Brian Chesky - AI Founder Mode

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This show is an open-ended exploration of markets, ideas, stories, and strategies that will help you better invest both your time and your money. If you enjoy these conversations and want to go deeper, check out Colossus, our quarterly publication with in-depth profiles of the people shaping business and investing. You can find Colossus along with all of our podcasts at Colossus.com. Patrick O'Shanasi is the CEO of Positive Sum. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of Positive Sum. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. Clients of Positive Sum may maintain positions in the securities discussed in this podcast. To learn more, visit psum.vc. My guest today is Brian Chesky, the co-founder and CEO of Airbnb. Our conversation traces the path from his early training as an industrial designer at RISD through the pandemic moment that forced him into founder mode. He explains what he calls AI founder mode and why it will demand even more attention to the details. He walks through his 11 star exercise which I've used personally many times over the years, which is his way of imagining the most absurd version of a customer experience as a path to product market fit. We talk about why founders are rarely good early CEOs and what changed him when he stopped chasing adulation and started making things for the love of making them. Please enjoy this great conversation with Brian Chesky. Before we head go here, we were talking about industrial design, which you studied at RISD. I have this weird affinity for the history of this topic just because Raymond Loewy, one of the famous industrial designers, helped me a lot in my career indirectly. I'd love to hear you just riff on the influence that guys like him had in your early studies and why you studied that in the first place. Such an interesting background. I was an artist growing up, but I didn't know what to do with my life. And I went to the Rhode Island school design and at RISD, when you're a freshman, you have to pick a major. I'm 17 years old and I'm like, okay, in three months, I decide when I'm going to do the rest of my life. And I remember the department head for industrial design came. I never even heard of the term industrial design, I don't know what it was. And they said industrial design designed everything with toothbrush, to a spaceship and everything in between. I immediately said, that's what I want to do in my life. Because I was thinking of maybe being an architect or something like that. So I started learning about industrial design and I learned about trails and reemes, Raymond Loewy. Raymond Loewy, probably the most important industrial designer of 20th century, designed so many incredible products. This first designer Air Force One, he designed a lot of beautiful consumer products. He designed a lot of cars and he had a profound impact, I think, on society. And as I was studying the history of industrial design, it was so incredible. Because industrial design field is a deeply technical field. The thing about architecture is fairly technical, but it's a more known boundary. Like there's buildings and there's commercial, there's residential, there's retail, there's only so much variation, it's a multi-thousand year old field. Industrial design for the most part really started with Josiah Wedgewood. It was like, it's really the mass industrial product. So industrial design is really new from the industrial revolution. And it used to be analog things. The first industrial design was chairs and tabletop dishes and bowls. But as technology grows, suddenly industrial design becomes cars and airplanes. And now you have microwaves and refrigerators and you have all these things at 20th century radios. And then eventually becomes like medical equipment like ventilators. And then, you know, with computers, I mean, a lot of people, the most and famous industrial design part in the world is the iPhone. And the vastness of industrial design is unbelievable. The intimate relationship you have with a product is incredible. I remember in the group of the 1980s, I love video games. I played with a Game Boy, a Game Gear, Super Nintendo, or remember Nike in the 80s and 90s, those sneakers. They were the Reebok pumps. Like these products captured kids' imaginations. And they had a very intimate relationship with you. They really had a sense of personality. And computers in particular or something I was really, really interested in. And then of course, you get to the Golden Age of Apple, starting probably in 1998 with the iMac. And into Johnny I, who was my hero. So into RISD, and when I was at RISD, Apple was the golden age of industrial design. They really educated the public about design. Once they're educated, they couldn't unseek great products. And that captured my imagination. What I loved about industrial design was A was very technical. You worked in mechanical engineers, you worked in electrical engineers. B, here's the thing about industrial design. It's almost different than any other design. There's also true fashion design. A design is only successful if it sells. So if we design an office building, architect can win awards in their office building, and it can never get leased. We can design a house, but no one looks at what was retail value of the house. So the words are detached from the commercial success. If you design a product and no one buys it, it's considered a failure. And so because the commercial success matters, you have to think about marketing, manufacturing, distribution, solving problems. It's not just about winning awards, about being viable to a customer. Another thing is it's very much a problem-solving field. It's got so many different boundaries. And it's very much about empathy, about user journeys. More than I think any other design field, I think industrial design always seemed like it was the kind of field where you put yourself in the shoes of the user. You design these user journeys. And I think they really teach us design through user journeys. There's very specific type of field. And I think that really prepared me for designing, I just give you one example. One of the projects I designed, when I graduated with a child's ventilator. And so it's not just thinking about a child's breathing machine. Instead of just thinking about the design of the ventilator, one of the projects that I like to do was imagine being the child on a hospital. And so I imagine being a child is hard to do, but you're six years old, imagine being six. And you're scared, you're looking up at a breathing machine. And imagine the parents. The parents go in and the parents are like, "Is my child going to be okay?" If this breathing machine seems like ominous and like it's keeping you alive, the parents are going to freak out. Like, "What's wrong with my child?" The other thing is I learned that one of the interesting things that happened was the nurse technicians, the really technical nurses, is a weird thing. They had no problem that these things were complicated. But the hospital wanted a breathing machine that was so simple that everyone can learn how to use it. Except that their technicians had pride only they knew how to use it. So you had to like weigh the stakeholders. How do you design something for the vantage point of a child? Consider how would it imbue to the parents? How could it be universally useful for everyone without threatening people's jobs? You see, there's so many dimensions that just I think really prepared me for this field. There's no product managers in industrial sign. You are the PM. There's industrial signers and there's engineers and there's program managers. So as your designer is the product manager. So a design product is one function. Do you think the world's going to go that way now? You're obviously famous for helping usher in this founder mode idea. Yeah. That was kind of pre-opus 4.6 or whatever. There's like another layer to that now. I'm curious what we would call it. But it seems like for the first time again, someone even like you running a very large company with lots of people can disintermediate lots of the steps between idea and outcome and this design stuff maybe even more applicable than ever. What is the new mode like? Because everyone's trying to figure out how do I run a company in this era? So how would you describe the new capabilities and the mode through the lens of this? You know, founder mode was something that Paul Graham coined but based on experience I had. I think people are basically born good founders or said differently. It's a neat. You don't have to learn how to be good founder. It's like you jump in the pool and you learn how to swim. No one is born a good CEO. And the job of CEO is completely counterintuitive and almost all of your intuition about what to do is wrong. And so the problem is we founders never were really prepared to be great CEOs. We founders were taught to learn by doing and that's great for a founder. It's not good as a CEO. You do not want to learn on the job how to be CEO. In other words, trial and error is bad for CEO. You know why trial and error is really bad? Because you hire somebody, they build an empire, they leave and now you get to unwind their empire and it takes like four years. So you've wasted years. So actually learning how to be CEO is something you should learn. And so I learned the hard way and I basically learned that what happened was founders were over delegating their companies to these professional managers. I'm not disparaging them, but they were detaching themselves and they were being managed, rather than managing the company. And it was really about not apologizing about how you run the run the company, being in the details. That was founder mode. - Was there a moment that, like, clicked for you that you had to change the mode? - Yes, the pandemic. Two things happened. Actually, speaking of Johnny Ive and Apple and another person named Heroke here, I spent the 2010s riding a rocket ship, Airbnb, Uber, a few of us. We went on these crazy rocket ships that, like, you know, open-air and throp-hacker doing now. It was awesome. It was amazing. But by the end of the last decade, around 2019, I remember waking up one day and was, like, completely