Tobi Lütke – Building Shopify and the Future of AI | Ep. 50

SPEAKER_01

I think in a way people are all somewhat overestimating the founders of companies and then they are really massively underestimating what you can do when the founder is still present and in charge. It's my best way to help the mission. Everyone gets to complain about a crazy founder, which is great. It's like, do whatever venting you want. And then you do very often some of the best work of your careers. That's why people actually flock to these types of companies because you're surrounded by other people that you can go on such crazy journeys. I am so excited to be here today with Toby, the CEO, founder of Shopify. Toby, before we start, I will say when I was running my company Lattice and you were one of the founders that I most looked up to and so many things about the way you operate, the way you've run your company, the changes you've made over time. It's the top of the top for me. And so I feel super lucky to be doing this with you. Before we get into AI and Shopify, I want to learn a little bit about you and more your psychology. You've been running Shopify for over 20 years and from what I see about you, it seems like you love what you do and it seems like you're as energized by it as ever. It seems like you're as passionate about the future as ever. And I think that's really hard. Having life's work is sort of a romantic dream for a lot of people. And I just think it's very hard to do in practice because people either fall out of love with their work, they get bored, they get tired. And on top of that, I think being a founder CEO of a big company is not even the easiest type of thing to have. My work now as a VC would be much easier to do for 30 years. So I guess I'm interested in how you are able to bring and seemingly grow your love for what you're doing after two decades.

SPEAKER_01

[SPEAKER_00] That's such a wonderful question. Thanks so much for having me on the podcast. I'm super excited really good to get to do this. Part of the reason why I wanted to start a company is because I have found before in my teens that I have an extraordinarily hard time learning things that I don't have experienced the problem that they solve. It's just the way in school, how math was taught, here's the steps for it. I actually had to really go and figure out, okay, well, what exactly is trigonometry useful for? And I started with tricking myself into finding a useful problem that involved trigonometry after which I felt I could learn it significantly faster than everyone else because I was so motivated, right? Karl Popper said, one of the joys of life and one of the best things in life is to find a beautiful problem that might occupy you all of your life trying to solve it. And if you're so unlucky to at some point do solve it, it will have plenty of delightful problem children that you can dig into, right? First of all, I think that's a beautiful way of thinking about life's work. But also it just works specifically well for me because I love learning things. I love challenging myself. I find myself very, very interesting. My favorite thing is that I want to do something and I can't because you find the limits and then you can have this conversation with yourself about what. There's a very simple recipe to success that everyone I think intuits or knows but maybe doesn't spend enough time following through on, which is success is really, really simple.

SPEAKER_01

It's just you have to figure out what it costs and then you have to be willing to pay it, right? And very rarely does this come in the form of money. It usually comes in the form of time commitment and discomfort and these kinds of things. So I seek problems. I love computers, love computers. To state with an example, trigonometry turns out the very early video games like Wolfenstein 3D are basically just trigonometry. Once you realize this and play with these things, they become delightful and you learn the next thing and the next thing. So I wanted to start a company because I was wondering, is that the right time of my life? I just moved to Canada from Germany. I didn't have a work permit, so I couldn't work for anyone. I needed something to do. My wife had a lot of, needed a lot of time for her degree. And I'm thinking, this is a good time to try it. And it's probably not going to work, but I've learned a lot. And so this has been a powerful way for me to motivate myself.

SPEAKER_01

[SPEAKER_02] I'm curious about, as you think about this, are there things that other people can do to more likely stick with and enjoy their life's work? I think there are a lot of people who enter a career or profession, and they love what they're doing. And then as time goes on, barnacles kind of attach to the ship and cruft builds and responsibilities grow and your job evolves and you end up doing something that you didn't start doing. And so I think people sometimes don't know how to shed all of that weight. And obviously you as much as probably anybody in the world have the potential to have all of that around you. You're a public company CEO, you've got tons of employees, you've got all these responsibilities. So it's possible that you could be encumbered by all these things, but you somehow haven't been. So I'm curious if there's learnings for everybody, no matter how many or few barnacles they have, what can you do to keep loving what you do?

SPEAKER_01

[SPEAKER_02] Yeah, look, I certainly collected barnacles around certain times in my career too, where I fell into the trap of trying to live to people's particular expectations, not really in the department of aesthetics. I can only call it an aesthetic because people say things like, this is what CEOs are like. This is the behavior that a CEO should display. You should possibly be a statesman. You should travel and kiss babies and whatnot. I'm thinking, well, that sounds pretty inefficient from my perspective, but I guess at some point, you just sort of get worn down and you try all these kinds of things. My life was miserable too. Again, this is sort of junk science a little bit, but what I'm pursuing here is trying to make a beautiful product. I just think we need to create products that are joyful. And one of my favorite quotes is a quote by Kathy Sierra, don't make better cameras, make better photographers, right? And it's just very deep to my psyche. I feel for beautiful tools and for beautiful, you can just inspire people to be the best version of themselves and actually become induce more.

SPEAKER_01

[SPEAKER_02] my perspective. At some point, you just get riddled down and you try all these things. My life was miserable too. Again, this is junk science a little bit, but what I'm pursuing here is trying to make a beautiful product. I just think we need to create products that are joyful. And one of my favorite quotes is a quote by Kathy Sierra: "Don't make better cameras, make better photographers." It's very deep to my psyche. I feel for beautiful tools and for beautiful—you can just inspire people to be the best version of themselves, actually induce more ambition, induce more skill, or at least induce more ambition for yourself to develop skill beyond what your other voice would do. And so I think that I want this to exist. This is my guiding post here. And it throws off all these problem children, which are interesting, which then challenged me. You're talking a bit about calm. I'm not a terribly calm person either, but I actually don't want to dial down my calmness. I want to channel it into building something. And so I have just found that almost all the mediocre products in the world remind me of room temperature. It's the middle temperature of what you get and then no one really cares.

SPEAKER_01

Yeah, exactly.

SPEAKER_02

It's a default setting of a thermostat. Almost every great product is forged in some kind of furnace and some kind of temperature. You got to put up all your energy source to produce that kind of heat. Do you think that has to start from love for the customer? I don't know. I don't know because you seem to love your customer. [SPEAKER_01] The greatest gift people make great products. I think without that crutch, if you have it, it should be an incredible boon. You think you can be a great CEO and not love your customer?

SPEAKER_02

[SPEAKER_01] It depends on what great CEO means. I'm an engineer. I read lots and lots of books about how to make great software. And you know what? When you actually check what project they all worked on when they figured out the design patterns of modern software, it's the Pennsylvania payroll system. It's not the most inspiring project. But it turns out, I think, just focus what you make out of it. If you just default to, "Hey, let's actually build something that's really meaningful. We all learn a lot about it." And one of the greatest things—I tell people this in interviews—when people are thinking about coming to Shopify, I point this out: one of the greatest gifts this company has is all of our customers are inspiring. They are remarkable people doing an incredibly courageous act of starting a company themselves. People who flock to come to Shopify, the people who actually have experience starting a company or have a family member or at least a deep appreciation, or in fact, people who have even been near customers in the past. There's something wonderful about Shopify feeling very fresh as a company. There's no tree rings that you can read about its age, but it has been around. We do our annual summit where we all get together in Toronto for a week. There are going to be people who work at Shopify who weren't born when I started the company. That's amazing. It's a little bit of an institution. Kids are so capable at young ages of being productive.

SPEAKER_02

[SPEAKER_00] Absolutely. Yeah.

SPEAKER_00

[SPEAKER_01] I think finding the challenges is useful, and tapping into it—I found it doesn't work when I'm trying to be different. But what definitely works is if I take the energy that I have, by my deep discontent. I have such a discontent with bad products and software. And I want to solve this problem. You worked for a long time on HR software. We built HR software inside of Shopify because we couldn't find the one that we want to use. Because we see ourselves as tool makers and we solve these types of problems. That also means I'm going to spend half a year learning everything there is about how to build this type of software so I can work with a small team on the side to make something better.

SPEAKER_00

[SPEAKER_02] And I imagine now you're able to do so much more of that with AI coding? [SPEAKER_02] And now it's crazy. [SPEAKER_02] One last thing here: you talk about wanting to build great products, but you've also spoken about wanting to be original, probably to a degree where I imagine you'd rather be original and good rather than mimicking and great.

SPEAKER_00

[SPEAKER_02] One hundred percent. In fact, what's even better is be different. Because, again, axiomatically, if you are building the same thing other people build, it can only be similarly good. It can't be actually much better. It can maybe make slightly look nicer, but you're bounded a couple of percentage points either direction. If you want to build something great or much better, it has to be different. If it then converges on the same thing, you have learned something potentially from first principles about why the solution is the one that everyone has converged on. If it gets worse, you actually learned something more important because now you know your theory here was wrong. Something about the world—you had an assumption which now has been validated. That learning is the thing from which you're going to pull so much value in every other realm because you now have a clearer idea about how things actually work. I think the results in science are massively underrated. Ideally then you don't ship it because the world needs better, not failing.

SPEAKER_00

[SPEAKER_02] Right. [SPEAKER_02] And I think that's actually—we have tried to eliminate the term failure in Shopify and just call it the successful discovery of something that didn't work. [SPEAKER_02] wrong. You had an assumption, which now has been validated. That learning is the thing from which you're going to pull so much value in every other realm now, because you now have a clearer idea about how things actually work. And I think results in science are massively underrated. And so ideally then you don't ship it because the world needs better, not.

SPEAKER_00

[SPEAKER_02] Right? So I think that's actually, we have tried to eliminate the term failure in Shopify and just call it the successful discovery of something that didn't work. I'm curious if you've experienced this. You obviously spent a lot of time in the Bay area, but I wonder if it's different for you, being in Canada. For me over the last 13 or 14 years in the Bay area, I have definitely felt a trend towards herd mentality. I think there was more originality in 2013 when I moved than there is now. I imagine there was more in 2003. I bet you there was more in 1995. I would feel like the trend line is professionalization of the industry and the mindset. I'm curious if you experience it the same way. And I'm curious if there are things that people can cultivate to free themselves from the sort of mimicry shackles.

SPEAKER_00

[SPEAKER_02] Look, you can't help but be affected by what you see around you. And if it's the best and the worst about the Valley is that everyone's working on interesting things, but of course that causes priors to be pre-installed when you start on a project.

SPEAKER_00

[SPEAKER_01] What's amazing is when you see children interact with things like AI, they will use it so different from how you imagine. It's worth aspiring to having a free mindset, just try to take orthodoxy or the obvious path off the table when you start, because the forces of especially teamwork will always cause a convergence on the safest path. Right. I think it is an advantage to be outside of it. You just have fewer prearranged priors. In fact, a really funny effect was when I went to the Valley as a visitor and met with people over coffee and we were talking about how a company should work. I asked questions. Then I went home and had been tired from the flight to make my notes. And I have a bias towards do it differently. So I take what I hear and try to figure out, okay, well, what would the Shopify version look like, and what would be better of the system and make it different because I felt that's what you have to do. But then I realized, only very late in my career that I never actually got the real story from everyone about how they work internally. I got everyone's ambition or highlight reel, right? Because that's what they really share, plus the ability to then make edits to try to improve it further. That meant that very often we actually found ourselves doing the things that we thought someone else invented actually, but they might never have actually implemented it. Maybe that was just the thing that they had the most previous meeting over. And so I think that helps a little bit, distance.

