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First Move with Julia Chatterley
Dr. Fauci Sounds The Alarm As 26 U.S. States Report Spiking COVID Cases; The E.U. Considering Banning U.S. Visitors According To Reports; Ben & Jerry's Suspends Advertising On Content Concerns. Aired 9-10a ET
Aired June 24, 2020 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:07]
JULIA CHATTERLEY, CNN INTERNATIONAL ANCHOR: Live from New York. I am Julia Chatterley. This is FIRST MOVE and here is your need to know.
A disturbing surge, Dr. Fauci sounds the alarm as 26 U.S. states report spiking COVID cases.
Persona non grata. The E.U. considering banning U.S. visitors according to reports.
And a Facebook freeze. Ben & Jerry's suspends advertising on content concerns.
It's Wednesday. Let's make a move.
And another busy show ahead. We'll be discussing the global COVID driven online payment boom plus the health tracker claiming it can help detect
some early symptoms of the disease. It might be as easy as putting a ring on it. Well, we'll see. The skeptics, too.
For now, I must say, stock futures don't have a great wind to them at all this morning. Take a look at that. The health risks and economic risks
front and center. We now see rising COVID-19 cases, as I mentioned, in more than half of the 50 U.S. states.
Dr. Anthony Fauci calling yesterday the recent uptrend, quote, "disturbing." At this hour, no surprise, I have to say, the I.M.F., too,
slashing its global growth outlook once again.
They now predict GDP to fall some five percent this year. That's far weaker than their previous estimates and I think a lot of people thought we were
too optimistic at the time. So, we're clearly climbing a wall of worry. The NASDAQ is set to pull back from record highs after rising for 16 out of the
past 18 sessions.
Heavy weights like Apple, Amazon and Microsoft all hitting records as well. Technology stocks have been seen as a de facto defensive play amid all the
rising health uncertainties, especially, of course those with strong earnings and balance sheets.
What about the European session? Well, those stocks feeling it, too, despite signs of improvement in business confidence data from Germany and
France, both nations seeing a record jump in the past month, but as always, context is key. Optimism still way below pre-COVID levels.
In Asia, they remain close to four-month highs for stock markets there. South Korean shares outperformed as Samsung rose almost three percent. A
resurgence in chip demand fueling optimism there, I think. Another notable move though coming in gold. It's risen to more than seven-year highs.
Slight pullback in the session today, but it has increasingly been seen as a place perhaps for nervous investors to park their money -- money amidst
the COVID-19 uncertainty, and there's plenty of that.
Let's get to the drivers. Coronavirus cases on the rise here in the United States, 26 states this week reporting increases in new infections compared
to last week's numbers. Dr. Anthony Fauci, the White House's top Infectious Disease expert giving a strong warning to Congress.
(BEGIN VIDEO CLIP)
DR. ANTHONY FAUCI, DIRECTOR, NATIONAL INSTITUTE OF ALLERGY AND INFECTIOUS DISEASES: We are now seeing a disturbing surge of infections that looks
like it's a combination, but one of the things is an increase in community spread.
We were going down from 30,000 to 25,000 to 20,000 and now, we sort of stayed about flat, and now, we're going up. A couple of days ago there were
30,000 new infections. That's very troublesome to me.
The next couple of weeks are going to be critical in our ability to address those surging that we're seeing.
(END VIDEO CLIP)
CHATTERLEY: John Harwood is live at the White House with more. John, great to have you with us. Dr. Fauci there clearly concerned. We were always
going to see more cases as people started moving around, as we got cracking with reopening.
The inference though here is that perhaps, we're focusing too much on reopening and not on the appropriate protections.
JOHN HARWOOD, CNN WHITE HOUSE CORRESPONDENT: There is no question about it. And yes, we were going to get more cases, but we expected that the rate of
positivity in the testing, as testing has expanded, would continue to go down, especially in the summer when more people are outside and the
transmission rate was expected to be less. We've seen the opposite of that.
Now we see cases rising to and above the 30,000 level and we see the rate of test positivity rising, and you see the reaction in terms of the E.U.
discussing potentially barring U.S. travelers. We see governors like Greg Abbott of Texas, Doug Ducey of Arizona, who have been pretty casual about
this so far, all of a sudden looking to take stricter measures, recommend mask wearing, things like that.
And you saw the evidence when the President went to Tulsa last weekend and the arena was only one-third filled and he afterward blamed the news media
for frightening people.
But it's not the news media frightening people, it's the coronavirus frightening people, and this is going to compel a stronger response from
state governments and perhaps from Washington.
[09:05:18]
CHATTERLEY: What we heard from Steve Mnuchin in the past couple of weeks, he said, look, we're not going to shut down again. We all get the sense
that on a nation level, at least, the bar here for re-closing the economies, even in certain parts, is very high.
