Vimeo to become a publicly traded company. We will hear about the content strategy and a new hiring feature. First, our top story. More worries for wework. Pressure is mounting to oust ceo adam newman ceo adam neumann after the delayed ipo. The board was supposed to meet today but they are likely going to meet later this week. Huet covers startups and she joins me. Why the shakeup . Ellen insane week in the last week or two. Pressure first to delay the ipo and now it seems like there are reports to consider replacing the ceo, adam neumann. A lot of back and forth within the board. Maybe delay the ipo october and later. We seem to be watching as it unfolds. Possible Board Meeting this week , not expected today but likely very soon. Taylor who wants adam neumann out . Ellen that is most likely softbank. They hold two board seats. It seems like they also have support from benchmark. One board seat has been an early investor. Some viewers they remember was also instrumental in the ousting uber. Vis kalanick from remains, atess least softbank and benchmark are adam neumannetting out as ceo. Taylor support seems to be wavering a little bit. Ellen it has been an aboutface. Softbank has been a staunch supporter. They have been the only investor since 2016, pouring tons of money into this country into this company. Their chairman has shown a lot of support. Support for adam. They have been portrayed in the media as kindred spirits. It seemed like they had been aligned on the incentives, the purposes and goals of the company, and now it seems like the support is shifting. Taylor we thought we would get that Board Meeting today, on monday, we didnt. Anything on what we can expect this week . Toen we have been trying report the latest developments. We will be looking for this meeting. I dont anticipate it will be decided in one day. This is a huge change for the company. A ceo who has been a cofounder since the very beginning. Ideas, vision, personality. Similar to uber, very hard to separate the culture from the personality of the ceo. Changing anything about the position will be a huge shakeup at the company. Taylor the saga continues. Hunk you to bloombergs alan bloombergs ellen huet. Abby, how concerned are you now . What does this board shift into you . Hit on a lot of the high points. The concern for investors will go back to the governance side as well as the business fundamentals. When you have a ceo in play like this, you have to question which are being driven the most by that. It tells us that the governance house is very much not in order. Gene, give me your thoughts on a potential board shakeup it is that enough to squash some of the investor concerns . Gene far from it. I think this will take a year or so. Ellenk the set up piece, really captured it when she talked about the infusion of adams views with the company. I dont think he will survive as ceo. I think he will be some kind of executive chairman. An organization like this in high growth mode to align with more scrupulous public investors is a most difficult agenda. Ultimately, i think this will take a lot of time. I think there will be some changes in terms of late stage private investing because of the result of this. About adamt is it neumann . Is it the spending more than the income, his quirkiness, his management style . What is it investors are so concerned about . Gene he is perceived as being reckless. When you look at the evil lucian of a company when you look at the evolution of a company, there is a period when recklessness is seen to change the world. There are several factors we have talked about that play into it. The list is long. Ultimately, i think it creates some anxiety around investors about what is going to happen. It really is an openended question when you hear stories about the party type of culture. That recklessness does not sit well with public investors. Theor abby, explain for us role of the board. We know Corporate Governance 101 is to hold the ceo accountable. Is the Board Holding the ceo accountable . Abby i think it goes beyond that. The first rule of governance is the business judgment rule. The Board Members have to act in the interest of the overall corporation. They have a duty of loyalty and a duty of care. When they look at the role of the ceo, they have to ask themselves, is the ceo the right person to lead the organization . A lot of problems coming up, related to what gene just said, why are we facing this issue now . Is this not something that was known to this board and this team and private investors . We didaylor taylor know about it in the case of facebook. Why now, why the focus on adam newman and we work when zuckerberg got away with it . The private markets have pushed and pushed and we got that breaking point. The outrage really sort of drew the line. People can talk about the Public Market environment, other public role models, but i think he got pushed one step too far. Sorry. Elon gene, i was thinking about elon musk. Talk about these ideas of Tech Companies where you have Mark Zuckerberg it was ok, though shareholders are ok with Mark Zuckerberg running the company. Why is there this concern over adam neumann at wework . . Is it because the company is not profitable . Gene the exception to the rule, i think Mark Zuckerberg is one. The line is drawn generally around what i refer to as recklessness in the past. Drug usage, which is common in the tech community. I think there is a level, awareness of that that gets public investors more concerned. Ashink a culture that is not respected as they should be, that is a concern, too. I know it is easy to say negative things in an environment like this. I think the simple take away, if you look at somebody like Mark Zuckerberg, even though he had a break things type of mentality, i think those two former pieces, he was measured and respected. I think that is why the differences. In the brief time we have, i want to quickly taylor mentioned, i think there will be some changes. I think this concept of super Voting Rights will probably go away over time. Now not onlypany having power around politics, media, the economy, this is a perfect example of why 20 to one Voting Rights isnt appropriate. Taylor abby, you are nodding your head. Abby i think gene is spot on. I think we will see a lot of changes in the private market. It may be has not surprised people that the litany of ceos you are talking about are sort of the bad boys of silicon valley. Bad boys need good parents. This is where the board has to step in. Taylor gene, let me get comments about the basic fundamentals. 