this week, is the a miracle food or just a hipster flavor of the month. either way the makers of soylent stand to make some green. plus the guy who made some of the best on tech. venture capitalist gordon ridder on the future of the cloud and the cloudy future of going republican. with reporters sarah lacey of ando daily and farhad manju from "the new york times" this week on "press: here." good morning, everyone i'm scott mcgrew. for all the problems science and technology are trying to solve, perhaps none is as important as feeding the world. over the past couple weeks a team of biologists and hackers started shipping a space age powder to customers called

soylent. i'll get to the name in just a minute. but for now the most important thing to know is this relatively cheap, it gives you all the nutrition and calories you need. in other words, man or woman can live on soylent alone forever. david is one of the people who made soylent a reality. he studied evolutionary biology at harvard before getting his ph.d. in highology from cal tech. he's joined by farhad manju 6 "the new york times" and the return of sarah lacey from pando daily. so glad to have you back. let me start with what this is. this is a powder, actually has a pouch of this underneath my desk here. let me -- it's a powder, in case i get hungry, i mix with an oil and what is it that this is delivering to me? >> so, that's 100% of your daily nutrition in terms of calories, in terms of carbohydrates, fats, proteins, vitamins. >> this is my day. this is what i would eat during the day. >> yep, you mix that with our

fat oil bottle and you mix it with water and that's all you need for a day. >> and what does it taste like? >> tastes deliciously neutral. >> you understand that's an oxymoron. >> i've heard chunky pancake batter. would that be a fair assessment? >> some people have compared it to that. something like a cake batter. we purposely made it a very neutral flavor because people like to add in their own flavors. you can imagine if we gave it a very strong flavor people would get tired of that very quickly if they're consuming it on a regular basis. >> in the introduction scott mentioned feeding the world. but who is this for? is this for people in western countries, for us, or people -- >> is it for coders who are really, or the poor guy? >> we want it to be for all of that's people. right now it's primarily people who are chained to their desks, who want more efficiency. >> hopefully not literally. >> you know what? funny you bring that up, the week said food substitutes are

not a boone for the future, they are the glut of tyranny. we've never had any tyrannical features on. you're tyrants -- >> they always say at bloomberg they wheel around carts of this elaborate food so you can't possibly leave and like yours is just deliciousry neutral but the same effect for everyone. >> and we realized chained to a desk was a metaphor. it was a metaphor, right? >> okay. >> but right isn't that funny, though, that there were some reactions that were like, i think out of science fiction, this is kind of the slop that we're going to serve the underworld sort of the underclass. >> sure. >> that's not what you intended at all. >> the goal is not to replace all food. the goal is to replace the sort of staple meals, meals of convenience that might not be as healthy as you'd like. something like fast food, or junk food. going out socially with your friends.

cooking. these are things that, you know, we want people to enjoy. not -- not you know, do away with entirely. >> i totally -- i'm on board with that. i love food and i love cooking but there are several meals in the day where i spend a lot of time thinking about what i'm going to eat and it's just a big process trying to figure out what to eat. if i had a thing that could sort of just fill me up, and i wouldn't have to think about it, i think i would do that. >> so i used to always do a three, four-day juice cleanse once a month. i got so much more out of my day because exactly that i wasn't having to think about food and it was just delivered and i had all this free time. but like how is this really different than that? there's a lot more variety, a lot more mix of nutrients. you know, i mean, to me if i was doing that every day, like i'll still grab a green juice when i'm busy, but if i was drinking something deliciously neutral three times a day every day, that would get old really quickly. how are you better than a juice cleanse? >> sure. i think there's a number of

things to say there. first, you know, a juice cleanse is not nutritionally complete. it's very high in sugar. it's not meant to actually be sustainable. you can't live the rest of your life on a juice cleanse. you can't live for even, you know, a couple weeks, really, with -- and experience optimum nutrition. this is designed to have actually all of the nutrients according to the fda, the institute of medicine that you need to enjoy a healthy life. >> so, this bag has -- and explain this to me because i'm not a biologist, has everything, all of the nutrients that i need, even though there's not much to it? i mean i would have thought that there's sheer mass i need to bring into my body. or is it all just purely vitamins and things and calories? >> yeah. i mean, the -- there are vitamins in this, certainly. the calories are -- >> but i could live on the bag, i could live on soylent forever? >> sure. >> how long have you gone just, just drinkings? >> i personally have gone about the span of a work week.

