>> Live from Stanford University. It's the Cube covering global Women in Data Science conference brought to you by Silicon Angle media. >> Welcome back to the Cube. I'm Lisa Martin Live at the Stanford Ari Aga Alone, My Center for the Fourth Annual Women and Data Science Conference with twenty nineteen and were joined by a very special guest, Liza Donnelly, cartoonist for The New Yorker. But Liza, you are a visual journalists, visual journalism. You're here live, drawing a lot of the things that are going on. It would. You were just at the Oscars at the Grammys. Your work is so unique, so descriptive. Tell us a little bit our audience about what is visual journalism? >> Well, I suppose a lot of us define it different ways. But I did find it is somebody who I am, somebody who goes to events, either political or social, cultural and draw what I see. I'm not a court reporter. I'm I'm an Impressionist. I give people a feeling that they're they're with me from what? By what I draw what I see, how I draw it, and and it's I don't usually put any editorializing in those visual drawings, but my perspective is sort of a certain kind of approach. >> So you're bringing your viewers along this journey in almost real time. When people see people might be most failure with New Yorker your illustrations there. But folks that are watching the Woods event lie that engaging with that tell us a little bit about the importance of using the illustrations to bring them on this journey as if they were here. >> Well, you know, I send the drawings out immediately, do them on my iPad and I send them out on social media almost immediately, so as I do that so that people can see them immediately. So they feel like they're there, and it's a way to draw attention to whatever it is I'm drawing. Because on the Internet, there's so many words in so many photographs, people see a drawing by other stream that like, Wait, what's that? And I'm a thumb stopper, in other words, so it's. It gives people different perspective on what's going on. And I think that my background is a cartoonist for The New Yorker for forty years. Informs these drawings in an indirect background kind of way, because I have been watching culture have been watching politics for a very long time, so it gives me a, you know, a new attitude or a way to look at what's going on, >> right? And so you you call these illustrations, not cartoons. >> I do call the cartoons cartoons. Okay, we'll do the cartoons for the for >> The New Yorker and some other magazines, and those have a caption, and they often are supposed to be funny, or at least cultural commentary. I do political cartoons for medium, and those also have it have a point of view, are a caption. But the's this visual journalism like I'm doing here is more like reportage. It's more like this is what's happening here. You might be interested in seeing what people are talking about, what they're doing and I do behind the scenes to I don't just do like the Oscars. I'll do the stars if I could get them. And on the red crime on the red carpet, it's really cool. If I catch them, I'll draw them. And then But then I also do the people taking out the trash, the guy painting, you know, painting the sideboard or the counterman, things like that. So I try to give a sense of what it's like to be there. >> So you really kind of telling a story from different perspectives. Yes, right. Yeah. And so the role of I'd love to understand you mentioned being with the New Yorker for very long time and loved. You understand from your perspective, the evolution of cartoons and the impact they can make in in our society, in politics and economics. Tell us a little bit about some of the impacts that you've seen evolve over the last few decades. >> Well, I've written about >> that. I'm also a writer. I've written about that for a very sites. Did a commentary on op ed for The New York Times about the Charlie Hebdo's murders a couple years ago because we know cartoons can be very controversial. Yes and problematic Nick. And that's been true through the course of the history of our country, and I'm sure in England and other countries as well. But it's compounded. Now because of the Internet. I think cartoons could be misunderstood that could be used as weapons. People are gonna be talking about this next week at the South by Southwest. I'm talking about political cartoons and what what their impact has been in the past and how, >> how they, how they create an impact now >> and why that is, and how we could use it to the to our to good effect. You know, not a divisive tool, which I think is a problem that we're dealing with right now in our culture is everybody's so divided and so opinionated and so hateful towards each other. Can we use cartoons? Not to perpetuate that, but to make things better in some way. >> And that's kind of the theme of Wits, Women and Data Science Conference. You know, we're talking Teo and listening Teo at the live event here at Stanford and all of those around the world. It's really strong leaders and data sign. So we think of data science on DH, the technical skills. But data is generated. We generate tons of it as people, right with whatever we're buying, what we're watching on Netflix. But we're listening to on Spotify, etcetera. There's this data trail that we're all leaving, and we know you talked about using cartoons for good. Same conversations that we have on the data side, about being able to use data for good for cancer research, for example, rather than exposing and being malicious, that's interesting. Parallel that you've seen over the years that there is a lot of potential here. Tell me a little bit about the appetite in. Maybe we'll say the millennials and the younger generations for cartoons as a tool for positive the spread of positive social news and not fake news. >> Well, there. I know that >> there's more and more cartoons on the Internet now. A lot of Web comics and cartoonists are young. Cartoonists are using the Internet effectively, too. Put out their ideas. In fact, I when the Internet hit, I was mid career right, and it just took off and helped me become Mohr more well known just by leveraging the Internet. No, because I love it. You know, I love Communicate. It's >> actually it's really an extension >> of what I did as a child learning to draw, communicate with people. I was shy. I don't want to talk. The Internet is just a matter of for me. It's like a dialogue with people on DH. That's how I look at it, and I I think this new generation is really trying to find ways to use these tools in a good way. I think there's a whole new, you know, the kids in their >> twenties. I think they're trying >> to make a better world, are working on it, and