15does a 10 billion to billion valuation feel to you, a good value . Gene i think that is the right range. Growth whichenue we talked about, probably closer to 10. I think some of the language has been changed. The probably favors kind of low end of that. The challenge, when you think about the valuation, there is probably no good comp. Ins is a tech company quotes, but a Real Estate Company in practice. I think it feels closer to that range, 1015. Do an ipo they dont this year, how does their Balance Sheet look . It starts togene get stressed at sometime next year. That is why i think adam starts to move toward a chairman role. The Balance Sheet needs work and will need some help. Close to 1 billion. 700 million seems to be the number that would get them to a more appropriate ipo. If you look at a chart here that i am showing our bloomberg audience, it is that the bondholders have held in pretty well. I believe i was reading that there might be a clause that if there is a management change, bondholders would have to get cents on the 101 dollar. Gene news to me. That could impact some of the forces at play. 101 ,tely, if it is just i think that doesnt change kind of how i feel ultimately that change at the top is needed here and we will get that. Taylor it is a roundtable monday. Loup ventures cofounder gene inster, and Abby Alderman san francisco. Coming up, we will discuss the focus of facebooks antitrust probe by the ftc, next. Taylor federal prosecutors are conducting a probe of ecigarette maker juul according to a report by dow jones, citing people familiar with the matter. The investigation is being led by the u. S. Attorneys office of the Northern District of california. The fda and several state attorneys general are investigating juul. The Trump Administration said earlier this month that it planned to ban most flavored ecigarettes. A Company Spokesman has denied it markets to tenens. Social Media Company snap is reportedly talking to regulators about the way facebook allegedly tries to thwart competition. It is reported that the snap legal team had been keeping a dossier nicknamed project of old amort on facebook tactics project voldemort on facebook tactics. For more, i will bring in michael, research analyst, who joins me from new york. What is your take on this report . Reaction is that they are probably one of a laundry list of companies that the ftc is probably currently reaching out to to have a better understanding of if they are apt if they are acting as a monopolist. Had a negative impact with regards to emulating what they had done with stories. There is probably a little bit of an ax to grind, a baseline. We have been hearing it from we have been hearing it from large advertisers as well that the ftc has been reaching out. Taylor you cover facebook as well as snap. I wonder how much of this is normal cost of doing business and how much is facebook really overstepping the bounds . Michael it is hard to say. I have some Firm Opinions looking at the big names that are at this point under the scrutiny of the government i think, and a lot of cases, when i look through what facebook has done, definitely what they are doing with cambridge analytical was a little bit aggressive last year. I think they are a tough competitor. I think they have definitely emulated competitors in the past, they have done so with snap. I think the tactics about going ahead and trying to publish influencers gets a little close to the line but i dont know if aat in itself makes facebook monopolist. Taylor depending on how these discussions go, what is the real threat that facebook would be broken up . Is something you have to respect. I think you are seeing that in facebook, google, and amazon stock. Investors dont know quite how to handicap it. If i were to roll things forward by a few years. Lets say, for example, instagram was broken off of facebook, i think you would ultimately have Value Creation because i would suspect the instagram assets growing at a much faster rate than facebook. Facebook would probably be showing much better margin at the core. He would have necessity to reduplicate some of the targeting infrastructure and sales but ultimately i dont think it would be a game changer in terms of just being company ending. Would it disruptive . Certainly. Taylor what we have heard is the market actively pricing in, lets quality conglomerate discount lets call it a conglomerate discount to facebook . Michael one of the examples i would point to out of earnings that i thought was probably the biggest surprise, amazon, google, facebook, currently being investigated, is basically google where you had numbers go up by 11 , the stock went up 9 after earnings and is basically down a couple of percent since then. What you are seeing, reaction to earnings, reflecting some degree of a government overhang. A discount, then what investors think it should be worth, it is hard to say. It is a bit of an art form when it comes to multiples but i have talked to frustrated google and facebook bulls who have loftier expectations about where the multiples could go in the short term. Taylor is the only way to get ahead of this from a tech Company Perspective to self regulate . Michael i think it is a little bit harder for the government to come through with nuances