>> yeah. >> and i've enjoyed a perfect -- >> didn't lose weight, gain weight, because that's not the point of this? >> no, it's not a diet. it's a staple food. it's regulated as a food by the fda. it's not a supplement. >> and did you have to -- what kind of regulation do you have to go through to make that claim that it's a complete nutrient system? >> so all the ingredients are generally recognized as safe by the fda. we're regulated similarly to a premade salad. because, all of the ingredients are approved in that manner and -- >> a really shocking report from someone who spent time in your factory and said it was, you know, pretty disgusting condition, to put it bluntly. what is your response to that? have you cleaned things up? >> sure. so, the reference there is tilely when we were doing our sort of beta product. where that was a facility in oakland that we don't produce in, never produced in en masse. that was something that was a very temporary space that we were using -- >> you were producing it for

yourself. >> for ourselves and just close friends and family. our ingredients and our product is produced rfi food ingredients and they have an outstanding safety record for the last 20 years. >> when we talk about ingredients, what is in soylent, and i know by the way, the joke, that -- explain -- >> people. >> right, actually, i have that quip. we'd like to see the movie clip? i had to buy it on amazon. kevin, show us the movie clip. >> listen to me, hatcher, you got to tell them. soylent green is people! >> charlton heston in 1970-something. okay, so they're not people in here. what is in here. what is it -- what is this? >> so, the bulk of the ingredients are oat flour, canola oil, brown rice protein, and vitamins and minerals. >> is it similar to the, you know, the kind of slurry that people were talking about the peanut butter that they're taking to the third world? is it the same sort of idea? >> are you referring to plumpy

nut? >> yes, that's what it was. >> i think it's similar in the idea that it's meant to be a good source of nutrition. but we're not a peanut based product. >> sure, sure. could it be used, could this have a u.s.aid bag on it and that sort of thing or is it not quite economically there where you could have that kind of -- >> sure, so it's definitely an aspiration of ours to have our product be in the field in that manner. but right now the economies of scale aren't there for us. >> how much is it? >> right now it's about $3.50 a meal. a little less than $10 a day, you know, total. >> mm-hmm. >> all right. well david from soylent, we wish you -- >> why did you name it that? was it something that -- >> well, go ahead, sarah. >> sorry. i thought you were going to ask this and you didn't! >> yes, we did ditch the name. sarah did point out why soylent if it's not made of people. >> it's taken from the book "make room make room." >> which the film was based on.

>> in the book it's not made of people and it's a product that allows a solution for this overcrowding. >> you're hoping everyone's read. >> what is it made out of in make room make room? >> soy and lentils. >> yeah, charleston heston, soylent is made out of soy andlentils. >> thank you for being with us. >> up next on "press: here" the venture capitalist who made a bet on sales force and spoiler alert it turns out pretty well when "press: here" continues.

welcome back to "press: here." does gordon ridder ring a bell? if he doesn't it's probably because he lets other people ring the bell. that's ridder in the corner rt handsome blond fellow is one of the bay area's most successful ipos. viva starts the first day of trading on the new york stock exchange, and that was not his first win. gordon ridder was one of the very first investors in sales force a company with a $32 billion market cap. in fact ridder and mark bennyoff founded a company together before sales force called software is a service. he's a partner with emergence capital ventures. the reason i think it's fascinating that you named the company software as a service is that's what the whole category is now called which is like opening up a thing and calling it restaurant. >> or internet. >> right, or airport.

