0:00Not confronting as [music] much pain as you could be about the things that are broken or shitty.
0:05What's the most challenging moment of [music] your career?
0:08In the middle of the night the freaking house got fire. Not everyone made it out of that house, let's just [music] say healthy.
0:14How do you think about just generating so much trust and loyalty and community around the brand of Vercel?
0:20Trust is going to be one of the most valuable moats, you could call it, for a post-AGI [music] business.
0:27So, you have six kids now.
0:28Six sub-agents. One of the gifts of having six children is that I've now [music] sampled through a probability distribution of all kinds of different personalities.
0:39All right, Guillermo, or some call you G, it's great to have you here.
0:43It's great to be here.
0:44I think you're probably the most anticipated guest of the year for multiple reasons. So, and thank you, Madison, for making this happen. Um so, let's rewind to 6 months ago. Delphi is undergoing a code base migration. We literally have to rewrite everything. And I'm I have to go out of office. When I leave office, AWS is our infrastructure provider.
1:07When I come back, Vercel That's amazing.
1:10is our infrastructure provider. And I I was not aware this was going to happen. This was a decision that the team made, and I'm not going to lie, I was a little nervous and frightened by the idea of moving from a giant to another giant, but not necessarily known for infra at the time.
1:28Uh future giant. It turned out to be an incredible decision by the team, a product that has saved us a lot of time and money, and you know, the team loves it. And I'm love to start off learning how you have decided to compete with the giant, and how how you have gone about competing with the giant.
1:48Every time I've developed a product, it's come from a at least I always attempt to make it come from a place of genuine interest and personal experience. So, I used you know, work at a company that deployed software to the data center. And then I heard about this thing, the cloud.
2:08And when I first tried to use it, after having been an engineer for over a decade, I felt like I felt stupid. I felt like I was going to spend an entire month setting up infrastructure and tools and stuff just to be able to create a product.
2:24It's also come from a place of anytime I've tried to solve a task, I've asked myself, "What have I learned from solving the task that I could turn into the tooling or infrastructure for the next task to be much easier for me, right? Like, if I have to assemble this table, what do I learn in the process of assembling the table such that every incremental table in the future gets easier?
2:49And so, the cloud in in many ways has been one of the I think humanity's greatest achievements because it gave us infinite compute capacity that we don't have to see with our eyes.
3:02And now you've seen how much that has made, you know, this future of super intelligence happen.
3:08But for the vast majority of people in the world, it was inaccessible. It was very hard and tedious and uninteresting. So, in many ways, you know, Vercel set out to solve a problem before we even called it AI. Like, could we automate away? Could we make something that feels tedious to be self-driving?
3:25In fact, nowadays we call it agentic infrastructure, but in the past we've toyed with the term self-driving infrastructure. Because it's like a self-driving car for, you know, making products possible in the cloud. Um, so that's kind of where I I approached it from and, you know, I never thought I was competing with the the solutions that I was sort of leaving behind. I was I tried to create the next generation solution.
3:50Um, in fact, competition doesn't even come to mind there.
3:52It never It never really came to mind and I've always thought, you know, the the way that the world evolves is through generational shifts in platforms. And usually, in technologies really interesting, right? Like the previous generation of a certain technology never fully disappears. It just loses interest and attention.
4:13So you would still have fax machines. I always think about that. We We We you know, I use Slack a lot, but we I still occasionally read and send emails. So the technology always just sticks around. But I always try to think about what is the what is the technology that I care about and in the future will care about.
4:32And so we that's what we try to do with Vercel and hopefully you know, the way that this manifests is whenever a new wave of innovation happens, new interesting technologies arrive, we want to be the platform for it rather than like maybe you know, enable some old-school migration of a an application from 20 years ago. We're seeing that now with agents, the way that Vercel has gotten out to support some of the largest enterprises in the world is because they started using coding agents
5:01or developing agents and they needed infrastructure for that. And so I guess my meta advice is is much for a startup at least is way better to be well positioned for the incoming wave than you trying to you know, kind of compete with the wave that sort of is starting to lose steam.