that's exciting. >> You talk about communication and how you used your artistic skills from the time you were a child to communicate. Being shy. We also talk about communication in the context of events like the women, the data science, where it isn't just enough to be ableto understand and have the technical acumen to evaluate complex, messy data sets. But the communication piece kind of go back, Teo sort of basic human scaled, being able to communicate effectively. This is what I think the data say and why, and here's what we can do with it. So I think it's interesting that you're here at this event. That has a lot of parallels with communication with using a tool or information for the betterment off a little bit about how you got involved with women in data science. >> Well, I met Margot Garretson >> about five years ago, and through a mutual friend, we met in Iceland. All places >> like it's conference >> about women's rights. It was, it was the Icelandic women are so powerful anyway. We met there, really, to be good friends, and she invited me to come live, draw her new conference at the time. I think she had one year of it, and I thought, data science, OK, >> did you even know what >> that Wass? Yeah, kind of. But I didn't think I didn't see my connection. But I thought, Well, it's about women's rights and >> I'm a big part of my interest in what I want to do with my work is promote equal rights for women around the world. And so I thought, this this sounds terrific. Plus, it's global, and I do a lot of work globally to help them and help freedom of speech as well. So it seemed to be a great fit on DH and and it seems even more to be a good fit in that. It's a way to get the information out there in a visual way because people will hear that word data, and they like they probably just >> start. Yeah, zero because >> they see it connected with a cartoon or drawing it humanizes it for them a little bit. And if I could do that, that's great. And that's what's also fun is that I thought about this today was drawing the speakers, and I'm drawing one of the speakers. I forget her name right now, but I thought and I put it out on the Internet. There were no words on there, but it was just a woman speaker talking about really very technical data science. I put on the Internet with the caption on the tweet and I thought, People, it's it's it's just a constant reminder to people that women are doing this. And it's not a silly not like writing a long essay about why women should be in data signs and why they are and why they're important. But they're doing great things. But if you see it, it resonates a little bit more quickly and more forcefully. >> Absolutely. And it aligns with what we hear and say a lot of we can't be what we can't see. >> That's right. Yeah, that's a saying right where you said that. >> Yes. I'm not sure I'd love to take credit for it. Sure >> would be if she can see it, she could be it. That's another >> thing. That a young girl, she's my drawing of a professor talking on stage. Maybe she'll think about it. >> Absolutely. So in the last few seconds here, can you just give us a little bit of an idea of how you actually What What inspires you when you're seeing someone give a talk like you mentioned about maybe an esoteric or a very technical top? What do you normally look for? That's that Ah ha moment that you want to capture in ten minutes. >> Well, I try to capture that person's essence. I'm not a caricaturist. I don't pretend to be, but I draw >> a likeness of them, and they're the full body is the best body language. You know, they're just tick yah late ing. And then oftentimes I try to capture a sentence that they're saying that has has more universal appeal that somehow brings like a not like a layman into the subject A little bit. If I can find that sentence in what they're saying, I'll put that you have the speech balloon will be saying that. But I just try to capture the person best. I can >> do anything if you compare two wins. Twenty eighteen. Here we are a year later. Even more people here, the live event, even more people engaging and think Margo's that about twenty thousand live today. One hundred thousand over. I think the one hundred thirty plus regional with events, anything that you hear, see or feel that's even more exciting this year than last year. >> Um, well, I do. I do feel the >> the increase in numbers. I can feel it. There's there soon be more people here I don't true, but the senior more young people here, what else is it is it is a buzz. I think there's a >> There's an energy >> is an energy. Not that there wasn't there last. The last I've >> done three years now. It's been there, but there's a certain excitement right now. I think more women are stepping into this field of being recognized for doing so. >> And it's great that you're able Tio, reach, help wigs, reach an even bigger audience and tell this story with your illustrations in a more visual way, way also. Thank you so much, Liza, for taking some time. Must daughter by the Cuban talked to us. It's an honor to meet you And you. I love your drawings. >> Thank you so much. You >> want to thank you for watching the Cube? I'm Lisa Martin Live at the fourth annual Women and Data Science Conference at Stanford's took around. Be right back with my next guests.

>> From theCUBE studios in Palo Alto in Boston, bringing you data-driven insights from theCUBE and ETR. This is Breaking Analysis with Dave Vellante. >> Much of the discussion around Intel's current challenges, is focused on manufacturing issues and it's ongoing market share skirmish with AMD. Of course, that's very understandable. But the core issue Intel faces is that it has lost the volume game forever. And in Silicon volume is king. As such incoming CEO Pat Gelsinger faces some difficult decisions. I mean, on the one hand he could take some logical steps to shore up the company's execution, maybe outsource a portion of its manufacturing. Make some incremental changes that would unquestionably please Wall Street and probably drive shareholder value when combined with the usual stock buybacks and dividends. On the other hand, Gelsinger could make much more dramatic moves shedding it's vertically integrated heritage and transforming Intel into a leading designer of chips for the emerging multi-trillion dollar markets that are highly fragmented and generally referred to as the edge. We believe Intel has no choice. It must create a deep partnership in our view with a semiconductor manufacturer with aspirations to manufacture on US soil and focus Intel's resources on design. Hello, everyone. And welcome to this week's Wikibon's Cube Insights powered by ETR. In this breaking analysis will put