But for state governors, as you point out, more stringent measures perhaps need to be introduced here in the very near future.
HARWOOD: We may not shut down again and obviously that is very politically difficult, but Greg Abbott, the conservative Republican, Trump-aligned
Governor of Texas, yesterday asked people to stay home. Didn't order them, but asked them to stay home.
He had been one of the earliest to lift stay-at-home directives several weeks ago. So, this is a very serious situation and there are simpler fixes
that the Trump administration, for some reason, continues to resist, like wearing masks by the President himself, encouraging others to do it.
When you talk to public health officials, they say if you've got widespread compliance, Republican, Democrat, Independent, everybody out there with
mask wearing, you could have a major impact on this quickly, and inexplicably, the Trump administration will not do that.
CHATTERLEY: Will that change, John? You look at the poll numbers, you look at the perception of handling of COVID-19 and the crisis, the lack of
widespread coordinated testing, the lack of widespread coordinated tracing, which is also required, too, if you want to send ill people home. Does that
approach change? Is it forced to change?
HARWOOD: Well, it could change. It ought to change, and when you look at the polls, 60 percent of the American people, three-fifths of the American
people are disapproving of the President's response to the virus.
There was a new poll by "The New York Times" out this morning showing him down 14 percentage points to Joe Biden in the General Election driven
largely by condemnation of his stance on the coronavirus, as well as on race relations in the aftermath of the George Floyd killing in Minneapolis.
So the President is facing a five-alarm fire right now and he is reacting in a way that is not commensurate with that, and you have to wonder, given
the public urgings of Tony Fauci and Robert Redfield of the C.D.C. yesterday, whether or not at some point, the President is going to get
dragged into a stronger response. He is not inclined to go there on his own.
But at some point, if hospitals begin to be overwhelmed, if hospital administrators have to start putting off elective surgery, you could have
in certain parts of the country a crisis situation on a par with what we faced in New York not long ago, and nobody wants to go there.
CHATTERLEY: No. Nobody does. John Harwood, thank you so much for your analysis there.
All right, the officials as John mentioned, telling CNN, the European Union is considering closing its borders to American travelers -- and other
countries -- to protect their citizens from coronavirus. The U.S. has the highest rate of COVID-19 related deaths and infections now in the world.
Richard Quest joins us on this. Richard, a contentious subject, but when you look at what the E.U. has for its own metrics, the nations within the
E.U., the United States in particular fails miserably and that's the truth.
RICHARD QUEST, CNN BUSINESS EDITOR-AT-LARGE: And it's that failure miserably that's grounded the decision that's likely to be made in science
and will make it very difficult to change.
You can't have a situation where the E.U. has put in place a parameter that other countries have to be as good as or better than the E.U. and then let
the United States in.
The U.S. rate is rising, as you were just talking to John Harwood about. It is more than double that of the E.U., there is no way with a straight face
you could say that the E.U. is meeting -- that the U.S. is meeting the criteria.
So simply on that alone -- now, could there be pressure from those countries in the south of Europe -- Italy, Spain, Greece -- that are
looking forward to U.S. tourists? Absolutely, they will want to.
But then, they will have to guard against, Julia, being told, well, if you want U.S. tourists, direct flights from the U.S., you may not be able to
reopen your borders with the rest of the E.U.
CHATTERLEY: I mean, that's the trade-off, isn't it? You can opt in and opt out. You're allowed to make a choice on this if you're an E.U. nation and
to act alone.
[09:10:08]
CHATTERLEY: But to your point, at great cost if it means that other European tourists can't perhaps drive over the border rather than flying
in.
QUEST: I find it almost inconceivable that the E.U. will not speak as one voice on this. The differences of opinion that you're talking about,
between the north and the south and those countries wanting to be more relaxed than others, they are going on at the moment behind closed doors.
In terms of the U.S., it's a black eye. It's embarrassing.
Now, I don't give credence to those who say the E.U. is doing this because the U.S. imposed its travel ban back in March and did so suddenly, et
cetera, et cetera. No, I don't give credence to that. This is grounded in science.
On no reasonable understanding of the data would you say that the U.S. is entitled to have access again to the E.U. if your barometer is same or
better.
CHATTERLEY: Yes. Absolutely. And I couldn't agree more with you. This is not a tit-for-tat in the case of what we saw earlier in March. Primary
metric, the measure of average number of new cases in 100,000 people over the last 14 days, E.U. block average 14. U.S. score 107. Brazil is 180.
Russia is 80.
We're in the same boat with some other interesting led countries.
