiting everyone involved. >> was the most amount of money so far the people have raised a kickstarter? if i'm sitting in the honest right now and i have a brilliant idea, what is the chance that i'm going to succeed? >> it is 100% for all of you fine, beautiful people. to date, it is a billion dollars that have moved to the system. it is about $1.5 million a day that gets pledged on kickstart her. that is a thousand dollars a minute.
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the largest single campaign was something called the pebble which raised $10.2 million. that is a smart watch, the first smart watch out there. on my walk here i said to people wearing them. that has been the largest project in terms of money raised. the very first project raised $35 from three backers. that was called trying for dollars. the guy said i want to draw a picture of something. give me five dollars and i will do it for you. that is still the essence of kickstarter. pebble is just a version of that. the way our system works is that money only changes hands if someone has reached their funding goal. there is a massive vetting of the public of every single project which is really kind of amazing. it is this incredible safety mechanism where the collective intelligence of humanity says this is cool or this is not cool.
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it helps sift out a lot of stuff. 44% of projects reached their goal. over 90% of all the money goes to those 44%. you really make your goal is you get very little. 10% of money goes to projects that don't make their goal. that says that collectively we as the public are sniffing things out. we are up people or ideas that we like and think are worthy of support. i like that. i like that there is a clear difference between what gets done and what doesn't. >> you're seeing a lot more competitors in the market. you became a ceo how many months ago? >> january 1. >> you just spent the afternoon
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with the ceo coach. when you think about the competitive landscape and what this will look like in the future, is athere one platform is kickstarter? or is it going to be a fragmented thing where charities will go to one place? how you feel about crowd sourced investments where people will have equity on the other hand? -- on the other end? >> our goal is to help people create things, help people make stuff. we don't support charitable fundraising. we will not support investment. we are very focused on a single thing which is honestly just where our hearts lie and where we originated and what we still care about in the thing that we pursue with a lot of love. i think there is a pretty good chance that if we were different people running this week could try to be the walmart of crowd funding.
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i don't want to do that. it doesn't seem very interesting to me. it is not what we care about. there will be other things. there will be platforms focusing on investment. that is fine. we are, there were platforms that existed before us. they have all copied us since. the original crowd funding campaign was alexander pope's translation of the iliad from greek to english. he found support from 700 subscribers who gave him money and took in four years translating 16,000 lines of poetry. their names are in the first edition of gilead, this is still the version we have today. we have mass media and large companies subsidize art. there is a long history of this and there's a great future for this. it is still very early on.
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at this point, harmonious and claims to kickstart and all of the platforms combined. i don't think that will always be the case, but i think that this market will continue to grow and interesting things will happen. >> you said that you won't sell the company, you will go public. what does this -- what will this look like in 10 years, mr. ceo? >> well, andrew. we try to take a long view of what we try to do. we want to be a cultural institution. we exist so other people can do things. i'm in service to for people who work with me in kickstart a. this is an idea that we believe in very deeply and i feel like we are trying to shepherd into the world. if the long-term health of this mission is important and we think being owned by giant
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company would not be best for that, is that we imagine very traditional things like profit-sharing to make sure that the value we create get shared with our community. >> we are out of time. what does the ceo coach tell you? [laughter] >> we talk about the challenges of the job. it is a strange job. some of my friends who are ceos talk about the pressures and the crushing weight you feel the fear and terror and the thrill and excitement of responsibility. i couldn't imagine anything better to do with my life than this. >> thank you very much, we appreciate it. [applause] >> how many of you have read an article today? how about in the past week?
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here is a question. but his feet has been evolving. >> one of the reason i started thinking about the history of media a little bit was when i would look for content for buzz feet. we have journalists in the ukraine, we have people doing stuff that none of the tech companies are doing. when you look at time warner or disney or viacom they are these giant companies with multibillion-dollar -- billions in profit that are using cable
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and broadcast, they are very different from what is feet is doing. the companies that i signed that are the most similar are media companies in their first 10 or 20 years and you look back at newspapers and magazines at hollywood studios. they're similar to buzzfeed. >> a lot of people see buzzfeed to read funny list or -- lists or cute pictures of puppies or kittens. >> we started as a site that as a lab. what people cared about was cute kittens, whether friends had for lunch, things like that.