5:19So I mean I think it's been incredible because you know, we're a team of 12 people and normally a startup it's very difficult to find a full-time infrastructure engineer. And we don't need one anymore.
5:30[snorts] So um that's that's been great.
5:32I also want to enable the largest small smallest companies.
5:38You know, I remember anecdote when I first came to Silicon Valley at the co-working space that I was working out of is where Instagram got started. In fact, not too far away from here. And I always admired how small of a team they were. They holy crap, this is the avid seeking over all of social media. They were challenging the giant Facebook.
6:01And it was the smallest team.
6:04One of the enabling technologies which was new at the time, was uh Amazon S3.
6:10They need to They didn't need to stand up racks of infrastructure and storage devices and RAID disks with redundancy and power and all of this. They just make an made an API call and stored every photo. Um and so my hope is that on Vercel we'll see maybe one day the single-person trillion-dollar company.
6:32And uh and that's not to dismiss the power of teams, but I do think it's amazing to see how one person plus agents can now do the work. I see this every day. One person plus agents can now do the work of hundreds of people, thousands of people, and [music] I'm curious, you know, how far that's going to go.
6:48Joining the conversation? Got a question? You can ask Guillermo's digital mind. Just check the link in the comments or description.
6:55And in trying to get more people using infrastructure agents at Vercel, are you exclusively going after the startups like us that could really benefit from this, or are all are you also trying to convince people to move off of AWS and things like that?
7:08Uh I think much like you see sometimes older people having a midlife crisis and they want to be young and cool and with the times.
7:18I do think there's an effect with enterprises that they're looking to you guys for inspiration, for I want to be like that, you know, I oh I want to be the 12-person company that's shipping the future. And so ironically, there's been an effect of by continuing to focus on the world's innovators, we do get everybody.
7:38It's a trickle-up effect.
7:39It's a total trickle-up effect.
7:40Sometimes it happens quite mechanistically in the sense that uh the enterprise acquires the startup.
7:47[laughter] And then they and then we get a bunch of Vercel technology into the larger enterprises. But also, enterprises are modernizing. And now I think it they really feel the pressure to modernize. I'll give you a very concrete example. I spent many, many years convincing the world to adopt headless backends and infrastructure. In a way, it was self-serving. I created Next.js, I created the front-end cloud.
8:14I needed the world to create an adapter for my technology. It's like I brought a new appliance to the world and You had to plug it in everywhere.
8:22Exactly. It needed to be like 220 volts and they had a specific plug. But I also legitimately believed in it. Like genuinely I thought the best architecture is one where there's an API that expresses your data, that expresses your um you know, it captures the user intent, it's easy to audit, it's easy to make secure. And now you can express that API and that business data in a number of really cool customer experiences.
8:49In fact, for many years it was hard to explain the value of Vercel to some people because it was so broad Mhm.
8:57that you know, what really helped us a lot was we started winning hard in e-commerce. And for the merchants the value prop of separating front-end and customer experience from back-end made total sense. They started to go omnichannel. Maybe some of these companies were launching or acquiring multiple brands. And so that architecture, that software architecture I was pitching, made so much sense to them. And so I can I tried to convince companies to start going headless.
9:26Hey, your e-commerce back-end and engine should be a set of APIs. And now fast forward to agents and everybody sort of adopting this architecture cuz you need APIs, CLIs, MCPs, and the world is becoming more generative.
9:43From those APIs, you can create these spontaneous user experiences, these generative user experiences. And now to the world it makes perfect sense. So in a way to me it feels like overnight success that we're here because you know, after turning advocate for this for for such a long time uh it turns out that when when coding agent coding agents have basically now persuaded the world to build in a way that's so aligned with what Vercel has been designed to do.
