Billionaire Trying to Keep the Public Off the Beach

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May 14 (Bloomberg) -- University of California Hastings College of Law's John Leshy discusses billionaire Vinod Khosla being taken to court for closing Martin's Beach in San Matteo County, CA. Leshy speaks with Emily Chang on Bloomberg Television's "Bloomberg West." (Source: Bloomberg)

You are watching bloomberg "ewest." alibaba's first cloud data center opened this week in hong kong marking the move towards international expansion for the chinese company and comes just after they filed for the u.s. public offering.

One of the companies first investors was a d.c. firm focused on the u.s. and china that took an early bet back in 2002. jeff richards joins me now.

What was it back in 2002 you saw with ali baba?

-- alibaba?

Jack had a relationship with one of our founders and you have to go back to the moment in time.

A very big vision for what he wanted to create over a 30 year time frame and if you read the perspective, they have a 100 year vision for the country.

It has not all been smooth sailing.

He took some public, and now going out again.

The you think those bumps in the road are behind them?

Every company goes through challenges.

They did go public.

Now what you have is the group going public.

It did have a $10 billion market cap.

Now the group is going public.

Like every entrepreneur, bumps in the road make you stronger.

The filing does not break down how each of the businesses are doing.

Overall sales and net income are strong but we do not know how each individual is doing, which could lead us to believe growth could be slowing down at one or the other.

What do you know?

They do not break it down.

A lot of companies do not break it down.

There are five or 6 million merchants.

Very large, very successful platform.

The world's largest e-commerce market is in china.

It is an e-commerce market that is growing.

Global payments are growing.

I think when investors get excited about the ipo, looking at some of the parts and not as a concerned about underlying division betting on the demand.

And overall opportunity in china and the rest of the world.

How much are they concerned with going global?

I think every company wants to be a global company.

They certainly have the resources to do it.

China is the world's largest e-commerce market so their primary focus is in china.

Recently there have been investments in the u.s. in different parts of the world.

Certainly part of the long-term plan just like it is for other chinese companies like i do.

They have been making a number of strategic acquisitions around the world in the united states.

How likely are they to succeed in the u.s. market in particular?

The u.s. companies have not succeeded in breaking into china.

Lex we have: vested with them for a number of opportunities.

We think they are taking the right approach.

A high percentage of success given the brand and strength of the team.

Amazon, google, these are some of the iconic leaders of the tech community.

They know how to execute on a global basis.

You just raised your sixth fund, six hundred $20 million.

How would you describe the fundraising environment right now?

We have been talking about whether there is bubble and a lot of capital seems to be flooding into the private tech market.

I think what you see is a number of funds raise capital.

The interest is high.

I know the fundraising process we have a lot of demand in a relatively short process.

I think that is a reflection of returns.

The returns have been exceptional.

A lot of firms returning more capital to investors.

I think the other thing is looking out over the next 3-5 years and see massive disruption in cloud, wearable, enterprise technology.

We are investing over the next three-five years.

Somewhat pegged to the current market conditions.

Investors in capital have a long-term investment.

I think you see a lot of opportunity for the long-term view.

Do you think we are in a bubble?

It is hard for me to call it a bubble when we have had the five-year sustained run of exceptional performance by companies.

I think if you look at first-quarter performance for the companies that have pulled back momentum name and consumer internet, 90% of them beat the revenue and earnings target.

The companies are performing.

Not like there is underlying cracks in the foundation.

I think a lot of that happened with hedge funds in particular pulling back the division area what about a company like square?

There have been reports they might be running out of time.

Lex if you look at the opportunity of square going after mobile payments, ebay gets wordy billion on annual mobile payment volume.

So square is going after a gigantic market opportunity.

One of the best entrepreneurs on the planet.

So i would say we remain very bullish on square's opportunity and would not believe everything you read.

Zendesk about to go public.

Another company in your portfolio.

What are the prospects?

They are defining the category around customer care with an exceptional team that has grown of business at a very high growth rate.

I cannot comment specifically on the ipo process.

I would say we believe companies can go public in good and bad market.

The market is a little volatile right now.

Other companies notably struggling with that process.

We are excited for whatever path they go down.

We are expecting a big announcement from calchao mis aspect of the global player.

I think they're much more than just a smartphone player.

If it was a u.s. company, we would be reading about it every day in the media.

One of the greatest success stories in the past five years of tech.

Fastest company to grow from zero to $1 billion in 18 months.

Valued in the tens of billions today.

Incredibly innovative company building terrific hardware and software.

It is a brand that people in china loved.

It is an iconic brand.

It is a software company a lot google.

A lot more to this company that i think people in the u.s. will become more aware of in the next few years.

Jeff richards, thank you for joining me.

We will have complete coverage of the news event in beijing tomorrow.

We will show you the latest products tomorrow.

Right here on bloomberg "west." the air b&b for retailers.

We talked with san francisco company helping digital's sellers bring their business to brick-and-mortar stores next.

? turning back now to wiring the world series.

This week looking at how we are changing the future of retail.

Allowing sellers to gain popularity and customers.

A san francisco company is helping them make the jump into brick-and-mortar.

Storefront connects brick-and-mortar with retail space for rent.

Storefront ceo joins me now in the studio.

Thank you for joining us.

It is called the air bbnb for retailers.

How does that work?

We work with those on the street fair to a neighborhood boutique.

And we will rent that's pasted to the lead through the platform and setup the store and a matter of days.

Tell me who is using it.

I know one of your customers includes kanye west.

Yes.

He has worked with our store.

Maybe do not have the brand name.

How are you getting inventory?

There are a lot of space is vacant or looking to increase foot traffic.

They are excited about listing the store for storefront.

You are not canvassing the city for empty space.