forth our prognosis for what Intel's future looks like and lay out what we think the company needs to do not only to maintain its relevance but to regain the position it once held as perhaps the most revered company in tech. Let's start by looking at some of the fundamental factors that we've been tracking and that have shaped and are shaping Intel and our thinking around Intel today. First, it's really important to point out that new CEO Gelsinger is walking into a really difficult situation. Intel's ascendancy and its dominance it was created by PC volumes. And its development of an ecosystem that the company created around the x86 instruction set. In semiconductors volume is everything. The player with the highest volumes has the lowest manufacturing costs. And the math around learning curves is very clear and it's compelling. It's based on Wright's law named after Theodore Wright T.P Wright. He was an aeronautical engineer and he discovered that for every cumulative doubling of units manufactured, costs are going to fall by a constant percentage. Now in semiconductor way for manufacturing that cost is roughly around 22% declines. And when you consider the economics of manufacturing a next generation technology, for example going from ten nanometers to seven nanometers this becomes huge. Because the cost of making seven nanometer tech for example is much higher relative to 10 nanometers. But if you can fit more circuits on a chip your wafer costs can drop by 30% or even more. Now this learning curve benefit is why volume is so important. If the time it takes to double volume is elongated then the learning curve benefit they get elongated as well and it become less competitive from a cost standpoint. And that's exactly what is happening to Intel. You see x86 PC volumes, they peaked in 2011 and that marked the beginning of the end of Intel's dominance from manufacturing and cost standpoint. You know, ironically HDD hard disk drive volumes peaked around the same time and you're seeing a similar fundamental shift in that market relative to flash. Now because Intel has a vertically integrated model it's designers are limited by the constraints in the manufacturing process. What used to be Intel's ace in the hole its process manufacturing has become a hindrance, frustrating Intel's chip designers and really seeding advantage to a number of competitors including AMD, ARM and Nvidia. Now, during this time we've seen high profile innovators adapting alternative processors companies like Apple which chose its own design based on ARM for the M1. Tesla is a fascinating case study where Intel was really not in the running. AWS probably Intel's largest customer is developing its own chips. You know through Intel, a little bone at the recent reinvent it announced its use of Intel's Habana chips in a practically the same sentence that talked about how it was developing a similar chip that would provide even better price performance. And just last month it was reported that Microsoft Intel's monopoly partner in the PC era was developing its own ARM-based chips for the surface PCs and for its servers. Intel's Zenith was marked by those peak PC volumes that we talked about. Now to stress this point this chart shows x86 PC volumes over time. That red highlighted area shows the peak years. Now, volumes actually grew in 2020 in part due to COVID which is not really reflected in this chart but the volume game was lost for Intel. When it has been widely reported that in 2005 Steve Jobs approached Intel as it was replacing IBM microprocessors with with Intel processors for the Mac and asked Intel to develop the chip for the iPhone Intel passed and the die was cast. Now to the earlier point, PC markets are actually quite good if you're Dell. Here's some ETR data that shows Dell's laptop net score. Net score is a measure of spending momentum for 2020 and into 2021. Dell's client business has been very good and profitable and frankly, it's been a pleasant surprise. You know, PCs they're doing well. And as you can see in this chart, Dell has momentum. There's approximately 275 million maybe as high as 300 million PC units shipped worldwide in 2020, you know up double digits by some estimates. However, ARM chip units shipped exceeded 20 billion units last year worldwide. And it's not apples to apples. You know, we're comparing x86 based PCs to ARM chips. So this excludes x86 servers, but the way for volume for ARM dwarfs that of x86 probably by a factor of 10 times. Back to Wright's law, how long is it going to take Intel to double wafer volumes? It's not going to happen. And trust me, Pat Gelsinger understands this dynamic probably better than anyone in the world and certainly better than I do. And as you look out to the future, the story for Intel and it's vertically integrated approach it's even tougher. This chart shows Wikibon's 2020 forecast for ARM based compared to x86 based PCs. It also includes some other devices but as you can see what happens by the end of the decade is ARM really starts to eat in to x86. As we've seen with the M1 at Apple, ARM is competing in PCs in much better position for these emerging devices that support things like video and virtual reality systems. And we think even will start to eat into the enterprise. So again, the volume game is over for Intel, period. They're never going to win it back. Well, you might ask what about revenue? Intel still dominates in the data center right? Well, yes. And that is much higher revenue per unit but we still believe that revenue from ARM-based systems are going to surpass that of x86 by the end of the decade. Arm compute revenue is shown in the orange area in this chart with x86 in the blue. This means to us that Intel's last mot is going to be its position in the data center. It has to protect that at all costs. Now the market knows this. It knows something's wrong with Intel. And you can see that is reflected in the valuations of semiconductor companies. This chart compares the trailing 12 month revenue in the market valuations for Intel, Nvidia, AMD and Qualcomm. And you can see at a trailing 12 month multiple revenue with 3 X compared to about 22 X for Nvidia about 10 X for AMT and Qualcomm, Intel is lagging behind in the street's view. And Intel, as you can see here, it's now considered a cheap stock by many, you know. Here's a graph that shows the performance over the past 12 months compared to the NASDAQ which you can see that major divergence. NASDAQ has been powered part by COVID and all the new tech and the work from home. The stock reacted very well to the appointment of Gelsinger. That's no surprise. The question people are asking is what's next for Intel? How will Pat turn the company's fortunes