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entertainment content. to the point where people were sharing longform journalism and news and entertainment. and so we hired and smith about three years ago and he started building out a news team we have investigative -- and investigative team. he has been hiring a lot of impressive reporters. they are doing longer-term investigations. we have two reporters in the ukraine. so we have been expending a lot in the last year or two years. >> what percentage of readers are engaged in journalism as opposed to the cute lists and frivolous content?
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>> it depends on the time so on the boston bombings happened there was the most popular content was all hard news content and we had reporters covering the bombings and people in new york who are using their knowledge of twitter and instagram to figure out what was going on in the web. we were the first site to authenticate twitter accounts because we noticed that the avatar predated the pictures that was in the news. we looked at who was following the account and they all went to the same high school. we were able to figure out what was happening and follow-up with reporters making phone calls. during those moments most popular content is news content. during slow news the most popular content is things like 23 animals who are extremely disappointed in you. what city should you actually live in, things like that.
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>> how are people discovering the journalism content? >> as you look at facebook you see hard news next to cute kittens and when you see that mix. we decided why not do that because people like to move between different types of content. it is hard to put things in terms of percentage. back to looking at the history of media. one of the things i found interesting looking at the early history of newspapers was there was limited space. you had to make these decisions because of limited space about how much news and advertising you're going to put.
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how much serious and how much frivolous stuff. the new york times and the herald tribune were in the battle to be the number one paper in new york and to be the number one paper in the country. and there was newspaper rationing, paper rationing. there was limited space. there was less stuff to print on. the herald tribune shrunk the size of the news of the could keep their advertisers happy and made huge profits and the times had limited space to cover news. and so they lost money during the war but when the war was over their circulation was higher in all the advertisers came back to "the new york times." the decision of how much do you use your limited resources for ads or, to use for news really
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meant something. what is different about the internet is would you not have to make that choice. we can say we're going to do all the news we can possibly do because the internet never runs out of space. we will do all of the cute animals and quizzes and lists because we are not going to run out of space and we will do all the branded content and all those things can exist in their track without scarce resources. that has created a really interesting opportunity to build the media company that does not have the normal constraints. >> are there times when there is different focuses come into conflict with one another? >> we have a tremendous food and
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food section and the test kitchen where we are making incredible [inaudible] and it is awesome stuff. many people are discovering it through pinterest. so there is not this conflict. not so much -- media is a -- less about adjacency. and that is why there is nott conflict. there is a lingering legacy of print where people think that if you do one thing image you cannot do something else. that is not true. people who are used to the newspaper dropped on your
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doorstep and you can count the pages that are in sports and foreign news and how much ads, if you take that calculus, buzzfeed is a weird site. there is no constraint on what you can do and there is no adjacency is things are spread on different platforms. the new start understand -- then you start understanding what we are doing. >> how many times do people come across a serious article and doubts the credibility because there is the buzzfeed brand? >> the classic network television, you had edward
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r. murrow during the evening news but you had soap operas in the morning and comedy shows and variety shows treaty had alfred hitchcock on the same network and people are used to having that mix. i think the bundle is something that has always been so important to media. a lot of the journalism wars were between papers fighting over the comics. "the washington post" when it was bought by the family, he said to his deputies, do comics matter, he had to fight to get the comics in the paper and it was a big protected bidding war because fewer people would read the journalism if the comics were not there. the comics to of more readership of the journalism. it is something that our news
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content reaches a much larger audience than it would if we didn't also have under 200 million video views a month and massive amount of viewership on quizzes and lists. >> there has been a lot of new media startups that have been launching recently. why do you think there are so many media startups happening? >> media startups are more of a thing now than they have an in a long time. there have been a lot of tech startups. if you look at the history of media, new technology emerges that is a distribution technology. the technology starts to get dealt out and people start creating content companies that take advantage that did not exist before. a lot of people do not know the story at cnn.