SPEAKER_00

[SPEAKER_02] Additionally, I should say, I think the world fundamentally, Silicon Valley specifically has now for a decade and a bit declared war on any kind of distinction. All the talk about diversity was very much about eradicating eccentricities and distinction. People are not allowed to be quirky or funny with off-color humor. So I think in the rest of the world, that is a little bit more intact and you just encounter characters and there's often more appreciation of, you know, so-and-so is just a little bit crazy and you know what, that's really good.

SPEAKER_00

[SPEAKER_01] I think that's coming back again a bit. Yeah. I mean, there was a big moment there. All tech leaders had to sort of go through the political back and forth and sort of, what are we talking about at work? Are we focused on work? Are we focusing on other things?

SPEAKER_00

[SPEAKER_02] That was not easy for anybody. Yeah. It wasn't easy for employees. It was hard for everybody. I think it was hard because everyone, literally everyone wanted to do the right thing and we generally all agreed even on the identified problems, but just not the solutions. They just caused distraction and also a erosion of this thing. I think a company should resemble an island of misfit toys much more than a convergence on one preordained truth. I think it's totally worth exploring any alternative on this idea, on the spectrum. And then I think the results will just tell us what works best. I didn't like when people were saying, hey, we are deciding for you if we can have distinction in this company, and that didn't work for me.

SPEAKER_00

[SPEAKER_02] You've gone through another sort of employee mindset change in the last couple of years with AI. From at least what I recall, you were one of the first sort of CEOs to say everybody we need to, however hard you think you're adapting, triple it, quadruple it. I'm curious, how did that journey go? Is it still going on? Do you have it where it needs to be? Is there an end to how AI-pilled we should be?

SPEAKER_00

[SPEAKER_02] I'm actually really proud of Shopify. I think this worked extremely well. I made a choice. There's a type of situation that you get in running companies and large groups where something becomes clearly true. And then you need to make a decision on, are you going to act on it? And sometimes people just fail. In fact, very often people fail to figure out what's true. But I'm sure Blackberry thought they were doing really well. I think they had the best year of sales ever the year iPhone was released and thought they were pretty safe. So sometimes it's not that people are just not smart enough to see it. Sometimes they don't want to believe it.

SPEAKER_00

[SPEAKER_02] And then you need to make a decision on, are you, first of all, do you act on it? [SPEAKER_02] Mm-hmm. And sometimes people are just like, oh, are you failing bad? Right? In fact, very often people fail to figure out what's true, but I'm sure Blackberry thought they were doing really, really well. I think they had the best year of sales ever, the year iPhone was released, and thought they were pretty safe. So sometimes it's not that people are just not smart enough to see it. Sometimes they don't want to believe it or want to see it. [SPEAKER_02] Exactly. They know the implications are. They're not predisposed for it.

SPEAKER_00

And they kind of, maybe for no fault of their own, created an organization where every layer inside of a conversation prioritizes kind lies over hard truths. Often because people just sometimes because there's a culture of everyone being nice to each other. [SPEAKER_02] There's also, when you have a big enough organization, you talked about this with teams, you know, make originality difficult. I also think big groups of people, it's hard to get everybody to agree to go through an uncomfortable change.

SPEAKER_00

[SPEAKER_02] I think in a way people are all somewhat overestimating the founders of companies and then they are really massively underestimating what you can do when the founder is still present in a chart.

SPEAKER_00

[SPEAKER_01] It's not so much about the individual as about the almost the piece of infrastructure, the slot of having the founder filled. And there's a lot of distinction, but it's actually as a founder, you get so much social credit as having started a company, but you can just invest in it. It's a bank. And it's just like every day, every time someone on boards, they hear how the company was created and that just deposits a little bit of credibility tokens into a virtual bank account that is hard to reason about, but virtually exists. And then I get to cash that in. You can spend it on big, important changes.

SPEAKER_00

[SPEAKER_02] And change management, right? That's one of the best ways I can speed up something that would take years of small culture change or internal training, with sometimes a memo. And so in this case, I find I take that really seriously.

SPEAKER_00

It's not the easiest thing for, it just leads to, more work, or sometimes unpleasantness. I just find that is what I owe the company, right? It's my best way to help the mission. And so when something like the AI thing becomes true and we are saying, Hey, we have two people, they're both equally good programmers 15 minutes ago, but one of them has been completely onto the AI train and has had value out of AI. It was more like the premise of AI was like, what do we do in performance reviews? And we just like the moment we said, like it's like we can't be, it's impact rating. It's net impact reviews, they caught with Shopify. So like, what's your net impact on the company and the mission? And so it's just very demonstrably true that one of the people was more of more impact. And the moment that is said, it feels like an incredibly unkind not to tell people. So just like, Hey, let's write it out and send it to everyone. It's unfair. If you're like, this person has an exoskeleton on and I'm not going to point out, Hey, that exoskeleton, thinking in Pinterest.

SPEAKER_00

[SPEAKER_01] Yeah. If we act on this thing, we should tell people. And so we did. And I included a bunch of other things that are true. I've invested lots in making sure that everyone has everything they need. They have an unlimited token policy that I'm sure your brother is thrilled with. And so you know, we want people to tinker, we want people to play with this. We want people to use it as much. And it's super good. It's skyrocketed. The second this message came along, but what Shopify did with this, the speed of diffusion of this tool was remarkable. And I'd like to think Shopify is predisposed for this. We have thriving on change is one of our core values and we really mean it. It's good that you talked about net impact. I think one of these blunter instruments that's getting used a lot right now is just tracking token consumption. And people are like, I want to see token consumption go up 20% a month. There are founders that say that, which is not an obvious terrible idea in the same way that judging people by lines of code, we could debate, is there anything to it? Probably something, but I think it's fine. I mean, at some point we had a leaderboard and so on. Of token. Yeah. And of course, that leads to immediately bad effects. And we don't have that. Like on vault is our internal system. It's an intranet. It's probably not a term that anyone's ever heard, but it's an internal wiki and everything. And on your profile, it shows you what your token uses and which percentile you are in your department and group and so on. Just because that's interesting. I think again, also because we are tracking it, we have to be, because we have to actually at some point allocate finances to OPEX and whatnot. And so just therefore we show it to people. So I know this is probably different numbers because you're at such scale, but there are private companies whose token spend as a percentage of revenue is going into pretty wild places right now. I kind of think that's fine if you're an earlier stage company and you're just trying to win the market at all costs. But I am curious how this might play out. I'm sure even you're seeing tokens spend at numbers that are probably not a huge deal relative to your revenue, but are. It's a huge deal compared to revenue. It's unbelievable. It's many percentage points. It's extremely high. It's many tens of percentage points for some of these private companies. And so I am a little.

SPEAKER_01

[SPEAKER_00] at such scale, but there are private companies whose token spend as a percentage [SPEAKER_00] of revenue is going into pretty wild places right now. I think that's fine if you're an [SPEAKER_00] earlier stage company and you're just trying to win the market at all costs. But [SPEAKER_00] I am curious how this might play out. I'm sure even you're seeing tokens spend at numbers that are

SPEAKER_02

[SPEAKER_00] probably not a huge deal relative to your revenue, but are. It's a huge deal compared to revenue. [SPEAKER_00] It's unbelievable. It's many percentage points. It's extremely high. [SPEAKER_00] It's many tens of percentage points for some of these private companies. And so I am a little curious, right now we're in that part of the journey with AI coding, where it's just so [SPEAKER_01] valuable that people are just like, I have no choice but to spend because it's too productive. I do [SPEAKER_01] think that we can't spend 70% of revenue on AI tokens forever and have valuable

SPEAKER_02

[SPEAKER_01] companies. So how do you think this might go? It's complex in a way that I'm very, [SPEAKER_01] very grateful for the stage Shopify's at because we are a profitable public trusted company. And [SPEAKER_01] right now it's just like, we really, really, really like the tokens we're buying. [SPEAKER_01] They're incredibly valuable and we are doing incredible things with them. It accelerates us in roadmap and therefore ambition and all. I think it just causes so many [SPEAKER_01] good things. You're getting leverage on your spend. [SPEAKER_01] It's a no brainer. I have very high opinion of markets.

SPEAKER_02

[SPEAKER_01] Markets are extremely good. They will figure out what the correct clearing price [SPEAKER_01] for these tokens is. And right now there's few providers and maybe there'll be more in the future. [SPEAKER_01] And there's all sorts of interesting moves around distillation and so on. I think companies will [SPEAKER_01] know how to wield these tools within their budgets. And we are actually doing a good deal of this kind of [SPEAKER_01] thing as well, but we are still just charging ahead because frankly, we like the tokens [SPEAKER_01] we're buying. It's that simple. [SPEAKER_01] I agree. And my instinct is that it should go down, but there are possible worlds

SPEAKER_02

[SPEAKER_01] where it goes up or prices go up. [SPEAKER_01] Honestly, I don't. No one knows. We are certainly [SPEAKER_01] 10Xing the amount of tokens we want every year right now. And I'm sure that's going to go up [SPEAKER_01] and we are 3Xing the amount of GPUs that we are putting into the world. So that is [SPEAKER_01] those lines are not converging anywhere good at price savings. [SPEAKER_01] So given that AI coding is dominating so much, how do the biggest changes to team [SPEAKER_01] design look? You know, there used to be this EPD triad and it worked a certain way. And there were

SPEAKER_02

[SPEAKER_01] certain ways that roadmaps were built and reviews happened and people would go out and talk to the [SPEAKER_01] customers and bring that back. What is it now? What is the most fundamental molecule? [SPEAKER_01] I think the small team is my bet. It's the three, four,

SPEAKER_01

five people team, which actually has always been Shopify's bias.