around? How long is it going to take? What moves can he and should he make? How will they be received by the market? And internally, very importantly, within Intel's culture. These are big chewy questions and people are split on what should be done. I've heard everything from Pat should just clean up the execution issues. It's no.. This is, you know, very workable and not make any major strategic moves all the way to Intel should do a hybrid outsourced model to Intel should aggressively move out of manufacturing. Let me read some things from Barron's and some other media. Intel has fallen behind rivals and the rest of tech Intel is replacing Bob Swan. Investors are cheering the move. Intel would likely turn to Taiwan semiconductor for chips. Here's who benefits most. So let's take a look at some of the opinions that are inside these articles. So, first one I'm going to pull out Intel has indicated a willingness to try new things and investors expect the company to announce a hybrid manufacturing approach in January. Now, if you take a look at that and you quote a CEO Swan, he says, what has changed is that we have much more flexibility in our designs. And with that type of design we have the ability to move things in and move things out. And that gives us a little more flexibility about what we will make and what we might take from the outside. So let's unpack that a little bit. The new Intel, we know is a highly vertically integrated workflow from design to manufacturing production. But to me, the designers are the artists and the flexibility you would think would come from outsourcing manufacturer to give designers more flexibility to take advantage of say seven nanometer or five nanometer process technologies versus having to wait for Intel to catch up. It used to be that Intel's process was the industry's best and it could supercharge a design or even mask certain design challenges so that Intel could maintain its edge but that's no longer the case. Here's a sentiment from an analyst, Daniel Donnelly. Donnelly is at Citi. It says he's confident. Donnelly is confident that Intel's decision to outsource more of its production won't result in the company divesting its entire manufacturing segment. And he cited three reasons. One, it would take roughly three years to bring a chip to market. And two, Intel would have to share IP. And three, it would hurt Intel's profit margins. He said it would negatively impact gross margins by 10 points and would cause a 25% decline in EPS. Now I don't know about this. I would... To that I would say one, Intel needs to reduce its current cycle time, to go from design to production from let's say three to four years where it is today. It's got to get it under you know, at least at two years maybe even less. Second, I would say is what good is intellectual property if it's not helping you win in the market? And three, I think profitability is nuance. So here's another take from a UBS analyst. His name is Timothy Arcuri. And he says, quote, We see but no option but for Intel to aggressively pursue an outsourcing strategy. He wrote that Intel could be 80% outsourced by 2026. And just by going to 50% outsourcing, he said would save the company $4 billion annually in CapEx and 25% would drop to free cashflow. So look, maybe Gelsinger has to sacrifice some gross margin in EPS for the time being. Reduce the cost of goods sold by outsourcing manufacturing lower its CapEx and fund innovation in design with free cash flow. Here's our take, Pat Gelsinger needs to look in the mirror and ask what would Andy Grove do? You know, Grove's quote that only the paranoid survive its famous less well-known are the words that proceeded that quote. Success breeds complacency and complacency breeds failure. Intel in our view is headed on a path to a long drawn out failure if it doesn't act aggressively. It simply can't compete on cost as an integrated manufacturer because it doesn't have the volume. So what will Pat Gelsinger do? You know, we've probably done 30 Cube interviews with Pat and I just don't think he's taking the job to make some incremental changes to Intel to get the stock price back up. Why would that excite Pat Gelsinger? Trends, markets, people, society, he's a dot connector and he loves Intel deeply. And he's a legend at the company. Here's what we strongly believe. We think Intel has to do a deal with TSM or maybe Samsung perhaps some kind of joint venture or other innovative structure that both protects its IP and secures its future. You know, both of these manufacturers would love to have a stronger US presence. In markets where Intel has many manufacturing facilities they may even be willing to take a loss to get this started and deeply partner with Intel for some period of time This would allow Intel to better compete on a cost basis with AMD. It would protect its core data center revenue and allow it to fight the fight in PCs with better cost structures. Maybe even gain some share that could count for, you know another $10 billion to the top line. Intel should focus on reducing its cycle times and unleashing its designers to create new solutions. Let a manufacturing partner who has the learning curve advantages enable Intel designers to innovate and extend ecosystems into new markets. Autonomous vehicles, factory floor use cases, military security, distributed cloud the coming telco explosion with 5G, AI inferencing at the edge. Bite the bullet, give up on yesterday's playbook and reinvent Intel for the next 50 years. That's what we'd like to see. And that's what we think Gelsinger will conclude when he channels his mentor. What do you think? Please comment on my LinkedIn posts. You can DM me at dvellante or email me at david.vellante@siliconangle.com. I publish weekly on wikibon.com and siliconangle.com. These episodes remember are also available as podcasts for your listening pleasure. Just search Breaking Analysis podcast. Many thanks to my friend and colleague David Floyer who contributed to this episode and that has done great work in the last better part of the last decade and has really thought through some of the cost factors that we talked about today. Also don't forget to check out etr.plus for all the survey action. Thanks for watching this episode of the Cube Insights powered by ETR. Be well. And we'll see you next time. (upbeat music)