QUEST: And, Julia, a U.S. situation that is worsening. That's the core. I mean, nobody in their right minds would start allowing travelers from the
U.S. at a time when the U.S. numbers are getting worse. And I say that, you know, planning a trip to Europe to film for "World of Wonder" in the next
few weeks and recognizing the enormous difficulties that it's going to be.
But the numbers at the moment are heavily against the U.S., and European leaders are looking in bewilderment at the current administration, which
seems to have done everything that the experts have told them not to do.
CHATTERLEY: Bewildering, yes, the perfect word. Richard Quest, thank you so much.
Now, business boycott of Facebook is growing. Ice cream maker Ben and Jerry's is the latest company that says it won't advertise on Facebook-
owned platforms for a month.
Brian Fung joins us now. Brian, this is an interesting move because this hits Facebook where it hurts, advertising money. What are Ben & Jerry's
saying here?
BRIAN FUNG, CNN TECHNOLOGY REPORTER: Well, this is a big step for Ben & Jerry's as this boycott is really gaining steam. Let me read a little
snippet of what Ben & Jerry's had to say yesterday. They are calling for Facebook to take stronger action to stop its platforms from being used to
divide our nation, suppress voters, foment and fan the flames of racism and violence and undermine our democracy.
Now, this is not the only company to announce a boycott of Facebook advertising. In recent days we've seen brands including Eddie Bauer,
Patagonia, the North Face and Magnolia Pictures, which is the studio behind documentaries like "Man on Wire" and Food Inc. all announce that they're
pulling their ads from Facebook and Instagram.
It's all part of a campaign launched by Civil Rights groups, including the NAACP, the Anti-Defamation League and Color of Change, among others, under
the #StopHateForProfit and saying this is a company that foments misinformation and ahte speech on its platform and that they are going to
be pulling their funding from this platform until Facebook changes its ways.
Now, some brands say that this boycott will last at least through the end of July, indicating it could go longer. Other brands are saying they're
also going to stop putting on organic content that is not advertising, but content that they've created and is unpaid on these platforms as well.
And so, this really just highlights the massive public relations crisis that faces Facebook now, even though it is currently unclear how much these
brands spend on Facebook advertising. None of them are willing to release hard numbers as of this moment -- Julia.
CHATTERLEY: Yes, I would guess a drop in the ocean here. Facebook took $70 billion in ad revenue in 2019 from major advertisers, but it's also about
the small businesses. Actually, the data is incredibly granular, it is tiny businesses that are advertising on Facebook. So, it's tough to get all of
them coordinated to send a real message here. But it's one step forward.
Brian Fung, thank you so much for that.
Authorities in China have accelerated coronavirus testing. Large scale testing sites that have been set up across the capital, Beijing. We're told
there's capacity to carry out more than 300,000 tests a day. David Culver checks out one of those brand new facilities.
[09:15:02]
(BEGIN VIDEOTAPE)
DAVID CULVER, CNN CORRESPONDENT: Here in China, you're looking at one of many mass testing sites that have been set up particularly within Beijing.
This is following the wholesale food cluster outbreak that happened more than a week ago.
They say it's now under control, but they are continuing testing in massive numbers. And you've got here 19 rows set up. This is for 19 different
communities that feed into this one mass testing site.
Once people have registered, they're taken across this little way here into these lines. Let me show you where they end up. It's almost like getting in
rides at an amusement park.
They're getting in line, if you will. I'll show you. Follow me over here. This is where the actual testing is done. It takes about 30 seconds.
They've got about a hundred staff members that work on two-hour shifts and there, they do the throat swab. They then take the sample and they will put
it in a refrigerator.
And then, move on to the next person. Usually, it takes just a few days' time to get the results back and most people are only notified if they have
a positive result.
You can see over here, this is where the staff will take off all of their PPE, all of their protective equipment, and they'll throw it away. It's
kept in a separate area.
And the other staff that are about ready to come on shift, they get changed, suited up and go through a sanitation procedure in a separate
facility to then keep this going really from 9:00 in the morning until 10:00 at night.
In three days' time that this has been operating, they've done about 20,000 tests. This was built overnight. So, they popped up relatively quickly.
They will keep it going for as long as they need to here in Beijing and they say as of now, they feel like they're on a good path in keeping this
most recent cluster outbreak under control.
But they are saying complacency is what they're trying to avoid with all of this.
David Culver, CNN, Beijing.
(END VIDEOTAPE)
CHATTERLEY: Wow. Comprehensive testing.
All right, let me bring you up to speed now with some of the other stories making headlines around the world. Latin America and the Caribbean hitting
the grim milestone of 100,000 coronavirus deaths. Brazil alone reports more than 52,000 lost lives and over 8,400 people have died in Peru according to
Johns Hopkins University.
