Bloomberg Businessweek Weekend - September 5th, 2025

27:40I mean, I spent, you know, 10 days just refreshing that thing, watching the progress of that fire. What is the right way for Californians to be ready for what has become just a part of daily life for a big portion of the year? Well, we have to have very smart brush management. You know, one of the problems in the Palisades, we had 40 years of brush that were not maintained by the state, the county or the city. That was rocket fuel. We have to have water. I mean, it was an unbelievable circumstance that we had reservoirs that are empty. So the competency level at the government and being prepared is critically important.

28:19L.A. City was not prepared for this fire. This fire, in my opinion, and I think in most people's opinion that have seen the facts is this fire could have been prevented, certainly significantly mitigated in terms of the damage. And then we have to be encouraging people to build with non-combustible materials. Fortunately, the knowledge that we built survived it, but it survived it because we were prepared to fight the fire. But equally important, we built it with non-combustible materials. And so it was able to sustain the fire around us. And we had a lot of smart people doing some things. So we can build better and smarter, but we also have to have better infrastructure.

29:02You know, the fire hydrants need to work. They were not working in Los Angeles. The reservoirs need to be full. And this is an opportunity right now to rebuild Malibu, Pasadena, Altadena, and Palisades in a way for the next 100 years and to get the right infrastructure put in. It's an incredible opportunity to create these communities for the future. And that's why we need to work with the federal government, get the right federal funding, and get some smart leadership locally that builds it back properly so that we can withstand fires and other natural disasters in the future. It can be done.

29:42Rick, the nonprofit you are leading, as we said, called Steadfast LA, you've got companies such as Netflix, Amazon, JPMorgan Chase, CBRE Group. so many who are working to restore these communities, but you guys are looking at everything. You're using AI. How long do you think it's going to take for the rebuild? And ultimately, are we talking about kind of the cities of the future in terms of the materials used and how it's done? You know, I think it's going to take, there's going to be phases. I look at it, what's going to be happening one year from now, three years from now, five years from now.

30:17One year from now, for example, the little downtown of the Palisades is going to get reopened. We're going to rebuild the park. Steadfast is leading the park rebuilding. Schools are getting back reopened, and we're involved in supporting the school systems and getting reopened. Same in Altadena, same in Malibu. I think in three years, you're going to see a lot of the homes back and running. We have some really encouraging programs with an alliance of builders who are coming together to buy in bulk, be able to build less expensively. And so that's really important to do. And I think in five years, we're going to be in pretty good shape getting these communities back on its feet.

30:55The biggest challenge we have, honestly, is the lack of diligence, the lack of urgency from the local governments to get permits issued. And we've got to speed that up and cut the red tape both in the county and in L.A. City so people can rebuild. Hey, Rick, before we let you go, I want to talk a little about your family foundation that's been involved at this point for more than 30 years in Watts. the Caruso Family Foundation, and it serves organizations, a slew of organizations in the area. And I'm just wondering, you know, the focus is on health care. It's on education, at-risk kids. I'm wondering why we need organizations to step in and fill the gap that isn't necessarily provided by other organizations.

31:39Why do we need the Caruso Family Foundation to do this? When will your work be done and you won't have to help bridge that gap? Well, I don't think our work is ever going to be done, but I have to tell you something. It's one of the most rewarding parts of my life and my wife's life and my family's life that we can help kids that are at risk living at or below the poverty line. And you bring opportunities to them and the right education and the right support. We have kids that are living in some of the worst and toughest conditions in L.A. and they're now at Harvard, MIT, Georgetown, USC, UCLA, and they're just excelling and doing it on their own because they have the right ecosystem around them and the right start and the right support.

32:23And a government alone can't do everything. It never has been able to. You have to have philanthropy and people need to give back and lean in and support churches and schools and all these great organizations that we have out there. And what I would argue for is we need more people to be leaning in. We need more foundations to be giving back because the reward and the payoff is so great and so huge. And it really does change these communities because these kids are coming back and helping others. I just find it one of the greatest parts of my life is being involved and being able to see these kids just take off and do great things.

33:04Well, we're going to end it on that optimistic note that makes us, I think, all feel really super good. Rick, thank you so much. Really appreciate your time and efforts. And we're going to mark our calendars to check back with you about maybe that political decision you may make very, very soon. Rick Caruso, thank you so much. Be well. Founder, Executive Chairman of Caruso, joining us from L.A. This is the Bloomberg Business Week Daily Podcast. Listen live each weekday starting at 2 p.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app. You can also listen live on Amazon Alexa from our flagship New York station.

33:40Just say, Alexa, play Bloomberg 1130. This past week, Swedish fintech giant Klarna officially launched its long, long anticipated U.S. IPO. The company is aiming to raise up to$1.27 billion through its New York Stock Exchange debut under the ticker symbol K-L-A-R. Makes sense. This marks a revival of its IPO plans, which were paused earlier this year amid market turbulence. Meanwhile, Affirm, Klarna's U.S.-based buy-now-pay-later rival, has reason to celebrate after posting strong fourth-quarter earnings, leaping back into profitability after a disappointing first half of the year. According to Bloomberg Intelligence fintech analyst Dick Chagera, Affirm appears very well positioned to turn an operating profit in 2026 with continued expansion in adjusted operating margin.

34:29To be fair, Affirm shares, man, they've been on a tear. For more on how consumers are choosing to spend and the state of their business, we caught up with Max Levchin. He's co-founder and CEO at Affirm. He's also, you might recall, a co-founder of PayPal. The Affirm consumer, that is the folks that we approve for transactions, and each transaction is separately underwritten. So we do have a very discerning eye as we underwrite these loans. They're doing great. They are shopping. Demand for our product is accelerating. We just posted another accelerating fourth in a row quarter of gross merchandise sales.

35:04They're doing really well. Repayment is really strong. Credit is steady to improving. And so we lend to a huge percentage of US population. So you could infer from that that US consumer writ large is doing well as well. So I think the rumors of the American demise are greatly exaggerated. That is, you know, that said, we continue to watch every metric we can all the time because that's what our job is. Are those metrics stronger now, Max, than they were, say, a year ago? Again, from a firm's point of view, we really are firing on all pistons. our ability to serve folks has improved about 20 % year over year.

35:47That's measured in transaction frequency. Our user base grew about just north of 20 % as well. So consumers are enjoying us. Our user active acquisition has accelerated for the sixth quarter in a row. So there is a meaningful secular shift from credit cards to a firm. So I think, again, within our ecosystem, every metric looks very good and better than last year. Can you talk a little bit about what transactions Affirm customers are using the payment system for? Are they using it like they would use a credit card right now? What's the typical transaction? What's the transaction size? That's a great question.

36:26And it's a little bit differentiated between players. So I can only speak to us. The average ticket for us is just under$300. That should tell you a lot. So everything from a truly considered purchase, like a nice bicycle, maybe a couple hundred dollars, all the way down to a large party supply, maybe a couple hundred dollars. Those are sort of the bookends. We tend to believe that really, really low ticket items,$20 is just too small of an amount to finance with a firm. So we have a notion of where we start trying to tell our consumers, hey, this seems like a good idea to be a cash transaction.