SPEAKER_02

[SPEAKER_01] This is quite gratifying. The reason why we had to often go past it is [SPEAKER_01] because you just need a lot of specialized skills, at least for certain moments, on the [SPEAKER_01] teams. Your example is a great one. Talk to the customers. It's having someone who [SPEAKER_01] actually does the customer research and talks with people. What we always did is relocate people from the support org. We're looking at [SPEAKER_01] routed them all the tickets and put them on the teams, which was an amazing way to do it. [SPEAKER_01] Now the agentic harness around our teams is actually routing really

SPEAKER_02

[SPEAKER_01] good summarizations of what our customers say automatically, back. So [SPEAKER_01] that's now available to everyone. And everyone can do more skill. Again, everyone is a [SPEAKER_01] seven out of 10 on every skill now. That's really helpful because it allows [SPEAKER_01] to make teams smaller. The thing that we are working the most and thinking the most [SPEAKER_01] around at Shopify is that I'm big on pace. Pace has to be induced. Otherwise it's

SPEAKER_01

received. Parkinson's law is one of my most recommended books. And I have a 1970s 60s copy of it that I give to everyone, my executives. I own many of them of the original run

SPEAKER_02

[SPEAKER_01] because it's so meaningful. And the law is basically work expands to the time [SPEAKER_01] allocated to it. The book is 60 pages and full of these kinds of wisdoms. This [SPEAKER_01] is the most important one. So one of the most important functions of a leader is to [SPEAKER_01] compress time windows. Yes. To the plausible. It's not that you just give [SPEAKER_00] any deadline and anything happens, but if this is why it's really helpful to be very

SPEAKER_01

[SPEAKER_00] technical and understand all the tasks and skills, you can ask for something that has [SPEAKER_00] a 50% percentile chance of being the right ship date. Then everyone gets to complain about

SPEAKER_00

the crazy founder, which is great. Do whatever venting you want. And then you do very often some of the best work of your careers. And that's why people actually flock to these type of companies because you're surrounded by the other people that you can go on such crazy journeys with. The main point here is I run the company by the six week review cycle where we go for [SPEAKER_01] all the projects and spend the time with engineers and champions and PMs that exist to set a pace, a pace ceiling and floor, of six week cycles, which was faster than we instituted it. Because if you don't do it, you are run by a

SPEAKER_00

quarter. Sometimes you see like the moment in a PowerPoint, first flag. Second flag is someone uses the word H2 or H1, which means first or second half. [SPEAKER_01] You're actually in trouble. You really have to do something drastic. [SPEAKER_01] all the projects and spend the time with engineers and champions and PMs that existed to set a pace, a pace ceiling, I suppose, ceiling, floor, floor of six, six, six cycle, which was faster than we instituted it. Because if you don't do it, you are run by a quarter. Sometimes you see the moment, the moment you see in a PowerPoint, first of all,

SPEAKER_00

first flag, second flag is someone uses the word H2 or H1, which means first, second half. [SPEAKER_01] You're actually fucked. You actually really have to do something drastic. [SPEAKER_01] Yeah, yeah, exactly. So as you do this, and now I think actually, [SPEAKER_01] six week review is actually way too limiting. It's just, we can do so much more and we're trying [SPEAKER_01] to figure out what is replacing this. I want to talk about your customers and

SPEAKER_02

[SPEAKER_01] what AI means for them. We were talking a little bit earlier about how, [SPEAKER_01] there's a lot of young people right now who have fears of permanent [SPEAKER_01] underclass and the idea being that you're just entering the workforce, [SPEAKER_01] you don't have any accumulated skills or credibility yet. And now you've got [SPEAKER_01] this AI thing, which in some ways is empowering and in some ways seems scary. [SPEAKER_01] The net is that people are afraid of ascending [SPEAKER_01] through the career and financial heights that they want to. And you talked about [SPEAKER_01] how that's not necessarily the experience that your customers are feeling.

SPEAKER_02

[SPEAKER_01] No, and our customers are wonderful and they're entrepreneurs. They're [SPEAKER_00] courageous people who are putting this out there. They build businesses, they create employment. And [SPEAKER_00] it's, in one way, it's clearly a particular slice of people who [SPEAKER_00] would do this, but it's actually much bigger than people think. First of all, [SPEAKER_00] it's incredibly diverse. It's really, you put Shopify customers go exactly with a population map. It's great businesses in the most, [SPEAKER_00] in the smallest communities. It's a point of sales stores in [SPEAKER_00] the town center of tiny, tiny, tiny little townships as well as aloo yoga. And,

SPEAKER_02

[SPEAKER_00] so it's incredibly different and it's cosmopolitan. It's big business, [SPEAKER_00] billion dollars business. It's the people who are trying to build a thing in the lunch breaks to make ends meet, or actually because they have an ambition that they want to become entrepreneurs. So what's funny with the way the AI conversation is protected, how it's reported and what you see on social media and so on is, it just doesn't, we can't access it anywhere. Anywhere where we look. You're saying Shopify is data and experience. It just doesn't reproduce this doomer stuff.

SPEAKER_02

[SPEAKER_01] It absolutely doesn't. What we hear from everyone is, Hey, you guys fix computers. It's, [SPEAKER_01] you techies talked about computers being these incredible things that can do anything. [SPEAKER_01] And it was so complicated. [SPEAKER_01] And then we try this and they like, I don't know what you guys just sound unhinged. [SPEAKER_01] And now we have, we can talk to it and it just does the thing. And it's incredible. It just [SPEAKER_01] works with me. And I've expanded my business and I've hired all these [SPEAKER_01] people now. And so, I mean, it fits into Shopify's vision because we want

SPEAKER_02

[SPEAKER_01] lots and lots and lots of small companies. And by the way, 60, 70, 80%, depending on country, [SPEAKER_00] of people in the economy work for small businesses. Yeah. Incredibly precious and important. [SPEAKER_00] So what should AI mean? If you're a small business owner, you're starting a new small company, [SPEAKER_00] logically, what should the change be as a result of AI from 2023 versus 2029? What's the fundamental change?

SPEAKER_01

[SPEAKER_00] I think you should sign up for more. You should, you can follow your ambition [SPEAKER_00] further. I think our customers are, if you would Paul, I think they

SPEAKER_02

[SPEAKER_00] believe in a permanent upper class. I think they are just going to, I think there's, [SPEAKER_01] we're going to get to a point where many, many, many more people can self-actualize. There's two [SPEAKER_01] pieces of data that I just find incredibly meaningful. One is every 36 seconds, someone gets [SPEAKER_01] their first sale, which I just think it just, while we're talking here, think about what that means [SPEAKER_01] for how many people just became entrepreneurs. The other one is a higher [SPEAKER_01] level observation, but every single time we ship something where we know it meaningfully changes

SPEAKER_02

[SPEAKER_01] something about the early journey, the sign up, the complexities, the questions, the friction [SPEAKER_00] in the business, each of them can be best thought of as a hurdle that someone has to jump over. And

SPEAKER_00

every single time we managed to make the hurdle slightly less high because we made something vastly better.

SPEAKER_02

[SPEAKER_00] We know, let you register domains or whatever, or easily transfer them. Or we have an AI that [SPEAKER_00] you can share your browser tab and it helps you set up GoDaddy. Um, [SPEAKER_01] every single time we do this, more actual business come out of it, which then provide [SPEAKER_01] employment and so on. It's people churn out early in process. If something happens that [SPEAKER_01] ends up being a governor for them and then they null out, they give up and they stop. And then [SPEAKER_01] the entire business doesn't exist. AI is never, ever has there been such a thing that it can take

SPEAKER_02

[SPEAKER_01] people so, be so supportive. It occurs to me that last year I, on this podcast, I asked somebody [SPEAKER_01] this question that they were a fine person to ask, but you're probably the number one [SPEAKER_01] person in the world to ask this to. And it's something that I've been thinking a lot about, [SPEAKER_01] which is what has to be true for us to be in a place where you can prompt, build me a business. [SPEAKER_01] How far are we from, Hey, I made this widget. Please go make me a million dollars. Thanks. [SPEAKER_01] I mean, it's my favorite replacement idea, a replacement for a Turing test,

SPEAKER_02

[SPEAKER_01] which we of course sailed past without oddly very little notice. I think it is [SPEAKER_01] crazy. I think, acting in the real world, starting a business and that people find

SPEAKER_02

[SPEAKER_01] person in the world to ask this to. And it's something that I've been thinking a lot about, which is what has to be true for us to be in a place where you can prompt, build me a business. How far are we from, Hey, I made this widget. Please go make me a million dollars. Thanks. It's my favorite replacement idea as a replacement for a Turing test, which we of course sailed past without oddly very little notice. I think it is crazy. I think acting in the real world, starting a business and that people find meaningful enough to vote for to the tune of a million dollars, marketing it correctly, getting the right. It is a wonderful test. Knowing what things to prioritize.

SPEAKER_02

[SPEAKER_00] Exactly. The shipping matter. I think we are actually getting there. I want to be

SPEAKER_01

and do a proviso though. You can obviously use Shopify without having products. We help you find manufacturers. If that's what you want, we help you. There's an entire thing called collective that manufacturers offer their products that you can then use in your Shopify store. So if your particular skill set is the marketing, you can come to Shopify and try your hand on entrepreneurship. And again, very often, I think about half of Shopify stores end up being created by people who have done an online store or at least a business before. So people try and build things. People should have a product that the world wants, ideally come up with some unique take on something. And there's so much white space out there. But you think AI could do everything else?

SPEAKER_01

I think AI should then do absolutely everything else. In fact, it's literally what our product's ambition is to be like the vessel for AI in being the brain or the exoskeleton around the model, to basically conspire to just do absolutely everything so that if you show up with a product, you can start a business. Just to extend the idea a little bit more, not to go into too crazy of a sci-fi place. Yeah. Is it possible that it could also do the make a product? Like, let's say I wanted to say, Hey, just go make me a million dollars.

SPEAKER_02

[SPEAKER_01] I think anything in a digital products space. Yeah. Make me some eBooks. [SPEAKER_01] Exactly. Books, there's print on demand for books, for t-shirts. Honestly, additive manufacturing is getting extraordinarily good now. And there's lots of great contract manufacturers for this kind of thing, like CNC and 3D printing. And then we are looking at humanoid robotics, which there's a lot of tailwinds here to the fact that making the products is going to become lots more tractable.

SPEAKER_02

[SPEAKER_01] This will probably be 10 years until I'm asking guests this, but the prompt like build me a house and then the robots just go dig up what they need and then put it all together. [SPEAKER_00] I think it's a world we're looking at. Like I don't see how it couldn't get there. Right. And I just think that's what's so, but I just like about the Duma conversation over permanent underclass or whatever people want to call it. [SPEAKER_00] Yeah. How are we not headed to a world of abundance? [SPEAKER_00] Exactly. It's, and frankly it's, and that then goes into this sort of conversation, you know, like we eliminated all the jobs. It's how good we are at making up jobs.

SPEAKER_02

[SPEAKER_01] Yeah. There are so many examples of things that are just delightful. I have friends who opened a shop, but we didn't think we needed it. And then it ended up being one of the most compelling things and one thing led to another. And now they have a warehouse full of 3D printers and things because suddenly you have a Jarvis that you can say, I would like to do this project. And I have this. I bought this crazy 3D scanner from Facebook Marketplace. And I just put it there. I don't even have software for it. But you just go hack it and you figure out how to help me. And it's just holy crap.

SPEAKER_02

[SPEAKER_01] I asked Kyle Vote from Baca. I was like, well, we get to a place where I can just text my robot to order Instacart, get the steak, you know, prepared, serve it, you know, slice it up. He's like, put clean it all up. He's like, yeah, that'll happen at Benchmark. I spend probably three quarters of my time in software land, but sometimes I do step back and I think, okay, to actually raise the standard of living for everybody in the world. It's things like we need more and better houses. We need better transportation. We need better food. We need better healthcare. We need good education. It's all these things that aren't software. And then sometimes I think about some alien watching us all, and we're just sitting behind our little boxes, typing, everything's going better in typing land and it's all bopping about in software land. But we do really need it to get into the physical world because the standard of living, it's all physical.