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wtbs was owned by ted turner. you could, ted turner realized i could beam my local station by satellite and then it seemed like he will was an exciting new thing. people thought why would anybody want to watch the local television station. in phoenix or new york or somewhere else but he started licensing television shows and movies and lots of other kinds of entertainment. in started to be a distributor of this kind of entertainment. when he saw the adhesive event there is going to be someone to dominate news on cable and he started cnn.
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it was interesting he started with entertainment and moved into news. at the time, the networks were spending $200 million year to do half an hour of news on the evening news and cnn's plan was just made 20 to $30 million to do news 24 hours a day. everyone thought it was impossible. you could cover things in ways that you could not if you only had a half hour. he had this advantage to -- that make content fit with distribution. it has grown into a jane company. when you look at or with time, this papers were exploding. time said let's aggregate the newspapers.
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people would listen on the radio and they would hear someone's voice. life magazine let people see what people liked. when you look across or even radio. people thought he would go back to cigars because cigars are much better business than radio. no one would stand for ads that interrupted the flow of audio and radio. the key is the reason there are so many media startups is because there is an explosion of distribution technology. whether it is radio or new printing presses or cable
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television there follows close behind an explosion of new kinds of media companies. with smartphones and social media you're seeing the ability to distribute media internationally more quickly than ever before in history. lots of companies have started to form to take advantage of that distribution that did not exist five years ago. when buzzfeed started the iphone did not exist. that has enabled distribution that people do not think was possible. >> is there a point of saturation where there is only so much that media startups can grow in room for only so many con a unlimited distribution acceptability? >> there used to be what people called natural monopolies.
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if you are the biggest newspaper in philadelphia you would have a natural monopoly. you had the big printing press and had the trucks to drive the papers around and who else can start something to compete with you and the argument was on the web we would never see that happen. any blogger can start a site. there is no limitation of space. likewise with radio. there is limitation. if you get a slot on the dial you have an advantage. what you're saying is the competitive advantage is having to come from technology. it is the ability for editors to make content more quickly. pages loading faster and better data to optimize your site.
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the way that you build competitive advantage is in technology. that is why we have a focus on building technology. that is why companies are focused on that. >> what is the future or roll of tape elegy in media? >> you cannot tell a good media company unless you have great technology. >> is that limited to the platform or is it beyond the lab form moving forward in terms of hiring data scientists? >> we build a lot of the tools we use everything that allows us to make a better product because all the pieces fit together. some sites -- everything is
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powered by some other start up and they are stapling them altogether. that is a better approach. i think there will be some startups that end up commodifying the layers. google analytics will be used by people because no one wants to build their own platform from scratch or something like that. it is still up for grabs which layers will end up eating outsourced to other tech companies in which one should -- publishers build themselves. i think there will be several -- when you look at cable or newspapers and you see that there is this cycle where people who build a better platform and
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of attracting better talent and that talent ends up improving the platform and it is a cycle. there will be several companies in this current crop of new companies building media businesses that get that cycle going. and becoming big players and building companies that will last for a long time. if you work at buzzfeed they should be able to reach a larger audience and have better understanding of how people work. so we're focused on building that cycle and other people are also -- also have a similar focus and that will lead to interesting new companies that will keep growing. >> given that there is this rise
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of the new media startups and given that you do not think that there is a saturation point, what advice would you have for someone who is launching a media startup today? >> think it is good to look for new emerging platforms that people laugh at and think are not that important. people laughed at radio and cable when ted turner went to cable. looking for areas where people think this is silly and this will never amount to much is often a good place to go because other people are not there and you can figure out how to build some guys unique for you a new distribution platform. we thought we would the a new site focused on social. we saw social becoming the dominant way of how people consume news and entertainment.
