Secrecy on Twitter's Side: Bloomberg West (09/13)

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Sept. 13 (Bloomberg) -- Full episode of "Bloomberg West." Guests include Charles River Ventures' Bill Tai, Greylock Partners' John Lilly, GoPro Founder Nicholas Woodman and reality TV pioneer John Langley. (Source: Bloomberg)

Live from pier 3 in san francisco, welcome to the late addition of "bloomberg west." we cover the global technology and media companies that are reshaping our world.

I am emily chang.

Let's get straight to the rundown.

Twitter has secrecy on its side thanks to new rules under the jobs act.

The regulatory filing is all -- and all correspondence remain confidential.

Will this help twitter avoid the pitfalls of facebook?

A company that backs company like facebook has raised a new billion-dollar fund to find its next success rate.

Go pro cameras are well known in the world of action sports.

It turns out they are also big business.

We talk about the markets for extreme cameras with the ceo and founder.

First, to the lead.

Can a secret ipo filing help twitter avoid some of the problems that plagued facebook and zynga in their public debuts?

Twitter filed secretly for an ipo taking advantage of new rules under the jobs act.

That allows certain companies to file confidentially with the sec.

That means that for now, the company's books are closed.

We do know that goldman sachs has been tapped as a lead underwriter.

The filing came earlier than expected.

Our editor-at-large cory johnson joins us live run outside twitter headquarters with more.

What is the latest?

There is no latest.

We don't know what is going on behind the scenes.

They put out a tweet yesterday and bouncing -- announcing that they are filing for an ipo.

Indeed, it was announcing -- the company is starting to have the back and forth with the sec to prepare for an ipo.

We learned today that this began a few weeks ago.

Yesterday, they told her employees and the rest of the world the process was underway.

At some point in time, we are going to see what the communication was.

Their filings will be made public.

At that point, they will have to wait at least 21 days for the ipo.

Then, we will get to see how this business of twitter really works.

Obviously, employees are legally prohibited from saying anything to the public about what is going on inside.

You are outside had orders.

Have you gotten any reaction?

The interpretation by the sec is that almost any kind of comment to the promotional.

Companies are restricted on what they can say about the ipo process.

That protects investors from crooked companies selling junk.

At a company, you want to keep moving on.

There is a classic moment for companies before they go public when they keep their heads down, nose to the grindstone.

The pr bill came out this morning at 10:30 for coffee.

That was nice of them.

Saying nothing about what was going on.

We are lucky to have bill join us.

You were one of the earliest investors in twitter.

My partner george zachary should have all the credit of that.

That 250,000 dollars get you what, one percent?

At the time, it bought around one percent of the company.

I know you don't want to talk about it, but you have been around a number of companies is a venture investor.

Also, you are a wall street analyst.

What happens at a company?

At twitter, people are watching a broadcast right now.

I was at a company that went public in 1999. it was a very disparate dividend.

What is it like inside a company -- disruptive event.

What is it like inside a company that is going public?

Wax lots of anticipation.

People get focused on what might happen.

You go public when you can because there are market openings.

You go public when you can.

You hope that you are ready.

When you're out there, your employees will watch that stock.

One of the worst distractions during nida -- what are the worst distractions during an ipo process?

The process is pretty isolated from employees.

Underwriters handle that for them.

The management is often a way.

What about that nose to the grindstone discussion that people -- my experience is that people work a lot harder into the process of going public.

They focus on the company and feel special.

Once the company is listed, they are working hard.

Back east, there is a belief that people in silicon valley go shopping for a maserati after filing for an ipo.

Absolutely not.

Their identities are tied to their companies.

They want to see it do well.

Let's talk about the jobs act.

Is there a time in which it is wrong for a company to go public?

You go public when you can but you hope that you are ready.

The best situation is when you have very clear earnings disabilities -- visibility and you know you're going to hit that quarter.

Is in that leading an analyst by the nose?

You are an analyst.

Is that just about communication or is it about a business that is not volatile?

Both of those.

An important part of it is asked -- setting expectations right.

If you don't have that perfect match, you have to do a great job hitting the numbers and making sure the expectations are set low.

What is it that you think this company has been able to achieve in terms of solving problems technologically?