unrecognizable the company I was running. I had, like, 7,000 employees. I didn't know what anyone was doing. I felt like I was in a car without steering wheel. And I just could not turn the company. I was like, "Turn left!" And the company would go right. And actually, not only did I feel like I was not in control, I don't like anyone felt like they were in control. It was just a free-for-all. Thousands of decisions being made for me, me overly differing, not listening to my intuition. And I got to this point where I remember having this dream and I told my co-founders, I had a dream in like 2019, where I felt like I'd left the company for 10 years and I'd come back. And I was like, somebody had been running the company for 10 years and they, like, turned it into this, like, giant political bureaucracy. And I didn't even recognize the company. And then I realized, oh my God, it was me the whole time. And so it was my fault. Like, I had actually enabled all this to happen. And then I started talking to people and they all had the same experience. And all these founders felt like we were all made to feel crazy because we had this instinct. So around the same time as a pandemic, I hired a guy named Mirroki Asahi. He was from Apple. And he told me about Steve Jobs ran Apple. And Steve Jobs, when he came back to Apple in 1997 in July of 1997, there were 90s from bankruptcy. And he basically just went into founder mode, when you call founder mode. He got into the details of every little detail. And I wanted to do that. But initially the company braced against it. It was almost like it repelled against it. But then the pandemic happened. And we lost 80% of our business in eight weeks. We were in total crisis mode. That moment I went from peace time to work time. And then I just totally took control of the entire company. And I just never let go. Over time, basically what I did is I reviewed every single thing for two, three years. I worked like 100 hours a week, reviewed every little detail of the company. My vision wasn't to do this forever. My vision wasn't to micromanage forever. My vision was, before I empower people, I need to know what's going on. This notion that great leadership is hiring great people and trusting them to know what to do. Well, how do you know they're great if you're not auditing what they're doing? And you actually want to start hands-on under control and give ground grudgingly. Everyone does the opposite. They let go. They hire someone. They go in the wrong direction. And by the way, that's bad for the leader. You're not training them. So to bring it back to your question, that's founder mode. We need AI founder mode. AI founder mode is going to be even more intense the founder mode. What are the principles that you're thinking about as you go into it? I think AI founder mode are even in significantly more details because you have almost everything on demand. The mechanism of founder mode was I had a lot of meetings because that was the only way I can information. So I probably do 35 hours in meetings, which is very similar to way steeper in Apple. I wouldn't do one-on-ones. I don't need to do group meetings. I do a recurring thing where I review every single family company. You learn a weekly basis by week, month, year, or a family. Live in person. Group meeting. And I tell the full chain of command. A lot of companies you have to get your boss to prove it and your boss is boss to prove it. Your boss is boss is boss to prove it. I know the full chain of command in the room. And anyone can give their opinion. I would make all the final decisions. I would not speak first. I usually speak last. And I usually agree with the team. But 10% of the time I disagree. But I'd ratify every decision. It was a very clear chain of command. But this is a meeting based culture. I think in AI, I think we're going to move away from meeting based asynchronous. And we're fairly remote. And so I think that will benefit us. I think we're going to have a lot fewer layers of management. I think the result of the famous saying the Catholic Church has been going on for 2,000 years. Only have four layers of management. Why do other companies have 7, 8, 9 layers of management? I know there's this general idea, as a thought experiment, what if I could theoretically manage all 7,000 people flat? I don't think that's a good idea. I think that's an extreme. But I do think going to a few layers of management would make a lot of sense. I'm in the middle of trying to think about how to redesign the company. I think every single person in this company's job will change. I don't know how. I've not wanted to make any rash changes. What I'm basically doing now is trying to get people to adopt AI tools. And I want to see how everyone's job changes in the world of AI tooling. And then I want to basically embark on like a fundamental redesign. I don't think people managers will have any value in the future. When I mean people manage people, I only manage people. I think everyone's going to have to be a hybrid people manager or manager IC. Meaning they have to have contact with reality in some sense. They have to be a thing a customer end up seeing or talking to you. An engineer recall that to be technical. In other words, every engineer needs a code. Even the managers need a code. Whatever the version of that is for your field, you need a code. So if you're a lawyer, you're just not managing people. You have to actually read the case law, you have to get involved. And that makes sense, right? You can't just be these managers where you're kind of people's therapist and you're just doing meetings. You're doing one-on-ones. Like people who have lots of recurring one-on-ones are not going to survive. Because what they're doing is like, that you come with me with whatever problem is I'm here to help you like a mentor or a professor. That kind of leadership style is not going to work. You need to have context. And I think a lot of people will survive this age of AI. The two types of people that will not survive the age of AI or two types of people. Pure people managers who think it's all about just leadership. No, it's about content and leadership. I hear about design leaders that like the heads of design, they don't actually manage the design. Johnny Ive manages the design. He designs. And he leads people. A design leader who only manages the people, that's crazy to me. The way Frank Lloyd managed his design team is through the work. I say you manage people through the work. You don't manage the people, you manage the work. Otherwise, what are you doing? I mean, yeah, like maybe a couple times a year you should have like a check-in, have a heart to heart, ask them if they're family, build relationships. You should do that. You should have relationships. That's not a day to day thing. You're not, they're therapists. You're managing people through the work. So the two types of people will not meet the shift to AI or pure people managers and people that are rigid and don't want to change and evolve. As long as you're like at a growth mindset, I think the tools are going to be very easy. There's an economic set up for the tools to be so easy everyone can figure them out. So I don't think the AI tools are going to be complicated. Right now there's a lot of command line. I think Cloudbot and coworker are not the most intuitive to an average person. But I think economic incentives will be for this to become incredibly intuitive. And I think AI is really an enterprise thing right now. If you take out Chatchubt, then people screwing around image generation, it's pretty much just an enterprise phenomenon. I'm in the board of white commentator. 175 companies last batch. 159 random price. There are no consumer companies. Because there's no consumer companies, the incentive to make the interfaces really simple is not there because it's their job to figure out the interface. The next wave of AI is going to be consumer AI. Consumer AI is going to be the big prize. Can you think of a consumer AI company? Maybe open AI, but most their energy is now going to Codex. Google, yeah, which I'm an AI, but most of it's still going to search. They don't want to cannibalize your business. So I think that's where it's all going to go. And I'm trying to start thinking about AI as a consumer play. And how do we make tools so simple that everyone here can figure out how to use them? 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Number one, I think a lot of people when Chattatubate came out were afraid. They were afraid Chattatubate was going to kill their business. Some of the other investors didn't want to invest in something where they thought Chattatubate was going to kill it. Number two, the business model is tricky. There is no yet consumer business model for AI that I've seen. For example, Chattatubate, there's three ways that can monetize subscriptions. Unfortunately, they're probably going to hit a local maximum percentage of users subscribing because Claude and Gemini are given away for free. Ads, again, they're hitting a local maximum because Claude Gemini not going to ads. And then e-commerce, they shut down the third party apps. And the inference cost are expensive enough that they're burning a lot of money. And so I think the first thing is, you need to have a business model around consumer AI. You can't just be in a business of information. Because people are not trained to pay for information. The second problem is distribution is mature. Now, again, top three apps are RAI. So it does prove you have something revolutionary. You'll find your way to the top. The third thing is, while I think Silicon Valley, we like to describe ourselves as rebels, I think, and maybe it's a little bit like the always on nature of Twitter, I think it's very trend-based and vibe-based. I think there's a sense that everyone kind of does what everyone kind of does. That makes sense. I think the trend is enterprise. The other thing is, is why commentator, we tell entrepreneurs get other wicie startups to be our first users. It's a really great distribution strategy, right? Like, the way we got our first users, is you do things that don't scale. Now, what happened was that has taken to logical extension that everyone just keeps making enterprise companies. Maybe finally, the