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mobile became better than pc's and that was not something we predicted or expected that we were interested in social almost for intellectual reasons more than anything else. being interested in something when it is small have a deeper understanding and a unique approach before something that [inaudible] >> what are some of the lessons that people should look into, such as lessons learned from old media? >> every big media company was once a startup. if you look at cbs there is not that much you can land because they are a giant and your small and starting out for you if you look at them when they were losing money, that looks like a lot of startups.
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when you look at time magazine that looks like a lot of new media startups that are starting today. people do not realize, i was surprised reading about the early days of hollywood that you would go to a movie theater and you would see a bunch of short films and then you would see in news reel updating you about the war or something and then you would see a 60 minute western. that is what you paid to see. people look at startups in the media space and they are doing these small, silly things. they're not like these big movie studios but if you look at what paramount was doing, they were making short films that are more similar to what we are doing on youtube than they are to the future films they're doing
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today. it is a case where there is something to learn from history. there is lots of differences. there is lots of differences. this new generation of media startups are old media companies 60-100 years ago. there are lots of interesting lessons. >> definitely. do you have a list? what would it look like if you were to give advice or to wrap up the history of old media? i do not know. i am not good at coming up with feed like the pros at buzz . for me, the things that have been most interesting are the early newspapers, early magazines. early hollywood studios and
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early cable television. those are huge industries that went on to be these multimillion dollar industries. i think when you look at the early days, it is shockingly similar to the way small media .tartups are operating now they would be on my list. awesome. all right. looks like we are just about out of time. we have some time for questions from the audience. does anyone have questions for jonah? hereve got a question over . one back there. >> hi, jonah. newhad a report of the media people the new york times and what they need to do different. the advice for the times i guess. did you see some lessons in their for new media companies
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and what did they need to do it for and based on the new york times staff research of where media is heading? depends a lot on what the new media company is. huge and mobile is cannot be ignored. note are companies that are thinking deeply about mobile than they should be. i think that report had a lot in it. there's also the question of how do you focus? there's a lot of really good ideas. you can only focus on a few things. there is the question of what are you going to focus on if you are a particular country? can focusbigger, you on a few things, but you still have got to stay focused. sorting through all of the ideas is sometimes the hardest part. >> other questions?
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so do you see yourself as you evolve as a media company and getting into other things in other mediums like conferences and events that you stage and record for your own purposes? for example, other areas. >> we do some events. we do a thing called buzz feed brews. we interview people like jerry seinfeld and anthony weiner and the ceo of hbo. it is a interesting way to generate media live events. it is pretty interesting. you're saying it like the super bowl and vma's and industry like this one. >> great. other questions?
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>> one more over here. [laughter] quick. be just say it. >> [inaudible] burst about all, i want to tell you how much i respect your all,ess model -- first of i want to tell you how much i respect your biusiness model. you are right. nothing if it wasn't read his named -- i book. he lives in new york. , he recruited all of the people from new york to atlanta. >> yeah.