I think more than a technical solution, twitter is just a part of everyday life, a social phenomena that is important to people's everyday lives.

In terms of other investments -- there are certain companies that recently created a world of companies around it.

Do you see twitter having that thing kind of effect?

Social communications in general has been a trend for the last couple of years.

It is going to continue.

I think with the movement in the cloud and mobile being a big part of technology, it is a lot easier to develop things that have a good user interface.

Years passed, 10 years ago, 15 years ago, to build a company like this, you had to build your own data centers.

You couldn't just plug into amazon and get something up and running.

These guys have done some of that.

Really interesting startups growing like a weed.

Do you look for these things?

Absolutely.

That is the other change in venture these days.

In years past, a lot of it was around technology.

Technology wasn't right in your face.

Now you can test the products and see if you like them.

If they are applicable, and you find a good use base for them, you might find them.

Do you think that is all of technology?

Is happening in enterprise too.

The cost of putting together a startup has gone way down because of the cloud and because mobile has dropped the cost of distribution.

It is a lot easier for small teams to build a product and get a company going.

Interesting stuff.

Thank you very much.

Thank you.

Why is twitter going public now?

Why not wait?

That is next on "bloomberg west." ? i am emily chang.

This is bloomberg wesbanco -- bloomberg west bank." -- bloomberg west.

Jon erlichman has been looking into the business behind twitter.

Judging by the performance of the stock this year, timing may be on twitter's side.

Funny, a few months ago, you would have looked at the performance of facebook and said, that could create a challenging road for twitter.

Thanks to nice earning reports, facebook has been a darling in the stock market.

Yahoo, google, pandora, even zynga is up almost 30%. as we talked to sources over the last few months, market conditions were part of the reason of whether they would move ahead.

The business itself and the gains they have made are just as important.

If you think about some of the product they have rolled out, the obvious one that people know is the promoted tweets.

Advertisers will pay rates depending on how you engage with it.

Also, things like licensing data streams and amplify is one that they recently rolled out.

They work with media partners, more media getting into twitter, more video for example.

There is an opportunity for an advertiser to introduce video.

All of a sudden, you have a nice growth story to share with the market.

Of course, you potentially have the luxury of having stock that helps you get more talent in, make more acquisitions, stuff we have seen twitter ramping up with over the past few months.

Linkedin wasn't on your list but that is up more than 450% over the last couple of years.

Twitter is a smaller business in some respects, smaller than facebook or google.

Talk to us about the size of twitter in comparison to some of these other juggernauts.

The number that gets faded so much is the idea that twitter could be on the road towards $1 billion in revenue.

I thought i would look at what wall street analysts estimate facebook and google will make.

Facebook's revenue is projected to be 10 times what twitter could potentially make next year.

Google, more than 50 times.

That is a reminder that google has proven value to advertisers in being a place where you search come you show intent on what you might buy.

That is valuable to advertisers.

Facebook is a platform , but it knows about you, your friends, your likes, your dislikes.

That is incredibly valuable to advertisers.

Twitter is still figuring out that part of the story.

It is where everybody wants to be.

It is the hotspot, lots of conversations.

That is exciting to advertisers.

Whether it can be the place where you can ultimately get to something like a sale of a product through advertising, that is still in the early days.

Jon erlichman, senior west coast correspondent, thank you.

We are waiting for more information in the next weeks about how big twitter is exactly.

What does it take to make a successful public tech company?

Greylock has seen social networking site's from the startup stage to the public offering.

It has backed pandora and they have just raised $1 billion for their 14th venture capital fund.

Welcome back, john.

Good to have you here on the show.

You have invested in some of the biggest winners of the last eight.

Linkedin, facebook doing a lot better in the public markets.

How do you do that again?

We look for great entrepreneurs.

We try to help them as much as we can to build a big business.

It is finding great people and doing the work.

Andreessen horowitz says they like founder ceos.

Do you feel the same way?

It is not the only model.

The founder ceo has worked with facebook spectacularly.

It has worked with others as well.

We don't mind bringing in great ceos.

It can work both ways.

We are not dogmatic about either way.

Your focus more on the consumer side.

There has been talk that on the consumer side, the innovation isn't happening as much as it used to.