37:07But generally speaking, because the product we offer is just so much better than credit cards for the end borrower, we're very pro idea that a firm should be used in place of credit cards full stop. If you think of it very quickly, it is an obvious idea. So we don't charge late fees. We don't compound interest. We don't do deferral or any of the sort of gimmicky things that look too good to be true because they are too good to be true. So it is an honest financial product that really helps the end borrower get full grip on their finances and not get into trouble, not get over their skis. So directionally, the more they use a firm for everything, I think the better off the consumer is going to be.

37:47That said, the current average is$297. dollars. How often does somebody miss a payment or they're late? And then what happens as a result? What kicks in? I'll be honest, I'm not a huge user. Well, I mean, have you ever used it? I think I've used one of them and I can't remember once because I was curious about it, you know, and I set it up so things just got paid and it was like three payments or something because I was curious about it because we talk about it all the time here. Grew up where you could put stuff away, you know, stuff on layaway. So it's interesting to see the evolution. But I am curious.

38:20Max, how often is it that somebody is late and then the terms start to change? And, you know, this is a business, right? So that's actually, thank you for that prompt. That is, let me try to make one, there's one thing I can make clear in this conversation. I just really want to hammer this one home. Nothing will change. Terms will not change. Fees will not appear. Interest will not change. No dollar amounts will change if something happens and you can't make your bill on time. The fundamental promise of a firm is what you see is what you get. When you're borrowing$500 and you're committing to paying, let's say, another$25 of interest, if you cannot make it on time, it will still be$525.

39:00There will not be a penny more. If you prepay and pay us early, that interest amount will come down. So it is a profoundly pro-consumer product. That said, I just wanted to make that very, very clear. We are a better financial product. About 98 % of our consumers are never late, never in default. And so it's fundamentally extremely, extremely high probability of none of that will ever happen to you if you're within the Affirm ecosystem. When folks are delinquent, which is a fancy term for late with their payment, we'll reach out to them. We use all sorts of digital channels to get in touch with them.

39:35We'll remind them. Vast majority of folks that are late are actually what's called sloppy payers in the industry where they say, oh, my God, I forgot to set the autopay. Thank you for using that feature if you did. and they cure it and so it goes. And so the reason we don't charge late fees is because for folks where they really cannot, something happened and they lost their job or something happened, they're not going to pay you any faster if they have no means of paying you back. The ones that are just stumbled somehow and forgot, the reminder is the most you need to do. You don't want to penalize them for being forgetful.

40:10So what is the default rate? It's on the order of 2 % plus or minus. That's remarkable. Well, I think it's meaningfully lower. It's meaningfully lower than credit cards. By the way, our lower ticket items, that trend below 1%. So just to give you a sense, the rumors of this being a bad financial product creating hidden leverage in the system is like bad math and ridiculousness. So push back on that a little bit, but do it through the explanation of the business model here. Because I think a lot of people approach this product with being informed about how credit cards work and the idea that high interest, high interest if you miss a payment, fees if you miss a payment.

40:54In a sense, the risk is somehow put on a different party here, Max. And there's also buy-in from the retailer who partners with a firm. Just explain how this whole transaction works. Yeah. Very simple. you typically find a firm at a point of sale on any online and now progressively more offline merchants, you will ask to use the product. So it's always an explicit request to borrow. And we take great pride and put a lot of technical emphasis on underwriting every transaction individually so that we have the discretion to say, hey, you're overextending yourself. These 2 % through 2.5 % default rates don't come for nothing.

41:39We do an enormous amount of work in this underwriting engine set that we've built. So as you get approved through your real-time application, of course, what happens, we pay the merchant and you commit to paying us back over time. And we always give you a menu of choices, could be anything as short as four payments every two weeks, could be as long as 36 months once every month. The rest of it happens more or less automatically if you opt into the auto-pay feature. If you don't, we will send you a reminder and then you arrange for repayment from your bank account typically. And that is it. In our case, there is no compounding.

42:17The interest is the interest expressed in dollars, and that is what you commit to. It will not go up independent of any modifications to the schedule. There are no late fees in our case. Again, we are unique or almost unique, I think, at this point in the industry by just not charging any incremental fees at all and so on. So this This really is the product where the cornerstone value is transparency. We are entirely transparent with every participant in the ecosystem, from merchants to consumers. Everyone knows what they're getting into. You get your bicycle or your couch or your putty supply today, and you pay for it over time.

42:50And you know exactly when the payment plan stops, and then you're no longer in debt. It is a better zone to credit cards because when you use credit cards, which are very convenient, you don't have this extra approval step, so just drop the plastic and on you go, you're adding to this giant bucket of debt that just sits there and revolves. The interest compounds into principle every month, every week, whatever it is you've accrued in interest becomes a part of the base that accrues interest on interest on interest. That is why credit cards are so expensive. The reason APR matters as a measure is because it doesn't just measure interest you'll pay on a principle, it's the interest you'll pay on the interest on the interest and so on.

43:29The model we invented, the reason we are so important, the reason people are coming to us, frankly, is they don't have to understand exponential mathematics to figure out what is the true end point of interest will be. Whatever it is we promised them, that's exactly what they pay. We're speaking with Max Levchin. He's the founder and CEO of Affirm, the$29 billion market cap fintech company. Also, you'll notice Carole keeps talking about bikes. He's a big cyclist, too. So he spends a lot of time on the bike. So is Tim, by the way, Max. Oh, we know. We follow each other. I know you guys do. Hey, listen, one of the things I want to ask you, Your stock is on a tear.

44:03It's up 50 % year to date. It surged as much as 25 % intraday in response to your earnings, which you've been talking about. That came out late August. You had analysts, several of them raising the price targets on the stock. What's the path to sustainable profitability? What do you need to see happen to kind of keep the momentum going? We just need to keep doing exactly what we've been doing. You know, the joke I make all the time is we are an overnight success 15 years in the making. Profitability is not an accident. We gave this date exactly a year ago where we said, look, 12 months from now, we'll be GAAP profitable.

44:41Two years ago, we said, hey, 24 months from now, we expect to get profitable. And so we've been on a journey that we planned years ago to deliver on all these milestones. And so the celebration isn't of some clever overnight idea that we've had and finally just poked our head from the unprofitable side of the fence. We've been planning to be profitable. We've delivered on this plan. We have said publicly, we intend to be GAAP profitable from this point on. That is not a thing you can decide last week and deliver tomorrow. It's something that you build over a long period of time. It takes discipline, it takes execution, it takes a great team, which I'm lucky to have.

45:20And so I'm not worried about that whatsoever. Whatever we commit to, we tend to deliver on. Well, speaking of time, it's been a long time coming for Klarna and its IPO, and it does plan that here in the United States. Competition in the space is definitely max picking up. They are specifically rapidly expanding here in the U.S. You've got Sezzle. That stock is up about 7 ,000 % less than two years. There's a lot going on. So how are you seeing the competitive landscape evolve, and what does that mean for you guys specifically at Affirm? You know, we're very happy doing our thing. As I just extolled for a little while, we are different.

46:00We do our thing a little bit differently than the rest of the industry. We have a very strong point of view on what is and isn't moral, what is and isn't right for the consumer, for the merchant partners that we have. And, you know, it's paid great dividends for us and our shareholders. So in that sense, we intend to change absolutely nothing. Part of why maybe I spend less time looking at the competition than one does in a competitive industry, and this one is certainly very competitive, is in aggregate, buy now, pay later is still just under 1 % of total US retail. And it's a worldwide phenomenon.