SPEAKER_02

[SPEAKER_00] Absolutely. It completely is. And I think this is actually the missing ingredient, right? Because people talk about the incredible infrastructure we used to build in the sixties. Even before that, there's a Hoover Dam, this kind of stuff, lots of individual stories about these infrastructure projects, how quickly we built subways and now it's hexed like forever and so on. Like there is an observed degradation of lots of these kinds of projects and it's multifactorial. There's not one reason behind it, but one of them that really is true is because we are building for more wonders that are no less impressive entirely in software, right? The web

SPEAKER_02

[SPEAKER_00] we used to build in the sixties. It was even before that, there's a Hoover Dam, and this kind of stuff, lots of individual stories about these infrastructure projects, how quickly we built subways and now it's hexed like forever and so on. There is an observed degradation of a lot of these kinds of projects and it's multifactorial. There's not one reason behind it, but one of them that really is true is because we are building

SPEAKER_02

[SPEAKER_01] for more than wonders, that are no less impressive entirely in software, right? The web browser, Linux, all these kinds of things are projects at a scale beyond what the permits are. And easily and without compulsion and just by volunteers, sometimes people who have never met each other in the open source world or at companies building these, something like Google or the social networks is incredibly, incredibly impressive pieces. If they would have physical manifestation, you would

SPEAKER_00

[SPEAKER_02] go to something like a refinery or so, and you see the

SPEAKER_02

[SPEAKER_01] pipes and so on. It's so impressive. It's not even in basis points territory in terms of complexity compared to a browser. [SPEAKER_01] Compared to a browser. [SPEAKER_01] Exactly. And just so we don't appreciate that. And that's not our problem. I don't think I appreciate a browser. Is a browser near the top of complexity? [SPEAKER_01] I would put it under, it's one of the wonders of the world. I mean, for so many reasons, it could never be introduced today. [SPEAKER_01] Can you give a small flavor? I'm sure it's hard to even explain why it's so complicated, but what can you give a flavor of what makes it such an unbelievable thing?

SPEAKER_02

[SPEAKER_01] In so many ways, okay, you go to a website. It's like, we don't trust that website. We just run code. But also it's like actually your computer in front of you magically reconfiguring itself into someone else's vision for what should be there. And without limits, it's actually you download software that then just exists for this one moment to do literally everything. And it's self-responsible. Like Shopify is over a hundred billion dollars market cap company with hosting millions and millions of businesses that might otherwise not exist. And all of this just happened because anyone can just put a server online, gets an IP address automatically. It's insane. And then it all hangs together.

SPEAKER_02

[SPEAKER_00] It all looks. [SPEAKER_00] It doesn't come down more. Why doesn't it all crash? [SPEAKER_00] It's the most reliable thing. It's

SPEAKER_02

[SPEAKER_00] and no app store on Planet Earth would allow the web browser if it would be introduced today, if it didn't exist. Right. It would like, no one would allow this because it doesn't even sound like it's sane. It sounds like an insane pitch yet it exists and we just don't think about it. And the font rendering alone is one of the most complex. The font rendering alone is a true incomplete system that just because we want to be able to read text slightly better than our displays can allow them. And it just keeps going and going. And I can go full nerdcore on this, but the larger points actually are following. We have not stopped as humanity building incredibly impressive infrastructure, but it has changed. The infrastructure that needed building over the last 30 years and the reason why other infrastructure didn't happen is because the people who could have just went into what the planet earth needed for us was digital infrastructure. And if all those people worked on robotics, this is happening now. Right. And we are happening with AI, like all the software we built was a bootstrapper for AI. Software becomes, due to this achievement, something that can become personal again and become now you can have basically a web browser, but the websites don't even need to exist for that you would like to see.

SPEAKER_02

The browsers, it's so true when you say it like that, the easiest to identify with example for most of us probably is an iPhone. Like we've probably all just randomly, one day you look at your iPhone and you're like, how the hell does this thing exist? It's crazy. And we just, you know.

SPEAKER_00

[SPEAKER_02] But as beautiful as it is, and as reliable as it is, and as personal as it is.

SPEAKER_00

[SPEAKER_02] And so I think the iPhone is a lucky exception in that you can appreciate it as a physical thing because it's not the fault of everyone is right. And they say, why is everything just standing still or not getting better around me? Because from the perspective and ability for us to observe it is because all the infrastructure digital, but we are almost done with this. We are at the end of the opening chapters of all this. And so now I think we will see vastly more impact. We put all of our energy against this thing because it was the foundation, but now all these people in some sense will be free to not write software.

SPEAKER_00

[SPEAKER_02] That's exactly right. And so I think we will have a huge influx of the brightest and most creative and driven people to make things which are going to be much easier to relate to and have much more impact, a direct impact on people's lives. How important for you is it as CEO of Shopify to have an opinion on where AI will be in two years? Like there's one worldview you could probably take, which is this is so unpredictable. I'm going to take it as it comes. I'm going to try to know six months ahead, but I'm going to do what I can do. And then there would be another, which is now I'm actually going to spend a lot of time with the labs. I'm going to try to have an understanding of two, three years out and try to care about the farthest out I can see. What do you think is the right position?

SPEAKER_02

[SPEAKER_00] Yeah. I mean, if my friends would listen to this question, they would laugh just because my predominant obsession is to try to have as many data points on worldview you could probably take, which is this is so unpredictable. I'm going to take it as it comes. I'm going to try to know six months ahead, but I'm going to do what I can do. And then there would be another, which is now I'm actually going to spend a lot of time with the labs. I'm going to try to have an

SPEAKER_02

[SPEAKER_00] understanding of two, three years out and try to care about the farthest out I can see what do you think is the right position? Yeah. I mean, if my friends would listen to this question, they would laugh just because my predominant obsession is to try to have as many data points on as many people, which I can try to match to the right super linear or linear or sublinear

SPEAKER_02

curves and just figure out how they all connect and what therefore will happen in the future. Right. To me the most fun game in the world is to have a pretty clear eye view of what the future is. And what in particular are you trying to figure out? I mean, the AI memo is a good example because I, again, it was probably slightly too early to write it, but now if you read it now, it says nothing that would be surprising. Right. Being able to give my company the gift of a headstart is what we're trying to do. Right. And because the moment then I can tell everyone something that isn't quite clearly true now about the importance of these systems and we can rebuild our systems to really reinforce this and support everyone in their own tinkering exploration. That means that

SPEAKER_02

[SPEAKER_00] our view of the future is going to be more accurate and things we are building because you're always building for future point. Software is getting faster to build, but you still have to aim at a future point of value. It's not our customer's job to tell us what they need. It's our customer's job to tell us what the problems are that they're experiencing. And we fall in love with those problems. We adopt those problems as our own and just solve them in an ideal way. But it's our job to figure out what the ideal way is that comes into contact with the customers and they give us further feedback for refinement. It's in my mind a complete application to just build what your customers ask for. It's an application of product responsibility. And it's hugely important and it's almost everything, every decision I make, I try to make on an understanding of I try to live in everyone

SPEAKER_01

[SPEAKER_02] else's relative future. This is incredibly fun and helpful to talk with the labs, and sometimes there's some really important information that you can get from this. What I found and we sort of touched on it earlier is one of my favorite things, especially for product teams and engineering is to hire people who actually know Shopify really well from outside. People who were merchants, some of my best product managers, because they actually understand what the software feels like when it's being used. And in same with people who build apps on the Shopify platform to help come to Shopify and help make the app platform better. I actually don't even think being in a lab is the best position. It's actually being using everything and paying a lot of attention to how everyone else uses what the gifts that the labs release. And then being in the conversation, which usually happens on X, on what everyone's figuring out, maybe actually building something and seeing everyone finds it useful. I think this learning by doing is how to get the most clear view of how everything works. Does that give you a clear view on the present or does it also give you a clear view on what's coming in a year or two? If you do it over a while, you get trajectory, you get trajectories. Yeah. And the trajectories are the point. If you are exactly on the state of art meter of the best thought on stuff, and you have other data points, the future gets very simple to predict. Now it's the hardest time ever to do it because right now the time horizons are so short. I did this very same thing throughout my entire life. And it used to be that the future was absolutely trivial to predict. You just looked at the first couple of numbers on mobile browser usage, and you just knew what's happening on a cell phone and that we needed to make mobile websites, which sounds insane now, but yeah, at some point people didn't believe that. And so yeah.

SPEAKER_01

[SPEAKER_02] Are there parts of AI right now that you think are under hyped in terms of capabilities and are there parts that you think are over hyped?

SPEAKER_02

So obviously the labs really care about programming because that's the problem they need to solve for themselves. And again, it's always easier to put and then for various reasons. Opus is unbelievably good at programming and right now it's easy to go from that and then just assume it's equally competent in everything else. And quite often it isn't. If you want to discuss how to do a public talk or something, it just doesn't have great theoretical routing of this and why. I mean, it knows about all the different ways to construct tension and so on. But it's not able to then look at something and make it meaningfully better where even an incredibly well optimized piece of code, it often finds abilities to go and do better. What is happening a lot is that you're bringing more types of problems in the domain of programming, which is really what OpenClaw is. If you really think about it, it's make it a file system, give it tools like a programmer uses and make a couple of files, in the files just tell it the soul and the memory and so on. And then it uses the normal programming tools to interrogate this. And because it stays a little bit in domain programming, it now actually is remarkably better at this other out of domain thing, which is really funny. I think we should assume though that we are going through the entire radio chart of things that are valuable and bring them to the same point of with home

SPEAKER_02

[SPEAKER_00] Think about it, make it a file system, give it tools like a programmer uses and make a couple of files. In the files, just tell it the soul and the memory and so on. Then it uses the normal programming tools to interrogate this. And because it stays a little bit in domain programming, it now actually is remarkably better at this other out of domain thing, which is really, really funny.

SPEAKER_02

I think we should assume though that we are going through the entire radio chart of things that are valuable and bring them to the same point with home programming. So I think there's a bit of overhype in having to work so hard on bringing things in programming domain, because all of this is just going to get much, much more natural and easier as the models appear. Where it's underhyped is just in deployment in companies. I think there's a huge... I mean, no one's using it enough. No one's using it enough. Partly because everyone just starts with, "Hey, let's help me do the things that I've been doing all along slightly better or actually vastly better," which is valuable, obviously. But if you do with more first principle things like, "Hey, if AI would have been around ever since Alan Turing first wrote about it and we just have worked and we are just in the presence of these super intelligence all the time, and we would just invent the job we are thinking about right now. Like how would we do it? Just invert the whole thing." Yeah. And when you're like, it just, it's so much more fun to have those conversations. And I think it'll be like, I mean, I'm exceptionally excited about this because I think it will create the environments that the most creative and best people will really appreciate, because everything around them happens at the speed that they want to work. And that has never been true for any company that requires some bureaucracy for doing stuff.

SPEAKER_02

On the point of talent, have you changed anything about the types of people you're looking for? Like pre-post AI, are the same people who were successful before still the same most successful people? Or is there any attribute that you are scanning for in a different weighting than you used to?

SPEAKER_02

It's fascinating. So this is actually really changing all the time. And actually I've had to change my mind a couple of times. But I think the best distinction point is, you know, Shopify is 20 years old. I think average age of Shopify is somewhere like late 30s, which is, I think, still pretty good. But this is one thing you have to look out for as a company. If there's some companies that just age themselves 12 months a year, and for various reasons, that's probably a problem at some point when a lot of new things happen. So just massively restarting the internship program has been really helpful, right? We take a thousand interns a year. We have been close to Waterloo and work with Waterloo. So it's great. And just making sure that the interns are not just the students now, but also the teachers, because they are just so native that it was really, really helpful.