It is all about the enterprise.

Are you finding enough entrepreneurs that you want to invest large sums of money in?

People saying there is no innovation happening are crazy.

There is more happening now than there ever has been.

In the way you communicate, the way you talk.

Linkedin, the way we do work that was transformed by linkedin.

The way you communicate has been transformed by facebook and what are and others.

-- twitter and others.

People are looking for rocket cars and jet packs and hyperlinks.

Innovation doesn't all look like that.

And your experience, what do you make of the timing for twitter?

What do you make of the fact that the process is secret?

I think that the timing is so idiosyncratic for every company.

The leadership must have felt they could have predictable results over a long.

Of time -- the word of time.

Every company is different -- [d period of time.

Every company is different.

Greylock passed on twitter.

David said it was a big mistake.

Why did greylock passed?

David is hard on himself.

He is doing just fine.

A lot of important things look like toys when they start.

What they saw before anyone else did was that mobile phones would change the way we communicate.

They saw it way before anyone else did.

A lot of people past including greylock but it is a very important company now.

I know you are on twitter.

What do you think of twitter?

Can it go mainstream?

It is not as big as facebook and some people think it is still more of a niche product.

I think it has changed the way we find out about things.

It has changed news completely.

I use twitter all the time.

I think it is a mainstream product.

It has already changed many things around the world.

Do you think it is a threat to facebook?

No, it is different.

I go on twitter to talk about things in public.

I go to facebook when i went to talk to my friends and share things.

One last question about dropbox.

You spent a lot of time with the company.

These nsa issues, the relationship between the government and tech companies has been in focus.

Dropbox comes up as a company that the government is probably interested in talking to and getting data from.

How does the company like dropbox manage these kinds of things in the future?

For dropbox, security is huge.

If people don't trust dropbox, they won't use it.

That will destroy the business.

Take those comments at face value.

Helping educate people about how to secure things, how to use things online and what expectations do have, that is the key.

John lilly, partner at greylock, thanks for joining us today.

As mobile powerhouse twitter prepares for an ipo, what could this mean for facebook's growing mobile advertising business?

We look at the design team adding pizzazz to the mobile app.

? as twitter ceo du ick costolo readies his company for a ipo, mason tweeted.

You may remember ripon face public scrutiny of its accounting practices in the months leading up to its ipo.

Facebook ceo mark zuckerberg spoke about his own ipo experience at the tech crunch conference in san francisco.

I was afraid of going public.

I have been very outspoken about staying private for as long as possible.

I don't think it is that necessary to do that.

You have to stay focused on doing the right stuff and sometimes it might take the market a while to catch up and see the results.

Facebook and groupon experienced relatively rocky ipos, something that twitter hopes to avoid.

Speaking of facebook, while it made 41% of its ad revenue from mobile last quarter, zuckerberg said he has not always been pleased with the mobile product.

How has facebook spruced up its mobile app to grant eyes?

We visited the facebook campus to meet the team that designed it.

Ever wonder how those ads in your facebook feed get there?

It starts with this team.

Our focus is on creating the world's best set of tools for businesses and advertisers to do their work on facebook.

Josh williams is a facebook product designer.

He has helped simplify the way advertisers build their ads.

That is important because the easier it is to advertise on facebook, the more ads the social network and sell.

Here is the format, put in that image or that video or that piece of copy that is going to get across that message to your customer and help you connect with them in a meaningful way.

Facebook help to build this team.

In this case, facebook but design firm hot studio for an undisclosed sum last year.

About 50 designers joined the social network.

When you think of designers response abilities, that is when design becomes a worthy industry.

Hot studio had worked with hundreds of companies around the world including tech giants like google, ebay and yahoo.

It had worked with facebook as an outside consultant making it an ideal acquisition target.

This company loves bold ideas.

Acquiring a group of talent like hot studio was a bold idea because it is a large agency.

It isn't easy.

We have a lot of interesting challenges in front of us to build not only new tools for advertisers but also to take a look at the ones we currently have and make them better.

The designers are squarely focused on helping brands better use facebook to use -- to reach their customers through better designed ads that are simpler to make.

We will be right back.

? you're watching "bloomberg west." with focus on technology and the future of business.