46:33And US is actually quite behind if you look at markets like Australia and the Nordics, where buy now, pay later is more mature. There, the penetration into e-commerce is on the order of 20, 25%, I think. In the US, it's a much more polite 7%, maybe. And if you expand it into offline, which there's no reason why this doesn't work offline. In fact, we have a card that's been growing extremely well, better than 100 % year over year just in the last quarter's report. You know, we're a fraction of a fraction. So the opportunity to provide more honest financial products is, you know, I said it in my shareholder letter, sort of tongue in cheek, it rounds up to infinity.

47:08And so for now, we're not really running into each other in the hallways fighting for that last same customer or merchant. And I'm sure one day we'll get to a point where it's so significant as a part of US economy where it becomes a zero sum game. But even in that world, there's a visa to a MasterCard. And for now, I think we're all just experiencing really good growth. And frankly, the fact that the market now will support a couple of large publicly traded companies, it's probably a good thing that just gives shareholders a sense for this has a long way to go in terms of growth. Hey, Max, before we let you go, just 30 seconds on crypto and stable coins.

47:47An opinion piece this week coming from Paul Davies of Bloomberg Opinion. He wrote that stable coins are an opportunity for merchants and airlines to recover costs from big banks and networks like Visa and MasterCard. Is there a use for digital assets at a firm? I think there are interesting opportunities around merchant settlement, which is sort of I'm echoing what this piece is saying. I'm not yet seeing consumers spending stable coins they have acquired in droves. And so as a back end mechanism, stable coins are very interesting. And we're certainly looking at the opportunities there. On the consumer side, I think folks are thinking in dollars and probably will continue to do so.

48:22All right. Got to leave it there. Hey, Max, thanks for carving out some time for us. Max Lefkin, founder and chief executive officer of Affirm. Max, of course, just a great voice when it comes to what's going on in the fintech space. We're going to have more of PayPal fame, a PayPal fame as well. Part of the mafia, as they say.

48:44The thing about AI for business, it may not automatically fit the way your business works. At IBM, we've seen this firsthand. But by embedding AI across HR, IT, and procurement processes, we've reduced costs by millions, slash repetitive tasks, and freed thousands of hours for strategic work. Now we're helping companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business. IBM. Let's talk about healthcare for a second. It doesn't always work the way people expect it to. If you've ever waited on a prescription refill or had a hard time getting the care you needed, you know the feeling.

49:24The system should just work better for everyone. That's exactly what the people at Optum are trying to do every day. They're a healthcare company linking patient care and pharmacy services and using data and technology to drive the whole system so care is connected, not complicated. for patients and providers. Things like making it easier to get care that looks at the whole person, from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together. Technology designed to help doctors spend less time on busy work and more time with their patients.

49:58And those prescriptions? Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optim.com to see how. As industries evolve faster than ever, companies need an environment that accelerates strategic growth, and Michigan delivers on that promise. From emerging startups to global enterprises, Michigan offers what executives value most, a resilient, innovative ecosystem, diverse communities that attract top talent, and a quality of life that supports work-life balance.

50:33With our unified Team Michigan approach, businesses scale faster and compete at the highest level. Michigan, pure opportunity. Seize your opportunity at michiganbusiness.org. Wise is the smart way to manage the currencies you need around the globe. If you've ever sent money internationally using a traditional bank, there's a good chance you've paid more than you realized. Hidden fees, exchange rate markups, and extra charges can quietly add up before your money even arrives. There's a better way. Try Wise. Wise uses the exchange rate you'd usually find on Google, helping you avoid the unwelcome surprises that often come with international transfers.

51:11Whether you're sending money to family overseas, spending while on your holiday abroad, or paying bills across borders, Wise makes moving money simple, transparent, and straightforward. Wise offers 24-7 customer service and runs over 7 million daily checks to spot and stop fraud. And most transfers happen in under 20 seconds, which means your money arrives in less time than you've been listening to me. Join millions saving billions Be smart, get wise Visit wise.com or download the Wise app today T's and C's apply

51:46You're listening to the Bloomberg Business Week Daily Podcast Catch us live weekday afternoons from 2 to 5 p.m. Eastern Listen on Apple CarPlay and Android Auto with the Bloomberg Business app Or watch us live on YouTube Plenty ahead in our second hour of the weekend edition of Bloomberg Business Week including putting sports back in the spotlight. I don't know. Have they ever left the spotlight? I feel like... Just feels like the spotlight is shining brighter than ever. I mean, there's more money than ever going into these things and also the way that these teams are being valued. It's remarkable.

52:17Valuations off and running. Hey, we're going to take you to some of our favorite conversations from this past week's Bloomberg Power Players New York Summit held here at Bloomberg headquarters in New York City where we talked about the booming billion-dollar sports and entertainment industry with some of the biggest names in the space. A lineup that included the CEO of PGA of America on reshaping golf's future and the hosts of The Deal, Jason Kelly and baseball legend Alex Rodriguez on The Deal shaping the business of sports. All of that to come, we begin with someone who's redefining how sports, entertainment and fan experiences collide in the nation's capital.

52:52Ted Leonsis is CEO of Monumental Sports and Entertainment. It's the company behind some of the biggest Washington sports teams. Think NHL's Capitals, the NBA's Wizards, and the WNBA's Mystics. MSC also commands a portfolio with around$7.8 billion in assets. It's a lot. It's grown a lot in the last few years. Ted joined us from the Bloomberg Power Players Summit at our headquarters in New York City, along with NHL Commissioner Gary Bettman. I think AI is really the next big thing. With sports? Oh, yes, totally. How? Well, right now we're redoing our building and all we're talking about is physical AI.

53:30How do we collect data? How do we with three million people that come into our building? Where are they coming from? How old are they? Who are they married to? How long have they had the tickets? What are they like? What do they eat? What do we what can we do to be anticipatory with our building? It's not just smart buildings anymore. It's build the intelligence and the data right into that experience. You know, I just want to ask you, Ted, because you were at AOL in the early days. I mean, this is before you were in sports, you were in technology. So you understand the space. Are we in a moment now that is like when AOL brought us the World Wide Web?

54:08Well, I think the leagues, it seems like it's been a long time, but it's been a quick pivot to go from analog and bricks and mortar and linear distribution and local to be a global digital power plant, if you will, that we look at our teams. Obviously, they have high fanavidity, but it's IP. And how do we digitize everything that we're doing from the start and distribute it over our own channels? That's why we bought our RSN. Everyone was running out of the burning house. We said, let's run in. There will never be a better time to buy and reinvent the distribution model than there is right now.

54:57Gary, I want you to come in on the role of technology. I think all of us, when we're watching sports, I love it, whether it's tennis, whether it's golf, whether it's baseball, the statistics that come up. Hockey. Hockey. Sorry, sorry. I was getting there. I was getting there. Sorry, sorry, sorry. Well, that's what I wanted to get to. How fast the puck is going or something. How much fans love that engagement. I'm going to respond to that, but I want to add on to what Ted said. Just so you know, I have four brothers, and growing up we had an ice skating pond that they dug out of the woods in the back and would play hockey.