Meanwhile, in Brazil, President Jair Bolsonaro ordered by a Federal judge to wear a facemask in public. The judge says failure to do so could lead to
a fine. This comes after the Brazilian President appeared at several public events without wearing a mask.
All right. Still to come here on FIRST MOVE, check out checkout.com, the pandemic's e-commerce spike triples the value of the British startup. I
speak to the CEO of what is now a multibillion dollar new company.
And could this be the ring to rule them all? Oura says, it has a health tracking band that can detect COVID-19 symptoms in advance, but there are
skeptics who beg to differ.
The CEO's take. He joins us coming up on the show. Stay with us.
(COMMERCIAL BREAK)
[09:20:56]
CHATTERLEY: Welcome back to FIRST MOVE live from New York. And a softer start expected this morning as investors eye rising COVID cases and the
challenges of reopening global economies.
New data from the financial firm, Jefferies showing that economic activity in the United States has regained just over half of its pre-COVID levels.
We need to keep the momentum going and not throw it into reverse. Of course, among alarm, rising cases. The past few weeks we've seen rallies in
companies that will benefit from the economic recovery.
Stay-at-home stocks like Netflix, Zoom, Peloton and Amazon though continue to do well, too as you can see, that's the last five sessions.
The best performing stay-at-home company at the moment is Fastly, a Cloud computing platform that boosts the performance of its e-commerce clients.
Its stock is up more than 40 percent in the last week alone, more than 300 percent since lockdown began. That's zooming past Zoom, I believe, as well
with that performance.
All right, let's talk about what's going on. Brian Levitt, Global Market Strategist at INVESCO joins us now. Brian, great to have you with us.
Markets are forward-looking mechanisms. We know this. They tend to not necessary look at the damage that's been done, but the data and the
recovery that we're seeing. Can they also look through rising COVID cases in 26 U.S. states?
BRIAN LEVITT, GLOBAL MARKET STRATEGIST, INVESCO: Well, I think in the near term probably not. I mean, you're likely to see a wayward or volatile
market in the near term and that's to be expected. The markets retraced over a very extreme bottom for a number of weeks and did so rightfully.
I mean, some economic data, whether it's retail sales or whether it's the Empire Manufacturing Index, even looks like a V-shaped recovery. Others
tell you a little bit of a different picture.
But the reality is that that is telling you that the sharpest, steepest, quickest recession is over. There's a recovery in place. But this recovery
will come with fits and starts and caseloads are going to matter significantly.
We don't want to just watch caseload, we want to watch hospitalizations, we want to watch deaths. But yes, any type of uncertainty will drive
volatility in markets and that's to be expected.
CHATTERLEY: What is the price, Brian, when you look in aggregate at stock markets at these levels?
LEVITT: I'm sorry, can you ask that again? What's the --
CHATTERLEY: What's in the price? Are we priced to perfection in terms of recovery here? I don't want to get into the alphabet soup of what kind of
recovery we're looking at here, but just when we look at the bounce back that we've seen in stocks, what are investors hoping or estimating in terms
of recovery?
LEVITT: Yes, I mean in the near term, you've priced in a lot of the good news. I think what investors should be recognizing is that if you look out
beyond this, I think we all ultimately know that we will get through this, whether it's through, you know, better behavioral changes around our
reopening policies, some type of medical or scientific breakthrough, we will get through this.
And what the equity market is focused on is as you progress through this, what's likely to transpire is a very slow growth environment, a very
protracted, prolonged recovery in which it takes a very long time to get back to full employment, in which case, policy remains very accommodative
for the foreseeable future.
So, what you're likely setting up is the next long-term market cycle in which a starting point of stocks being very cheap, the bonds and interest
rates being zero indefinitely.
So as an investor, I would say, you know, don't spend so much time focusing on the next weeks and whether reopening policies get called into question.
I think we all suspect that may happen.
It's far more important to think longer term about what this next cycle looks like. And I suspect it will be another one of these really long ones,
maybe even longer than the one that started in 2009.
[09:25:04]
CHATTERLEY: Wow. How much emphasis and importance are you placing on retail investors? They've acquired a lot of column inches of people just getting
involved, seeing beaten-up stocks, believing that at some point we will travel again, we'll fly again, we will go on cruises again and buying some
of the more beaten-up stocks and fueling what looks to be greater breadth in this market as many sectors rise.
How important is the signal that that's sending?
LEVITT: Well, I think it's over sending. There's been some articles that overstate, you know, what the day traders or people on the Robinhood app
are doing.
I would say that largely the market has followed what you would suspect it would follow. I mean, you bottom with really negative sentiment. You
retrace higher and then the breadth starts to widen from the growth stocks to the early cyclicals to the small caps to the parts of the market that
had been most beaten up, and that's what typically happens in a recovery.