Apple cheaper iphone 5-c is available for pre-order today.

He pre-orders are not allowed for the new more expensive iphone 5-s. both were revealed at an event at apple headquarters this week.

Both will go on sale in retail stores next friday.

The top u.s. mobile carriers are counting their plans for selling the 5- c, some offering it without a down payment.

T-mobile customers can get the 50- c 40 down payment.

-- for zer o down payment.

Verizon is offering it for $23 a month.

Lands to raise as much as $2 billion in an ipo with government funds that will maintain control after the ipo.

The company was set up last year when sony toshiba and hitachi spun off businesses.

Each own about a 10% stake in the company.

Whether you are skydiving out of a plane or snowboarding down a mountain, some are calling it the camera that just want to die.

It is not just the go pro camera that is indestructible.

The company is too.

At least for now.

Christina warren is us three reasons why the go pro is in a league of its own.

The go pro is not a flip.

One, connectivity.

Unlike the flip which is killed by the smartphone, the group pro -- go pro is better when you use a smartphone with it.

There are apps that let you control it, monitor video, stop and start recording.

You can upload the video immediately to youtube, facebook letter, instagram, whatever service you want.

Price.

The go pro is an extensive.

It starts at $199 and tops out at $399. it is hard to find anything else i can do what it does.

You can use it in water, strapped to a helmet and go skydiving.

You can use it to go up a mountain in the frigid cold or in high heat.

If you are trying to capture footage in those environments, you have to use a really expensive camera.

At a low price point, it is a great value.

Competition.

One of the biggest trends happening but smartphones right now is waterproofing.

Companies like samsung and sony are releasing cameras with waterproof coatings so that you can use them in up to three meters of water or in the rain.

They are not designed to be used in extreme situations where the go pro is most useful.

The go pro is not that unique.

What makes it special is that it has a lot of features from other devices and uses it in a way that put it in a class of its own.

Despite its adventure sport beginnings, go pro cameras are also popular for everyone from tourist to professional filmmakers.

Big players like sony and polaroid have taken notice, launching their own competing product.

Cory johnson tracked down go cofounder and ceo nicholas woodman and asked how the company got its start.

It was 2002, i was out of a job am looking for inspiration for my next is this idea.

I planned a surf trip to find inspiration.

I came up with he idea for go pro before i even left on the trip.

It was a wrist camera that i could shoot photos and video while we were surfing.

What was the thing that made this blowup?

I see it everywhere.

Go pro is the first company in photography, videography to enable people to self document themselves doing anything.

Traditional cameras are designed for people that want to shoot a or video of somebody else.

Go pro is designed for you to be able to shoot yourself.

Traditionally, people are interested in other people.

Maybe this generation wants to see themselves on camera more than others.

Not necessarily generational.

At the same time, i think all humans have an interest in seeing themselves living their lives.

It is surprising that people have so little footage of themselves doing anything.

You have photos of being at an event or before and after in the parking lot, but people rarely before go pro had footage of themselves in the act of living out their lives.

Your marketing strategy is interesting.

It seems like you are focused on adventure sports, outdoor sports.

You mentioned the origins and surfing.

How has that market and focus work for you?

It is usually effective because it is inspirational, aspirational and humans are smart.

When they see other humans doing something and capturing it with the go pro , they can relate it back to themselves.

Like wow, if that camera work that well at capturing that experience and is not easy to use and durable, then i can use it in my life doing x, y or z. at the america's cup, all of the guys in the boat knew how to use the go pro and some of them had them mounted on their helmets.

People in certain worlds, not just video guys, regular guys doing sports know this device.

Go pro is the world standard for capturing photo or video content during an activity.

It is not just consumers and professional athletes.

Go pro is the best-selling camera and the world.

It is also the best-selling camera in the world on a volume basis for professional production companies.

Where does it go from here?

We are having a lot of success, but the majority of the world does not know we exist.

We live in a bit of a bubble.

West coast tour east coast, everybody knows go pro.

We still have a long way to go.

How big is the business?

We did $526 million last year.

Up from 234 million the year before.

Nearly 100% growth.

That is incredible.

We are very grateful for the success.

Why stay private customer?

I bootstrapped the business.