55:26I knew I liked you and your family. You grew up with it. Sports tends to focus people at an instant, at a moment in time, the score of the game. What's the result? I don't think we're at a moment in time. I think we're on a journey, and we've been on a journey for decades, and the speed limits change on the road, road conditions change, there are curves, there are hills, but at the end of the day, it starts with the authenticity of sports and how important sports are in people's lives and how it brings people and communities together, and technology has enabled us to connect better with our fans.

56:09So AI, we're like any other consumer business. It's going to help us do business better. But also, it's going to help us make sure that our games stay true to themselves. I always tell, particularly my tech and strategy guys, we're not going to change the game to make it more tech savvy or tech favorable. What we're going to do is use technology to make the game more consumable, more connected. And so puck and player tracking and HL Edge is a function of that. We're gathering millions of data points a minute, but it's enabling us to take people inside the game. Maybe even people who don't know the game and understand it and let them say, wow, that puck traveled 14 miles with average 88 miles an hour.

57:03This player can skate as fast as 35 miles an hour, and he's already skated six miles in this game. This gets people to understand and feel more connected, and it's going to let us give them the game on their terms. Because with all the streaming platforms, you're going to be able to sit at home and decide how you want to watch the game. Not the way we've done it from a linear standpoint since I was a little kid, and people my age are used to sitting on the couch and doing it. We used to get in front of my dad and be like, you know, get down, get down because you couldn't rewind. But if you're a Gen Z or a Gen A and you want to focus on a particular player and you want Dana simultaneously and you want to place a bet, you're going to be able to do all that and buy a jersey all at the same time.

57:49In addition, what puck and player tracking has enabled us to do is use the metaverse. We use animated versions of our game in real time. We were the first sports league to do that, and it works really well, and it engages young people and their parents. You know, I'm thinking about all this, and I'm thinking about the technology and thinking about the investment that's being made, and it reminds me of the way that we've seen sports turn into this premium experience now and the premiumization, this idea of it being a luxury good. And I'm wondering how you think about that, Ted, and how, you know, it's not like you go to the ball.

58:27Well, I guess ball games are still affordable. But apart from that, I mean, some tickets just end up being so expensive. How do you think about that for your customers? Well, many of us have run big public tech companies. And when you come into sports, you say, oh, the model is like a software company. We have nothing but blue chip clients, naming rights, suite sales, big sponsorships. media deals with the biggest companies in the world, Amazon and NBC, Comcast and Disney, ESPN. And they pay us over 10 years or longer with Escalate. So the model looks just like Salesforce.com or Oracle. Those are very valuable companies.

59:18it's why they're valued at a multiple of revenues, not a multiple of EBITDA. So that's what's happened to sports teams. It's this, we're six times, eight times, ten times, twelve times revenues. But for those of us who came in from public companies and tech companies, I go, we don't have an R &D budget. Think about that. We didn't have a CTO. We were one of the first teams that, I mean, we made a major hire. We have software developers. There's like those software developers in these teams. That's a big part of the pivot, right? If you're going to be digitized or die, if you're going to try to get your products and services out and build brand and build audience on a global basis, it all starts with taking a pixel and digitizing it.

1:00:16And we're now, I've owned the team 26 years, but there's now a lot of the big markets and more innovative companies that have said, yeah, we're not just a hockey team. You've got to have the hockey team as the ethos for the competition, for the fans. But as a business, these have become big businesses. We're going to be doing two years from now a billion dollars in revenue. You were valued at about$4 billion back in 2023 with the Qatar investment. We've been valued now close to seven. It's big growth in three years. Good business. It's good business. But we're doing$750 million in revenue. But the landscape, and it relates to everything that's going on with the distribution of content, No matter what platform you're talking about, live sports is the most compelling, most valuable content.

1:01:10And that's what's driving the values that you're seeing. Right, because there's so much stuff out there. But you're right, people tune in, write to see something. It's reality TV. I mean, it really is. You're right. But I think one thing that people miss, too, the world's in chaos. And it's not going to get more calm, but there's something about you go to a game and you know the puck's going to drop at 7.06. You know where the game is going to be televised. You know where your seats are. The players know if you make the wrong pass, it goes over the blue line. They know what penalties are. There's referees.

1:01:57And while there's... Wait, are you saying there's guardrails? I'm saying that there's structure, right? I was amazed at the World Cup. You have countries fighting each other, at war with each other, yet they get on the pitch. And it's, I know this line is out of bounds, that this is a boundary. I think we crave that. We want a level playing field, and you want meritocracy, and you want to see how people can compete. And yet, politics, geopolitics have gotten their way into sports. And I think about the NHL being kind of the most international and Canadian of all U.S. pro sports. And yet, geopolitics, coming from the White House, whether it was over trade and terror policies, we saw that play out, certainly.

1:02:45It did during the Four Nations in February when Canada was playing the U.S. in two games, including the final game. But what's great about sports, and it transcends geopolitics, because sports brings out people's passion and it brings people together. Even if they're rivals, their common interest in seeing the game and the outcome, and even within a particular country, no matter how diverse a country is, on whatever basis you're figuring out what the diversity is, people come together. It brings communities together. And when you have assets, franchises like Ted has in Washington, they make a difference in people's lives.

1:03:27Their outreach in the community, their youth programs, using sports to teach young people life lessons. That's as important as anything else that we can do in sports. And I think Monumental, what Ted does in Washington, is a great example of being outward facing in the community and making a difference. So we helped the White House have the inaugural at our arena. We're called the World's Most Important Arena. And that same week, there was a study out on who is the most popular and best athlete in Washington sports history. And it's a Russian, Alex Ovechkin. He broke Wayne Gretzky's record last year, and he is beloved in Washington, D.C.

1:04:17Yesterday, we announced a naming rights deal with Kupang, a South Korean company, e-commerce company. We're global, right? We are exporting our IP around the world. We have these icons, these great global brands. Advertisers want to reach those fans. And so, you know, it's just ironic. Here we are in Washington, D.C. As I said, I can see the White House. and while they're churning on things, sports is the great uniter. And didn't that poll also say that you were the most popular owner?

1:05:01Let the record show Ted did not answer the question. I think you guys need a little podcast. You want to be modest. It's good to hear that. It's good to hear that sports really kind of brings people together. We do see that over and over. Gentlemen, thank you so much. Thanks for being a part of this. Ted Leons is founder, chairman, managing partner, and CEO of Monumental Sports and Entertainment. Gary Bettman, commissioner of the NHL. Gentlemen, thank you so much. This is the Bloomberg Business Week Daily Podcast. Listen live each weekday starting at 2 p.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app.

1:05:37You can also listen live on Amazon Alexa from our flagship New York station. Just say, Alexa, play Bloomberg 1130. More from Bloomberg Power Players New York. This event that brought together influential voices from the business of sports to identify the next wave of disruption that could hit this multi-trillion dollar global industry. Next up, a name, gotta say, that baseball fans are very, very familiar with. So are Bloomberg fans familiar with. Alex Rodriguez has long been known as one of baseball's brightest stars. But in recent years, he's become almost as well known for what he's done off the field.

1:06:13From co-owning the NBA's Timberwolves to WNBA's Lynx, A-Rod has shown how retired athletes are approaching business. He also co-hosts a podcast for Bloomberg. It's called The Deal with Alex Rodriguez and Jason Kelly. Yeah, that's why he's so familiar to the Bloomberg audience as well. A-Rod joined us at the Power Player Summit alongside his Deal co-host, Bloomberg Originals chief correspondent, Jason Kelly. We've had a crazy last couple days because we – and you're going to love this one, Carol, because I know you're a fan of this person. The first was Erika Badon, who is former Erika Nardini.