and then has this idea we'll have airplanes, we'll call it airport. you were crazy early to this space. >> things kind of work out for the best. meeting mark bennyoff in that point of his career as he was transitioning from oracle to this new world, it's around who you meet and who you get to understand what the future is going to look like. >> had to be more than you happened to run into him once. i wish i had, too but you saw something. what did you see at that time that made you say, oh. >> you know, our industry, venture capital industry you have to look out about five years plus for anything to actually show up and if you're betting on anything that looks kind of makes sense today, it's never going to pay off. and so, when mark came in and said you know what we're going to do? this thing called software is a service and we're making $50,000 a month in recurring revenue and we're going to unseat part of oracle that's craziness. yet something about how he, you know, how the world, said this

is a guy i want to back and that's what our job is, is to back leaders. >> i think what's so interesting about emergence is you guys were bullish in the first way of soft our as a service. early days, sales force of net suite and a bunch of others that basically went nowhere. a lot of these guys got into this category and felt like this description revenue, you don't have to make as much, lo and behold you have to sell the software and it was time consuming and expensive so people fled the category. you guys not only stayed in it but that was what your firm did. i mean you didn't pivot to use the overword silicon valley word and it took awhile for there to be sales force. >> it did and you know, like i'm a three-time founding ceo as well. and what our companies have to actually focus on particularly strategies. we don't get to kind of pivot quickly and kind of move to another area, when we bet on this area we said it's going to happen and we're going to live or die by our firm will live or

die by how well the service goes. it took ten years to get to where we are now. >> do you think now it's the future of all software or is it more nuanced than that? we're seeing a bunch of companies that are having trouble in this area, especially with the sales teams that you need to do this and the different kinds of accounting that people have to get adjusted to. what do you think about how widespread this phenomenon is? >> it is the air we breathe now. we like to say that. this is the way software is now done, and the key we're focusing on is in the beginning, we just focused on anything that was called software service. >> hence the first company. >> it is all the nuances about how do you get to market efficiently. things like premium business models, how do we really take advantage of those and companies like yammer that we sold to microsoft for $1.2 billion is a great example of a company that used -- you used to go to market

sites. there used to be ten other go to market strategies in software and our job is to find those. >> it's -- we talk about what yore doing software is a service the claude all of these things. as that becomes just well duh, of course that's the way we do it, how do you then, you know, retreat down to a smaller section, you're going to stay ahead of everybody. you saw software is a service, now you've got to see the subsection of software is a service, and where things are going to grow. what is that subsection? as we all do this. >> right. so, in that category the air we breathe a number of different trends, kind of subtrends. those trends are the size of the original software service. >> right. >> they're just enormous because it's the way businesses buy technology, and run their business. so a couple of those trends, one is called industry cloud. so this is the first wave of the cloud, was dealing with horizontal solutions like hr and finance those are all done. those have been done and the public market companies have been well established. 9 next is called industry cloud

which is going to be cloud companies that focus exclusively on certain industries. focuses on the pharmaceutical us is dry, there's health care companies that are doing sort of the linked in for the health care industry for doctors in particular. and companies in like o-power in the utility space companies like guide wire in insurance so each one of these big monstrous segments is going to have a vertically integrated company like viva that has multiple product lines that solve the needs of that industry. >> and have those filled in yet? >> no. >> so where is the next one? >> the next one of those will -- i mentioned the three public companies. but there are only three and there's going to be even others -- >> you mentioned power, you mentioned -- what's the other one? the one where you say, hey, that's where they could benefit from a viva-like service. >> i mean there are education is a big one. the education market right now is going through such a transformation in the industry