[Music] Andre one of the things that have come up is your relation with Russia as we talked about so I have to ask you a direct question do you to work with sanctioned Russian entities or Russian companies shown we and c5 we do not work with any company that's sanctioned from any country including Russia and the same applies to me we take sanctions very very seriously the one thing you don't mess with is US sanctions which has application worldwide and so you always have to stay absolutely on the right side of the law when it comes to sanctions so nothing nothing that's something that's connection nets are trying to make they're also the other connection is a guy named Victor Vail Selberg Viktor Vekselberg Vekselberg to go with the Russian names as people know what is your relationship with Viktor Vekselberg so victim Viktor Vekselberg is a is a very well known Russian businessman he's perhaps one of the best known Russian businessman in the West because he also lived in the US for a period of time it's a very well-known personality in in in Europe he's a donor for example to the Clinton Foundation and he has aggregated the largest collection of Faberge eggs in the world as part of national Russian treasure so he's a very well known business personality and of course during the course of my career which has focused heavily on also doing investigations on Russian related issues I have come across Viktor Vekselberg and I've had the opportunity to meet with him and so I know him as a as a business leader but c5 has no relationship with Viktor Vekselberg and we've never accepted any investment from him we've never asked him for an investment and our firm a venture capital firm has no ties to Viktor Vekselberg so you've worked had a relationship at some point in your career but no I wouldn't on a daily basis you don't have a deep relationship can you explain how deep that relationship is what were the interactions you had with him so clarify that point so so I know Viktor Vekselberg and I've met him on more than one occasion in different settings and as I shared with you I served on the board of a South African mining company which is black owned for a period of a year and which Renova had a minority investment alongside an Australian company called South 32 and that's the extent of the contact and exposure I've had to so casual business run-ins and interactions not like again that's correct deep joint ventures are very kind of okay let's get back to c5 for a minute cause I want to ask you it but just do just a circle just one last issue and Viktor Vekselberg Viktor Vekselberg is the chairman of scope over the Russian technology innovation park that we discussed and he became the chairman under the presidency of President Dmitry Medvedev during the time when Hillary Clinton was doing a reset on Russian relations and during that time so vekselberg have built up very effective relationships with all of the or many of the leading big US technology companies and today you can find the roster of those partners the list of those partners on the scope of our website and those nuclear drove that yes Victor drove that Victor drove that during during in the Clinton Secretary of this started the scope of our project started during the the Medvedev presidency and in the period 2010-2011 you'll find many photographs of mr. vekselberg signing partnership agreements with very well known technology companies for Skolkovo and most of those companies still in one way or another remain involved in the Skolkovo project this has been the feature the article so there are I think and I've read all the other places where they wanted to make this decision Valley of Russia correct there's a lot of Russian programmers who work for American companies I know a few of them that do so there's technology they get great programmers in Russia but certainly they have technology so oracles they're ibm's they're cisco say we talked about earlier there is US presence there are you do you have a presence there and does Amazon Web service have a presence on do you see five it and that's knowing I was alright it's well it's a warning in the wrong oh sorry about that what's the Skog Obama's called spoke over so Andres Kokomo's this has been well report it's the Silicon Valley of Russia and so a lot of American companies they're IBM Oracle Cisco you mentioned earlier I can imagine it makes sense they a lot of recruiting little labs going on we see people hire Russian engineers all the time you know c5 have a presence there and does AWS have a presence there and do you work together in a TBS in that area explain that relationship certainly c5 Amazon individually or you can't speak for Amazon but let's see if I've have there and do you work with Amazon in any way there c-5m there's no work in Russia and neither does any of our portfolio companies c5 has no relationship with the Skolkovo Technology Park and as I said the parties for this spoke of a Technology Park is a matter of record is only website anyone can take a look at it and our name is not amongst those partners and I think this was this is an issue which I which I fault the BBC report on because if the BBC report was fair and accurate they would have disclosed the fact that there's a long list of partners with a scope of our project very well known companies many of them competitors in the Jedi process but that was not the case the BBC programme in a very misleading and deceptive way created the impression that for some reason somehow c5 was involved in Skolkovo without disclosing the fact that many other companies are involved they and of course we are not involved and your only relationship with Declan Berg Viktor Vekselberg was through the c5 raiser bid three c5 no no Viktor Vekselberg was never involved in c5 raiser Petco we had Vladimir Kuznetsov as a man not as a minority investor day and when we diligence him one of our key findings was that he was acting in independent capacity and he was investing his own money as a you national aniseh Swiss resident so you if you've had no business dealings with Viktor Vekselberg other than casual working c-5 has had no business dealings with with Viktor Vekselberg in a in a personal capacity earlier before the onset of sanctions I served on the board of a black-owned South African mining company and which Renault bombs the Vekselberg company as a minority investment alongside an Australian company called South 32 and my motivation for doing so was to support African entrepreneurship because this was one of the first black owned mining companies in the country was established with a British investment in which I was involved in and I was very supportive of the work that this company does to develop manganese mining in the Kalahari Desert and your role there was advisory formal what was the role there it was an advisory role so no ownership no ownership no equity no engagement you call them to help out on a project I was asked to support the company at the crucial time when they had a dispute on royalties when they were looking at the future of the Kalahari