1:06:47She ran Barstool. She had some incredible stories. And then yesterday, Robin Arzon from Peloton, who you and I interviewed way back in the day. I mean, Alex, that was unbelievable. I mean, she's a force of nature. And what a story, right, to be a litigator lawyer, one of the top firms in New York. and then around 2011 says, you know what? I'm going to do a radical pivot. And she cold emails Peloton, gets the job. And one of the most things, I mean, there's so much to admire, but the fact they've been to the moon with their stock, right, over$30 billion market cap, and now it's obviously a lot less than that, and she has stuck it through.

1:07:22And we asked her about it, and she gave a fantastic answer. That's my tease for her. Yeah. The other thing that she said, which is so funny. So this is how, I mean, I'm going to tell a little bit behind the scenes story. Inside baseball. Inside baseball. about the deal. And this is how I know that I think the show is really working is we literally sent each other voice memos this morning saying, like independent of each other, saying my favorite part of the interview with Robin Arzon was this thing that she said. And you'll have to wait to listen to what it is. But that was kind of a cool moment.

1:07:55That was cool. In this 45 minute conversation, there was one thing that we were both like, I'm going to use that in my day-to-day life. And I do think one of the things that we've started to achieve with this show is, like, sort of a level of intimacy with our guests. You know, they tend to open up. You know, we had, in this most recent season, we had Bill Belichick on, you know, a pretty rare business-side interview. You know, I think he told us stuff that, you know, he hadn't really talked about before and really talked about his approach to coaching, what it's like to sort of take this new job in college sports.

1:08:29And so, I mean, we're having a ton of fun. I mean, this is fun. Another fun one, timely-wise, because you mentioned time, is Mark Shapiro. They rang the bell, and they took TKO public. And he gave us some fascinating stories, going back to the Bob Iger days and what he was doing at ESPN and how he was a rising star. And now he's obviously the president of TKO and Endeavor. So, so many great stories. And now people are starting to reach out to us and saying, hey, can we be a guy? Well, that's what I was going to ask, Alex. I mean, now that it is the third season, you're not necessarily having to knock down doors the way you guys did just two or three years ago in order to do this.

1:09:01How are you thinking differently about the conversations and who you want on the program? Well, I think Jason reminded me yesterday that we've done around 50 shows. So we're getting some reps. We're getting out there. We're dropping one every week, which is the consistency is key in podcasting and anything just like your job here. And I think we're thinking bigger. And we're thinking, you know, how do we think outside the box? How do we storytell? But I think Robin from Peloton was like the epitome of everything, right? You have a lawyer who's now in fitness, who's now, you know, one of the most influential fitness people in sports in the country.

1:09:35Well, and I think, you know, to build on what Alex is saying, I think one of the key things that we think about with our show, and honestly, you know, infuses everything we're doing today with Power Players, is, you know, from the beginning, and this is why I think, you know, Alex really bought into our shared vision of this, is we're talking about the intersection of business sports and culture. And I think, you know, there's a fair amount that's being done around business and sports. You know, it's undeniable what's happening there. But I think, and we just literally talked about this on a panel that I moderated with Tom Garfinkel from the Dolphins and Mike Garagetti, the CEO of Ares, this amazing cultural impact that sports has on everybody's lives.

1:10:15At a time when we're so polarized, we're so divided. You know, Alex is, you know, very involved on the board of University of Miami. University of Miami beating Notre Dame at Hard Rock Stadium last weekend was an unbelievable moment, like, in the broad culture. I mean, it really was incredible. Yeah, and it had a huge number, around 13 million people. Right. And that is a huge number, right? And it's one of these things, especially after COVID, I think, and Tom talked about it in your last panel, that people still want to come together in a stadium. To have 75 ,000 people cheering on, remember the old history, like bringing the old days back for the University of Miami, convicts versus Catholics, right?

1:10:54It's pretty awesome. And the fact that we won, I'm very, very happy about that. We're speaking, of course, with Alex Rodriguez, chairman and CEO of A-Rod Corp. Also, Bloomberg Originals chief correspondent Jason Kelly. Talking about the newest season of the deal and more, is that culture around sport today, is that a lot different than it was when you played? Oh, there's no question about it. I mean, I think Michael Arregetti was talking about, you know, 10, 15 years ago, the ownership landscape looked a lot different. A little bit, you know, his words, a little bit more sleepy. And I'm paraphrasing.

1:11:25And the sophistication with the newer owners that have come in with the ability and the appetite to take risk while still being disciplined. But, you know, it takes a certain amount of, you know, a cowboy or a bit of a poker player to innovate and keep pushing the envelope and making these assets emote. But then it's all the businesses around, whether that's a stadium, networks, you know, what the Atlanta Braves have done is incredible. They did$75 million of extra cash flow for the team. I think that's the new model moving forward. Thank you for mentioning the break. That was very nice. I ran a person here.

1:12:02We should know it for everybody who doesn't know already. Smart co-host. So smart. So smart. So thoughtful. But, you know, I'll sort of toss it right back in the sense that I do think, to answer your question, Tim, one of the things that's also changed is in these years that we've been doing this, Alex has become the majority owner of an NBA and a WNBA team. And I do think being able to, you know, we talk a lot about, you know, in our partnership, sort of the roles that we play in the conversations that we have with our guests. And I think Alex's now ability and curiosity and willingness to essentially say to people, whether it's Robin, whether it's Erica, whether it's Ted Leonsis, who's been on our show, whether it's Belichick, to be like, hey, listen, I'm doing something new.

1:12:46We had Sue Bird on our show, you know, WNBA legend, you know, to be able to say, like, listen, I'm doing something new. Help me understand this new job. I mean, I do think that sort of unlocked something. Do you agree? For sure. And especially, like, they just handed us the keys about, call it, a few months ago. And it's fun for us to think we just brought in a new CEO. And Matthew Caldwell, who was formerly at the Florida Panthers, worked for my great friend, mentor Vinny Viola, who's won two titles back to back. No, it's just really a – the other thing that has changed, Jason, I think, is now we've brought institutional capital into the game.

1:13:20And if you think about the 92 professional sports team, when you include the four major leagues, NBA, NFL, NHL, and Major League Baseball, that changes the whole landscape of the ability to find some liquidity, put that money to work, and keep growing these assets. You know, I think there was always the worry, though, and I pose this question to both of you, of a lot of money coming in, gambling coming in, what that does to the sport. Let me start with you, Alex. Has it changed sports overall, all this money in? There's no question. There's a new data point that came out that blowout games in the fourth quarter in the NFL were doing better numbers in the second and first quarter.

1:13:59And that's because of fantasy football and the interest level that is no longer about the score. The NFL has found another hook to, like if they needed one, to bring in more fan base and become even stickier. I thought that was fascinating because most people in the fourth quarter, if it's a blowout, they're done. Net-net good? Yeah. What depends – It's complicated. It is complicated. Look, and there's regulations and you have to obviously put guardrails around everything. Right. Or money in college sports. So that's the one that I think is probably – it was funny. I was talking with the athletic director of Ohio State who was here on a panel earlier.