SPEAKER_02

[SPEAKER_00] It's also interesting because initially I had the thought that there's fluid intelligence and crystallized intelligence, basically knowledge and curiosity-driven willingness to learn. Um, and often early in career, you have more fluid intelligence, you have no knowledge, therefore you're all fluid. And then I was sort of new, but also the first people who just flocked to it, right? Like they immediately got value out of it. And that was super, super exciting. I had the thought that maybe that really tilts in their direction. But then as we started, like the more of the systems got firmed up around the coding harnesses, cloud code, pie, and all these kind of things, it really shows that programming is so much, it's not the type of typing task. It's really understanding the problem deeply. And I think every programmer in the world massively underestimates how much they're doing when steering in AI right now and how much that was really them being creative and actually what they're coming up with is uniquely theirs.

SPEAKER_02

They are like having seen the movie before. You can sort of spot the AI just going in the wrong path and you just like one, two words can completely change everything. There's a very, very long answer to say, I kind of don't know. But I actually just think good people are good. It's like there's a bit of variance in how quickly people adopted the tools, but once they did, it's like everyone just falls back onto their level. So that, I guess, is the sort of what do you like side of the question. To flip it to what a candidate's like, have you felt any change in competing for talent in this market? And maybe it's, you know, you've got a lot of variables at play here. You're public, many of your competing for talent companies are probably private. You're in Canada and not in Silicon Valley. There's all these different factors. But I'm curious, how does the sort of AI wave change what you do to attract and retain the various people?

SPEAKER_02

Yeah. I mean, I think the best way to deal with recruiting is to build a company worth looking for by the best, right? So I think people are thinking about it too much as selling and not enough as marketing, you know, in a way, or at least even just like information. Yeah. It's like, how do I look super healthy? Well, you could use this, you could turn this angle, you could do... it's like, well, you can also just try to be healthy. Exactly. So sometimes it's just like, things are simpler than they seem. So what goes into that then?

SPEAKER_00

Yeah. Obviously there's being a good business, but just don't mire people in bureaucracy. Give people the space to be creative and allow them to fall in love with the mission actually. And have them understand what problems people care about and what impact the work has.

SPEAKER_00

[SPEAKER_02] You can also just try to be healthy. Exactly. So sometimes things are just simpler when they seem. So what goes into that then? Yeah. Obviously there's being a good business, but yeah. Just don't mire people in the bureaucracy. Don't give people the space to be creative and allow them to fall in love with the mission actually. And have them understand what problems people care about and what impact the book has. I think Shopify has a lot of intrinsic advantages here, but the best way to attract talent is make it so that when people try on the idea of maybe coming to Shopify, they meet everyone they will work with and also really impressive people that they will work with together. As a CEO of a public company for over 10 years, how do you feel about companies being private for so long? Obviously it's more possible than ever. Venture markets are a lot bigger than they were back when you were going public. But what do you think? I find it a little bit sad from a perspective of, I totally understand why the individual companies do it. I just find it, man, I'm so glad that so many people end up buying Shopify early. And then it's going well for them.

SPEAKER_00

Exactly. A lot of retail investors have done really well with it.

SPEAKER_00

Exactly. It's remarkable. I can go basically anywhere and meet people and they tell me that they bought some shares at some point and it was really important to them. And it's cool. I want people to make money with Shopify because they, the one vote, one share thing. The influence part. That's what is that all about? Just found the shares, let's go. But I think they had tickets to participate in something you believe in. Look, my view of money is money is how you vote for what you want. And when you buy a product, you're voting for that product and everything that caused that product to exist. And that works with shares too. If you want to hop on a company because it does things that you agree with, then you can buy them and you can go to another company if someone else captures the imagination better. And I think that's a wonderful institution. So I just also,

SPEAKER_00

I feel like it came from a meme. Because I have lived the other side of this, I thought it was kind of easy to go public. You're saying the stay private, it's much better. I don't, what is there? The arguments, you don't have the quarterly public scrutiny. Not everybody can see all your financials all the time.

SPEAKER_00

Yeah. Your employees aren't seeing their stock move up and down. Fair enough. I just never really saw these things as bad things. They induce diligence and data drivenness and a set of responsibilities, which I think are worth having, because you're responsible for thousands of people's jobs and an important product. Right. So what are the other benefits that you just shared one about the joy of a lot of people getting to share your success, but it helped us in a way that maybe it's not always the case, especially as a Canadian company listing in New York. We were very small. When Shopify IPO, it was a one and a half billion dollars valuation. Right. You've had a hundred acts in the public. Yeah. And that's cool. And therefore I find lots of people who tell me that was a good investment for them. Right. Yeah. It gave us legitimacy to then go into, we never wanted to go up market, but we always wanted to have a product that can work well for people at all parts of the scale. That just sounds like building a product is about a hundred X harder, right? Building a product that actually scales across the entire thing is insanely difficult to do and has been one of the most fun challenges to pursue. And so, bigger customers, but yeah, you have the company that's cool. That's different. And then frankly, there's really good people who would only work for a public company. So that's also helpful. Makes sense. And my last question is, I know you have been a big reader. Do you still have time to read a lot? Yeah. Yeah. Got any books I should read?

SPEAKER_01

There's so many books I love. Obviously I'm a huge fan of short, incredible books like Parkinson's Law and Lessons of History. It's when people distill all of the knowledge into under a hundred pages. And I think that's great. Recently, we had a really good book on what is intelligence? It really explains basically all of biology from a perspective of how important prediction is and how it probably emerged in the sequence. I feel this is existentially profound in a way that I don't quite know if that was because it felt this part was just to support an argument later that wasn't actually that important to make, I think. So this is interesting. I think others have felt this too, but I struggle. I've been struggling more to read, partially at the stage of life thing, but partially I think the internet is making my brain loops too short. And partially I think I am in a head space where I want every minute to be productive. And so it's hard for me to read a book for joy and I need to figure out how to get through that. But you seem to have figured out how to. It's a job of an author to make you keep reading. This is important, a mental switch, right? If you read a book and it just doesn't capture you, it's not because you're broken. It's because

SPEAKER_01

[SPEAKER_00] and it just doesn't capture you, it's, that's not because you're broken. It's because

SPEAKER_01

[SPEAKER_02] Partially at the stage of life thing, but partially I think the internet is making my brain loops too short. And partially I think I am in a head space where I want every minute to be productive. And so it's hard for me to read a book for joy and I need to figure out how to get through that. But you seem to have figured out how to—it's a job of an author to make you keep reading. Like this is important, a mental switch, right? Like if you read a book and it just doesn't capture you, that's not because you're broken. It's because the author didn't manage to do the thing that they set out to do. Right?

SPEAKER_01

[SPEAKER_00] I have an advantage, disadvantage. I have probably an advantage at this point. Being out of cycle with my wife or also as a light sleeper. So I just go to bed and she wants it way too early, usually like at 10 or whatever, something crazy. [SPEAKER_02] Yeah. [SPEAKER_00] I'm a night owl. So I don't need a lot of sleep likely. So I just have hours of reading time and that's—the Kindle is not that bright, doesn't wake her up. And therefore I have a couple hours of reading time. And you're not doom scrolling on Twitter like the rest of us.

SPEAKER_01

[SPEAKER_02] Yeah. Yeah. It's important to use something. I really am a huge fan of a Kindle just because not because it's great, but because it isn't. Because it's such a limited, single purpose device. So I find that wonderful. I just find books to be so remarkable. And they're like going to the gym. When you read a book, I'm like, I gotta be reading more books. Life just pulls this off. [SPEAKER_00] It's best to have some ritual or dedicated time for it if you can pull it off. At least it works for me. [SPEAKER_02] Yeah. Well, Toby, this was an absolute pleasure. Thank you for making time for this. This was really fun. [SPEAKER_00] Thanks so much for having me. Bye.

SPEAKER_01

um, uh, uh, policy that I'm sure your brother is thrilled with. Um, and so, um, and so, um, you know, like we want people to tinker, we want people to play with this. We want people to use it as much. And it's super good. It's skyrocketed. The second, this, uh, message came along, but what Shopify did with this, the speed of diffusion of this tool was like remarkable. And I I, I'd like to think Shopify is like predisposed for this. We have thriving on change is one of our core values and we really mean it. It's good that you talked about like, you know, net impact. I think one of these sort of blunter instruments that's getting used a lot right now

SPEAKER_01

is just like tracking token consumption. And people are like, I want to see token consumption go up 20% a month. You know, there's, I think there's founders that say that, which is, it's not an obvious, terrible idea in the same way that, you know, judging people by lines of code, like we could debate, is there anything to it? Like probably something, but, um, I think it's fine. I mean, at some point we like had a leaderboard and so on. Of token. Yeah. Yeah. And of course, that leads to immediately bad, uh, like effects. Um, and, and then, and we don't have that. Like on vault is our internal system. Like, uh, it's of intranet. It's probably not a term that

SPEAKER_01

anyone's ever heard, but like it's, um, um, so, so internal wiki and everything. Um, and, um,

SPEAKER_00

on your profile, it shows you how, what your token uses and which percentile you are in your department and group and so on. Just like, because that's interesting. I think again, also because we are, we are tracking it. We have to be, because we have to actually, I mean, at some point we have to allocate finances to OPEX and whatnot. And so, um, just therefore we show it to people. So that I know this is probably different numbers because you're at such scale, but there are, um, there are private companies whose token spend as a percentage of revenue is going into pretty wild places right now. I kind of think that's fine if you're an

SPEAKER_00

earlier stage company and you're just trying to win the market at all costs. But I am curious how this might play out. I'm sure even you're seeing tokens spend at numbers that are probably not a huge deal relative to your revenue, but are. It's a huge deal compared to revenue. It's like, it's, it's unbelievable. It's like many percentage points. It's extremely high. It's many tens of percentage points for some of these private companies. And so I'm, I am a little

SPEAKER_02

curious, you know, right now we're in that part of the journey with AI coding, where it's just so

SPEAKER_01

valuable that people are just like, I have no choice but to spend because it's too productive. I do think that that won't, we can't spend 70% of revenue on AI tokens forever and have valuable companies. So how do you think this might go? It's complex in a way that like, I'm very, very grateful for the stage Shopify's ad because we are a profitable public trusted company. And, um, right now it's, it's, it's just like, we really, really, really like the tokens we're buying. Um, it's, they're incredibly valuable and we are doing incredible things with, with them. It like accelerate, it accelerates us in roadmap and therefore ambition and all, I think it just causes so many

SPEAKER_01

good things. Like you're getting leverage on your spend. It just like, it's, it's, it's like, it's a no brainer. I have very, very high opinion of markets. Markets are extremely good. Um, they, they, they will figure out what the correct clearing price for these tokens is. And right now there's few providers and maybe there'll be more in the future. And there's all sorts of interesting moves around distillation and so on. Like I think companies will know how to wield these tools within their budgets. And we are actually doing a good deal of this kind of thing as well, but we are still, um, uh, just like charging ahead because frankly, we like the tokens