basin and the future of the manganese reserve say and also to help the company through a transition of the black leadership the black executive leadership of the cut year is that roughly 2017 so recently okay let on the ownership of c5 can you explain who owns c5 I mean you're described as the owner if it's a venture capital firm you probably of investors so your managing director you probably have some carry of some sort and then talk about the relationship between c5 razor bidco the Russian special purpose vehicle that was created is that owning what does it fit is it a subordinate role so see my capital so Jones to start with c5 razor boot code was was never a Russian special purpose vehicle this was a British special purpose vehicle which we established for our own investment into a European enterprise software company vladimir kuznetsov later invested as an angel investor into the same company and we required him to do it through our structure because it was transparent and subject to FCA regulation there's no ties back to c5 he's been not an owner in any way of c5 no not on c5 so C fibers owned by five families who helped to establish the business and grow the business and partner in the business these are blue chip very well known European and American families it's a small transatlantic community or family investors who believe that it's important to use private capital for the greater good right history dealing with Russians can you talk about your career you mentioned your career in South Africa earlier talk about your career deal in Russia when did you start working with Russian people I was the international stage Russian Russia's that time in 90s and 2000 and now certainly has changed a lot let's talk about your history and deal with the Russians so percent of the Soviet Union I think there was a significant window for Western investment into Russia and Western investment during this time also grew very significantly during my career as an investigator I often dealt with Russian organized crime cases and in fact I established my consulting business with a former head of the Central European division of the CIA who was an expert on Russia and probably one of the world's leading experts on Russia so to get his name William Lofgren so during the course of of building this business we helped many Western investors with problems and issues related to their investments in Russia so you were working for the West I was waiting for the West so you are the good side and but when you were absolutely and when and when you do work of this kind of course you get to know a lot of people in Russia and you make Russian contacts and like in any other country as as Alexander Solzhenitsyn the great Russian dissident wrote the line that separates good and evil doesn't run between countries it runs through the hearts of people and so in this context there are there are people in Russia who crossed my path and across my professional career who were good people who were working in a constructive way for Russia's freedom and for Russia's independence and that I continue to hold in high regard and you find there's no technical security risk the United States of America with your relationship with c5 and Russia well my my investigative work that related to Russia cases are all in the past this was all done in the past as you said I was acting in the interest of Western corporations and Western governments in their relations with Russia that's documented and you'd be prepared to be transparent about that absolutely that's all those many of those cases are well documented to corporations for which my consulting firm acted are very well known very well known businesses and it's pretty much all on the on the Podesta gaiting corruption we were we were we were helping Western corporations invest into Russia in a way that that that meant that they did not get in meshed in corruption that meant they didn't get blackmailed by Russia organized crime groups which meant that their investments were sustainable and compliant with the Foreign Corrupt Practices Act and other bribery regulation at war for everyone who I know that lives in Europe that's my age said when the EU was established there's a flight of Eastern Europeans and Russians into Western Europe and they don't have the same business practices so I'd imagine you'd run into some pretty seedy scenarios in this course of business well in drug-dealing under I mean a lot of underground stuff was going on they're different they're different government they're different economy I mean it wasn't like a structure so you probably were exposed to a lot many many post-conflict countries suffer from predatory predatory organized crime groups and I think what changed and of course of my invested investigative career was that many of these groups became digital and a lot of organized crime that was purely based in the physical world went into the into the digital world which was one of the other major reasons which led me to focus on cyber security and to invest in cyber security well gets that in a minute well that's great I may only imagine some of the things you're investigated it's easy to connect people with things when yeah things are orbiting around them so appreciate the candid response there I wanna move on to the other area I see in the stories national security risk conflict of interest in some of the stories you seeing this well is there conflict of interest this is an IT playbook I've seen over the years federal deals well you're gonna create some Fahd fear uncertainty and doubt there's always kind of accusations you know there's accusations around well are they self dealing and you know these companies or I've seen this before so I gotta ask you they're involved with you bought a company called s DB advisors it was one of the transactions that they're in I see connecting to in my research with the DoD Sally Donnelly who is Sally Donnelly why did you buy her business so I didn't buy Sonny Donnelly's business again so Sally Tony let's start with Sally darling so Sally Donny was introduced to me by Apple Mike Mullen as a former chairman of the Joint Chiefs of Staff and Sally served as his special advisor when he was the chairman of the Joint Chiefs of Staff Apple Mullen was one of the first operating parties which we had in c5 and he continues to serve Admiral Mullen the four start yes sir okay and he continues to serve as one of operating partners to this day salad only and that will Mike worked very closely with the Duke of Westminster on one of his charitable projects which we supported and which is close to my heart which is established a new veteran rehabilitation center for Britain upgrading our facility which