1:14:36And we have Dartmouth's athletic director joining us in just a few. And what I said to him, which he did not disagree with, is what has happened in the business of college sports over the past five years is the most radical thing that has happened in any sport in the past 100 to 200 years. I mean, there's no question. Yeah. Because the entire business model has changed. The amount of money coming in has changed. I mean, even the idea. So let's use University of Miami. University of Miami, the reason they won that game, almost, I mean, not completely, but a huge part of it is because the former quarterback of the University of Georgia was done playing at Georgia.

1:15:12He was headed for the NFL, got a call from the University of Miami and said, Hey, bro. Hey, Carson Beck. We'll pay you$4 million to come to University of Miami, which was probably 4x what he would have made his first season in the NFL if he got drafted. And then he goes down, plays in front of a bigger crowd in front of a, you know, in a higher profile game, higher viewership, you know, than he would have gotten if he had even been on the field in the NFL. That's a radical difference. Like that's complete. It's a game changer. Is it a good one? Is it like a. So, I mean, listen, I think if you it depends if you're an investor, there is certainly a lot of investing to be done around it.

1:15:55I think there, to Alex's point about guardrails, there need to be new guardrails. You know, one of the things the athletic director said was, like, we are literally making this up as we go along, which is crazy. I mean, like, none of us can do that in our jobs. And it's like, I try, as you know, but, like, we can't actually do it. Yeah, I mean, imagine any league without a collective bargain agreement, right? Without a union, without what is the exchange? If you sign a player for five years guaranteed, he can't just go on to the, you know, the opponent over there, the rival. So I think especially with the young kids, I mean, look, I have a junior, a girl who's a junior and a young lady that's a junior at the University of Michigan.

1:16:32And I have a senior this year in high school. And I couldn't imagine one of my girls getting five, six, seven million dollars today. And they're not equipped for it. Right. Well, and the other thing, and to your point, Bill Belichick on our show said this is actually harder than coaching the NFL because it's free agency all the time. So the kids can move around. Yeah. And they will move around. Yeah, we were talking about the portal with a colleague. We were talking about it with a colleague here. His son can just log in to a portal and go somewhere else. And he is going to move somewhere else.

1:17:00And if you look at some of the great coaches that we've lost from these institutions, whether you go to Saban, you go to Coach K, you go to Coach Wright from Villanova, a tough name for my Georgetown buddy here. But I think one of the reasons they're leaving is if you scream at a kid, he's going, I'm out, I'm going to Georgetown, or I'm going to University of Miami. And that wasn't the case back then. So what does this do to the pipeline going into the pros right now? I think college football becomes NFL junior. Yeah. And I think it really just becomes an extension. And so you start to – what it could do is you could have more, in some form or fashion, Carson Becks, who opt not to go to the pros because they're going to make several million dollars playing in college for an extra year.

1:17:45And then, I mean, big-time football is going to just get bigger and bigger, and college is going to be a part of that. So, Alex, I'll ask you the same question I was asking you about sports gambling. Net-net, is this a good thing? It's interesting, right, because I still remember the days with Pete Rose, right? I think the answer we don't know yet. But for college sports. Oh, for college sports. For college sports. I'm not sure about that. But I will tell you one correlation. Just to back up what Jason was saying is you've never had companies stay private longer, Whether it's Stripe or whether it's many examples.

1:18:23I think you can have an example of players staying in college longer. Because they can develop. They can go to the University of Miami for a senior for$4 million. The kid over at Michigan, the quarterback,$12,$12.5 million. That's amazing. Impressive. So it's a different world. So eight years in college and still no MD degree. Ouch! But they got a lot more money. Yeah, they got a lot more. And no student loans. We just got a few seconds left here. Got a dream guest that you guys are like, if they're listening? Real quick. Roger Federer. Oh. Oh, good one. Roger Goodell. Oh, good one. All right.

1:19:01A couple of Rogers. Listen up. So Rogers, if you're listening, they're ready. Well done. Guys, thank you. Good luck on the big stage. Thank you. We're getting ready to talk to you just to talk. All right, of course, J.C. Kelly, chief correspondent of Bloomberg Originals, Alex Rodriguez, chairman and CEO of A-Rod Corp. They are the co-hosts of The Deal, the third season. It is underway. You can find it wherever you download your podcast.

1:19:26So there's a lot of noise about AI, but time's too tight for more promises. So let's talk about results. At IBM, we work with our employees to integrate technology right into the systems they need. Now, a global workforce of 300 ,000 can use AI to fill their HR questions, resolving 94 % of common questions. Not noise. Proof of how we can help companies get smarter by putting AI where it actually pays off. Deep in the work that moves the business. Let's create smarter business. IBM. Let's talk about healthcare for a second. It doesn't always work the way people expect it to. If you've ever waited on a prescription refill or had a hard time getting the care you needed, you know the feeling.

1:20:07The system should just work better for everyone. That's exactly what the people at Optum are trying to do every day. They're a healthcare company linking patient care and pharmacy services and using data and technology to drive the whole system so care is connected, not complicated, for patients and providers. Things like making it easier to get care that looks at the whole person, from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together. Technology designed to help doctors spend less time on busy work and more time with their patients.

1:20:40And those prescriptions, Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optum.com to see how. As industries evolve faster than ever, companies need an environment that accelerates strategic growth. And Michigan delivers on that promise. From emerging startups to global enterprises, Michigan offers what executives value most, a resilient, innovative ecosystem, diverse communities that attract top talent, and a quality of life that supports work-life balance.

1:21:16With our unified Team Michigan approach, businesses scale faster and compete at the highest level. Michigan, pure opportunity. Seize your opportunity at michiganbusiness.org. Wise is the smart way to manage the currencies you need around the globe. If you've ever sent money internationally using a traditional bank, there's a good chance you've paid more than you realized. Hidden fees, exchange rate markups, and extra charges can quietly add up before your money even arrives. There's a better way. Try Wise. Wise uses the exchange rate you'd usually find on Google, helping you avoid the unwelcome surprises that often come with international transfers.

1:21:54Whether you're sending money to family overseas, spending while on your holiday abroad, or paying bills across borders, Wise makes moving money simple, transparent, and straightforward. Wise offers 24-7 customer service and runs over 7 million daily checks to spot and stop fraud. And most transfers happen in under 20 seconds, which means your money arrives in less time than you've been listening to me. Join millions, saving billions. Be smart. Get Wise. Visit wise.com or download the Wise app today. T's and C's apply.

1:22:28You're listening to the Bloomberg Business Week Daily Podcast. Catch us live weekday afternoons from 2 to 5 p.m. Eastern. Listen on Apple CarPlay and Android Auto with the Bloomberg Business app. Or watch us live on YouTube. Wrapping up our Bloomberg Power Players New York coverage on Bloomberg Business Week, we, yes, had to talk a little bit about golf. There was so much going on over the last year or two. We had a great voice, the head of PGA of America, which is home to the revered Ryder Cup. Derek Sprague is CEO of PGA of America. He joined us alongside Bloomberg News Texas Bureau Chief Julie Fine from Bloomberg Power Players in New York.

1:23:06Yeah, so we're the PGA of America, so commonly known as the coaches of the game, the administrators of the game, the club professionals, right? There's 16 ,000 clubs in this country, and we have PGA professionals at nearly 10 ,000 of those clubs. So you'll see a PGA professional if you go to a golf course, whether that's a public facility or a private facility. You'll take lessons from our PGA members versus the PGA Tour, which that's what you see on television every week. The elite part of the game is the PGA Tour. However, we work very closely with them because a lot of our PGA members are coaches of their tour players.