in the market given what's happening to you know educational testing strategies and so forth. so education is being disrupted, and a number of young companies are coming up the stack there. we have a couple in the portfolio, but you can look at the places that are changing the way education is delivered top hat changing the way retention is managed with students in higher ed number of different strategies. >> i've got to ask you about the ipo market at some point scott's going to yell at me again for going over time. viva was a rocket, and rockets kind of run out of steam a little bit as a lot of enterprise ipos collapse stocks and other companies very anticipated ipo and people are saying they pulled back on that ipo and had some challenges. you know, sales force in its time was a company that was criticized for not having good enough margins and went in and out of favor of wall street. so with what we're seeing in the enterprise collapse are do you have companies that need to get

out because of the sales and marketing pressures that are really rethinking it and really worried about it? >> so, first of all, to the collapse. to me this is no question a correction. the question is, what's going to happen, this has been a correction, there's been yeah cross the board, anything that was trading at higher margins is now coming down, so, when that returns, when that correction settles down, you're going to see more, you know, careful decisions about what companies are going to do well. those companies are going to be ones that are less capital intensive, no question, than they were in the past. many of our companies, whether they're private or public, can adjust to these markets. i won't comment on names, because some of them are in registration but we can adjust by just lowering that feverish growth rate and saving cash, as needed. so, these companies have a plan "b" in every case -- >> there's no loud cloud that needs to go out -- >> no, these are companies that have huge recurring revenues, and don't have high churn rates,

if you have high churn rates that can go away, but they have large occurring revenues and a very solid base. >> so it's just a matter of just like adjusting their kind of aggressiveness? >> what it is is the you know these companies are doing what the market says they should do and when capital is virtually free, you do what you should be doing by growing as fast as you can and spending as much money as possible. ironically with viva we didn't spend as much money as we could because it was it's such an efficient business going after a known target that they didn't need sales people to be running all over -- >> -- one round -- >> $3 million of capital to grow to a a you know a large large public company. >> you've been you were tremendously successful with viva. what weren't you successful at or what did you say i've -- >> one classic one that's there the category of course and so i'm not making myself look as bad as i probably should but coming to the logistics and

transportation space just since 2007 you remember the little thing happened in 2008 we had shipped out in the bay, that completely took the air out of a company that was selling into those markets, and there was no inventory to manage so this was trying to manage inventory and transportation no inventory to manage and no trucks were moving so we decided to make a sale that did not move as profitable. >> somehow i think you'll be able to afford it. >> i'll find my way. >> okay if we go to brake? >> yes. >> okay >> gordon ridder, thank you for being with us here this morning. >> thank you. >> "press: here" will be back in just a minute.

welcome back to "press: here." you may have noticed earlier that sarah and i were fussing about each other about when it was time to go to break. we are not only very close friends. sarah helped invent this television sew. and was on the very early pilot

and was on the very first one. you've since gone on to to found pando daily a tech blog. there was afr series of articles you did about indy go go and one of the projects on there that just did not seem like it could be real and yet people poured a lot of money into it. >> a modern-day snake oil campaign at the best. at the worst it was outright fraud. >> it was a bracelet that promised -- >> what it said is, this would be the holy grail, every scientist told us it's actually possible we would have seen papers proving this along the way and it would not be raising money on indy go go it would be massive what it said is you put a bracelet on and it would automatically know by everything you eat just how many calories you -- you ingested without manually entering anything. >> right. which would be great. >> and people were just so captivated by it they funded it up to a million dollars. we got this interesting thing where before the campaign was closed we did all this research

of different academic -- >> talking to scientists. >> we found basic lies on their profile page. they were based in russia. they said they had patents pending, they were very vague about what the patents were. took us awhile to chase that down. they said they raised money but their page only linked to indy go go. and the science made no sense. one of our scientists told us it was basically out of ghost busters there was no way this works. yet indy go go dug in their heels and worse they originally had on their site that they guaranteed there would be no fraud on there. >> yes. >> kick-starters doesn't -- >> it's a big promise. >> when we pointed that out they quietly went in and pulled that rather than pull the million dollar campaign. >> what is the end of that story? they paid it out. they paid out a million dollars. and to make things worse indy go go so dug in their heels on this one they couldn't admit they were wrong and their fraud