I think what investors should call into question right now is does that recovery persist that continues to drive the more economically sensitive
parts of the market or is it a return to favoring the stay-at-home stocks or the companies that are benefitting from the true structural changes in
society?
I suspect it's the latter. I mean, look, don't get me wrong. At some point we're going to have an economic recovery and deep value will be unlocked
and the early cyclicals will be the winner.
But ultimately, what's happening here is that the structural changes and shifts in society and the economy are being accelerated by this, which
means we're going to emerge from this in a slow growth world without a lot of inflation and interest rates low.
To me, those are structural forces against steep value, early cyclicals and continues to have me wanting to favor the true growth companies, finding
growth wherever I can find it.
CHATTERLEY: Absolutely. Back to technology and health and the two things that we are focused on and needing the most at this moment. Brian, great to
have you with us. Brian Levitt, Global Market Strategist at INVESCO there. Thank you for joining us.
LEVITT: Thank you.
CHATTERLEY: All right, the market open is next. Stay with us.
(COMMERCIAL BREAK)
[09:30:27]
CHATTERLEY: Welcome back to FIRST MOVE, and U.S. stock markets are up and running this Wednesday. We've got a weaker open across the board. Fears
that rising COVID cases could imperil the economic rebound we're seeing in many parts of the globe, hampering the reopening efforts.
California saw a rise of more than 5,000 cases yesterday. Meanwhile, cases in Arizona and Florida spiked by more than 3,000. Some states now
considering rolling back their reopening plans. The Governor of Texas recommending that citizens stay home if possible.
Gloom from the I.M.F., too. The I.M.F. is forecasting an almost five percent drop in global GDP this year as the impact of the pandemic
reverberates and the worst of it is, the poorer you are, the more damaging the fallout will be.
The I.M.F. says 30 years of progress in reducing extreme poverty could be undone.
Clare Sebastian has been pouring over the details. Clare, no surprise, I think that they've had to review and lower their estimates. A lot of people
thought they were too optimistic last time. You and I discussed it. But a synchronized deep downturn. That's what we're looking at.
CLARE SEBASTIAN, CNN INTERNATIONAL CORRESPONDENT: Yes, 4.9 percent contraction, Julia is now what's predicted this year. Just to put that in
context, what we saw in the wake of the global recession in 2008 and 2009. In 2009, world output contracted by just 0.6 percent.
So, I think synchronized is crucial here. When you see this kind of number for the world, you know that every economy is being impacted by this. But
not every economy is being impacted the same.
I think we can look at the situation for some different countries. The U.S., for example, set to contract eight percent this year, but rebound 4.5
percent next year.
Euro area, similarly deep contraction this year followed by a rebound next year. Mexico, one of the worst hit at the moment; Latin America, of course,
is one of the epicenters that is set to contract 10.5 percent this year, but only rebound some three percent next year.
China though, interesting because we did see a lot of the restrictions lifted towards the end of the first quarter, is set to grow one percent
this year and up to 8.2 percent next year, which is a growth rate that we haven't seen in a while in China. So that is something to watch going
forward.
But the reason they downgraded, Julia, from those forecasts in April is, one, because even in economies where infection rates are slowing, they're
worried about the impact of prolonged social distancing that they see continuing through the second half of 2020.
They talk about what they call scarring, which is the closure of some firms which will, of course, never be able to rehire unemployed workers. The
impact on supply chains, the cost of productivity of building resiliency into workplaces, and of course, in countries where infection rates are not
slowing, they're worried about the prolonged impact of continued lockdowns.
CHATTERLEY: Yes, a lot of different warnings in there for developed and emerging market economies. Clare Sebastian, thank you so much for that.
The British startup checkout.com has just raised new funding that tripled it's valuation to an estimated $5.5 billion. Checkout.com does what it says
on the tenet, it provides the digital platform upon which merchants process their online sales.
Transactions on the site surged some 250 percent between May 2019 and May 2020, as the COVID-19 lockdowns led to an e-commerce boom.
Joining us now is Guillaume Pousaz, he is founder and CEO of checkout.com and he joins us now. Great to have you with us, sir. Explain checkout.com
in your own words and what kind of clients you're helping here.
GUILLAUME POUSAZ, FOUNDER AND CEO, CHECKOUT.COM: Good to be here. We've always focused on enterprises so we have innovative global brands to
process payments all around the world, and it will be companies like Sharna (ph), FarFetch. We do a lot of luxury and other FinTech, Adidas, Samsung
and fundamentally, we have been taking payments all around the world and we go extra granular with data insights for them.
So, it's a different value proposition than Stripe for instance.
CHATTERLEY: Okay, so I just mentioned the 250 percent increase in sales between May of this year and May of last year. Just hone in, if you can,
for me what you've seen since the outbreak of COVID, how much of this has increased transaction volume for individual customers versus new businesses
saying, hey, I need help getting online.