dates back to the Second World War which is called Headley court to a brand-new state-of-the-art facility which was a half a billion dollar public-private partnership which Duke led and in this context that Ron Mullen and Sally helped the Duke and it's team to meet some of the best experts in the US on veteran rehabilitation on veteran care and on providing for veterans at the end of the service and this was a this was a great service which it did to the to this new center which is called the defense and national rehabilitation center which opened up last summer in Britain and is a terrific asset not only for Britain but also for allies and and so the acquisition she went on to work with secretary Manus in the Department of Defense yes in February Feb 9 you through the transaction yes in February 2017 Sally decided to do public service and support of safety matters when he joined the current administration when she left her firm she sold it free and clear to a group of local Washington entrepreneurs and she had to do that very quickly because the appointment of secretary mattis wasn't expected he wasn't involved in any political campaigns he was called back to come and serve his country in the nation's interest very unexpectedly and Sally and a colleague of us Tony de Martino because of their loyalty to him and the law did to the mission followed him into public service and my understanding is it's an EAJA to sell a business in a matter of a day or two to be able to be free and clear of title and to have no compliance issues while she was in government her consulting business didn't do any work for the government it was really focused on advising corporations on working with the government and on defense and national security issues I didn't buy Sonny's business one of c-5 portfolio companies a year later acquired SPD advisors from the owner supported with a view to establishing and expanding one of our cyber advising businesses into the US market and this is part of a broader bind bolt project which is called Haven ITC secure and this was just one of several acquisitions that this platform made so just for the record c5 didn't buy her company she repeat relieved herself of any kind of conflict of interest going into the public service your portfolio company acquired the company in short order because they knew the synergies because it would be were close to it so I know it's arm's length but as a venture capitalist you have no real influence other than having an investment or board seat on these companies right so they act independent in your structure absolutely make sure I get that's exactly right John but but not much more importantly only had no influence over the Jedi contract she acted as secretary mitosis chief of staff for a period of a year and have functions as described by the Government Accounting Office was really of a ministerial nature so she was much more focused on the Secretary's diary than she was focused on any contracting issues as you know government contracting is very complex it's very technical sally has as many wonderful talents and attributes but she's never claimed to be a cloud computing expert and of equal importance was when sally joined the government in february 17 jeddah wasn't even on the radar it wasn't even conceived as a possibility why did yet I cannot just for just for the record the Jedi contract my understanding is that and I'm not an expert on one government contracting but my understanding is that the RFP the request for proposals for the July contract came out in quarter three of this year for the first time earlier this year there was a publication of an intention to put out an RFP I think that happened in at the end of quarter one five yep classic yeah and then the RFP came out and called a three bits had to go in in November and I understand a decision will be made sometime next year what's your relationship well where's she now what she still was so sunny left finished the public service and and I think February March of this year and she's since gone on to do a fellowship with a think-tank she's also reestablished her own business in her own right and although we remain to be good friends I'm in no way involved in a business or a business deal I have a lot of friends in DC I'm not a really policy wonk of any kind we have a lot of friends who are it's it's common when it administrations turnover people you know or either appointed or parked a work force they leave and they go could they go to consultancy until the next yeah until the next and frustration comes along yeah and that's pretty common that's pretty cool this is what goes on yeah and I think this whole issue of potential conflicts of interest that salad only or Tony the Martino might have had has been addressed by the Government Accounting Office in its ruling which is on the public record where the GAO very clearly state that neither of these two individuals were anywhere near the team that was writing the terms for the general contract and that their functions were really as described by the GAO as ministerial so XI salient Antonia was such a long way away from this contact there's just no way that they could have influenced it in in in any respect and their relation to c5 is advisory do they and do they both are they have relations with you now what's the current relationship since since Sally and Tony went to do public service we've had no contact with them we have no reason of course to have contact with them in any way they were doing public service they were serving the country and serving the nation and since they've come out of public service we've we've not reestablished any commercial relationship so we talked earlier about the relation with AWS there's only if have a field support two incubators its accelerator does c5 have any portfolio companies that are actually bidding or working on the Jedi contract none what Santa John not zero zero so outside of c5 having relation with Amazon and no portfolios working with a Jedi contract there's no link to c5 other than a portfolio company buying Sally Donnelly who's kind of connected to general mattis up here yeah Selleck has six degrees of separation yes I think this is a constant theme in this conspiracy theory Jonas is six degrees of separation it's it's taking relationships that that that developed in a small community in Washington and trying to draw nefarious and sinister conclusions from them instead of focusing on competing on performance competing on innovation and competing on price and perhaps that's not taking place because the companies that are trying to do this do not have the capability to do so Andre I really appreciate you coming on and answering these tough questions