reason people aren't doing consumer commisers, they're just harder. They're more hit-striven. The price is bigger, but the risk is higher. It's more all or nothing. You can pick a narrow vertical, build a good medium to large-sized business. It's pretty straightforward. You can get other wicie commisers adopted, and you can grow into large and large enterprise. It is much more hit-striven business. You have to be good a lot more things. You generally have to be better at design, marketing, culture, press. It's not purely technology and sales, which is what I'd say, enterprise is like, you make a product. It can be a technology based product. Oftentimes, in enterprise, the person uses a product, not person buying the product. And so, sales becomes really important, but you can start sales really small with smart companies. It's really hard to figure out how do you start small consumer? Who do you start with on the street? So, I think these are the reasons why. But it might also just be that everyone doing enterprise is the number doing enterprise. And it's a trend. My prediction is that we're living in the age of enterprise AI. And I think in the next 12 to 24 months, you're going to see the beginning of a consumer AI renaissance. Almost every app of my home screen has not changed fundamentally since AI, including Airbnb. I think that's going to change the two years. And your most recent earning call, you referenced this thing, Project Hawaii, and it was called, which is like the on-the-ground direct application of the soon-to-be-defined Founder AI motor, whatever. Maybe just describe what that is and how you as an incumbent consumer company are trying to make yourself into one of these AI companies. And sort of like, what's possible with a project like this? This is such a great story. So, I had this conundrum. We had like 7,000 people. We were down to 5,000. I wanted to like basically take the magic of the founding of the company, the early stages. We were in this little apartment working together. And I wanted to work with like this team of 10 people. And I wanted to like have that team work in one problem. And so, we ended up focusing on one problem. We said, let's put a team together to focus on improving the guest experience and improving conversion rate. Conversion rate is basically search to book, the conversion rate of people typing in a location and dates and booking. And there's a funnel. And you can basically measure the funnel and you can do A/B test. But more than A/B testing, I wanted to do something where the North Star was, let's make the experience better and increase conversion. And we're going to start with a better user experience. And so, we put together a team, 10 or 12 people, designers, engineers, product people, data scientists, as mostly just up here, software team. And we treated it like a little startup. And we said, we're going to just focus. And we're going to do a system of crawl, walk, run, then fly. Crawl, fix the bugs, fix the problems of conversion, right? Just the easy things. Once you build a little bit more confidence, walk. Start to develop features. Really start to reframe the journey, then run. Rethink the entire flow, big features, fly, completely reinvent yourself. And everything is going to be measured. Everything is going to be operationalized. The team's results are phenomenal. They ended up delivering the equivalent of, I think, a year one, two, three million dollars in revenue for the company. The following year was four or five million dollars. Now, we're on the run rate of over 600 basis points, 600 basis points of 13, 14 billion dollars. You get the sense of how much of a lever that is. This is one team. I mean, it may be agreement to dozens and dozens of people, maybe 50 or 60 people. But it was this really lean team. We took that team. We said, we'll be applied to the next problem, pricing, totally different team, same model, than another model, than another model. And I really tried to work with a team. And initially, I would meet with them every week. And then it became every other week, and then every month. And my general philosophy is start really hands-on and let go over time. I'm not a golfer, but like, I took a couple golf lessons. Here's an analogy from management. If you learn golf, you want to learn with a golf instructor before you build any habits. Because if you learn on your own, you're going to have a weird swing. And then when you get a golf instructor, they got to change your muscle memory. So the golf instructor's got to watch you swing like thousands of times. Eventually, they don't need to see you. You let go over time. What most founders do is the opposite. They bring these people in. They let them figure it out. And then they intervene later, but they already have the wrong muscle memory. And then they decided I'm going to be totally hands-on, do everything with a team. Teach them everything I know and let go. That do it the next team. And then I had teams learn from other teams. Then when we launched services experiences, we basically found this other way of innovating. So here's a riddle. Or it was riddled to me. Airbnb, we had this core business that was really successful. It did nearly $100 billion a year in gross sales. For every $1,000 spent in the world, $1 was spent on an Airbnb. Except we had the problem of we're like a one-hit wonder. And for 18 years, I couldn't get a second hit out. And I kept wondering, why is this not working? And the answer is like too obvious. It was staring us in the face. But we kept having the burden of trying to scale these businesses at a global scale from the beginning. When we started Airbnb, we started a one-city, New York City. We had 100 users. I was in Y-Cometer. Paul Graham goes, where are your users? I'm like they're in New York. We have not many but in New York. He goes, you're in Mountain Dew, you're using New York, what are you doing here? We went door to door meeting users. The basic philosophy is make the problem as small as possible. Get the product market fit, then scale. So we launched service experiences last year. And it didn't work right away. And I'm like, oh shit, we launched service experiences in a hundred cities. And I went back and I thought to myself, wait a second, Airbnb launched New York. Uber launched the services go. Door to ash, launch like Palo Alto. Let's make the problem small and just perfect a city. And so we started doing this with new businesses. We basically get any new business. We're going to do one to 10 to many. We'll pilot in one market, any idea. If we get the market to work, we'll go to 10. We get to 10 to work, one to utilize. It took us 16 years to get to our second and third business. We started getting those two working. Now we have like 10 to 20 pilots. Eventually we'll have 50 to 70 new verticals. This is like the Hawaii system. It's basically taking this giant company, making it a really small elite team. It's like the Navy Seals. I work with the teams really leanly. Make the promise small as possible. I think that's a key thing. Dominie Inish, Peter Tielis to say this. He's one of our first investors. He said it's better to have a monopoly of a tiny market than a small share of a big market. This is counterintuitive. Every investor wants to go into big markets. I don't like big markets. Big markets have a lot of competition. Going to a small market and make it big. Is the reason for both of these things. The idea that it works in Toronto, but not at a hundred city scale. And the reason a 10 person team can outperform a 100 person team. Is the shared reason some sort of like better contact with reality. And like somehow reality starts getting distorted as you get bigger or something. This comes back to the most important piece of advice I ever got. The first day why commentator Paul Graham said, "It's better to have 100 people love you than a million people sort of like you." And that came from Paul Buckeit. Paul Buckeit was a partner with a commentator. He created Gmail. This old famous story was he created Gmail and it took him two years. And they said, "You can't ship until 100 people inside a Google love." And it actually took two years to get 100 people to actually like the product. But once 100 people like something, 100 million people like it. It's like the sample size is enough. The problem is you try to make something in million people like you can't talk to a million people. And so you end up with this shallow swimming pool. It's like you're trying to heat up an ocean. And the ocean just, it takes too long to heat up and you can't tell. Instead of heating up an ocean, heat up a bathtub. Make the problem as small as possible. And you're close to the customer. In fact, if you only are focused on one city or even a subset of city, you can talk to every person. You can put all of these resources on a tiny problem. And I guarantee you take a ton of resources, you put on a tiny problem. The smaller the problem, the more you'll change the numbers, the trajectory. And that will teach you lessons. And there's your two things that don't scale, then you scale. And the scaling is a desolation. But product market fit is a distinct problem from desolation. So you want to basically make the promise as small as possible. Understand the user, put yourself in the shoes, blow their mind, do some things you've never thought before. Do them by hand, make them unscable. Don't worry how much it costs. Just prove the model. It's like R&D. That is a lot of like industrial design. It's what we call prototyping. Before you manufacture something, you prototype. And you make prototype after prototype after prototype. And until you make something that you'd love for yourself or someone loves. So yes, though smaller the problem, the more there's fewer abstraction layers, you're actually on the ground. You're talking to people. That's how you prove it. Why to these pilots? It's all the same thing. By the way, same thing with AI. You're removing abstraction layers. You're making the promise as small as possible. And you're going directly to the source. I think that's a principle that all these things have in common. It's like we're playing this game of telephone if we don't do it that way. And you just lose information. And this is why founders don't like running large