POUSAZ: So we have two tailwinds. We have obviously all the net new volume that has been coming with us over the last 12 months, because, I mean, we
went from like being a fast growing company, but mostly unknown to one of the largest index in Europe last year when we raised the $230 million
Series A.
[09:35:03]
POUSAZ: On the back of this, 500 new enterprise clients, these clients are obviously ramping up. Now, you combine this with COVID-19, you will have
obviously music and television subscriptions. These are public companies, so they are growing very fast on the back of COVID-19. There is an
acceleration there, food delivery and I think the opposite is obviously, everything that has to do with mobility, travel and experiences, ticketing
sales and things like this have slowed down quite drastically, so they are trading at 10 percent of where they used to be.
But, overall the business has been very good for us.
CHATTERLEY: Do you think you can sustain this, whether it's the volume of traffic that we're seeing from businesses as they're trying to shift more
of their business online as we stay at home and shop more? Or do you think we see a petering out again as we try to get back to some normality and we
see reopening continue?
POUSAZ: I think this is -- we always had this thesis that the world is transforming. People call it digital transformation and we just call it the
global transformation of the world we live in in the sense that people are moving from offline to online.
I look at my kids, they use TikTok in a way that I couldn't imagine myself. So, I think new generations are just used to like living online and kind of
transacting online.
So we are firm believers that the world is only going into one direction and that's more online sales. Will we see a bit of a slowdown on the
acceleration? I think, this is the million-dollar question to which I don't have the answer.
But clearly when we look at our models and forecast, I mean, the business is about to triple in the next 12 months again, so I think we're pretty
optimistic about the future.
CHATTERLEY: Wow, a tripling of the business again in the next 12 months. All right, then on that line, talk to me about the $5.5 billion question,
and maybe going public. You've talked about potentially listing in the United States. Why listing in the United States?
POUSAZ: I think any tech company wants to list on Wall Street, it seems like probably like any -- not any tech company -- I'll speak for me, but I
think, you know, when you work 15 years into a company trying to build something, Wall Street seems like the right way to go.
In terms of timeline, I mean, we raised Series A last year, we are raising a Series B now, for just now, so I think it's like speaking about an IPO
right now. It's a natural step for a company of our size. That's for sure.
We're profitable and we've been profitable for many years and we're growing really fast, that we are going to mention, so fundamentally the idea as a
natural step, but I think like, I'm not ready again to make the timeline.
What I would say though is that Wall Street is obviously an exciting place to do it and hopefully we'll be there one day.
As far as the Series B is concerned, so it too was a bit of a natural fit for us. Two things I think -- three things actually. First of all, they
have a strong Silicon Valley DNA which was something for us that was really important because a lot of our clients are in the Silicon Valley itself.
Second of all, they understand China really, really well. It is a hedge fund that had exposure to China for many years. The CEO is on the Board of
Directors, so I think they truly understand that market. And third, their data science team is one of the best we've seen in an investor and we are
extremely data driven as a company, so I think that it was just like a natural fit there and we're super happy to have them as an investor.
CHATTERLEY: Good to know. I guess, I'm asking as a Brit in terms of where you're listing, quite frankly because I just want to see European talent as
well rising at the same level as the United States in terms of the technology as well.
I want to get your view on Wirecard. What do you make of Wirecard and do you think it has cast a shadow over FinTech, maybe specifically the
payments industry and the sort of scandal that we are seeing?
POUSAZ: So Wirecard was always a bit of a mystery, at least for me. It's a company that had a giant market cap a few years ago, but you would never
see them anywhere. I mean, we never had a client from Wirecard. We would not see them in our fees. I mean, we see some of our competitors like
repeatedly and I mean, you know, Orts (ph) Stripe and Adyen, but we don't see Wirecard. We've never seen them.
And as a matter of fact, this company was always a bit of like a mystery for us. It's hard to speculate on what exactly happened over there, but I
think we should not put all the companies into the same basket and you know, payment companies like ours, we see regulation compliance as an
opportunity.
You were mentioning Europe. Europe does that really well, imposing compliance and regulatory requirements on people, strong customer
authentication, for instance, we have talked a lot about it last year.
This is a true opportunity for us to actually build technology that is useful to merchants. Same thing for marketplaces that in Europe have
certain kind of regulatory requirements.
So I think it's too easy to say that there is a shadow on payments in general. There's plenty of good companies in the payment industry and I
think, you know, we are -- we should focus on that.
CHATTERLEY: It's interesting what you say though about regulation and the regulatory environment, because this does look, and we're obviously
speculating on actually what happened here, at least for now, a regulatory failure if this $2 billion is indeed missing and never existed.