10:11And you So, you said you were initially broad and focusing in on this niche of e-commerce allowed you to eventually get to the scale that you needed.
10:17Yeah, so essentially when we came to market, we were maybe a little bit naively saying like, "Hey, we're just like all of AWS but better." Or all of Google Cloud and better whatever. And And what really helped was, okay, I And I And this I think is really good advice in general for startups is like, you don't want to be jack of all trades, master of none. I do think the world always chases mastery.
10:42So, you will pick the best product for this specific thing. You will want um you know, I think the answer to slop and and and the fears that people have over over AI can easily be met and answered by shipping better and higher quality products. Like, "Oh, yeah, AI could do these things, but as a customer, I always want to go to the highest quality solution possible, right?" And so, what what I ended up doing was, "Okay, let's focus on a few
11:10things that we can really master." And let's have very relatable everyday examples for our technology. And so, I started switching the way that I would If I would sit in front of an enterprise prospect, I would never start with the technology. I would start with the customer experience.
11:31Or I would start with the business ROI. And so, it turned out that one of the most magical sort of niches or segments to explain this value is e-commerce. For e-commerce, time is money. If I make your application 200% faster, you make more money overnight. So, when you talked about that overnight migration over cell, every day I hear stories of really happy CIOs, CEOs.
11:58Sometimes they even tell the public markets in in their in their filings of like, "We upgraded our technology over cell. We're immediately making more money." It's because you make the transactions happen faster. So, there's a very clear arithmetic to the value that we can bring there. And also it's very relatable from the from a customer experiences standpoint. Um we just launched vercel.store which is sort of like our swag store and and we built it with our latest technologies, Next.js and Eve. So, we built a really cool storefront
12:27experience, but we also built sort of the agentic commerce side of things. And I had to explain Vercel to a bunch of high schoolers a couple nights ago. It was I was like the invited uh sage speaker. And uh you know, I was like, "You know what? I'm going to cut to the chase. I'm going to start with this really cool storefront, and from that I'll peel back the layers so they can understand the technology."
12:49So, first I opened up the website. It's like, "Look look at how cool it is uh that you know, how it animates and how cool the clothes look and whatever." Like I started teasing out some of the features in Next.js. And then I explained, "Look, we have this virtual try-on feature." And it took a photo of me, and then it generated myself wearing our own jacket.
13:09And so, I was like, "Okay, this is the world of e-commerce is going into this, you know, more intelligent, more generative experiences." And so, that which now happens so second nature to me took a lot of like, you know, hitting my face against the wall of trying to get too much into the weeds of the tech, not being highly differentiated, not having good customer-centric um narrative, etc.
13:34Yeah, when you go and and go niche and try to become master of something, um how can you do that while still balancing the ambition of being a mass market product? And not not losing not going so niche that it becomes almost impossible to serve the world.
13:50I like the, you know, the Tesla master plan thing. Remember that? It was like a four-point plan. There's also a really funny South Park four-point plan. But the Tesla four-point plan was step one, build the Roadster, give it a hundred people.
14:07Make it it to to my point about you do have to be world-class right out of the gate. There's no there's no opportunity for slop. You have to create something amazing. And the reason that they constrained it like, you know, a few hundred like hundreds of people I can't remember how long it how much it was is that they really didn't have the factories and and the production support to to be able to do it.
14:27Um but then you kind of like you go from a from a niche, let's call it, to areas of concentric expansion. If you're only in your plan in your master plan, if you only have the niche and there's no concentric expansion, I think that's a problem.
14:44So you need to be able to think a couple steps You do need to be able to 5D chess many moves ahead. Now, I've seen some entrepreneurs naturally discover those concentric sync circles and good things happening to them. And the way that you could get there through this sort of unconscious competence is by going after massive markets.
15:09Right? Because if you go after, you know, if you if you go after what seems like a niche, but and maybe to use an example like people going after um a very narrow life improvement thing.