companies. They end up in a game of telephone. They say something and then it goes down like five layers. And then it goes back up five layers. And there are these like meetings and the meetings become like system reviews. And literally like the lowest point for me when I was when I was having meetings about meetings. You've gotten into this new mode. It's called founder mode. It's not called CEO mode. Do you think you're now a good CEO? I think I am. I think I was naturally good founder. Although I would say I also got really lucky because I had two great co-founders and a damn that I luck out on that. I think it was a very good early stage CEO. And I think the moment I had ever had an executive team. I really struggled to make this shift from a founder to CEO. I really struggled. And I think in the 2010s, I do not think I was a great CEO. And I think we paid the price for my learning curve. And I think the pandemic was a rude awakening for me. I think I was confident, by the way, somebody once said, a pitcher never takes them self off the mound. As a manager, you got to go take them off the mound. I didn't want to hurt people's feelings. I wanted them to take them off the mound. And the longer you leave a pitcher on the mound, the more homeruns they give up, the more upsetting they're getting. And they're still going to be angry, you know, matter when you take off the mound. So I don't think I was naturally a good CEO. And I remember up to the pandemic, at one point, I wonder, I wonder if I'm just not meant to be a CEO. Even not meant to do it. And then the pandemic happened. We had a near death experience. And I said, well, screw all the remination. Like, is do or die. And I feel like I learned how to do the job. There's really a few phases of CEO. Have an idea. Get to product market. Product market fit to hyper growth, hyper growth, scale to become a real company, real company as in profitable public. And I did all that. We have like 40% free cash on March and we're very profitable. We do a hundred billion dollars in sales. The last phase of a CEO is reinvesting the company. Product extension. And the reason our stock has been flies because we only do one thing and we've started to saturate a little bit of the core idea. So we've had to reinvent ourselves. We had to do product extension. So I still got to prove myself. And then there's another proof point. Can I navigate this transformation of AI? I think founder mode is going to be the only way to operate an age of AI. If you're a giant professional CEO, I think you can operate in a founder mode. But if you're like risk averse, you want to be incremental, those types of people are not going to survive the age of AI. So I think there was an old Albert Einstein quote. He said the best way to keep our balance in a bicycle is to keep moving. You're going to have to keep moving. Those are going to be really well-rhymed or set up for this age of AI because we kind of have to redesign our whole company from scratch again. Was there anything else that Herokie taught you because Steve was perhaps the literal ultimate example of everything you just said, focused on the details in the weeds forever, reinvention of the company. And before I say just to say who Herokie is, everyone knows Johnny Yves. Herokie is a bit of an unsung hero. I always heard about him. He was like this legendary mythical figure that like was elusive. He does like almost no photos in online. There's like no videos of him. He was never out in front. He was Steve Jobs creative director. It was a function under marketing. He did the ads. He did the graphic design. He was really responsible for when you was like that black type with a gray font and like the product in front of white. That was really his aesthetic. He taught me two principles of Apple that I brought. One was simplicity. I think startups are like, when you start a company because you have no money and you're so constrained, you're naturally simple. Lack of abundance creates natural constraints. And so simplicity is thrust upon you. And that is good for you. And then once you raise a bunch of money and hire a bunch of people, you go to a lot of directions, then you lose your sense of focus. How many startups can we think of today who have struggled from lack of focus? Probably a name of you. So you start to lose your muscle for simplicity. Herokie taught me simplicity. And he taught me simplicity is not removing things. Diversity is distilling something so fundamentally that you understand its essence. I know Steve just say, design is a fundamental soul of a man-made creation that reveals itself through subsequent layers. In other words, great design is about distilling something to its essence. It's kind of what Elon does with SpaceX, where he talks about first principles. And first principles is kind of a physics term, but it's also a design term. It's about understanding. If I'm going to reinvent this product, I have to understand the properties of glass. I have to understand everything about it to distill it to its essence. So I got obsessed with simplicity. Simplicity of our products. Simplicity of our organizations. The pussy of everything. The other one was a sense of craft and details. How you do anything is how you do everything. And I said, everything must be perfect. It comes from, there's a book that a lot of people in Silicon Valley recommend the score takes care of itself. Bill Walls, the coach of the San Francisco 49ers. John Wooden, winning his coach in college basketball history, UCLA, same principle. First day, UCLA. So John Wooden won 10 NCAA champs over 12 years. First day, first hour in his team, he spends an hour teaching how to put your socks on. One hour, and he said, put your socks on this way. Mr. Miyagi, yeah. One hour teaching you how to put your socks on. It's a metaphor. Everything was that rigorous. Bill Wall said, the way you tuck your jersey into your pants was one of 10,000 details of 10,000 on whether you won or not. To be, don't focus on winning, focus on getting all the inputs perfect. And you get everything perfect, then you will win. And you don't focus on the score card. We do focus on growth, but we kind of stop focusing growth. We started focusing on making everything perfect. And if everything is perfect and you don't grow, then you focus on the wrong input. But if you have the right inputs and you make them perfect, then you'll grow really fast. And so that's really what I learned from him. He really taught me, I think, founder mode. Because I never met Steve. I only knew through Heroki and I said, well, I love this. I'm an artist. I'm a designer. I could have more control. The product I could make everything perfect. The initial attempt to founder mode created giant revolts. Everyone hated it. Because everyone thought I was micromanaging. And I learned something fundamental. Initially, everyone hated it. And by the end, everyone loved it. The people hated it left. So maybe there's like selection bias. The people liked it stayed. But even the people that thought they wanted autonomy and independence and empowerment, that they didn't realize was control and power is not zero sum. It's not like if I have all the power you don't. There's a scenario where we're all powerless. And there's all scenario where at five power, I can therefore give you power. It's not zero sum. This is the problem people understand. If I have more power and control, I can give you more power and control and I can hand it off to you. It's about the idea that the car has a steering wheel. You turn it left and it actually goes left. I do think it's all about the company rolling in one direction. That's it. The thing that you've said historically that had the largest impact on me was this notion of the 11 star experience, the exercise of going from not five star, but a six star, and it's actually forcing yourself to write it. And I have this idea in mind because of this idea of simplicity and distillation and it's a beautiful thing, right? It's ultimately empathetic with the customer. But why is that idea in practice so powerful? What happens as you go up the star count to 11 stars? So let me do like a one minute on what it is. Basically when you book an Airbnb, most people leave a five star and if you leave a four star, it's a bad experience. Five star, everything went as planned. So it's called review compression. Similar to Uber. You always leave a five star and if you leave anything other than a five star, something really went wrong. But what if the driver was really amazing? You can only leave a five star. So I started imagining what if we could give a six star? Now I did this exercise from six to like 10 or 11 stars. So a five star, let's say take one moment checking into Airbnb. Five star check-in is you get there and the host greets you or there's a door, a code and it works. In other words, nothing went wrong and you give a five star. Anything wrong, you give a four star less. That's review compression. Like what if you went above and beyond? So what does six star look like? If six star would look like you basically get to the Airbnb and there's your favorite wine on the table and there's like fruit and there's snacks there and there's a hand-writing card. Okay, that's better than just letting me in the house. So what's a seven star experience? Seven of their experiences, there's like a limousine or something waiting for me at the airport. And you know, like surfing, there's a surfboard waiting for me and they're like showing me around the city and there's all this stuff. So what's an eight star experience? An eight star experience, I get to the airport, there's an elephant, I go on the elephant, I go on a parade in my honor. I'm like, wow, I feel really special. What's a nine star experience? I call it the Beatles check-in. I get out the plane in like 1964 Beatles. There's 5,000 teenage girls screaming my name with cards making me feel like I'm a pop star. I get to the front lawn of the Airbnb and there's a press conference in my name. So it's a 10 star experience, 10 star experience Elon Musk greets me and takes me to space. It's an exercise, it's an exercise in the absurd. You keep pushing to go so absurd to 10 stars that suddenly six or seven stars doesn't seem crazy at all. And the way to get to product market fit is