Do you think as a result of this there will be greater regulation, specifically on this sector?
[09:40:10]
POUSAZ: So, I think the real question, is it a regulatory failure or is it an auditing failure? You know, I think it is -- I don't work with BaFin, we
work with the U.K. regulator in Europe and the French one, so we have two licenses as part of our Brexit contingency plan, so we don't have really
experience with the German regulators, so I couldn't really speak for this.
But I think you know, the questions are probably elsewhere.
CHATTERLEY: Yes, it's a really important point. Guillaume, great to have you with us. Thank you so much and keep in touch, please, on that timing,
especially with regards the IPO. Thank you.
POUSAZ: Thank you very much, Julia.
CHATTERLEY: Guillaume Pousaz there, founder and CEO of checkout.com.
All right, still to come, could a health tracking ring help detect whether an NBA player is developing symptoms of COVID-19? We'll discuss the claims
with the Oura CEO. That's next.
(COMMERCIAL BREAK)
CHATTERLEY: As the NBA prepares for the basketball season to resume at the end of July, some players will have a new tool that could help them stay
safe and healthy.
The league is partnering with Oura, the maker of health tracking rings. The company says they can detect symptoms related to the onset of COVID-19
three days in advance with 90 percent accuracy. Although, I have to say, some doctors are skeptical.
The Las Vegas Sands Casino and Hotel Group is also providing employees with Oura rings as part of its reopening. Harpreet Rai is the CEO of Oura and he
joins us now via Skype. Great to have you with us, Harpreet. Let's just start with the basics. What exactly does the ring monitor?
HARPREET RAI, CEO, OURA: Yes. Sure. Thanks for having me on the show, Julia. Our ring actually tracks a couple of things related to the onset of
symptoms for coronavirus, that's heart rate, heart rate variability, body temperature, and actually respiratory rate. We track sleep and activity.
Our focus has always been sleep and recovery.
[09:45:07]
RAI: But we found out ways to use the other sensors in our rings to make them valuable during this pandemic.
CHATTERLEY: How accurately does it monitor these things? Because it sounds like a Fitbit or an Apple watch, for example, in terms of monitoring vital
signs. How accurate is this ring?
RAI: Yes, we've had an independent research that's been published on the different characteristics of our device, as well, we published research on
our own, too.
We've shown that the heart rate and heart rate variability are correlated to an EKG at 99 percent and 98 percent, respectively. In terms of the
research for COVID-19 in particular, we're working with two large institutions, UCSF, and we're doing a research study together on the
characteristics and the symptoms of coronavirus and other influenza-like illnesses and the same thing actually at West Virginia University with the
Rockefeller Neuroscience Group.
CHATTERLEY: And just to be clear though, you're paying for that research with the universities and the Rockefeller Neuroscience Institute, the
research was done in conjunction with you.
Because this is one of the big criticisms, and I know you're receiving a lot of it. They're saying hang on a second, no one is independently
verifying any of this and it's all research that you as the producers of this ring have paid for. What is your response to that?
RAI: Yes, Julia, it's a good question and thanks for asking it. Actually, the research at Rockefeller Neuroscience Institute of West Virginia is
fully independent. That's fully funded by them. In terms of the UCSF research, we did actually contribute to the research as one of the funders,
but we're actually going to be a minority of the funder in that research study.
Those researchers have found really promising information in regards, and they've been able to get several grants in addition and I would expect us
to end up being a small minority of the total funding.
CHATTERLEY: Are you going to be speaking to the F.D.A. as well about getting some kind of approval for this, too? Because just measuring the
change in vital signs could be a prelude to any form of illness, not necessarily COVID-19. It could be a prelude to nothing, too, surely.
RAI: Yes. You know, that's again a great question. And we've scene said in the research that it's COVID-19 and other influenza-like illnesses.
Frankly, even Fitbit has seen this and they actually published research even last year on the common flu, you know, the seasonal flu.
So I think we're in a state right now in this country that we're trying to figure out how to reopen businesses, and frankly people like the Las Vegas
Sands, people like the NBA, right, they're innovators and they're willing to invest and actually learn. And it's not just this novel coronavirus.
There's likelihood, 50 percent likelihood that we have another pandemic in the next 20 years.
So I think these organizations are real leaders. They really want to make their workers safe. Everyone is worried and they want to figure out how can
we use technology to figure this out? And we're really proud to partner with them on that.
CHATTERLEY: Talk to me about that partnership with the NBA. Have they bought these rings and then you're going to collect the data and get a
sense of what you're seeing here, or again, is it a partnership where you've given them the rings?