These people come to you?

Exactly.

Half have been referred through current users.

I want to talk about the importance of physical store space.

, and is it really?

How much does that drive up sales?

Is it significant.

94% of all commerce is still through brick-and-mortar.

It is a huge channel.

And we want to make it more accessible to those that are making something in the house or garage and not sure unarmed -- the next step.

In can do wholesale which it did this division channel.

Brick-and-mortar really allows me to control the message.

Any numbers on how much it actually adds?

Brand multiple of 1-7 multiple.

What about the prospects of bigger retail will be one of your customers like target or nordstrom?

We are working with a few larger retailers that want the local makers on site.

Exactly.

You have seen this with a few companies likeetsy wholesale-- like etsy wholesale.

Or if i am a kick starter, i will raise a bunch of money.

Let's connect them with customers and create a compelling experience.

A lot of matchmaking going on today.

Are you looking at partnerships with etsy?

We work with a lot of sellers with them and ebay.

We are agnostic to where they are selling online.

We want people with really compelling products.

Airbnb has had people trashing apartments, tax issues and legal problems.

How do you handle that kind of thing?

We have not had a problem yet thankfully.

Today we are working with his missive on both sides of the platform.

Not necessarily a consumer getting into business they are not aware of.

As mrs.

Looking to grow their business.

We protect them on the back end with an insurance product.

-- businesses looking to grow their businesses.

We have a five million dollar insurance policy for every rental that protects both of the platforms.

Thank you for joining us.

Is a billionaire venture capitalists trying to keep you off this beach?

One environmental group a lead so.

Who it claims next.

Watch a streaming on your tablet, phone, bloomberg.com apple tv and amazon tv.

? welcome back to bloomberg "west." i'm emily chang.

Take two interactive reported earnings because of the block ester hit grand theft auto that gave a big boost to company sales with more than 33 million copies sold.

Grand theft auto five the most successful release in videogame history.

The take two chairman explains why that kind of success is a good thing.

The success is continuing to feed more success.

Not just grand theft auto five that continues to sell but ran theft auto online.

That is a first for us.

It is true not just for grand theft auto but a number of the other franchises.

He also said the company is working to add more franchise hits like grand theft auto.

"vanity fair" calls and him an eco-warrior for donating to causes.

He is now being sued by environmentalists who claimed he illegally shut off the only road to a popular beach just outside san francisco.

California law prohibits accessing -- blocking public access to beaches.

University of california hastings law professor john but she joins me in the studio.

This is a beach called martin's beach, a very popular beach with surfers.

What is your take for what is going on here?

It is pretty complicated and there are two different lawsuits going on.

The outcome is a little hard to predict.

These are questions that might involve robbery law and a relatively new regulation of the coast and the coastal commission act.

Almost certainly will go up on appeal.

A tough issue.

Like the most common thing he said in his testimony this week, i do not specifically recall.

What kind of answer is that?

A little unusual that he does not recall details like that.

What we have is a classic battle between property rights and access to a treasured rate soars on the california coast in the culture of the california coast.

What he does or does not remember is not that central.

As i understand it, the law says you cannot develop the california coast without permission.

He claims he is just put a gate up.

Does that count as development?

That is the question being litigated right now.

His predecessor allow public access to the beach and has decided to close it.

The question is, is that closure development?

The california supreme court has never addressed a question specifically like this but has said the idea of development should be broadly construed and the idea of the coastal act was promote protection and access to the coastline.

I would say he has an uphill battle.

Did the prior owner allow it out of the goodness of their heart or because they had to?

I think he would probably get different answers depending on who you ask.

The prior owner did allow purely open access to the beach.

Even if he loses here and has to get a permit, the question will be, can the commission deny him the right to close or can it make open access?

He has not done anything with it with the exception of the state.

We do not know what his current plans are.

Does it matter?

If he wants to do anything in terms of development like building a new house or anything, he would need a coastal permit round the commission.

The commission might be able to demand him to provide access as a condition for getting the permit.

Lex how you see this playing out?

-- how do you see this playing out?

A very desirable property from a public access point and from a privacy rights aspect.

Those rights are in collision.

The california coast commission is set up in part to provide and improve public access and for all citizens of california.

We have wonderful resources in california and happily, a lot of the really scenic and desirable property in california is publicly owned him a which is a great thing for the quality of life in this state and that means a lot to a lot of people.

A similar thing happened in malibu.

I believe he lost.

What is the precedent out there?

To some extent, each of these situations is controlled by its own local the cure where facts.

If he does nothing else but simply deny access, then he has better argument than it he comes to the commission and says i want to do this and that and give me a permit to do that.

This depends to some extent on the facts.

What if he does that later but not now?

Than the access issue will probably come back.

People feel very strongly about the private property and people who use the beach feel fairly strongly about being able to have access to the beach.

This particular case i'm if there is no other access to the speech other than across this property.

One said it may go all the way to the supreme court.

Is that possible?

Sure.

It is a fairly common thing.

These are very strongly felt issues on both sides.

The chances of ultimately going to the high court is a very good one.

A case we will continue to follow.

John leshy, thank you for joining us.

Time now for the bwest byte where we focus on one number that tell the whole lot.

John ehrlichman with us from l.a. i am a simple guy and bring you a simple vite.

-- bite.

30, today is mark zuckerberg's 30th birthday.

He has moved out of the 20's. we will see if he can be an innovative 30 plus-year-old.

Obviously we have been so fascinated with the story of facebook and it is an important highlight.

I am feeling really old right now.

He has accomplished a lot more than any of us in his short three decades.

Thank you.

Thank you all for watching this edition of bloomberg "west." you can get all the headlines at the top of the hour.

?

This text has been automatically generated. It may not be 100% accurate.

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