to just create a six or seven star experience. But you can't create a six or seven star experience without going beyond. In other words, go beyond the edge of reality and work backwards. And so it's kind of a fun exercise. What would the craziest possible way to blow someone's mind? One person's mind, one customer. And maybe try that. And maybe you can't scale that because that's like an eight star experience. But you can probably scale a six star. And the difference between the five and six stars probably depends on you and a competitor. And if you can find a way to industrialize it and scale it, you might have product market fit and something special. One of the things that I think about when you give the absurd examples at the high end of the range is this feeling that I've experienced with AI that my imagination had almost atrophied that by using these tools, I realized how hard it was like, oh, I can make anything. And I sit down like, I have no fun idea what to make. And that as I started making little things like all of a sudden my imagination got rebooted. And it feels like this exercise is like an imagination exercise. It is. One of the things is great writing is great thinking. But I find that I don't know about you. Some people have ideas and they think of the ideas and they write them down. Because I figured out the ideas through the act of writing. The act of writing is the act of coming up ideas. The act of designing is the act of coming up ideas. It's really hard to sit in a room and abstract, we think of ideas. You need to like do something. And so I think what was happening was we didn't have enough tools to express ourselves. I think a lot of the tools were very passive tools. I think increasingly we were spending more and more time on a sit back experience of like social media. But I like about AI is I think AI shifts our attention from consumption to creation. Social media a lot of us spend our time on and the only type of creation is giving your opinion. But you're mostly consuming what I love about AI is, it's not about opinions, it's about testing the hypothesis for making. I love what's happening right now. Suddenly all of us have a paintbrush and a canvas to make stuff. I think that AI is going to lead to a renaissance and creativity. And I was an artist growing up, I was pretty good artist, so I had the ability to express ideas. Here's an analogy. You ever meet a person, you probably think of musicians, like Prince, a native musician, that probably, in words, couldn't express themselves, but then through music, there's this dimension you never knew. An artist, they seem really reserved, but their art is really emotional. So many of us have this creativity inside of us, but we don't have the craftsmanship or tools to express it. And suddenly, what AI is going to do is going to give us the ability to express it. We're going to realize there are a lot more creative people we thought, because we typically think of creative people as people that know how to express their creativity. It turns out what if everyone can express it? Pobbobakasa once said, all children born artists or problems remain as one grows up. Every child's creative. If every child's creative, that means every adult could be creative. I think that every humanist's plan is creative. You ask the average person you're creative. About one in two says they're not. That's my experience. That's not true. It's just that they haven't exercised the muscle. And I think that the magic of AI is what's in our head can manifest. But also, as you said, we can develop new ideas in our head because it's a relationship. We maybe have a small idea. We try something, it goes in our idea. And you go on this journey. A lot of people call founders visionaries. We're more expeditionaries. We're on these expeditions. We only call it visions later. We're really just one foot in front of the other. Can you talk about the difference between the act of creation in pursuit of use of people pleasing earlier, achievement, notches on the belt, versus just for the raw, pure joy of it, which seems to be more the way the motor in now. I think what it started to be, I don't think we're totally trying to be successful. And I like to joke that if I was trying to make money, I would have come up with a better idea than air, bed, and breakfast. I truly did it for the love and the fun. In some way, along the way, I got really successful. And that almost became a curse. Because the success became a scorecard. And then I want to get even more successful. It stopped being intrinsic. And it started being a version of status in people pleasing. It took me a little while to realize what I was doing. What I really wanted was love. I think that I learned growing up as a child, the way to get love is to be special. The way to be special is to do special things. And if I do special things, I get praised by feel love. I think that translated into, if I'm really successful, I will get adulation. And if I get adulation, I'll feel that feeling that I'm always seeking. And I'm just consciously, I'm not like saying this. It took me many years to realize this is what I was doing. By, adulation's kind of like seeking status. So many people seek status. Anyone's on social media and posting all times, probably, somewhere seeking status, it's really wrong with it. But the problem is that's not where great products in great companies come from. See, adulation is like a cup with the whole at the bottom. And you keep filling it in, thinking it's love, except it just keeps coming at the bottom. And at some point, you have to confront, who am I doing this for? Am I doing it for other people? For them to briefly love me and commend me to then move on? And by the way, that's a drug. And it's a drug that's like real drugs. You need a greater hit to get the high. And eventually, it stops working. And eventually, you reach a peak. And it gets really meaningless and empty. And that happened to me. And at some point, around the pandemic, we go public. We have 100 billion dollar evaluation. It's like one of the best days of my life. And the next day, I wake up, I put on sweat pants, I go on a Zoom meeting. It was like, it never happened. And it became like the saddest day of my life, because I realized, okay, what now? I got a sadulation, and I don't feel any different. And that made me like reevaluate like what I'm doing this for. I had to just come to terms with, I wanna do things for pure entrance to reasons. And so I had to basically detach myself from people's approval, from status, from worrying about how high Airbnb is, or how successful I am, which I never gave a shit about when we started. You start getting accolades and you want more of them. And you gotta let go of that, 'cause it's a losing game. And I just really started focusing on being heads down. Do the work, like you used to do. Like when you were a kid, there was light, just make stuff, make it for yourself. That great book, Rick Ruben, he says, an artist is an artist when they make it for themselves. And they don't try to make something successful. And I stopped trying to be successful, and I just went back to the basics. And I realized, like, a person doesn't know you will never love you. That's okay. The people love you and the people that know you. And though it's a poor person that will love you as yourself, and we should love as the thing you're doing. So this became like a whole thing. It became about doing it, 'cause you love it. Putting your heart and soul in it. It's like the score takes care of itself. It goes back to that. Don't try to be successful. Try to do something wonderful, that you love for yourself. Maybe you'll be successful, maybe you don't. But don't focus on who you want to be. Focus on what you want to do. That was the vice president of one's told me. He said, "If I focus on who I want to be, I focus on being president states, and I wasn't, my life would have been a failure. But I focus on what I want to do. I want to help people on the computer organizer. Then I don't need to be president. And so I think so many entrepreneurs focus on what they want to be. I want to be a giant tech founder. I want to earn a billion dollar a company. I want to do this. I want to do that." Instead of focusing on what I want to make. And then suddenly there's no way to fail if you're making what you love. Some incredible set of ideas. I'm curious what most fell away in your life in this recent period as a result of this shift in mindset. Like what do you do less of that you used to do a lot of when you stopped chasing adulation? Mostly ruminating. You ruminate less? Yeah. Just worrying about people's opinions of me. By the way, somebody kept saying like, there's something mildly narcissistic about like worrying about everyone's opinions as if they're all thinking about you. The reality is like even people watching this like I don't know if you self-conscious except for a moment they're gonna think about me. But then they're gonna be mostly thinking about themselves. And that's okay. And all of us are thinking everyone's thinking about us. And they're thinking about themselves or the people in their life. They're not thinking about some guy in a podcast except for like maybe an hour. And then it's over. Letting go of what people think about you. 