SPEAKER_01

we're buying. It's like, it's, it's that simple. I agree. And my instinct is that, you know, it should go down, but there are possible worlds where it goes up or press goes up. Yeah. Honestly, I don't, no one knows. Uh, it really don't know. Um, we are certainly, I think we are 10Xing the amount of tokens we want every year right now. And I'm sure that's gonna go up and we are 3Xing the amount of GPUs that we are putting into the world. So that, um, is, uh, yeah, those lines are not converging anywhere good at, at price savings. So given that AI coding is dominating so much, how, what are the biggest changes to like team

SPEAKER_01

design? Like, you know, there used to be this EPD triad and it worked a certain way. And there were, you know, certain ways that, you know, roadmaps were built and reviews happened and, you know, people would go out and talk to the customers and bring that back. And what is it now? Like, what is sort of like the, the sort of, uh, you know, most fundamental molecule? Yeah. I think the small team is my bet. Um, like it's, it's like the three, four, five people team, uh, which actually is like, funnily enough, has always been Shopify's bias. This is quite gratifying to like, um, um, the reason why we had to very often go past it now is

SPEAKER_01

because you just need a lot of specialized skills, at least for, for certain moments, uh, on, on the teams. Your example is a great one. Talk to the customers. It's just like having someone who's like, actually like does the, you know, customer research and just like talks with people who are like, um, I, what we always did is like forelocated people from the support org. Um, we're looking at, we, we routed them all the tickets and put them on the teams, which was an amazing way to do it. Now, just like that, the sort of agentic harness around our teams, it's actually routing like really,

SPEAKER_01

really good summarizations of what our customers say automatically, basically, uh, back. And so that's now available to everyone. And then everyone can do more skill. Like, again, we, everyone is a seven out of 10 on every skill now. So that's like really, really helpful because it allows to make teams smaller. The thing that we are, um, working the most and thinking the most, um, around at Shopify is that, um, I'm, I'm, I'm big on pace. Like pace has to be induced. Otherwise it's received. Uh, Parkinson's law is one of my most recommended books. And I, I have a 1970s, 60s copy of it that I give to everyone, my executives. I, I own many of them of the original run

SPEAKER_01

because it's like so meaningful. And the law is basically, uh, time, uh, work expands to the time allocated to it. Uh, uh, is, uh, the book is 60 pages and full of these kinds of wisdoms. This is the most important one. And so basically one of the most important functions of a leader is to just compress time windows. Yes. Yeah. To, to the, uh, to the plausible. It's not that you just give

SPEAKER_00

any deadline and anything happens, but like, if this is why it's really, really helpful to be very technical and understand all the like sort of tasks and skills, you can ask for something that has like a 50% percentile chance of being the right ship date. Um, then everyone gets to complain about, uh, uh, you know, uh, the crazy founder, which is like, great. Um, it's like, do, do whatever venting you want. And then you do, uh, uh, very often some of the best work of your, uh, careers. Um, and, and, um, uh, you know, that's why people actually flock to these type of companies because

SPEAKER_00

you, you're surrounded by the other people that you can go on such crazy journeys with. The main point here is like, uh, um, I, I run the company by the six week review cycle there, there, where we go for

SPEAKER_01

all the projects and spend the time with engineers and, uh, uh, champions and PMs that existed to set

SPEAKER_00

a pace, um, uh, uh, uh, like a, a pace ceiling, um, I suppose, ceiling, floor, floor of, um, uh, six, six, six cycle, which was faster than we instituted it. Because if you don't do it, you are run by a quarter. Um, sometimes you see like the moment, like the moment you see in a PowerPoint, first of all, first flag, second flag is someone uses the word H2 or H1, which means, you know, first, second half.

SPEAKER_01

You're actually fucked. You, you, you, you, you actually really have to do something drastic. Yeah, yeah, exactly. So as you do this, um, and, uh, now I think actually, uh, uh, six week review is actually way too limiting. It's just like, we can do so much more and we're trying to figure out how to like, what is replacing this? Um, I want to talk about sort of your customers and what AI means for them. You know, we were talking a little bit earlier about how, um, there's a lot of, uh, there's a lot of young people right now who have sort of fears of permanent underclass and how I think basically the idea being like, you're just entering the workforce,

SPEAKER_01

you don't have any like accumulated skills or, you know, credibility yet. And now you've got, you know, this AI thing, which in some ways is empowering and in some ways seems scary. The net is that there's become this meme of, you know, people are afraid of, you know, ascending through sort of the career and financial heights that they want to. And you sort of talked about how like, that's not necessarily the experience that your customers are feeling. No, I, and again, um, our customers are wonderful and they're entrepreneurs. They're

SPEAKER_00

courageous people who are putting this out there. They build businesses, they create employment. And it's like, in one way, it's like, uh, uh, it's clearly like a particular slice of, uh, people who, who would do this, but like, it's actually much bigger than people think. First of all, it's incredibly diverse, right? It's just like, it's like really, um, you, you, you put like, like Shopify customers go exactly with a population map. It's like great businesses in the most, in the smallest communities. It's like, well, it's, I mean, it's a point of sales stores in, um, the town center of tiny, tiny, tiny little townships as well as, uh, you know, uh, uh, aloo yoga. And,

SPEAKER_00

um, so it's, uh, it's, it's, it's incredibly different and it's cosmopolitan. It's big business, billion dollars business. It's, it's, it's the people who are trying to build a thing in the

SPEAKER_02

lunch breaks to make ends meet, um, or actually because they have an ambition that they want to become entrepreneurs. So what's so funny with the way the AI, the conversation is protected, how it's reported and, and sort of what you see on social media and so on is like, it just doesn't, like we can't access it anywhere. Like in anywhere where we look. You're saying Shopify is like data and experience. It just doesn't reproduce this doomer stuff.

SPEAKER_01

It absolutely doesn't. What we hear from everyone is like, Hey, you guys fix computers. It's like, you would techies talked about computers being these incredible things that can do anything. And just like, and it was so complicated. And so, and then we try this and they like, I don't know what you guys just sound unhinged. And now we have, we can talk to it and it just does the thing. And it's incredible. It's like, just works with me. And it's like, I've like, like expanded my business and I've like hired all these people now. Like just like, and, and, and so, I mean, it fits into Shopify's vision because we want

SPEAKER_01

lots and lots and lots of small companies. And by the way, 60, 70, 80%, depending on country,

SPEAKER_00

of people in the economy work for small businesses. Yeah. Incredibly precious and important. So what should AI mean? If you're a small business owner, you're starting a new small company, logically, what should the change be as a result of AI from 2023 versus 2029? What's the fundamental change? I think you should sign up for more. Like you should, you should, you can follow your ambition further. I think our customers are like, if you would Paul, like, like, I think, I think they, they believe in a, in a permanent upper class. I think they are just gonna, like, I think there's,

SPEAKER_01

we're gonna get to a point where just many, many, many more people can self-actualize. There's two, two pieces of data that I just find incredibly meaningful. One is like every 36 seconds, someone has, gets their first sale, which I, I just, I think it just, while we're talking here, think about what that means, for how many people just became entrepreneurs. The other one is, um, uh, more like a, uh, higher level observation, but every single time we ship something where we know it's meaningfully changes something about the early journey, the sign up, the kind of complexities, the questions, the friction

SPEAKER_00

in the business, each of them can be best thought of as a hurdle that someone has to jump over. And every single time we managed to make the hurdle slightly less high because we made something just vastly better. We know, let you register domains or whatever, or easily transfer them. Or in fact, we have an AI that like you can share your browser tab and it helps you set up GoDaddy, right? Um,

SPEAKER_01

every single time we do this, more cost, actual business come out of it, which then provide employment and so on. It's people churn out early in process. If something happens that, um, uh, ends up being a governor on, uh, for them and then they null out, they give up and they stop. And then the entire business doesn't exist. AI is just, never, ever has there been such a thing that it can take people so, uh, be, be so supportive. It occurs to me that last year I, on this podcast, I asked somebody this question that, you know, they were a fine person to ask, but you're probably the number one

SPEAKER_01

person in the world to ask this to. And it's something that I've been thinking a lot about, which is what has to be true for us to be in a place where you can like prompt, build me a business. Like how far are we from, Hey, I made this widget. Please go make me a million dollars. Thanks. I mean, it's my favorite, um, uh, uh, replacement, like idea, um, as a replacement for a Turing test, which we of course, um, uh, sailed past without oddly very little, uh, uh, notice. I think it is crazy. I, I think, um, acting in the, in the real world, starting a business and that, that people find meaningful enough to vote, to vote for, to the tune of a million dollars. Marketing it

SPEAKER_01

correctly, getting the right. It is a wonderful, wonderful test. Knowing what things to prioritize.

SPEAKER_00

Exactly. The shipping matter. I think we are actually getting there. I want to be

SPEAKER_01

and do a proviso though. Like, like you can obviously use Shopify without having products. We help you find manufacturers. If that's what you want, we help you. Um, um, there's an entire thing called, um, you know, collective that, uh, uh, uh, you know, manufacturers offer their products that you can then use to in your Shopify store. So if, if you're, if your particular skill set is the marketing, you can come to Shopify and like, like you, you can, you can try your hand on entrepreneurship. And, and again, very often, um, I think about half of Shopify stores end up being, uh, created,

SPEAKER_01

um, by people who have done an online store, at least a business before. So, um, people just like, you know, try and build things. People should have a product that the world wants, um, ideally come up with some, some unique take on something. And there's so much white space out there. But you think AI could do everything else? I think AI should then do absolutely everything else. In fact, it's actually literally what our, what, what our product's ambition is to be like the, maybe the vessel for AI, uh, in being the brain or the exoskeleton around the model, um, to, to basically like conspire to just like do absolutely

SPEAKER_01

everything so that if you show up with a product, you can start a business. Just to extend the idea a little bit more, not to go into like too crazy of a sci-fi place. Yeah. Is it possible that it could also do the make a product? Like, let's say I wanted to say, Hey, just go make me a million dollars. I think the, I mean, anything in a, um, you know, digital products, um, uh, Yeah. Like make me some eBooks. Exactly. You know, actually books, you know, there's print on demand for books, for t-shirts, like honestly additive, uh, uh, manufacturing is getting extraordinarily good now. Um, and, um,

SPEAKER_01

there's lots and lots of great contact manufacturers for this kind of thing, uh, like CNC and, uh, 3D printing. And then we are like looking at humanoid robotics, which kind of, like there's a lot of tailwinds here to the fact that like making the products is going to become lots more tractable. This will probably be 10 years until I'm asking guests this, but the, uh, prompt like build me a house and then the robots just go dig up what they need and then put it all together.