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it is a great story. i read this book called "cnn: the inside story." a lot of amazing stories. he was a major layer. -- player. >> yeah. >> he was running the news operation. >> we need to wrap up. thank you, jonah. we appreciate it. [applause] [captions copyright national cable satellite corp. 2014] [captioning performed by national captioning institute] >> next is a discussion on radical islam and how the u.s. should respond. >> so i tell the story of how i
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of identity is in one way or another a threat to israel. my gender is male. my religion is muslim. my citizenship is american, but by nationality is iranian. my ethnicity is persian. my culture is middle eastern. offything about me sends all of the warning signals for israel. the experience of an iranian american, single man tried to get through the airport in the 21st-century is a reminder to everyone that despite the way the globalization has brought us closer and has diminished the boundaries that separate us as nations, ethnicities, halter's, despite all of that, all you got to do is spend a few minutes at
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the airport to remember that those divisions, those things that separate us is still very much alive. >> best-selling author and aslan will take your phone calls and tweets live for three hours sunday at noon eastern on book tv "in depth." a holiday weekend full of books and authors. readers.n for serious >> remaining free from regulation, especially from the fcc regulation. it is like refusing the -- of course we want the conversation to be free on regulated. sure thatalways made the communication pathways stay open. of -- they vestiges
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the communication pathway is affordable and nondiscriminatory and therefore everyone to use. >> it is crucial to think about whether those platforms remain open. up.internet has grown anyone can get online. anyone can get access to the network. it is vital that it not change as the internet evolves. >> opinions on the fcc internet policy and the flow and speed of traffic. "the communicators" on c-span 2. >> an egyptian american human rights activist and critic of islam. -- she reallythe spoke to the conservative form
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of silicon valley and its current war on the west. this is an hour and 20 minutes. [applause] >> thank you, jerry. before i introduce our speaker tonight, i want to tell you just a quick story. the other day i was chatting with a friend of mine and we were comparing great inventions of various civilizations. i mentioned the microchip, the personal computer and the internet as pretty decent inventions on our side. he scoffed and said, that's nothing compared with the islamic time machine. i said, islamic time machine? never heard of that one. he said, oh, yeah, it can take any country back 1400 years. [laughter] [applause]
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>> our featured speaker tonight was born and raised a muslim in egypt in the gaza strip. her father was a prominent leader of the egyptian military who organized the fetaine operations which targeted and killed hundreds of israeli civilians until he was killed in 1956. she grew up in an environment that cultivated a keen sense of resentment, grievance, anti-semetism and hatred of israel. she earned a degree at the american university of cairo, immigrated to the united states in 1978, and subsequently converted to christianity. she founded the group, arabs for israel, in 1994. shortly after the 9/11 attacks in 2001, she began writing pieces critical of islamic extremism. she was a co-founder in 2009 of a group called former muslims united. she's written extensively on
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islam including several books, most recently, "the devil we don't know, the dark side of revolutions in the middle east." she covers topics such as human rights and women's rights under islamic law. human rights and women's rights under islamic law. that sounds like a contradiction of terms to me. she lectures on college campuses and internationally and apparently some organizations are fearful of the consequences of her message. just last month, in fact, she had been scheduled as a keynote speaker for i-fest, a week-long pro-israel event at the university of california at irvine. unfortunately, one of the sponsoring organizations feared the appearance would be too divisive and canceled. she had the wit to reject the teachings of islam and courage to speak out eloquently and
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fearlessly about the harm that sharia law can and does inflict on its hosts. she deserves our appreciation and admiration. please help me give a warm and conservative welcome to nonie darwish. >> thank you. [applause] >> thank you. thank you. what an honor. what an honor, a pleasure to be here with you. really, your group here just warms my heart because i didn't know there were any conservatives in silicon valley. [laughter] you are the patriots of today. i learned from you. when i came from egypt and immigrated to this country, i came with baggage. i didn't know what liberty means. i didn't know what human rights meant, women's rights. i didn't know equality.
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all of this never taught to us. peace, the concept of peace, i didn't know any -- people like you, if americans like you who taught me what i am today so that's why i want to thank you. i lived for 30 years of my life in oppressive dictatorships and police states. i saw and experienced and met people who were killed, mutilation, oppression of women, polygamy and how polygamy destroys the family dynamics completely. for a man to be -- have a polygamist marriage, his loyalty is to no one in the end. if you look at the modern marriage contract which is in my
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second book about sharia, cruel and usual punishment, in the modern marriage contract there's a question for the groom, please name an address of wife number one, wife number two and wife number three, if any. so the bride signs the marriage contract knowing that he does not vow loyalty to her. it's totally different concept from marriage in the judeo christian culture where they both vow loyalty to each other equally. that was a revolution brought to us by the judeo christian culture. when i see middle east marriages compared to my jewish friends or christian friends, i find it very different, having lived there and lived here. i often see america -- especially in israel, powerful men and powerful women who
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respect each other. in the middle east, you either find two kinds of women. either the doormat or the extremely aggressive, because when you put so much pressure on women, oppress them a lot, especially under the law, you will either completely get suffocated or you become extremely aggressive and oppressive and that is something i wouldn't want any woman to experience. i want to start also by telling you that i'm not here to criticize people or muslims, the people. the problem is not the people. it's the ideology, and please, when i speak about islam, don't misunderstood me and think i'm trying to insult muslim people. some of the nicest people i know are muslims. so we're not here speaking about human beings.