15:23But if you're improving people's lives and you create a great brand and a great product, then I'm sure that there will be more concentric circles that if you do have the ambition, you'll be able to go after. Right. I call this sort of the natural adjacencies of a business. Sure. I kind of started like big ambition, but I could have started very narrow and because I was going after a market called the cloud or infrastructure.
15:47I could have found those natural adjacencies. I think that what's weird is when businesses go into like unexpected adjacencies. And I think it's risky for the identity of the company, the culture, how customers perceive it. Sacha calls this brand permission.
16:06It's weird if, you know, you one day you're like, "Vercel, the agentic infrastructure company, tomorrow we're making refrigerators." It's a cool refrigerator there. And so I I I do Do you there's something about the brand?
16:18Oh, I I'm probably behind the scenes in some of these refrigerators. Yeah, we have we have a lot of IoT products and platforms deployed at the company. So, I wouldn't be surprised if that In fact, funny story, we were looking at there's just so much threat activity this week and I first foresee for the rest of the year. The most valuable thing today is I like high-quality residential IPs.
16:43Because the agents are all getting blocked. So, for a Muse type of agent or Instinct to work, believe it or not, they proxy themselves through household IPs in order to not get blocked by amazon.com and other things like funny tangent of these networks are getting very vast and they're touching every aspect of our lives, but we're still kind of remains unless you're a developer or a knowledge worker, I think we're still very happy
17:12to sort of be behind the scenes supporting all of this innovation.
17:15But, I think the other interesting thread from the migration story is how much developer loyalty and trust Vercel has. I I mean, I feel like you personally have like a a cult-like persona. And maybe it's because you just have natural aura and like that's that's you, [laughter] but I'm or you you definitely are aura farming.
17:36But, I'm curious what part of this was deliberate and how do you think about just generating so much trust and loyalty and community around the brand of Vercel?
17:46I think little things that we do like our obsession for design are trust-building things. They're trust-building exercises or habits. And so, I think I do think that trust is going to be one of the most valuable motes, you could call it, for a post-AGI business. Uh but, I think trust is an output, not an input.
18:09I I one mental model that I like to share with entrepreneurs is there's a lot of things that you want and you think you're you're going to work on that are actually outputs. Brand, trust, even to some extent like the developer experience or like the the overall quality of the product, those are things that are measured after the work has been done.
18:34So, a lot of you ask me like, how do you you know, what do you do to to to what do you do to build a personal brand?
18:40And the best things we've done for our brand is the things that we did without thinking we're working on our brand. We're working on a great customer experience. We're working on a delightful detail. We're working on on sweating the details.
18:55Every day you sweat the details and like, you know, I'm going to use a wild metaphor, but um there is a I love fitness stuff and whatever and like it's well known that if you want to be ripped and have like a six-pack or whatever, you don't do crunches. Have you heard of this? Like you you don't exercise.
19:14Yeah, in fact I remember reading this crunches?
19:16You don't you don't do crunches. No. In fact, I I actually actually like dive deep into this topic if you want, but uh Yeah, I want I want to know. I'll ask you Delphi.
19:23I remember uh seeing this um charts of ab muscle activation by exercise. And actually pull-ups was one of the highest ones. Um but even regardless of that, the the the wisdom is that your abs are made in the kitchen.
19:41And so, if you wanted to have a uh fit-looking [snorts] body, the inputs that you're controlling for actually the most important input is probably nutrition. Mhm. It's also probably sleep and just the overall quality of of or how you work on on your on your fitness and your nutrition your life. And oh, and you can optimize it with doing a bunch of crunches. And actually incidentally crunches probably not the best exercise. Maybe isometric holds and or pull-ups and whatever could help more. I think there is a
20:10transferable lesson there to like building a company that you think like you're going to get a great brand by doing a lot of crunches or like doing a lot of tweets with your website or your website or whatever. And actually you should be working on like the foundations of the business.