We have a terrific team that has built one of the best companies in the world.

We are profitable and while we are preparing for the company to the public should that opportunity look promising, we are also very happy as a private company.

I think having bootstrapped the company gives us this -- affords us the choice.

That is where we are at right now.

I did a piece recently about a surf movie shot on go pro.

It seems that suddenly 3-d has a purpose.

Do you think that 3-d is dead or dying?

You guys just came out with a 3- d camera.

Is it a gimmick or is there still a future in that business?

I think that you are going to see 3-d technology potentially become more of a standard when all tds have it as a feature.

Tv companies made a mistake from a marketing perspective when they positioned tv's as 3- d, as opposed to the world's greatest tv that can also show your tv and movies in 3-d. it is just one of the features.

I think that when that 3-d technology is in all homes, you may see it become more prevalent and content.

It is very expensive to produce.

It is still a question mark as to whether or not there is enough of a value for consumers.

That was go profound or nicholas woodman with cory johnson.

We go behind-the- scenes of this year's america's cup next on bloomberg west.

? i am emily chang.

This is "bloomberg west" on bloomberg television and radio.

U.s. sales of videogame products and one percent last month to $521 million.

That marks the first gain in almost two years.

The gaming industry has been slumping as users wait for new consoles and is gaining on smartphones and tablet becomes more popular.

Chris edwards joins me here in the studio.

The first time in two years, what is driving this?

A lot of releases are coming out in august.

It shows there is some pent-up demand for some releases.

They didn't do as well as people expected, but the cumulative releases really helped.

One thing that was big this particular month that wasn't there before was disney's infinity game.

Hardware, still down.

Way down.

Most people are now basically waiting.

Anyone who has bought an xbox or playstation probably has bought one.

They are waiting for the new xbox and ps4 in november.

The gaming industry is seeing a lot of tumbled in a last several months.

What sort of productions are you seeing for the holiday season?

Is it as big as it always has been?

Is it going to be smaller?

That is the million dollar question.

If you talk to analysts, you get a different answer from each one.

Right now, it is everybody's guess.

There is going to be an air pocket where it is up to the consumers to decide which games they want.

Between now and november, there is 30 different titles coming out.

Analysts say that five or six of those will account for the majority of revenue.

People are going to pick and choose which games they want.

Let's talk about the bigger players that are seeing some transition.

Ea, they are looking for a new ceo.

Some think that maybe don may have been the top choice.

Why is it taking so long to find one?

That, we don't know.

We heard metric was a top choice and that they have big internal candidates.

You would think that if he went to another job and they would look at one of the other candidates.

Maybe they are still trying to figure out and look elsewhere.

How is he doing at singer?

-- zynga?

Hard to say.

He is getting a lay of the land.

Earlier, last week i spoke with the former coo of zynga.

He is starting his own mobile gaming company.

He is optimistic about the future.

It is a very hit driven business.

How optimistic are you about these kinds of businessez wrote -- businesses relative to bigger players?

Premium games are going to be an interesting market.

It depends on how interesting you make the games.

Everyone is talking about premium and so a lot is being poured into the market.

You have to make a good game for it to sell.

Cliff edwards of bloomberg news, thanks so much.

America's cup races have been going on all week.

The event features high-tech catamarans pushing the boundaries of safety and design.

Covering this year's competition on television has proven to be just as challenging.

I looked at what it takes to reduce this coverage -- produce this coverage and get people to watch.

Has been described to me as watching white canvas on a blue background.

This america's cup coverage is anything but that.

The america's cup is returning to network television in the u.s. for the first time in more than 20 years.

It is the super bowl of sailing.

Unlike the super bowl where networks aggressively compete for the rights to broadcast, the america's cup race organizers had to pay to air the event.

Sailing isn't often broadcast in the united states.

How do you make it understandable that also entertaining?

The viewer has to be able to understand what is going on.

We put an enormous effort -- that was the evolution, we had to find a way that the viewer could look at it and understand who was ahead, who was behind.

We wanted to humanize it.

Onboard cameras and onboard audio were designed to humanize the field of play.

They couldn't have done it without the creator of the graphics.

The major thing that is new is the use of augmented reality or graphics inserted into the real world.