for what you are able to do with regards to advertising. There have been attempts over the years. I think the nuances get pretty granular and it is challenging. We have certainly been a little bit more negative with regards to google. We think things like the play itunes, apples case, to come in and say, 15 feels like a more appropriate cost of doing business. That is my suspicion. Taylor what Tech Companies do you like that dont have that regulatory overhang . Michael we are huge fans of snap, huge fans of twitter, both of which i think are going ahead, executing fabulously. Twitter, lets take that for the first example, is a name i am hearing more and more from investors. They want to own into the invest into the election year. They have a sizable presence in japan so they should benefit from the olympics. Meeting earlier today with snap, i think their execution is phenomenal. A massivereally been turnaround at the senior ranks. User growth is rebounding. We think trends are looking strong. Taylor thank you. That was Michael Levine of pivotal research. Coming up, life on the roadshow. Highlights to potential investors. What to expect ahead of the ipo, next. This is bloomberg. Taylor google bracing for another landmark privacy decision from the eu comedy right to be forgotten law that passed five years ago. The law forces the Tech Companies to delete personal information upon requests. The court is questioning whether the law should be applied globally. A decision could be reached as soon as tuesday. Still with google. Investigators will again listen to audio snippets of people speaking to a digital assistant if users give the company permission. Google paused all human review in july. Under the policy, google will tell users that they could be listened to if they opt in. Hopetives at peloton hotels will propel investor demand. John foley helps highlight the bike and treadmill at a luxury hotel in new york. He said subscribers will to continue the peloton while traveling. In june, they had bikes and 700 hotels. Trading sales debut thursday. Coming up, apple is making a supply chain shift amid the u. S. China trade fight. Where they are building, when, and why, next. Roku shares in vocus. We dig into the companys fundamentals. This is bloomberg. Devices are like doorways that could allow hackers into your home. And like all doors, theyre safer when locked. Thats why you need xfinity xfi. With the xfi gateway, devices connected to your homes wifi are protected. Which helps keep people outside from accessing your passwords, credit cards and cameras. And people inside from accidentally visiting sites that arent secure. And if someone trys well let you know. Xfi advanced security. If its connected, its protected. Call, click, or visit a store today. This is Bloomberg Technology. Im taylor riggs. Now for the latest on trade and tariffs. Apple says the next version of its macro desktop will be assembled in texas after the Company Received tariff waivers. The company on friday was rented exclusion from the Trump Administration on several parts, including processors, power components and the computer casing. It will include components made by more than 12 u. S. Companies. For more, im joined by mark gurman in los angeles. Is this part of a broader trade deal . Mark thank you for having me. I dont think so. It is very possible they can use this they will be manufacturing this computer which they have been doing for for six years in texas, to maybe influence the Trump Administration to go easy on them on december 15 when the iphone, ipad and other important products are due to be hit with tariffs. Taylor you brought up december 15. We know the mac pro was made in the u. S. Why cant they make all of those other products that are facing future tariffs to to avoid those tariffs too . Mark to be clear on the mac pro, it is not complete lee made in the u. S. Primarily, the casing and other important components are made in china. Then, they are exporting them to the u. S. For what is known as final assembly. Whereas in china, the iphone is primarily made there, all the components and the phones actual production. Why cant they make the iphone and ipad here . They are more complex than the mac pro. The mac pro is basically a mismatch mishmash of components that are easier to assemble rather than something as small as a mobile device. Taylor do you have any sense of tim cooks conversations with the president . How did this come about . Mark apple has been lobbying the Trump Administration for relief on tariffs for over a year. They started by lobbying against publicly the apple watch last year, they got a brief waiver on that. They save some money there. Trump has notably been meeting with tim cook. There have been dinners, white house meetings, oval office meetings. A famous photo of tim cook along with President Trump and john bolton at the time in the oval office. Clearly, he has been working behind the scenes to make sure apples business is s8 best possible from the impact these tariffs will have on Many American companies. Taylor i have to note that the mac pro being mostly, as you mentioned, assembled in the u. S. A win for apple, consumers. You wonder if this also feels like a win for trump too. 12 u. S. Companies will be participating in this, made in texas. How important is it that 12 of those companies are u. S. Companies . Mark this is all p. R. , right . This is not a big change in their strategy. The previous model was manufactured in the u. S. Even the Trump Administration will very likely flocaunt this. Trump talk about apple building big, beautiful plants in the u. S. Whether or not that is actually true. And making a point that he has apple on his side. Calling tim cook one of his good friends. From a strategic standpoint, i am not sure much has changed for apple. From trump, it is a pr win. Taylor another day, another apple product, another tariff. That was mark gurman. Hase the strea