20:26Security is the one for trust, for example. Um and just showing up, digging deep, fixing bugs, curated experiences, simplicity, great documentation, all of those things I would attribute to the trust that developers have in us. More so than like, oh, another crunch-style exercise for developer trust would be like, oh, you hosted a lot of meetups.
20:50Anything that you could point to that is a very concrete tactic or activity is it probably ain't it. Whereas I think working on the in that rock-solid foundation of the business, you know, some people are worried about what Vercel could do to their businesses and they and they forget that the way that I think customers build trust in a product, it's humans are amazing at sampling data points.
21:15You earn trust in a technology because you had like five or seven scattered interactions that you can't even fully like it's not like you wrote them down. It's like, oh yeah, I interacted with that product here. Oh, I clicked on this blog post some other day. Oh, I saw this comment from the CEO here. And then you kind of like summed it all up. It's like gut instinct. It you develop that gut and you develop it not only for your company, you develop it for other companies.
21:42Which is fascinating. And then one day you're like, well, I need some hosting infra. It's like, okay, that one that I collected all of those data points for like has an edge.
21:53And um and and I've always believed that that's why you have to be so excellent every day across everything you do.
22:00You were early in getting to this conviction. I mean, now everyone's like brand design, like that's the mode, you have to focus on it. But you have been focused on building a design-first brand for a developer tool company. You have the design that usually goes to like consumer. Um what what gave you the conviction to slow down for these kinds of bets? We're normally startups are like fast, fast, fast, I got to ship, I got to ship.
22:23I think part of it was and I think we all have inspirations. I think you know just like Apple had inspirations in like existing companies that were not quite in personal computing. And you wanted to like bring attributes. I think I I don't know if it explained or not, but Braun inspired Apple in the industrial design etc.
22:43And one of my inspirations was could you bring elements of that craft and design and obsession to developer products?
22:53That was not a thing when I started. You know, even the idea that you would care [snorts] about the readme file on a GitHub repo. That you would care about the logo of an open source project. They would care even to have a website explaining, educating, animating what it is that you're building. Those were really uh pretty wild ideas at the time.
23:18And now they're canon. And so I think there there was an element of inspiration in great companies that apply design to other areas. And there's also the by the way like I really think people being true to themselves.
23:32What is What is it that you like? Like [snorts] what are the products and experiences that you like?
23:38And are you holding yourself to that bar every day?
23:42Rick Rubin mentality.
23:44to that bar every day. And I really think this is a lot of hard work by the way. Cuz every single day there's an element of like, "Oh, I need to fix that. I need to improve that." Like it's it's a little bit like going to the gym every day, but for your product because there's a bunch of elements of your product and your company that you need to be dissatisfied with.
24:04So there's almost like an inherent negativity that you have to have. Obviously, you know, you hone in over the years how to like paint both the very optimistic, beautiful picture of what what the world could be if you fix that, but there's a and there's an element of dissatisfaction Mhm.
24:21that you have to have with your own products. And there's an adjacent piece of advice that I give myself and give people, which is sometimes I don't know if you I don't know why today I happen to make some gym metaphors, but sometimes I've gone to the gym and not really push myself very hard.
24:40Have you ever been to like 24 Fitness and everyone's like kind of like on their phone and I'll do like one and then I'm done.
24:45Yeah, exactly. You're there, but you're not. Like and I remember I remember I was at a tiny like hotel gym one day and I had this guy next to me who was like I think he was probably trained We both spent the same amount of time. He was probably training 10 times harder. And he was probably in 10 times more pain when he was doing it.
25:06Um and it it's a good metaphor for sometimes you do run your company, but you're not confronting as much pain as you could be about the things that are broken or shitty. And so that could take the form of like you you're simply not doing enough discovery with customers about what it is that they hate about your product or they don't like about your product.
25:27You're not reading enough feedback. Um like let's say that you have you give out surveys anytime someone deletes their account.