algorithm didn't work not only did they pay it out but one of their top engineers made the last contribution that put it over a million and the guy came from russia and took a picture posing with the ceo and it was like, i swear if i can impart one skill in my children it would be apologize when you do something wrong. >> very quickly. >> but the beauty of this, somebody is going to be wrong. you're going to be horribly, horribly wrong or -- >> no we're not. >> well i know. >> but somebody has to come up with a bracelet that does this. >> they said -- >> june it's shipping. >> i guarantee it is not. and i said to indy go go one of our first calls look you and i both know how this ends. this bracelet is not shipping in june. we know that. >> yes. >> so why are you okay with this? and they said well it's crowd sourcing not everything ships. wait a minute, there's a difference between the vagaries a and challenges of hard ware and fraud. >> this is going to revisit in june. i know you write of all kinds of

things but you shut down a hoodie company. a sweatshirt company. you so liked a hoodie and this is a power that this man has by the way. >> it's a great hoodie. >> somebody wrote about you i actually wrote it down. farhad manju occupies the tallest perch in mainstream journalism. you see that quote? >> i did. >> did you show it to your mom? >> you should be very proud. you wrote about a hoodie you liked so much the company is now desperate to get back on track to make these hoodies because they're four months behind -- >> they're far behind. >> that's an improvement. >> right. >> when you first wrote about it. >> i mean the reason i wrote about them is because they were doing this thing a couple years ago, they were selling directly to consumers. american giant is the name of the company, and because they were selling directly to consumers, not using stores, they were saving a whole bunch you know in distribution costs. and thereby producing a better hoodie. you know, pouring it into the product, rather than you know, spending it like the way the gap does on the stores.

and the problem was they couldn't produce at scale. but they say you know, they've been telling me they've been ieving it out over the past -- >> you did an interview with four of the foremen or the president who said that literally on the assembly line and on the production they didn't essentially didn't know what was going on. they're getting 50 orders a minute. >> right. i mean i think that it changed this sort of the scale of the company. >> what did they learn from it? because i of course read your article as i do all of your articles and immediately went to go try to get my husband a hoodie for christmas and i was so annoyed with how they handled it. they didn't get back to me. they didn't have a good way -- >> they were too busy. >> an auto e-mail is not that hard. >> -- person company and they were completely overwhelmed. i think what they did was they lot a lot more money and got more employees and you know over time i think it got better. but they've been telling me they've been trying to get off dbs kept up to the point where there would be no back orders but i don't think they're there yet but they have produced more product like expanded in to different lines.

so i think they're better. >> have they sent the a gold plated hoodie or anything? they must -- >> but i have the same hoodie that i had before i wrote the article. i still have it and it's great. big fan. >> you know you write about and and and you write about jay -- >> -- >> because you wrote about it. >> glad you like it. >> the power of farhad. >> you have amazing pants on, too, they're like electric blue. >> we have 30 seconds. >> blue pants it's from this internet company called frank and oak. >> frank and oak, ladies and gentlemen. the company is going to say what happened to our server. >> we just broke them. >> farhad likes frank and oak. always glad when you can come on the show. yeah you know somebody said stick your leg out of the side. blue pants there it is. sorry frank and oak. "press: here" will be back in just a minute.

that's our show for this week. my thanks to my guests.

i'm scott mcgrew thank you for making us part of your sunday morning.

hello and welcome to "comunidad del valle" i'm damian trujillo. today the new san jose police community liaison is in our studio plus a new film about a bay area climbing victim. this is "comunidad del valle." >> nbc bay area presents "comunidad del valle." with damian trujillo. >> we begin today with the man who's been making waves all across the bay area, aron, the president of the story road business association. welcome to the show. >> thank you. >> you have been twrafling up and down north america mexico and canada. to promote companies or whoever establishing kind of business association. tell us what we've been doing.