'Cause that's a prison. Suddenly you're making things for approval. And then you lose your courage. That's the main thing. It's just like the mental energy. But I really try to do things that are meaningful. Meaningful things are really two buckets. It's making, it's been a time that people I care about. That's just those are two things. There are two very different ideas I'm curious for you to react to. The first was, things by Warren Buffett who said, you wanna buy as an investor. Businesses that a ham sandwich could run 'cause eventually one will. Not to pick at anyone, but think about like the car payment processors, like Visa or MasterCard, like just extremely elegant business models. Actually a network of fact businesses like Airbnb tend to be in this category. And then you've got this opposite end of the spectrum which is one of my favorite investors, early stage investors said, he tells every founder that they should think about the company as a platform or a vehicle for their own personal growth and that their ability to grow will set the ceiling for the company. It's this sort of like opposite ideas. And we've been talking a lot more about leadership in this second bucket. I'm curious how you think about whether or not you care if eventually a ham sandwich ran Airbnb, like the business model would be so perfected that it wouldn't matter in the Warren Buffett sense. And just like in general, how you think about if that's true that your ceiling is the company's ceiling. I just said it's leader. I think they're both true. Let me try to square those with one example. I agree with both sentiments. Okay, here's an example. Walt Disney. People watching. I want them to try to name a Paramount Pictures film. I want you to name a Warner Brothers film. Maybe you'll think of like Batman. I want you to name a Universal Pictures film. I want you to name something from the MGM library. Pretty hard, right? But you can name a lot of Disney films. And probably Pixar during their Golden Age. There's a big difference to us too. One is that Disney was very founder led and that Disney was all about a personal expression of one man. The irony is the longer a company is run by founders and the founder mode, the more I think it can let go and anyone can run it. I think Disney, not to take away from the CEO of Disney, the new new guy Josh is really great. I've met him, he's great. And I think they've had a lot of the CEOs. But I generally think the CEO of Disney has the bases loaded. You've got this incredible theme park that like people are going to visit no matter how well it's run. Like it's like a city that as many people visit Disneyland every year as like San Francisco, it's crazy. They've got this incredible IP. It's not that. It's a crazy job but like Walt left so much. I remember I was speaking to the former CFO, Disney once. This was like 10 years ago and he said, Disney hasn't really done anything new since Walt I. Walt I, 1966. Since 1966 we still make future dynamic films, TV and magic kingdoms. And of course, yeah, they do new things, but fundamentally that's the same playbook. So I do think that that's an example where the founder reinventing the company in their expression created such a reservoir of IP of momentum. He died 50 years ago. 50 years later Walt Disney's spirit seems very omnipresent. Whereas Louis B. Meyer, I don't know if most people can tell you which studio he was. See him saying there's a huge difference. So I generally think this is a paradox. The ham sandwich. You have a business so good in a carrenica sooner or later they will. The best businesses are ones that founders run and they reinvent and they create so much equity in such a great mode that then when they hand it off, they won't endure and grow after them. I think Apple is very similar. They've not had to invent new products for the most part. They're still running the iPhone. I mean, what a gift Steve left them. They were a few hundred billion dollar company. We need to die. They're like a multi-choyant dollar company now. I think the one caveat is I think tech companies are different. Warren Buffett generally didn't invest in tech companies with the exception of Apple. Coca-Cola was a big investment of his or like C's candy. These are things that don't get disrupted. I think technology is a sin of change. If we're in the change industry, you kind of need to be more in founder mode more time. But I think that's how I square it. The company is the upper bound of the founder's potential. The longer you're in founder mode, the more it will endure. I remember one founder told me, "I want this company last 100 years. So therefore I can't be in all the details." And so therefore I need to empower people. And I remember saying, if you want to some e-brab for 100 years, you want to control it as long as possible and keep it in founder mode as long as possible. Like Disney. I think that's counterintuitive. And I think people say, "Oh, but like the company is going to get very dependent on you." Well, yeah, but the alternative is you're going to have so institutionalized this magic that it can endure after you. Your finance team isn't losing money on big mistakes. It's leaking through a thousand tiny decisions nobody's watching. Ramp puts guard rails on spending before it happens. Real time limits, automatic rules, zero firefighting. Try it at ramp.com/invest. As your business grows, Vanta scales with you, automating compliance and giving you a single source of truth for security and risk. Learn more at Vanta.com/invest. 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It comes to mind when you talk about Disney, I have this visual of Walt just like continuing to drill down to some sort of bedrock or something. And that's the mission that you're on as a founder is like bedrock. What is that for you from this point forward? Like as you keep drilling, what do you think you're still after? Where is there still room for your ceiling to raise so that the businesses can? A few things come to mind. When people think of it, if you close your eyes and say, I want you to think of a picture of it and be probably think of a house where a noun and a verb like Kleenex, which is amazing and not amazing. It's amazing in that like we're kind of the category leader. It's also tough because when you're Kleenex, you want to sell shampoo. They're like, wait a second, I'm not putting Kleenex on my head. It's a double edged sword or brand. The bedrock for me is how do I change the atomic unit of Airbnb from a home to a person? I do not want Airbnb to be about homes. I want it to be about people. And I want the people to be atomic unit. And on Airbnb, you get a home, you can experience, you can do service, eventually a flight. I want to imagine like a person in the center with a ring with like 50 things around. These are the things you can get. That is the thing. The bedrock of Airbnb is going to be identity, profile, the person's preferences. I want to develop the most authenticated identity on the internet. Proof of personhoods can be really really important in the age of AI, artificial. I want to develop the most robust profile on the internet. I mean, these to be Facebook, they've kind of abandoned that strategy. I want to build one of the richest preference libraries of you as a person because that would be useful to have. I want to build a social graph, but in the real world. And I want to eventually have a membership program where you get all these different benefits. So the bedrock is the person. I want to basically figure out how we can launch like Amazon, Amazon from books to like 100 things. I don't want us to just have homes. I want to have 100 things. So we need to develop this industrialized machine of understanding what are the like atomic units or the primitives that are consistent across all these different businesses. And then the last one is AI. We have a bit of the innovators dilemma plus reminds 100 billion dollars goes to rap. I have all these visions to totally change it. But you're a public company and you're like giving guidance and the difference between missing and hitting earnings is not just being public company. People's livelihood depends on Airbnb. If we mess with something, somebody could go from like making a living, not making living. So you got to be very careful. That is not an environment for mass innovation when you're being really careful. So I'm also exploring little sandboxes like almost like a separate app like what is a radically radically different Airbnb's? What's after Airbnb? Airbnb and see. What's that? What's the next thing about? So those are the three things I'm thinking about. Number one, how do we take the atomic unit from a home to a person? Number two, how do we basically industrialize what Airbnb offers to do like 50 things, not three things? And then how do we disrupt ourselves before someone else does with AI without screwing over our investors and our host to depend on us? And so those are the kind of things I'm doing. Maybe the last thing I'm thinking just as a CEO is I think I've reached a certain level mastery. I've reached the mastery of like product market fit, hyper growth, profitability. I'm beginning level four. Level four is reinventing yourself product extension. I think there's something potentially even beyond that in the age of AI, which is like one of my strengths is all my experience and that's also my weakness now. Like I'm 44. I'm not old. But I'm not young. I'm not AI native in the same way a 22 year old is. Here's a bad example. When I started me as 25, 26 and we were competing against expedient, they were on like outlook and we used Google docs and we were like iPhone. It all seems anachronistic now, but back then that was innovative and we were on the coolest new tools and we just move faster. And so also just staying young, probably because so another quote he said, the older you get the stronger the wing gets and it's always in your face. You've got to stay light on your feet. You got to stay young. You got to keep reinventing yourself. You got to have curiosity. And so I don't want to become like this old school person in the groove. I got to reinvent myself. One of the things that as I've been building stuff myself really for the first time, like I'm not an engineer. I used to build stuff, but I'd tell people and I would come to feedback loop was like painfully slow and lossy. Now it's like five to 15 minutes and pretty high fidelity and soon it'll be five seconds and perfect fidelity. I always love bread, Victor's idea of wanting the input of the output being as linked as possible. And we're getting to that stage. The anxiety I have having this experience is that it feels like just nothing will last. Historically, there's been these ways to have enduring votes. People would always call them. You have 200 million people that you know a lot about already. You've got hundreds of millions of reviews that lots of information on places like you have these embedded things that I can't just get that from you. But it just seems as I build this stuff like, oh, it's going to be really hard to have something enduring and lasting. Do you share that anxiety? How does that make you feel that as the frictions fall, it also feels like the pot of gold at the end of the rainbow is