25:35How often are you saying like, all right, time to like, you know, eat my vegetables. Like read through a thousand of them. Or reach out of the customers that, you know, rage quit your platform or whatever it is. I think there is a there's a variability to how much are you getting out of that workout that is building a company every day.
25:55I mean as a CEO that list could technically be infinite.
25:59Does it ever How how do you know areas of [laughter] focus? You know, I because I think like an engineer, I try to solve everything like an engineer, so I engineered the company.
26:10And so you're not looking just at customers of the product. You know, I want to build the best possible employee experience.
26:17And we have a we have a channel that I love called scream about internal developer experience. That's the That's the name of the Slack channel. And Uh, I pay a lot of attention to it. If anyone has a bad experience working at Vercel, I want to read it. I want to read every I have it on high notification. I'm always improving on the experience of working at the company. Mhm. Cuz I also think that companies and their products ideally are mirrors of one another.
26:48It'd be really weird if at Apple people used Android phones.
26:53Uh, or you [laughter] know, they didn't care about design or or how they showed up to work was weird or like there's an element of like you want to have alignment and symmetry. And so, for example, I take a lot of issue with like if the experience of working And by the way, it's also fine to like take in some pain for the greater good of the customer in the future. So, doesn't mean that everything has to be pleasurable about working, but it does um, there has to be some rhythm to it.
27:21Um, and so there's areas that I take interest in. And obviously, customer is one. Internal experience is another one. Um, uh, for example, when given the what AI can do for us, I think I I've taken a lot of um, uh, attention now to like how are agents like agent as a customer and how are they using our platform and are the agents happy Yeah.
27:45I mean, uh, speaking of customer, initially your customer were mainly technical people. And then with V0, you started to serve non-technical people. And now you have a new kind of customer, which is an agent.
27:58I'm how that transition from technical to now you're serving non-technical to now you're serving agents. Like what things have you had to change in the company to support these different user groups?
28:07Yeah, what The way that I think about it is that there's a spectrum of uh, sort of like technical ability.
28:15And we we and I mean Vercel since day one our our goal has been to lower the bar so that more people can get into the process of building. And like you could think of that as like React made it really easy to build UI components. And then Next.js has it really easy to assemble those components into sites and applications.
28:35And I always wanted that okay, like in order for someone to feel productive with Next.js and deploy something, I want them to learn the fewest number of concepts and the fewest number of instructions to do. But I want the ceiling to be really high. And there is a selection process in there. We We're not tailoring to non-technical in the sense Um.
29:02you want to achieve greatness or you're you don't want to learn more in the future. So, we have a I think a slightly different take from most companies in this. That said, I do think agents are making it so easy to build that technical and non-technical are also merging into one thing.
29:21The The word that I love is builder. You know, we're a platform for builders. We're a platform for entrepreneurs. You know, we we recently announced our our partnership with Shopify and we invited Tobi to to give a fireside chat. And you know, their mission is to enable entrepreneurs through e-commerce.
29:40Our mission is to enable entrepreneurs, builders through more than just e-commerce. E-commerce is one of our use cases, right? And uh it's it's it's a big bold uh mission. Uh but I think by by using the products ourselves, by being entrepreneurs ourselves, founders, and continuing to sort of uh cater to the to this audience, uh we we we're getting there.
30:04And the third user, agents. Um yeah. I I like how you treat non-technical and technical as one and it's really about like where in this floor to ceiling someone is coming in at. Um how has serving agents, given that, you know, whenever I ask an AI tool to build something, it's choosing Vercel most of the time. Um so, how does marketing, customer support, uh building a product that is attractive to agents instead of humans change the way you do things internally and how you think about product?
30:35On one hand, I think we need to not surrender our sort of thinking or choice or um independence or freedom of thought to agents. I think that's a Even if they always choose Vercel?
30:52Even then as a community or society we should be we make agents the way we want them to be. Like we don't like like give up our our our our intention or judgment to them. I'm very happy that agents love Vercel and I think agents should just choose the best products. That's the world that I want to live in.