SPEAKER_00

I think it's a world we're looking at. Like I think I don't, I don't see how it couldn't get there. Right. Like, and I just think that's just like, this is what, what's so, but I, but I just like about the Duma, um, conversation over permanent underclass or whatever people want to call it. Yeah. Like how are we not headed to a world of abundance? Exactly. It's like, and, and, and frankly it's, it's, um, and that then goes into this sort of,

SPEAKER_01

you know, like we eliminated all the jobs. It's like, you know, how good we are at making up jobs. Yeah. You know, like there's so many examples or like, like of, of, of things that are just like delightful. Like I, I, I just like, I have like friends who, uh, um, you like open claw came around, but we didn't need, we need, but we didn't think we needed. And then it ended up being one of the most compelling things and like one thing led another. And now I have like, they have a warehouse full of 3d printers and things because it just like, like suddenly you have a Jarvis that you can say,

SPEAKER_01

I would like to do this project. And I have this, I bought this crazy 3d scanner from Facebook marketplace. And I just put it there. I don't even have a software for it. But you just go hack it and you figure out how to help me. And it's just like, I know, holy crap. I asked Kyle vote, um, from Baca. I was like, well, we get to a place where like, I can just like text my robot to like order Instacart, like get the steak, you know, prepared, like serve it, you know, slice it up. He's like, put, clean it all up. He's like, yeah, that'll happen at benchmark. I spend probably three quarters of my time in software land, but

SPEAKER_01

sometimes I do step back and I think, okay, to actually like, you know, this is maybe a little easier for me when I'm like, not in San Francisco and I'm like touching grass in some other city or something. I'm like, okay, what's actually going to raise the standard of living for everybody in the world? It's things like we need more and better houses. We need better transportation. We need better food. We need like better healthcare. We need good education. It's like all these things that aren't software. And then sometimes I think about like some alien watching us all,

SPEAKER_00

and we're just like sitting behind our little boxes, typing, everything's going better in typing land and it's all bopping about in software land. But we do really need it to get into the physical world to like, because the standard of living it's all, it is all on some level physical. Absolutely. It completely is. And I think this is actually the missing ingredient, right? Like, because I mean, people talk about the, you know, what was looking at the incredible infrastructure we used to build in the sixties. It was like, well, just even before that, there's a Hoover Dam, like, you know, and this kind of stuff, lots of individual stories about these infrastructure

SPEAKER_00

projects, how quickly we built, uh, um, subways and now it's hexed like forever and so on. Like there is a observed degradation of, uh, uh, like a lot of these kinds of projects and it's, it's, it's multifactorial. There's not one reason behind it, but one of them that really is true is because we are building,

SPEAKER_01

um, for more than wonders, um, that are no less impressive entirely in software, right? The web browser, Linux, um, all these kinds of things are like, like projects at a scale beyond what the permits are. And so, um, uh, easily and, um, uh, without compulsion and just by volunteers, uh, sometimes people who have never met each other in the open source world or at companies building these, I mean, like, uh, something like Google or, or, or, or the social networks is like, it's incredibly, incredibly impressive pieces. If they would have physical manifestation, you would, again,

SPEAKER_02

you go to something like a, uh, uh, like a, like a, like a refinery or so, um, and, and you see the

SPEAKER_01

pipes and so on. It's so impressive. It's not even, uh, in basis points territory in terms of complexity compared to a browser. Compared to like a browser. Exactly. And just so we, we don't appreciate that. And so, and neither, that's not our problem. I don't think I appreciate a browser. Is a browser near the top of complexity? I would put it under, I, it's one of the wonders of the world. I mean, for so many reasons, like it could never ever be introduced today. Can you give a small flavor? I'm sure it's hard to even explain why it's so complicated, but what, what can you give a flavor of what makes it such an unbelievable thing?

SPEAKER_01

In so many ways, like we just like, okay, you got to a website. It's like, we don't trust that website. We just run code. We, we, we, but like also just like, it's like actually your computer in front of you magically reconfiguring itself into a, someone else's vision for what should be there. And like without limits, it's actually like you, you download software that then just like exists for this one,

SPEAKER_00

one moment to do literally everything. And like what it's, it's self-responsible. Like Shopify is a hundred, like it's like over a hundred billion dollars market cap company with, um, uh, hosting like millions and millions of, of, of business that might otherwise not exist. And all of this just happened because anyone can just put a server online, gets an IP address by like automatically. It's insane. And then it just like, it's like, and then it all hangs together. It all, it all looks. It doesn't come down more. Why doesn't it not all crash? It's like, it's the most reliable thing. It's a, it's, it's, it's just,

SPEAKER_00

and, and no app store on Planned Earth would allow the web browser if it would be introduced today, if it didn't exist. Right. It's just like, it would like, no one would allow this because it just doesn't even sound like it's, it sounds like an insane pitch yet it exists and we just don't think about it. And so it's, it's just also like the font rendering alone is one of the most complex, like, like the font rendering alone is a true incomplete system that like, just, just because we want to be able to read text slightly, uh, more, uh, better than our displays can allow them.

SPEAKER_00

And it just like, it just keeps going, going. And, and, and it's like, I can go full nerdcore on this, but like the larger points actually are following. Um, we have not stopped as humanity building incredibly impressive infrastructure, but it's had changed as the infrastructure that needed building over the last 30 years. And the reason why other infrastructure didn't happen is because the people who quit just so much went into this into had the planet earth needed for us was a digital infrastructure. And it's like, if all those people worked on robotics, it's like, this is,

SPEAKER_00

and this is happening now. Right. And it's like, we are, we are, we, um, we are happening with AI, like all the software we built was a bootstrapper for AI. Software becomes, um, due to this achievement,

SPEAKER_02

something that can be become personal again and become like, um, now you can have basically a web browser, but the websites don't even need to exist, um, uh, for that, that you would like to see. The browsers, it's so true when you say it like that, the easiest to identify with example for most of us probably is like an iPhone. Like we've probably all just like randomly, one day you look at your iPhone and you're like, how the hell does this thing exist? It's crazy. And we'll just, you know. But as beautiful as it is, and as like, as reliable as it is, and it's like, it's personal as it is.

SPEAKER_02

And so I think, um, I think the, uh, like the iPhone is a lucky exception and that you can appreciate it as a physical because it's not the fault of like, everyone is right. And they say, why is everything just like kind of standing still or not getting better around me? Because from the perspective and from the ability for us to observe it is like, because all the infrastructure digital, but we are almost done with this. We are at the end of the opening chapters of, of, of all this. And so, um, now I think we will see vastly more impact. We put all of our energy against this thing because it was the

SPEAKER_02

foundation, but now all these people in some sense be free to not write software. That's exactly right. And so I think we will have a huge influx of, uh, the brightest and most creative and, and, and driven people to make things which are going to be much easier to relate to and have much more impact, a direct impact on, uh, uh, you know, people's lives. How important for you is it as, you know, CEO of Shopify to have an opinion on where AI will be in like two years? Like, you know, like there's one worldview you could probably take, which is like, this is so unpredictable. I'm going to take it as it comes.

SPEAKER_02

I'm going to try to know six months ahead, but like, well, I'm going to do what I can do. And then there would be another, which is now I'm actually going to spend a lot of time with the labs. I'm going to try to have an

SPEAKER_00

understanding of like two, three years out and try to care about the farthest out I can see what, what do you think is the right position? Yeah. I mean, if my friends would listen to this question, they would laugh just because like, it's my predominant obsession is to like, try to, um, have as many data points on as many people, which I can try to match to the right, um, you know, super linear or linear or sublinear

SPEAKER_02

curves and just like figure out how they all connect and what, what, what sort of therefore will happen in the future. Right. Like it's basically, I mean, to me is the most fun game in the world is like have a pretty clear eye view of what the future is like. And what in particular are you trying to figure out? I mean, the AI memo is like a good example because like, I, again, it was probably slightly too early to write it, but now if you read it now, it like, it says nothing that would be surprising. Right. Like, so being able to give my company the gift of, uh, um, like a headstart is, I mean, that's what we're

SPEAKER_02

trying to do. Right. Like, and, uh, because the moment then, um, I, I, I can tell everyone something that isn't quite clearly true now about the importance of these systems and we can rebuild our systems to really, really reinforce this and support everyone in their own tinkering exploration. That means that,

SPEAKER_00

uh, our view of the future is going to be more accurate and things we are building because you're always building for future point. You're like, software is getting faster to build, but you still have to aim at a future point of value. It's not our customer's job to tell us what they need. Um, it's, it's our customer's job to tell us what the problems are that they're experiencing. And we fall in love with those problems. So like adopt those problems as our own and just solve them in an ideal way. But that's our job to figure out what the ideal way is that comes into contact with the customers

SPEAKER_00

and they give us further feedback for refinement. But it's in my mind is a complete application to just build what your customers ask for. Um, uh, it's an application of product responsibility. And so, um, uh, so it's, it's, it's hugely important and, and, and it's, it's kind of like almost everything,

SPEAKER_02

every decision I make, I try to make on, um, an understanding of like, I try to live in everyone else's relative future. So, so this is, uh, I, I do a lot of it. Interesting. While it's incredibly, um, uh, fun and helpful to talk with the labs, and sometimes like there's some, uh, really important information that you can get from this. What I found and we sort of touched on it earlier is my, one of my favorite things, especially for, you know, product teams and so on. And then engineering is to hire people who actually know Shopify really well from outside. People who were merchants,

SPEAKER_02

um, uh, uh, some of my best product managers, because they actually understand what the software feel like feels like when it's being used. And, um, uh, you know, in same with, uh, people who build, uh, apps on the Shopify platform to help come to Shopify and help make the app platform better. It's like, it's like, I actually don't even think being in a lab is actually the best position. It's actually being like using everything and paying a lot of attention of how everyone else uses what the sort of gifts that the labs release. And then being in the sort of conversation, which usually happens on X, on, uh, what everyone's figuring out, maybe actually

SPEAKER_02

building something and seeing everyone finds it useful. It's like, I think this sort of learning by doing is just, that's actually how to get the most clear view of how everything works. Does that give you a clear view on the present or does it also give you a clear view on what's coming in a year or two? If you do it over a while, you get trajectory, you get trajectories. Yeah. And the trajectories are the point. If you are exactly on the state of art meter of the best thought on stuff, um, and you have, um, other data points, it's just the future gets very simple to, uh, to predict. Now it's the hardest time ever to do it because like right now, the time horizons are

SPEAKER_02

so short. I did this very same thing throughout my entire life. Um, and, um, uh, it used, it used to be that the future was absolutely trivial to predict. It's like, you just like, I mean, you just looked at like the first couple of numbers on, on, on mobile browser usage, and you just knew what's happening on a cell phone and that we needed to make mobile websites, which sounds insane now, but like, yeah, it was at some point people didn't believe that. And so, yeah. Are there parts of AI right now that you think are under hyped in terms of capabilities and are there parts that you think are over hyped?