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germany gave us hitler and the most horrific ideology called nazism but that doesn't mean every german was evil. communism was evil because it oppressing evil but it doesn't mean everyone who lives in soviet union was evil so i don't understand why in america we're not getting it. when we criticize islam, we're criticizing an ideology, not people. there's good and bad in every culture so i hope i made myself clear because i often, when i speak, especially on college campuses and i make this statement, at the end, they come back and they say, but why are you criticizing all muslims? which is not true. and that accusation is happening to silence us, to silence people like me, robert spencer, pamela gellar, all of us, bridgette gabrielle, all of us who are
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really criticizing the ideology. ladies and gentlemen, we are living in very crucial times. we have just succeeded in ending the cold war and now we are starting a new -- we are confronting a new enemy but this enemy we are now -- we don't want to even name by name. this is the first time in american history we are in a war and people have declared war against us, all over the middle east. we are the great satan. israel is the little satan. they have declared war on us in every mosque, in every mosque. friday prayers always end with "may god destroy the jews and the infidels, israel is the enemy of islam, go kill them and jihad, jihad, jihad."
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why isn't this coming here and we comment about it? why are we afraid of commenting about it? didn't we have enough with hitler being afraid of commenting on what happened? it's just a different ideology, that's all, but it's preaching the same evil, if not worse, because with hitler he didn't have a religion to rely on and say it's god's will. this is an ideology that's been in war with humanity for 1400 years and we have to speak about it openly and honestly and i think even muslims, the good and peace loving muslims, should join us, because they also, they need to see the reality, and if possible, to reform their religion, but by appeasing the situation and not wanting to
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mention it and we keep getting hit and terrorized and our men and women are being killed and airplanes are flying into buildings, and 13 years later we can't name them? something's wrong here. this is not america and we have to start speaking out. so this is a war you have to understand that has been imposed on us by the jihadists and it is our duty to call them by name, and no appeasement. we have to call them by -- i'm not saying go bomb muslims. of course not. but we have to identify our enemy, and when we remove any reference in 9/11 memorial in new york, any reference from the
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word "islam" or "jihad," what does that mean? it means terrorism worked on us. terrorism works, ladies and gentlemen. it doesn't only work on individuals. terrorism affects the psyche of whole nations. it makes them elect the wrong people. it makes -- [applause] whole nations can fall into the stockholm syndrome. it's not just one person, a person who was taken hostage like patricia hearst. no. whole nations. this can be a syndrome that happens and i am seeing this in america.
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america is totally divided against itself. half of america wants to know the truth. and half of america is in denial. and they're fighting each other instead of looking at the enemy that wants to destroy us. this is not healthy. and so what have we done since 9/11? we have hired muslim brotherhood sympathizers in our government. we didn't hire muslims who are rebelling against sharia. we are hiring in the white house, in homeland security, and in several of our top government, even mohammad elbiari, he's a senior homeland security official.