31:14And I think we really hack it.
31:15We built a great product. I hope that that's what I was trying to say, right?
31:18Like I hope that we don't find ways to hack it and I hope that and I think again we have to work towards this. I hope the model labs don't hack it. I really think in in Patrick's drive recently talked about this.
31:31The ideal world is that agents sort of make the most liquid information and product discovery system in the world. They're almost like the epitome of capitalism in that like you ask for a a product of some kind and the agent has not been fooled by you know, deceptive marketing tactics.
31:56Uh it gives you all the choices. It considers the up and comers as well as the established ones. It meets you where you are. Obviously, you know, as an agent you one one very interesting observation that I've made about agents is that there's this power and autonomy paradox with agents where the more the ideal user experience is hey agent make an amazing application and deploy it and give me the link.
32:24And the agent chooses Vercel and like it happens really fast and here's the link.
32:28And for that to happen for that beautiful experience to happen you were not involved at all. Right?
32:34Like you just said hey, I want this thing and you go and go to the beach and you come back and the thing is there. So, what happened is that the agent had to make a thousand different choices. And I think we are uh seeing that this works great. Like people really love the fact that agents are working for longer periods of time.
32:54And so, in a way you are delegating more and more choices and decisions, etc. this to these things. Um but I also think the agent needs to be able to get to know you better and your preferences. And it's healthy for it to like give you choices and to push back when necessary.
33:11And to this what broadly people call alignment, right? Like you need to stay aligned with your intention. You need to be stay aligned with your objectives. It has to do reasonable make reasonable choices and take reasonable actions in order to accomplish that objective. Um we've seen how, you know, agents in the pursuit of an objective could hack another company.
33:33Just because it happened to fit the definition of what they were trying to do. And so, I I take this sort of agentic will problem quite seriously. Uh even even though it now it's we're we're benefiting from it.
33:45How are you handling that internally um with engineer builders using agents at Vercel? Like when are people jumping in?
33:52How are you verifying that the work is actually in the Yeah, you you use you used the perfect word. I think one of the things that we're doing is we're shifting our focus from what do you would call it frameworks or developer experience to verification.
34:09So, it's more this days it's more about creating the checks and balances for the agent and the task more so in telling the agent how to do it.
34:21So, you have software now that is optimized for checks and balances.
34:27So, one thing that I love about the current world is that I mentioned the world is now embracing headless, which I was a huge believer in. Salesforce headless, Shopify headless, um all of these things. Another thing that I always uh advocated for is I love to test systems from their boundaries and edges as close as to the user experience as possible.
34:52So, I wrote several essays about end-to-end testing. I have a one of my most popular tweets was um test write tests, not too many, mostly integration. Which is a riff on uh eat food uh not too much, mostly vegetables. Mhm. Which I don't incidentally agree with because I don't I eat vegetables, but not mostly vegetables. But, I do have lived all my life through this reasonable testing approach, focus on the end objective.
35:24And uh people are coming to terms with that now because they realize that soul writes 2 million unit tests and then ships garbage. And they and you read the unit test and like you're horrified and like, "Oh, it's unit testing that 2 + 2 = 4."
35:38Like I recently read a test like this in one of our code bases. It was like there was a constant somewhere and then it wrote a test called the constant is so-and-so. It's like, "Cool." And and so what I've advocated for is that I don't care that much about like what data structure you use and the algorithm or library or whatever. I care about you give me the product and I use it and it's great.
36:05And so how did you turn that into a technology? Well, what we had before was this more comprehensive test that test the thing like a human would. And then if that fails, you can go into like, you know, okay, now of course we need to understand how the system works. And so that's the other thing that I advocate quite strongly for within the company and into the world, which is I also don't want to surrender understanding.