SPEAKER_02

So obviously the labs really care about programming because that's the problem they need to solve for themselves. And again, it's always easier to put, um, uh, and then for various reasons. So like, like, like Opus is unbelievably good at programming and right now it's easy to go from that and then just like assume it's equally competent in everything else. Uh, and quite often it isn't. If you want to discuss like how to do like a, like a, like a public talk or something, it just doesn't have great, like theoretical routing of this and why, I mean, it, it, it knows about all the different sort of

SPEAKER_02

ways to construct tension and so on. But like, it's, it's, it's not able to then look at something and make it meaningful better where like even an incredibly well optimized piece of code, it often finds like abilities to go and do better. What is happening a lot is that you're bringing more types of problems in the domain of programming, which is really what OpenClaw is. If you really

SPEAKER_00

think about it, it's like, make it a file system, give it like tools, like a programmer uses and make a couple of files, like in the files, just tell it the soul and the memory and so on. And, um, then it uses the normal programming tools to interrogate this. And because it stays a little bit in domain

SPEAKER_02

programming, it now actually is remarkably better at this other out of domain thing, which is really, really funny. I, um, think we should assume though that, uh, we are going through the entire, uh, uh, you know, radio chart of, uh, things that are, uh, valuable and bring them to the same point of, uh, with home programming. So I think there's a bit of overhype in like, um, having to work so hard on bringing things in programming domain, because like all of this is just going to get much, much more, more, more natural and easier as the models appear where it's underhyped is, uh, just in deployment

SPEAKER_02

in companies, I think, and just like, like what role it should play is like, there's a huge, I mean, like no one's using it enough. No one's using it enough. Partly because everyone just starts with like, Hey, let's, let's help me do the things that I've been doing all along slightly better or actually vastly better, which is valuable, um, obviously, but like, if you do with more first principle things like, Hey, if, uh, AI would have been around ever since, uh, Alan Turing first wrote about it and we just have worked and we are just in the presence of these, uh, uh, super intelligence

SPEAKER_02

all the time. And we would just invent the job we are thinking about right now. Like how would we do it? Like just, just invert the whole thing. Yeah. And, um, you know, when, when you're like, it just, it's so much more fun to have those conversations. And, um, I think it'll be like, I mean, I'm exceptionally excited about this because I think it will create the environments that, um, the most creative and best people will really, really appreciate, uh, because everything just around them happens at the speed that they want to work. And that has never been true for any company that

SPEAKER_02

requires some bureaucracy for doing stuff. On the point of talent, have you changed anything about the types of people you're looking for? Like pre post AI, are the same people who were successful before or those still the same most successful people? Or is there any attribute that you are scanning for in a different weighting than you used to? It's fascinating. So this is actually really changing all the time. And actually I've had to change my mind a couple of times, but I think the best distinction point is, um, you know, Shopify is 20 years old. I think average age of Shopify is

SPEAKER_02

somewhere like late 30s, which is, I think still pretty good. But like, I mean, like this is one thing you have to look out for, like as a company, if you, there's some companies that just age themselves 12 months of a year and, um, uh, for various reasons. And, you know, that's, that's probably a problem at some point when a lot of new things happen. So like, just like massively restarting the internship program has been really helpful, right? Like, just like, um, uh, we take a thousand interns a year from, we have been close to Waterloo and work with Waterloo. So it's great. And, um, just, um, making sure that the

SPEAKER_02

interns are not just the students now, but also the teachers, because like, again, they are just like,

SPEAKER_00

so I, I native that it was really, really helpful. It's also interesting because, um, initially I, I, I had the thought that, you know, there's like fluid intelligence, intelligence, crystallized intelligence, basically knowledge and curiosity driven willingness to learn. Um, and often early in career, you have more fluid, you have no knowledge, therefore you have all, you're all fluid. Um, and, uh, then I, I was sort of super new, but also the first people who just flocked to it, right? Like an immediately got value out of it. And that was super, super exciting. I had the thought

SPEAKER_00

that maybe that really tilts into their direction, but then as we started, like the more of the systems sort of got firmed with, uh, uh, around the coding harnesses, cloud code, pie, and all these kind of things. It really programming is so much, not the type of typing, uh, like typing, uh, task of typing. It's really understanding the problem deeply. And, um, I think every program in the world massively underestimates how much they're doing when steering in AI right now. Um, and how much that was really them being creative and actually just like, uh, like it's uniquely there is what they're coming up

SPEAKER_02

with. They are like, just like having seen the movie before, like it's, you can sort of spot the AI just going in the wrong path and you just like one, two words can completely like just change everything. There's a very, very long answer to say, I kind of don't know, but I actually just think good people are good. Like, it's like, there's a bit of variance how quickly people adopted the tools, but once they did, it's like everyone just like, yeah, falls back onto their level. So that, I guess that's the sort of like, what do you like side of the question, I guess to flip it to what a candidate's like, have you felt any change in competing for talent in this market? And,

SPEAKER_02

you know, maybe it's, you know, you've got a lot of variables at play here that, you know, you're public, you know, many of your sort of competing for talent companies are probably private you're, you know, in Canada and not in Silicon Valley, you know, there's all these different factors, but I'm curious, how does the sort of like, um, AI wave change sort of what you do to sort of attract and retain the various people? Yeah. I mean, I think the best way to deal with, um, recruiting is to build a company worth looking for, for the best, right? Like, so I think, um, I think people are like,

SPEAKER_02

thinking about it too much as selling and not enough as marketing, um, you know, in a way, or at least even just like information. Um, yeah. It's like, how do I look, how do I look super healthy? Like, well, you could like, you know, you could use this, you could turn this angle, you could do, it's like, well, you can also just try to be healthy. Exactly. So sometimes it's just like, things are just simpler sometimes when they seem. So what goes into that then? Yeah. Obviously there's like, you know, being a good business, but. Yeah. Just don't, don't mire people in the bureaucracy don't like, like give people the space that, uh, like to, to, to be creative and,

SPEAKER_02

uh, have them like, allow them to, you know, fall in love with the mission actually. And like, have them understand what problems people care about and what impact, um, the book has. I think Shopify has a lot of intrinsic advantages here, but like, I mean, the best way to attract talent is make it so that when people, uh, sort of try on the idea of maybe coming to Shopify, that, you know, they, um, come by, they, they, they meet everyone they will work with and also really, really impressive people that they will work with together. As a CEO of a public company for, I think over 10 years,

SPEAKER_02

how do you feel about companies being private for so long? Like, obviously it's like more possible than ever. Like venture markets are a lot bigger than they were back when you were going public. Um, but I don't know, like, what do you think? I, I, I find it a little bit sad from a perspective of, like, I, I totally understand why the individual companies do it. I just find it like, man, I'm so glad that so many people end up like buying Shopify early. And then it's going well for them. Exactly. It's just like, I, I, I, a lot of retail investors have done really well with it. Exactly. It's just like, it's remarkable. I can go basically anywhere and like, and just meet

SPEAKER_02

people and they tell me that like, that, they just like bought some shares at some point and just like, it was really, really important to them. And it's like, it's cool. I just want, I want people to make money with Shopify because I'm like, they, uh, um, much not like, I, the sort of one vote, one share kind of thing, uh, like sort of the influence part. I'm like, totally that's what the fuck is that all about? Like, just like, like found the shares, let's go. But like, I think they had tickets to, uh, participate in something you believe in. Like, I, I mean, look, my view of money is money is how you vote for the, what you want. Um, um, and when you buy a product,

SPEAKER_02

you're voting for that product and everything that caused that product to exist. And that works with shares too. Like if you want to hop on a company because it does things that you agree with, then uh, you can buy them and you can like go to another company if someone else captures the imagination better. And I think that's, I think that's a wonderful institution. So I just also like,

SPEAKER_00

I feel like it came from a meme. Like, I think like, because I have lived the other side of this, I thought it was kind of easy to go public. You're saying the, uh, the stay private, it's much better. It's just like, I don't, I mean, what, what is there? I mean, the arguments, you don't have the quarterly public scrutiny. Not everybody can see all your financials all the time. Yeah. Your employees aren't seeing their stock move up and down. Fair enough. I just never really see, saw these things as bad things. They are like, they, they, they induce like a diligence and a data

SPEAKER_02

drivenness and kind of a little bit of, you know, a set of responsibilities, which I think are worth having, um, because you are, you know, you're, you're responsible for thousands of people's jobs and, and an important product. Right. So what are the other benefits that like, you know, you just shared one about sort of the joy of, you know, a lot of people getting to share your success, but it helped us in a way that maybe it's not always the case, like in, and especially as a Canadian company listing on, and in New York, um, we were, um, just very small, like when Shopify IPO, it was like one and half

SPEAKER_02

billion dollars valuation. Right. Like, so you've had a hundred acts in the public. Yeah. Yeah. And, um, uh, right. That's cool. And, um, um, um, therefore I find lots of people who start, who tell me that was a good investment for them. Right. Yeah. It gave us like legitimacy to then go into, like, you know, we, we never wanted to go up market, but we always wanted to have a product that can work well for people at all parts of the scale. That just sounds like, like just words is about a hundred X harder from building a product, right? Building a product that's like actually

SPEAKER_02

scales across the entire thing is insanely difficult to do and has been one of the most, uh, you know, fun challenges, uh, uh, to, to pursue. And so, um, you know, bigger customers, but just like, yeah, you have the company that's cool. Like that's, that's, that's different. And then frankly, there's really, really, really good people who would only work for public company. So that's also, um, helpful. Makes sense. And my last question is, I know you have at least been a big reader. Do you still have time to read a lot? Yeah. Yeah. You got any books I should read? There's so many books I love. I mean, obviously like I, I, I'm, I'm a huge fan of a sort of short,

SPEAKER_02

incredible books like Parkinson's law and lessons of history. Um, um, it just like, then people distill like all of the knowledge into like under a hundred pages. And I think that's great. Recently, we had a really good book on, uh, it's called, um, what is intelligence? It really explains basically all of biology from a perspective of how important prediction is and how it probably emerged just in the sequence. I'm like, this is like felt. Exidentially profound in a way that like, I don't quite know if that was because it felt all this part was just to support an argument later that wasn't actually that important to make, I think. So this is kind of interesting.

SPEAKER_02

I think others have felt this too, but I struggle. I've been struggling more to read, partially at the stage of life thing, but partially I think like the internet is making my brain loops too short. And partially I think I am in a head space where I want every minute to be productive. And so it's hard for me to read a book for joy and I need to figure out how to get through that. But you seem to have figured out how to, it's, it's, it's, it's a, it's a job of an author to make you keep reading. Like this is important, like mental switch, right? Like if, if you read a book

SPEAKER_00

and it just like, doesn't capture you, it's like, it's, that's not because you're broken. It's because the author didn't manage to do the thing that they wanted, set out to do. Right? Like I sort of have an advantage, disadvantage. I have probably advantage at this point. Um, like being out of, uh, uh, um, cycle with my, uh, wife or also as a light sleeper. So like, I just like go to bed and she wants it just like way too early, usually like at 10 or whatever, something crazy. Yeah. I'm like a night old. So I, I don't need a lot of sleep likely. So I, uh, I, uh, just have like hours

SPEAKER_00

of reading time and that's like, you know, the Kindle is not that bright, doesn't wake her up. And therefore I'm have a couple hours of reading time. And you're not doom scrolling on Twitter like the

SPEAKER_02

rest of us. Yeah. Yeah. It's, it's important to like using like this, I really, really am a huge fan of a Kindle just because not because it's, great, but because it isn't right. Because it's like, it's such a limited, but actually single purpose device. So yeah. Like I find that, I find that wonderful. I just, I just, I find books just to be so remarkable. And they're like going to the gym. It's like, when you read a book, I'm like, I gotta be reading more books. Life just pulls this off.

SPEAKER_00

It's best to have some, uh, some, some, some ritual or some, uh, dedicated time for it. If you, if you can pull it off, um, that's, that just, I mean, at least it looks for me. Yeah. Well,

SPEAKER_02

Toby, this was an absolute pleasure. Thank you for making time for this. This was really fun. Thanks so much for having me. Bye.