1:23:40Right. During the pandemic, golf really exploded because it was one of those sports that early on people realized they could do, and it was low or no risk. Have you seen that growth continue? It's been incredible. you know we haven't used social distancing word in a long time but golf pg of america actually went to bat during the pandemic to say because as states were shutting down we said hey golf is a safe sport and i think what we're seeing today you know five years after the pandemic is that growth continuing because as i told julia earlier families got together right they were all living together they got to play the sport together you have to play with your kids and your grandkids in a safe environment, outdoors and small groups, all the things that social distancing lend itself to.

1:24:24And we've seen that retention today. We have more golfers in the game. We're up to like 28 million in this country. 550 million rounds of golf were played in 2024. It's just incredible growth since the pandemic. I mean, I think in terms of the financial aspect of this game, what surprised me a little bit that we discussed earlier is the global impact of it. and what a difference global sponsors are making, the biggest changes you've seen in Ryder Cup in that aspect. Yeah, this year at the Ryder Cup here in a few weeks in New York City's backyard out in Long Island and Bethpage is we have about 280 corporate partners, and 30 of those are from around the world.

1:25:04We certainly have our worldwide partners at the PGA of America for the Ryder Cup, but we have 30 partners from Australia and Japan coming in. They're not even – those countries aren't involved with the Ryder Cup, But they're investing in the Ryder Cup because it's a live sporting event, one of the most epic sporting events in all of sports, not just golf. How do you think of the role of the Ryder's Cup in the midst of what feels like a divided golf world right now? How important is that? Yeah, I mean, I think we're past that a little bit, Carol. But it's certainly divided when you talk about the Ryder Cup because, you know, it's going to be loud and ruckus on Long Island.

1:25:42The Europeans are coming into our home court, so to speak. And as Keegan calls it, our captain calls it, America's course now. It used to be New York's public course, but it's America's course that week. So, yeah, it'll be divided that way. The crowds will be divided. But I think the investment in golf is now global, like I just mentioned. And so many people, golf is booming not only in this country, it's booming globally now. More golf courses being built around the world because of more golfers from around the world playing that are playing over here in America. They go back to their hometown and home countries and help start the game there.

1:26:17Since the inception of the Live Tour, what we've also seen boom is the purses. I mean, these players are making a lot more money because of this really competing tour. What do you see the future of all this? Yeah, I see it plateauing a little bit. We saw that was, again, we're different than the PGA Tour, but it certainly increased our purses at our majors, all three of our majors, the KPMG women's PGA, the senior PGA, and the men's PGA, which we'll be holding at our home course at Frisco, Texas there. So, yeah, the purses have grown, but I don't think they're going to continue to grow at the rate they have in the last few years.

1:26:55Might you see the Ryder Cup grow beyond the United States? Yeah, I mean, we play it every other year, So it's only in this country. And I think that's why the demand is so high for this year's Ryder Cup, one being in New York City metro market. It's a great market to hold an event. It sure is. And then we'll play it. It'll be in Ireland in 2027. So it goes back and forth every two years. Just to show you the magnitude, a half a million people registered for tickets for this year's Ryder Cup. Only 50 ,000 a day will be coming to it. But a half a million, right? And then we had 30 ,000 on the list to volunteer.

1:27:2930 ,000 say hey we'll come and work we'll buy a uniform we'll come out there and work we'll have about 4 ,000 volunteers out there. But do you expect it beyond the US and Europe? No I don't think so because this event goes back to 1927 we're coming up on our 100th anniversary in Ireland in two years and I don't see that changing at all. I'm wondering about accessibility to the sport here in the US and how you grow that pipeline especially for US players. We just went to the US Open last week we broadcast from there every year and every year we hear from the USTA about their efforts to increase the ability for kids to go out and play tennis, a sport that oftentimes is associated with country clubs, similar to golf.

1:28:04What needs to be done in the U.S. to increase that pipeline for young Americans? Well, the PGA of America has been doing it now for over 10 years, and we have a program under our PGA Reach Foundation umbrella called PGA Junior League. We put these kids in jerseys with their names and numbers on their backs. We'll have them out here at Ryder Cup, so you'll see a little sprinkle of that cheering on their favorite players or whatever. But last year in 2024, we had 77 ,000 juniors play. So our PGA of America golf professionals, they form these teams at their facilities. They compete against other teams from nearby facilities.

1:28:38And then we'll have a national championship actually in Frisco here in a few weeks. So, I mean, and that will be televised on ESPN. So even junior sports are seeing the big time on television, right? So, again, our PGA professionals are hard at growing the game. And PGA Junior League is just one of those great programs. It's probably the most successful program we've ever had for growing the game. You have some really big names in golf right now. You look at like a Scotty Scheffler from our neck of the woods. Texas really actually is becoming home to a lot of pro golfers now. But you look at him, you look at Bryson DeChambeau.

1:29:14Overall, you've got a lot of younger players. They're really appealing to people via social media and different means. And you've got a traditional base as well. So how do you marry that? Yeah, well, I think the younger generation, they grew up, a lot of them, in this video game world. So now technology has helped them get in there. They've got range finders, and they're checking the yardage on their watches and stuff. I mean, it just connects them to the game. And then when you look at the alternative off-course things like Topgolf in those type of venues, and you've got some right here in the city, right?

1:29:45You can go play golf inside the city here at some of the venues here. So I think that's transferring to whether you play nine holes or play a short course or play 18 holes. All these alternative forms of golf have helped elevate the game, especially with that demographic. And when they go all in on something, and I think other CEOs would tell you this, whether it's a certain product or a certain sport, they're all in. That demographic, they're not doing the mile wide and inch deep. They're going a mile deep and an inch wide. So if they get on the sport, a certain sport, they're staying with it.

1:30:17But, Derek, you know, like everyone is competing for our eyeballs right now. There's so much content out there and certainly just even sports content. There's so many different choices. So how do you guys kind of figure out how to expand your audiences in a way and then still stay kind of true to the traditional aspects of the game? Yeah, well, I think that's what the sport does, the multigenerational part of our sport, where you have, you know, right here at Bloomberg, you'll have some folks that have worked here for a number of years. They're mentoring the younger generation. They're taking them out to play golf.

1:30:45A lot of business deals are done on the golf course. So that's just one. Is it still, like, or is that just a stereotype? No, no, it is. And when you think about it, as much as technology is in this environment now, at a lot of the golf courses, it's great to put your phone down and actually talk with someone. And just think about having a meeting for four or five hours. So on a golf course to play 18 holes, you're playing for four, four and a half hours. You could be with your boss for four, four and a half hours. You could be with a client for four and a half. You get to know these people. And it's a great human interaction.

1:31:17That's another beautiful part of our sport is that, you know, it's not only traditional, but you have the technology infused with it, but then you get to spend time. And that's why I said earlier, just being able to play with my kids and spend four or five hours with it is great. Is it still a lot of guys, though, playing? No. Like, have we seen an increase in women? In fact, women's is the fastest growth of the sport. Since the pandemic, more women have gotten in the sport, not only for recreational. Again, I think being like, hey, when the families were at home and they were shuttered at home, they said, hey, I want to go out and play too.