like disappearing into the distance or something. Here's an analogy. Take a fashion brand like Hermes. I think the most valuable single fashion brand in the world, the Birken bag and the Kelly bag. It's like they have a new product every decade or something. Like these really multi decade old things and they appreciate and they resale. And then you've got like Zara fast fashion. And I feel like we all want to make these things that endure but we're living in like a hyper fast fashion of software. If you look at software from 10 years ago, no matter how great it was at the time, it looks really old and dated. You look at hardware from 10 years ago. It looks pretty decent. You look into your design. It looks pretty good or better or better. You look at buildings after a certain period of time, they've got this patina and they're wonderful. You got a Paris and old Inders. Environments in physical worlds. I've got huge endurance. Hardware and physical things have medium endurance. Software is extremely ephemeral. Opinions are like that, but some ideas permeate. This is something I'm wrestling with myself because I want to make things that endure. I don't know how I've reconciled it except to say this. I obsess over app, Airbning Bees app. It's designed, it's interface. And yet no matter how great it is 10 years from now, I'm going to look at it and think it looks like crap because they look at the interface from 10 years ago and take it looks like crap no matter how good it was. Get it software never looks good even if it was good back then. So then you're going to ask it what Inders? I do think there are things that endure. Airbning Bees, the community Inders. I started realizing the software won Inder and the network effect will decently endure, but the ideas that there would be. It's principles. It's mission. The organization. The company. The brand. The identity. The logo. The voice. The community. What it stands for. Those things will enter. Most importantly, the community I realize at some point I told the company, we're not building an app. We're not building a service. We're building a community because that's the only thing that will last. I don't think there will be apps in the future. I think there'll be agents. So like if we're attached to apps, I don't think there will be apps. So we better like let go of that. So many of the themes that we've talked about is this steady progress I'm learning through time applied in service of others. What did bodybuilding you were young teacher about? Steady progress over time. Weirdly bodybuilding taught me so much that I could apply to Silicon Valley. It taught me two important principles. That was really in Dice Hockey. Want to be being an ice hockey player. Unfortunately, I was very skinny. I hit puberty really late and I went to a sports academy for hockey. When I was 13, I thought I could be a really good hockey player, but by the time I was 14, I didn't hit puberty tiles like 15 or 16. And that's a death sentence in hockey because suddenly I went from like first or second line to third or fourth line And I went from thinking on be a division one athlete to vision three athlete I'm like kids not really gonna work out for me And so I sort of weightlifting I was 135 pounds and I told my friends I'm gonna be like one to top out of both the country by time I 19 And they thought it was like out of my mind and ended up by 19 competing at the national level like I competed at teenage Nationals The first I saw learn from bodybuilding was if you can change your body you can change your life It was actually the most fun and all thing to change like everyone wants to change things around them But what if you change you first physically and I even think like if you could start somewhere a lot of people say like change your thoughts I would change your body first Change your physical biology you can change your body or change your life It was the ultimate expression of power in it. Okay. Now I changed my body. What else can I change? It's a metaphor for eventually you can design the world around you you can change your body. I can change my environment eventually I can change the world. It's like you just go inside out But the other thing it taught me which might be even more helpful is that you can't get in shape in one day And if you go to the gym and work out for like 20 hours, you're not gonna get better shape in fact You're gonna over train and the way you get stronger is an adaptation from progressive overload that you basically You stress the body the body doesn't get stronger during excise actually breaks the muscles down and it's an adaptive response Like an immune system it gets stronger and you just keep doing it the basic idea is that you can't get in the shape in one day And it's about 1% better every single day and if you compound 1% a day You can actually have massive gains and so it's really about discipline and it's also very analytical body buildings This wonderful thing where it's judged. It's a subjective sport that you judge visually But you measure it scientifically You weigh your food yet to put yourself in the right color deficit You have to write down your training you have to write down your weights. It's like extremely analytical It's only to be very analytical metrics driven and that it's really about discipline Consistency and I think that's important because I think a lot of founders just give up too early It's about discipline and it's about if you train for a month you take a month off You're starting over and that's the key you never quit you just keep going one of the nice things about it is the visual feedback Like you to judge visually you can literally see it you can look in a mirror other people can look at you and say you've been working out Probably some of the skills that you would want to apply the same progressive overload thing to as a leader are very invisible How do you figure out the objective function like how do you apply that same thing to something else that other people can't see? I still trying to focus on like how good of a company I may as I take it to the project So I'll give you one example of a project I focus on one is I want to build the best team possible So twice a year we do this like giant thing we call road map review and there's the top 100 people in the room And I see the quality of people in the room and we did one in the last two days and then one of my most important jobs the most important job I do it every and be is hiring that's a whole separate topic and the visual feedback is every twice a year I get the top 100 people in the room and I can see the quality of the people in the conversation So in other words, there's many metrics that you use and I obsess over it Maybe it's the app and I just look at the design of the app Maybe it's like how will the company operates and look at decision making so I try to break the problem down to something That's observable that I can observe either measure it data or even subjectively look at an observe So I always always out breaking the problem down to something that's observable and measurable By the way, just on this because this is a really important point Basically as a leader you can choose if you want to spend time hiring or managing One or the other the better the people the less thing you'd be managed the more time you spend on recruiting the less time you have to spend on management It's one to one. I remember when I was starting your being be Sam Altman who Obviously everyone knows now it's opening eye. I was like one of the first Sequoia funded companies Before me were two people that had ever been funded by Sequoia from White Cumber true house and from Dropbox But the first one say I'm Altman is coming called looped It was like a way to see your friends on a phone before the iPhone. I remember him telling me I was like 27 or 28 Sequoia just funded us $600,000 a three million to our post money valuation highest value is a white commenter now the average value is 30 million And he said you're gonna spend 50% your time on hiring. I never did by the way It was my death below not spending more time on hiring the less time I spent on hiring the more time I spent managing and I started learning My number one job was hiring every day. I wake up the first person I calls my recruiter I think people should think about their first employee being a recruiter non-engineer They are the most important person because they are the ones that like get you every other person When a company is as good as this people and the difference between like the good companies the great companies are the people I think AI kind of makes that clear now that like what's all about the people but I obsess I Obsess over recruiting I spent hours a day and I'm a don't recruit executives. I recruit two three layers deep Here's how you hire good people do not do searches generally what you want to do is build pipelines So here's the mistake people make when they hire they do I need to hire a blank so do a search they hire a search firm And the start firm scans they give you like 50 profiles you like call it down to 10 people you contact 10 And you pick the best when you hire and a year later you realize like they're good or bad and if they're bad Oh, they've already hired their own team that is the wrong way to do it So the best way to do is pipeline recruiting you're constantly recruiting you're constantly meeting people So this is what you do try to map out all the best people in the valley So let's say I need to hire really good engineers. I don't do searches. I just Informationally meet the best engineers in the world every meeting the job is to get the next meeting meet someone else So if I already meet you and I say hey, who's the best people you know Can you introduce me to three people? So what you're doing is you're constantly meeting people in advance the searches and you're just building your pipeline You just need to know lots of talent and all that's referral based the two ways to find out if people are good I mean one way is you're just good at assessing talent But the two best ways to start with the results work back as the people So a lot of people say like I want like a really good marketer. I'm gonna go to Nike. They do really good marketing no No, no jet finding an ad you like and