You can look at the real video, see the real votes -- boats, the wind and water, and graphics inserted into that.

You see the boundaries of the course, the lines that indicate who is ahead, delay lines.

He not only revolutionized the sailing graphics, he also invented the emmy award-winning virtual first down line for the nfl.

Now, sailing.

Sailing was by far the toughest.

Why?

All the other systems, the cameras are tripod mounted.

You can survey the location.

In sailing, the helicopter carries the camera.

The helicopter is moving all around, bobbing and weaving.

It is far away from the field of play.

Larry ellison wants to turn sailing into a spectator sport.

Do you think that is possible?

Can it be a more mainstream sport?

I think if it is possible, if it can be made to be a sustainable commercial media sport, this is the way you have to do it.

Team new zealand is in the league right now having 15 races -- won five races so far.

As we hit the break, here is a look at what is coming up on tuesday.

I will be speaking with twitter cofounder jack dorsey about his other company, square.

You can watch that interview at 3:00 p.m. pacific next tuesday.

Still ahead, 25 years since the show "cops" debuted on network television.

We talked with the creator and executive producer.

? this is bloomberg west.

Cops is one of the longest- running tv shows in history.

After 25 seasons on fox, the show that pioneered the reality genre is heading to spike tv.

Jon erlichman caught up with cups creator and executive producer john langley in l.a.. take a look.

I have been on fox for 25 seasons.

For legacy purposes and ego purposes, i figured that was a great target for having hit the bull's-eye.

It is time to move on.

Put that in perspective.

25 years, hard to think of any other show that has had a run like that.

You have done well.

We are pushing 1000. pretty incredible.

When you got started, it wasn't a sure thing.

It was a shaky network at best.

They had a series of failures.

They were defying the odds and they were experimental.

Does that give you any thought in these new tech days where there are all these new platforms.

People are concerned.

Do you have any advice for people who are trying to figure out how it is going to play out?

I always have advice on everything.

My kids will tell you.

The real issue in television is to be innovative, to be daring, to be bold.

Try something new.

In its time, cops was an extremely revolutionary -- no one had done a show with no writers, no host, no script, no reenactment.

No music in the body of the show.

We have a famous song that opens the show but there is no music in the show itself.

What do you think it was?

What was it that got people so caught up in what cops became?

Because it is in the moment, because it is ultimately real and raw, it is a riveting experience.

There is nothing more fascinating than watching reality unfold.

You discover.

I have heard people describe you as the godfather of reality.

You don't necessarily want to take credit for any of the reality tv that you don't approve of.

I will take credit for the things i like.

I love certain shows like deadliest catch.

That is a great show.

I admire other shows like survivor.

Basically, there are a lot of shows i wouldn't want to be associated with.

Is reality a bit of a stretch for some shows?

Reality is the biggest misnomer i have ever heard for 80% of the reality shows.

They are managed, scripted.

They are literally written by the producers or writers.

Just speaking about fox for one second.

The other reality, sports.

These days, why can't somebody keep paying for cable -- they want to get the live sporting events.

What is your review -- view on sports programming versus your bread and butter and what you have been doing?

There is an audience for everything.

There is an audience for reality shows, one for fiction, one for sports.

They overlap and interweave and intersect.

That is all great.

I do what i do and hope there is an audience.

Use the basic fundamental dictum , if i like it, somebody else should like it.

That was john langley with jon erlichman.

You can see the new season of cops on saturday night on spike tv.

We have some breaking news about twitter's ipo filing.

The banks that will be handling the ipo, we know that goldman sachs is a lead underwriter but we are also hearing that jpmorgan and morgan stanley will have a role in the ipo as well.

Morgan stanley, jpmorgan as well as deutsche bank having a role in the ipo along with goldman sachs.

It is time for the bwest byte.

Cory johnson is a twitter headquarters.

What you got for us?

How about 75%? 75% of the companies that have had ipos since the passage of the jobs act have employed the emerging growth category to do the same secret ipo that twitter is now proposing.

It has really changed the ipo landscape.

Twitter is one of the most high- profile companies to do that.

Cory johnson, thank you.

Thank you all for watching.

Have a wonderful weekend.

We will see you back here on monday.

?

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

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