1:31:50A lot of women took up the sport in the last five years. They've stayed in the game, which is great. And then I hear I've got a lot of nieces, and they're taking up the sport because they know it's an important part not only for business but for family. So it's wonderful to see, and that's one of our proudest moments, is to see the sport grow with the youth and with women and other people of underserved populations. We have a PGA Works part of our foundation, which really helps grow the game for underserved communities. And we're trying to make, PGA of America is the entity that's trying to make the game look more like America.

1:32:25You just talked about the human aspect of this. I'm now going to the not human aspect of this. Great segue. AI, changes in the game and technology. PGA of America, of course, in Frisco, Texas. That's how we know each other. the technology is you take a shot and it tells you everything that's wrong with it and what's right with it but i mean they anything to dissect your game that is there what is the future of technology in the game it's just going to continue to grow in fact that's one of the first things i did as the ceo when i got there i as i talked to our head of education and i said what are we doing we have all our associates that go through our headquarters there and they learn the trade and become a PGA professional there, and I said, what are we doing to teach them AI?

1:33:08Okay, not only with the launch monitors and all that, that'll have AI all factored in there with the algorithms and all that, but we're teaching our young associates how to use AI in running their golf facilities. So whether it's doing a flyer that's generated in a couple minutes rather than a couple hours, or doing rounds forecasting for their budgets, or doing newsletters for their club, and using that AI technology to save them time, make it more efficient. Hopefully it'll look better and then impress their bosses and their boards and their members. You know, one thing that we talked about, again, tennis fresh on our mind as the US Open continues here in New York and as we broadcast from there last week, the average age of a tennis coach here in the US is relatively old.

1:33:49And I'm wondering if you're seeing similar challenges when it comes to coaching with golf. Are you able to get those younger coaches in there who can spend their entire lifetime essentially teaching the game to others yeah we have three three career tracks really that sort of like when they want to become a pga member which direction you want to go so we have club operations we have coaching and we have executive management the the highest growth is coaching so we're not seeing that challenge we're seeing more young professionals want to get into coaching and i think why is that well i think one is it's a good lifestyle right you're not club operations can be challenging right you're coming Teaching generally is done in daylight hours.

1:34:31And I think we've had such great success teaching players. Randy Smith is one of our PGA members, and he's teaching the number one player in the game, Scotty Scheffler. And we've done a lot of great segments on that. And I think that just inspires our young professionals to say, I want to be like Randy Smith, and I want to be one of the best teachers in the game. We were talking with Derek Sprague. He's CEO of PGA of America. Also with us is our Julie Fine, Texas Bureau Chief here at Bloomberg News. Things evolve, things change, and things are questioned about. I do remember these conversations we were having that, like, younger generation isn't playing golf.

1:35:04Is it just the pandemic that you think got people more interested? Well, certainly that was probably a jump starter. But, you know, this sounds self-serving, but I look at some of the programs that we're doing, Carol, like PGA Junior League. We've been doing that for 10 years. And it's grown every year for 10 years, right? And you're getting 70. So what happens, again, when you look at the multigenerational part of our sport, these kids play, okay, and then their parents, again, what's beautiful about the sport is they don't have to sit on the sidelines like some other youth sports. They don't have to be up in the stands.

1:35:36They can participate with their kids. So all of a sudden you take a couple children and then a couple parents start and the game of golf grows. So, I mean, it's just, I think programs like that and then we've got another great program on our foundation for our veterans of this country called PGA Hope. And these veterans that they're trying to re-assimilate back into civilian life, and our PGA coaches are helping them take up the game, building community, and now they're starting to play the sport. So I think all these programs that we do at the national level at the PGA America, plus our 30, we have close to 33 ,000 PGA professionals, one of the largest working sports organizations in the world, PGA America is.

1:36:15So those members working at these 15 ,000 clubs nationwide are helping grow the game day in and day out. Starting to pay it off. We've got one last question. We're going to let you, Julie, wrap it up for us. Perfect timing. Last question is, 10 years, where are we in the game of golf? Yeah, well, today we're a$102 billion industry. I see that growing probably by another$20 or$30 billion. I think the retention rate is going to continue, and I think we're going to see, instead of 550 million rounds of golf being played, we'll probably see 600 million rounds of golf in 10 years and just continue to grow this sport.

1:36:49Instead of 28 million golfers, we'll probably have 32, 34. million golfers in 10 years time so again all these all these programs are continuing to develop golfers and and our 33 000 pga professionals are growing the game nationwide and i think all these programs will just continue to add to the numbers in you know economically in golf well i guess i loved hitting uh golf balls at the driving range like it was just so much fun it's just such a part of of us growing up um thank you so much you're welcome thank you when are you guys doing the show from texas hey anytime you invite us i'm on all the time let's do it from texas bring us down lots of family in texas love we'd love to have you derek's break thank you so much again ceo pga of american of course our thanks to our own julie fine texas bureau chief of bloomberg news we're gonna put on a cowboy hat we're gonna come down i'm waiting come across bring your boots too maybe bring your golf club too sure i know somebody so we'll head on out to frisco this This is the Bloomberg Business Week Daily Podcast, available on Apple, Spotify, and anywhere else you get your podcasts.

1:37:53Listen live weekday afternoons from 2 to 5 p.m. Eastern on Bloomberg.com, the iHeartRadio app, TuneIn, and the Bloomberg Business app. You can also watch us live every weekday on YouTube and always on the Bloomberg Terminal.

1:38:16When you're running a business, the best days are the ones where priorities stay on track. For midsize and large companies, risk can affect multiple parts of the organization at once, from property and liability to cyber and regulatory challenges. At that level, managing risk becomes an ongoing discipline. At the Hartford, the focus is on helping businesses manage risk before it turns into something more disruptive. And when losses do happen, that work is paired with insurance coverage shaped by years of underwriting, risk engineering, and claims experience. Learn more at thehartford.com slash risk mitigation.

1:38:50Policies provided by Hartford Fire Insurance Company and its property and casualty affiliates, Hartford, Connecticut. Whatever your goal, trade show giveaways, client gifts, or team gear, 4imprint has the promo products to match. With thousands of options, from apparel and drinkware to tech and totes, it's easy to find the right fit for your brand and budget with standout choices at every price point. And with their 360-degree guarantee, you can be 4imprint certain your order will show up just right, right on time. Explore more at 4imprint.com. 4imprint. 4certain. As industries evolve faster than ever, companies need an environment that accelerates strategic growth.

1:39:28And Michigan delivers on that promise. From emerging startups to global enterprises, Michigan offers what executives value most. a resilient, innovative ecosystem, diverse communities that attract top talent, and a quality of life that supports work-life balance. With our unified Team Michigan approach, businesses scale faster and compete at the highest level. Michigan, pure opportunity. Seize your opportunity at michiganbusiness.org. Healthcare doesn't always work great. If you've ever waited on a refill or couldn't schedule an appointment, you get it. That's the kind of stuff Optum is changing.

1:40:02They're using data and technology to integrate patient care, pharmacy, and everything else. So healthcare is connected, not complicated. What's that look like? Cheaper prescriptions that are easier to get and care that looks at the whole person, how you need it. Optum is helping make healthcare work as one for everyone. Learn more at business.optum.com.