I want to talk about what's going on with c5 now but I got to say you know I want to ask you one more time because I think this is critical you've worked for big-time company Kroll with terminus international market very crazy time time transformation wise you've worked with the CIA in Quantico the FBI nuclei in Quantico on a collaboration you were to know you've done work for the good guys you have see if I've got multiple years operating why why are you being put as a bad guy here I mean you're gonna you know being you being put out there with if you search your name on Google it says you're a spy all these evil all these things are connecting and we're kind of digging through them they kind of don't Joan I've had the privilege of a tremendous career I've had the privilege of working with with great leaders and having had great mentors if you do anything of significance if you do anything that's helping to make a difference or to make a change you should first expect scrutiny but also expect criticism when that scrutiny and criticism are fact-based that's helpful and that's good for society and for the health of society when on the other hand it is fake news or it is the construct of elaborate conspiracy theories that's not good for the health of society it's not good for the national interest is not good for for doing good business you've been very after you're doing business for the for the credibility people questioning your credibility what do you want to tell people that are watching this about your credibility that's in question again with this stuff you've done and you're continuing to do what's the one share something to the folks that might mean something to them you can sway them or you want to say something directly what would you say the measure of a person it is his or her conduct in c-five we are continuing to build our business we continue to invest in great companies we continue to put cravat private capital to work to help drive innovation including in the US market we will continue to surround ourselves with good people and we will continue to set the highest standards for the way in which we invest and build our businesses it's common I guess I would say that I'm getting out as deep as you are in the in term over the years with looking at these patterns but the pattern that I see is very simple when bad guys get found out they leave the jurisdiction they flee they go do something else and they reinvent themselves and scam someone else you've been doing this for many many years got a great back record c5 now is still doing business continuing not skipping a beat the story comes out hopefully kind of derail this or something else will think we're gonna dig into it so than angle for sure but you still have investments you're deploying globally talk about what c5 is doing today tomorrow next few months the next year you have deals going down you're still doing business you have business out there our business has not slowed down for a moment we have the support of tremendous investors we have the support of tremendous partners in our portfolio companies we have the support of a great group of operating partners and most important of all we have a highly dedicated highly focused group of investment teams of very experienced and skilled professionals who are making profitable investments and so we are continuing to build our business we have a very full deal pipeline we will be completing more investment transactions next week and we are continue to scalar assets under management next year we will have half a billion dollars of assets under management and we continue to focus on our mission which is to use private capital to help innovate and drive a change for good after again thank you we have the story in the BBC kicked all this off the 12th no one's else picked it up I think other journals have you mentioned earlier you think this there's actually people putting this out you you call out let's got John wheeler we're going to look into him do you think there's an organized campaign right now organized to go after you go after Amazon are you just collateral damage you mentioned that earlier is there a funded effort here well Bloomberg has reported on the fact that that one of the competitors for this bit of trying to bring together a group of companies behind a concerted effort specifically to block Amazon Web Services and so we hear these reports we see this press speculation if that was the case of course that would not be good for a fair and open and competitive bidding process which is I think is the Department of Defense's intention and what is in the interests of the country at a time when national security innovation will determine not only the fate of future Wars but also the fate of a sons and daughters who are war fighters and to be fair to process having something undermine it like a paid-for dossier which I have multiple sources confirming that's happened it's kind of infiltrating the journalists and so that's kind of where I'm looking at right now is that okay the BBC story just didn't feel right to me credible outlet you work for them you did investigations for them back in the day have you talked to them yes no we are we are we are in correspondence with the BBC I think in particular we want them to address the fact that they've conflated facts in this story playing this parlor game of six degrees of separation we want them to address the important principle of the independence of the in editorial integrity at the fact that they did not disclose that they expert on this program actually has significant conflicts of interests of his own and finally we want them to disclose the fact that it's not c5 and Amazon Web Services who have had a relationship with the scope of our technology park the scope of our technology park actually has a very broad set of Western partners still highly engaged there and even in recent weeks of hosted major cloud contracts and conferences there and and all of this should have been part of the story in on the record well we're certainly going to dig into it I appreciate your answer the tough questions we're gonna certainly look into this dossier if this is true this is bad and if there's people behind it acting behind it then certainly we're gonna report on that and I know these were tough questions thanks for taking the time Andre to to answer them with us Joan thanks for doing a deep dive on us okay this is the Q exclusive conversation here in Palo Alto authority narc who's the founder of c-5 capital venture capital firm in the center of a controversy around this BBC story which we're going to dig into more this has been exclusive conversation I'm John Tory thanks for watching [Music] you