RAI: Yes, I can't actually comment on financial terms just because of the contract. I'll say that the NBA is actually providing the rings to all
players and staff and other individuals that are in Orlando and in the bubble. So I can't comment on the economic terms, but, you know, I think
really the spirit here that the NBA is taking is they're encouraging players and staff to actually enroll in the UCSF, in our research and
frankly, we're all trying to learn and get better together.
I think the players are arriving, they're going to have access to thermal guns and multiple temperature sensors, an Oura ring, a pulse oximeter,
daily testing. And really I think that kind of precaution, I wouldn't say let's use Oura ring in substitution of any testing. I think it's way too
early and the research is still ongoing.
I think, the NBA is thinking about what can we do in addition to? And frankly, it's that research minded partner and someone that's going to
invest the money so we can all learn as a country on how to move forward. And I think that's really what's exciting here.
I think it's really exciting to partner with them and try to figure this out and we're going to learn together and I'm sure there's other
organizations and sports leagues that can afford all of the same testing and precautions and they want to reopen, too.
But right now that's not possible and if we learn from others and leaders like the NBA, working with lots of innovative tech, I'm sure that there's
more we can do together across the country with other organizations.
CHATTERLEY: Yes, I know I'm pushing you, we are, as you quite rightly point out, the research stage here as well, and this is not a substitute for any
other version of testing or understanding, but again we are sort of desperate here really just to do whatever we can to improve things.
Talk to me very quickly about what next? I mentioned the F.D.A. there. Are you talking to the F.D.A. yet or is that in the future?
[09:50:23]
RAI: Yes, I can't comment on any conversations that aren't public yet. I think, again, here we've seen literally how this started. We have a
readiness score on our app. We have the four things I talked about, including temperature in our ring, which other wearables don't have on the
wrist like Apple or Fitbit.
And I think there's lots of interesting research institutions, organizations that are trying to figure out how to reopen. So I think, you
know, if we learn together and we provide a framework together that many different organizations are going to be interested, different governments,
different businesses, Las Vegas Sands, as a real example.
So I do think there's going to be future conversations and there are going to be future plans for the company and product. Frankly, I think, like many
businesses, we're being forced to adapt and learn during a pandemic.
And luckily, it turns out that it looks like some of the adapting we've done as a team and the changing we've done, and even the NBA, is a lot of
progress forward. And I hope that we can find something valuable here and see other organizations to use our product, too.
CHATTERLEY: Early days on that research quest. I have to say it's more attractive than wearing a big bulky watch. But I will just say that,
Harpreet. Keep in touch. We want to hear as you get progress and more data. Harpreet Rai there, the CEO of Oura.
RAI: Thank you, Julia.
CHATTERLEY: Fantastic to chat with you. Thank you. All right, still ahead, a hard pill to swallow for GNC. The vitamin and dietary supplement retailer
is filing for Chapter 11 as the global retailing route deepens. That story, up next.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to FIRST MOVE. Health and nutrition retailer, GNC, filing for bankruptcy. Paul La Monica joins us now with all the details.
Paul, retail troubles, but we could be talking what? Twenty percent of stores closing.
PAUL LA MONICA, CNN BUSINESS REPORTER: Yes, GNC is obviously struggling in the midst of the COVID-19 pandemic. But it was in trouble even before that,
Julia, and now, they could be selling about 20 percent to 25 percent of the stores as you mentioned.
They have a partnership to sell products with Rite-Aid, but that hasn't really helped all that much because Rite-Aid is the weakest of the big
pharmacy chains in the U.S., CVS and Walgreens is much stronger.
So I think this is a company that's really trying to figure out if it can survive through a Chapter 11 bankruptcy plan. The good news is that one of
its biggest backers, Chinese company, Harbin has a plan to try and buy the company if there isn't another buyer that emerges.
They're going to have what's known as kind of like a stocking horse bidding process to try and buy some of these bankrupt assets. There's already a
deal in place for about $760 million to purchase some of the stores that will remain open.
[09:55:09]
CHATTERLEY: And what about staying open in the interim, Paul?
LA MONICA: Yes, I mean, obviously it's a company that has been hit hard by coronavirus. It's had to shut some of its stores. They are planning on
reopening some, but they're only going to have about 80 percent of the existing stores remain open through the bankruptcy process because they are
going to be shutting down a big chunk of them. They need to downsize.
This is a classic case of a brick and mortar chain that really has been done in by online retailing trends, just another company that Amazon and
Walmart and others have really hurt in addition to those big drugstore chains, Walgreens and CVS.
CHATTERLEY: There's a number of names you can substitute in there -- it doesn't have to be -- for GNC, it continues. Paul La Monica, thank you so
much for that.
All right, that just about wraps up the show. You've been watching FIRST MOVE. Stay safe and I'll see you tomorrow. Have a good day.
(COMMERCIAL BREAK)
[10:00:00]
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