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he's a muslim and he tweeted something after egypt had its counter revolution, the muslim brotherhood. he tweeted statements -- this is a man who is a leader in our homeland security, represents america to egypt, in the egyptian mind, he represents america. and this is what he tweeted. so he was supporting the muslim brotherhood against the people who took the muslim brotherhood out and he was against the more secular government -- and i'm not saying military rule is good but they are the only ones who can stand up to the tyrants. the only people in an islamic state that can stand up to the khamenei style regime or saudi style regime, only one regime that can stand up to them and
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it's the military and this man was criticizing the people who took out the muslim brotherhood and he was critical of the christian minority in egypt that's being slaughtered in egypt today. the message to egypt was, america is against our freedom. their people are supporting the muslim brotherhood. that's the message. it has never happened in history. america was always on the side of people who are for freedom, and in the last few years, we have been siding with the wrong people. and this is -- a very delicate situation. by the way, i'm not try to just
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criticize obama. mistakes happen. [laughter] but what happened is obama has taken it to a totally new level, totally new level. we have been trying to appease the terrorists in even previous organizations. we have fought on the side of kosovo against the serbs. on the side of muslims against the serbs. we have fought iraq against -- i mean, on behalf of kuwait, to liberate them from iraq. we are killing our children to defend muslims. what has that gained us? and republican administration are doing it just like democratic. we should not go kill our
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children to defend muslims! it is about 54 islamic countries in the world. they are totally capable of defending themselves. [applause] you know, we are -- we don't know the consequences of when we interfere and help muslims, first of all, it doesn't work. they don't appreciate us. when we went to saudi arabia to defend saudi arabia from saddam, because saddam took kuwait and he was moving into saudi arabia and he lit up all the oil, the oil fields, he set them on fire. it took us, america, a year and a half to put it out. it was causing an environmental problem, ok.
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do you know that when we were in saudi arabia, our military was considered by the saudis as as infidel filth that is infidel filth that is desecrating our land? they invite them to defend them, but they regard them as filth. they bombed the building with a lot of our servicemen who died. so really you have to understand that we are going to be infidels in their eyes whether we do something good or bad. we are, in their eyes, infidels. as long as islam is radical, they will always look at non-muslims as infidels. just look at how they treat the jews and the christians in the middle east.
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just look at them and understand, do you know that the christians in egypt are trying to appease the muslims by any means because they're a minority, by any means, and nothing works. they are kidnapping girls and force marrying them. they are burning their churches, they are killing the women. it's unbelievable. nothing works so i hope america gets the lesson. don't appease! it's not going to work! you can only defeat radical islam. so, america has suffered trauma after 9/11 and no one is discussing it. no one is looking after the average american citizen who loves his country and i'm very sad over that. we expect too much from the
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american citizens. it's us who always have to put up with the rest of the world. it's us who always have to be blamed but third world countries, you know, they are so poor and oppressed. you have no clue that tyranny can come from any nation. you can be the poorest nation on earth and be tyrannical so being a third world country does not make you immune to become that tyrant. there was a sheikh recently in egypt who stated the following, "we are commanded by god to terrorize and it's in our quran." if you check the word terrorize in the koran, you find it all over. mohammad himself, he stated, "i have been victorious through terror."
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so you wonder why they're doing terrorism. it's in the koran. their ideology, their books are telling them that. that's why i'm not criticizing the people. i'm criticizing the books, the sharia law, because it's creating martyrs and this is what we have to deal with. this is what we have to deal with. if anybody comes to tell you, oh, you're a racist because you criticizing islam, say, no, no, no, i'm not a racist, i'm not criticizing people, i'm criticizing the ideology. you have to be very firm and self confident that you are criticizing the ideology. there are white muslims, there are black muslims, there are everything in between so it has nothing to do with race. don't be intimidated by the words, you are racist. they call me racist, i'm racist against my race. they don't know how to deal with
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me, they eventually just call me a name. you're a racist. what does race have to do with what i'm saying? i want equality for everybody. i came to america, when i first -- my first job, i was -- as a new immigrant, i was reading everything. whenever i went to work, i read every note written on the wall, every map i see, i check, you know, as a new immigrant and i saw a sign at my work on the wall. nobody ever -- i notice nobody looks at it, and it says the following. "this institution does not discriminate in hiring on the basis of race, general origin, gender or race or anything." and i read it and re-read it and re-read it. to me, it was like, oh, my god,

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