if you're going to who made the ad start with the results work back with people Don't start the resume the other thing to do is Keep asking people to build your role of X and so I'm constantly building a role of X and the moment I find somebody It's really good. I ask them who all the best people they know are and I basically build these little mafia's every company's got like a little mafia of talent So like Uber's got like an ops mafia Apple's got like a design mafia and then like build these little ecosystems and they tell you who the other good people are and you're Classly finding more people more people and what I do is I'm the co-hiring manager for the top 200 people in the company This is very radical a lot of CEOs think it's their job to hire their executive new executive team hires their team I think that is fatal. I mean theoretically yes You're radically you should live in a world. We have such good people. They can all hire their own people Most entrepreneurs if they have 10 executives would be lucky if two or three Are able to do that without any of support or help you know It's you always want to be like marrying up Hiring people to future. I sometimes used to say like My executives to hire people so good they would never work for them without my help In other words, it should be like we're reaching if you can hire them on my help We're not reaching far enough You want to like hire the very best person you can some constantly meeting people constantly interviewing the first and last call I make every day as the recruiting team Still I probably spend two three hours a day on it every day every year I spend more time on recruiting the less by the way the 2000s I did I thought it was all about like having a good idea Having a recruiting machine Managing people the great thing is I don't manage this much anymore The more time you spend a recruiting less time it's been a manager because it's really good people Ourself managing this is amazing and if you have to manage people then maybe you should think about like Upgrading the talent you said before that founders are born you think and CEOs can be more shaped For the most part and maybe the caveat to that is just like maybe founders aren't born But we spent our whole life tinkering and building but you can't simulate being a CEO I was gonna ask whether or not you think they're activated in some way like maybe there's the raw material But then some event happens Sean from Palantir would call this the Bruce Banner, you know Gamma race thing or something What have you learned about activating talent? I think the activation is giving someone a challenge Our founding stories who couldn't afford to pay rent but the course I have 50 stories before that of Challenges I had it just air me be that story activated something in a skill I'd never done before but it wasn't the first thing I made I was making things my whole life I think the way to activate somebody is the given a problem or opportunity And see if they can do it. I think the people that have a high level of Agency are gonna do it. I don't know how to teach motivation. I don't know if it can be taught by the way I don't know if you can teach but I think you can motivate people I don't think you can make a person who's not motivated and motivated But I think entrepreneurs have the trait of their self-motivated and so it's really about Giving them a challenge and then it's up to them to step in and activate Having plugged the leaky bucket of motivation of graduation. What's your motivation now as you attack this next chapter? Most of my heroes are artists. I'll pick four people to I've mentioned repeatedly Leonardo Vinci, Vince of Van Gogh, Walt Disney Steve Jobs There's many things in common but what is something the odd common the last day of their life or the last week of their life They were working. Leonardo Vinci carried the Mona Lisa with them until he died And he definitely didn't pay the Mona Lisa for adulation because he never showed it to anyone Vince of Van Gogh sold one penny his life He died a obscure artist in the cornfield maybe shot maybe not unclear what happened But did it because he loved it Walt Disney Last day of his life. He was laying in hospital bed. His brother Roy was like rubbing his cold feet dying of lung cancer Looking the ceiling tiles which are for a grid imagining Disney World. Steve Jobs, Paruki said the last couple weeks of life he like showed him like marketing. Like he was still looking at products. Now some people can look at that and interpretations, oh that's sad. Like they weren't spending time with family. But by the way, I'm sure those that had families. I don't think Vincent Van Gogh in the order of you to do that family. As mine understands, Steve and Walt spent time with their family at the end of the life. But I don't see that as a sad story. They're working in the end. 'Cause I think they did what they loved. You know, the great artist in history did what they loved. My motivation is the motivation and artist. My motivation is to create something great. That is my motivation. I would like to be successful. I want our shareholders to get a return. I would like employees to feel throughout a great company. I would love to make a huge impact in the world. But mostly I just want to make something. I feel like I'm a designer more than I am a CEO. And I might be a four to one of the great biggest canvases of any designer in human history. 'Cause usually designers are just not giving this many resources. It's almost like a glitch in the system. It was almost like accidental. Some air beds allowed me to crack this glitch and get all these resources. I wasn't supposed to get. But I'm not letting go. And so my motivation is that of an artist. I just want to make incredible things. It's a beautiful, almost closing thought, given the tools now at Artisposal that everyone can do that if they want. And we should encourage them to do so. All children of foreign artists to proms remain one as you grow up. AI is the opportunity for all of us to become artists and scientists and creators. We don't have to be consumers anymore. We can be creators. True creators. And we hear the word creator, you think, social media performer. That's one way to create. You can perform. The problem is I think creator has been performance. Now creator can be create, make. Everyone can make now. It's amazing. The last question I ask everyone's the same. What is the kindest thing that anyone's ever done for you? The biggest gift anyone's given me is believing me. And I think the biggest gift you can give somebody are one of the biggest gifts is believing you. A couple examples. When I was 16 years old, I transferred to a public high school. I was really into art. I was a pretty good artist. I didn't know how good I was. And I had teacher named Miss Williams. She believed in me. I remember her telling my parents, he's going to be a famous artist. I'd never became a famous artist. But it gave me confidence that I was actually good at something. Because I wasn't that good at hockey. I wish I was. And I wish I could make my dad proud of Isockia. I just didn't get very far. And suddenly that belief set me on a path. That moment I said, I'm going to go to art school. And that moment I realized, I can decide to be happy the rest of my life. I came to Silicon Valley. I met Michael Sybel and the guys at Justinate TV. And they believed in me. They were early YC people. Paul Graham made an exception to let me an early YCometer. He believed in me. I wasn't an engineer. And he almost never fun and non-geniers. He thought the idea was not a good idea, actually. He said, people are actually doing this. I go, yes, he goes, what's wrong with them? But he believed in me. My investors, they can go down the list of investors. They believed in me. Joe and Nate, I had no business being a CEO. Joe somehow believed in me. I wouldn't be here if it wasn't for the generosity of people believing in me, in helping me. But I think the greatest gift I can give back in believing in others and help them. And not pull the ladder up behind me, but to really show them. I had the great privilege to eventually join the giving pledge. And I had to write a letter. I remember my letter was, if you could ask my Hezgoat teachers who would join the giving pledge, they wouldn't have guessed me. And the basic idea in my life philosophy is we all have unknown potential. I think we have these stories in our own head about where we're capable of. To go back to John Wooden, somebody wants to ask them, I think, what's the secret to success? And he said, I only asked my players to do their very best. The person goes, oh wow, that seems weird. That sounds like a parent says that the kid who loses all the time goes, here's a catch. I saw potential in people they didn't see in themselves. And that's my management philosophy. When I tell somebody, it's not good enough. I'm not saying you're not good enough. I'm saying, I see potential and you don't see yourself. That is the most motivating thing you can do. To say, I believe in you and I believe you can do even more. And people will climb a mountain for that type of thing. And maybe the way to end this whole conversation is the most important person ever that you can believe in as yourself. And I think a lot of us, our entrepreneurs, we're driven by insecurity, we're driven by some whole, not all of us, but a lot of us. Something in our childhood, something, a lot of us were not the coolest kids or whatever. And there's something in us you wanted to prove. And then you get really successful. And you still have a pasta syndrome. And a lot of the path to happiness and salvation is just the path of learning to believe in yourself. For me, I only believe myself long after other people believed in me. Now my gift is to try to give it to others. People place the clothes. Thanks, man. Thank you very much. If you enjoyed this episode, visit Colossus.com. You'll find every episode of this podcast complete with hand out of the transcripts. You can also subscribe to Colossus, our quarterly print, digital and private audio publication, featuring in-depth profiles of the founders, investors, and companies that we admire most. Learn more at Colossus.com/subscribe. 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