36:31I want people to write these verification loops because it's going to give me conviction on the product that I deliver to my customer. And if anything goes wrong, uh I also want to sent. And uh I want to prevent broad categories of misalignment. And I use the word misalignment to mean like, oh, the agent's making class of security mistakes.
36:54Or um literally just like doing something else that you didn't foresee that could get slopped into a code base. And this is also why I think as humans are our next sort of like big job will be capital allocation.
37:09Where, you know, and you have to make a bunch of decisions. Do I allocate a bunch of tokens and compute time for vercel.com to be highly agentic?
37:18Uh, today the talk of town literally is security. Uh, I think a lot of people are going to be doing the capital allocation of, oh, we were shipping a 3D 3JS game for X likes. Oh, uh, whoopsie daisy, we forgot we need to make our system secure. Like, psh. They're going to allocate a bunch of tokens, capital, time into security loops.
37:42Uh, and so uh, I think this is just how the world moves moves on from now from here.
37:47So So if the human isn't needing to think about how to make the checkout page fast or how to make the the website agent reliable, then the human is deciding what the outcome even should be in the first place.
38:00Um Tradeoffs, too. Sometimes the agent does come back with like It's funny cuz it probably happens with this is agentic loop. Uh, one of the rules and guidelines there might not apply to your business. So the agent comes to you and say, "Look, um Rauch G, I can I can get you to 100."
38:18But it's either not reasonable or it costs too much. Like, do you really want Funny enough, I was working on this verification loop for very low-level systems performance. And uh broadly this this um this program that I was optimizing is is separated into a parser and a scanner and a checker.
38:43And and the The comes to me and say, "Dude, you've made me grind on this quite a bit. Like, we're pretty fast. To get to the next level, I'm going to have to spend like it's a law of diminishing returns, right? Like, I'm going to I might have to spend another thousand hours on this.
38:59And do you really want this? Like, I think we're going to have a lot of conversations like this with agents where they come to us with the tradeoffs, we they come to us with asking for more capital. They come to us with like advice and you see this in in that like some people are configuring their agentic engineering loops so that you get pinged.
39:20It goes off and you give it you give it give it the advice and like agent ping me for this, this, and this. I saw that tweet the other day from someone that was like, they hooked up the agent to wake them up in the middle of the night as an alarm. Meaning, if the agent needs to make a very hard choice with tradeoffs, I don't want you to stop working so that, you know, I wake up and like you you were stuck. Wake me up in the middle of the night for me to resolve that conundrum. Of
39:49course, I'm not advocating for this by the way, but But it seems like agents could get to the point where they're making the better judgment calls on the on the end experience. Like, your agent pushing back on like getting to 100%.
40:00So, this is like a superhuman employee and like at the end of the day, you're making some shot you're calling the shots and like hey, like capital allocation, uh where are we headed as a business, right? Like, the agent could be saying like, "Look, I could keep making the the checkout page faster, but like in order to do this, like I'm taking away the work I was doing in that other thing, right? And so, these are the things that will require your intervention.
40:24Now, do I believe that there could there could be fully autonomous businesses where the CEO agent is the one that's making those? Honestly, I I think for certain domains we're going to see this. Uh I've uh I've invested in a few companies that are building a fully autonomous companies on top of Vercel.
40:41Uh where the the the you give the the the agent basically capital. That's what you give it, right? Like, you give it here's your your seed round agent. Uh and and by the way them compete.
40:54They demonstrated success at small scale already, which is pretty uh fascinating. So, like many businesses that have agents delegated to different areas of the business, growth, marketing, sales, um and of course engineering, and then the sort of like decision-making role, etc.
41:14I would ask a couple questions about how you're running Vercel. Uh I know that you have already had teams rebuild software that you used to purchase internally.
41:24Um how are you making the decision on what's worth building internally versus like should we rebuild Gusto? Should should we rebuild Deel?
41:32Yeah, my guidance broadly is the all of those categories of engineering that I mentioned, like security, durability, availability, the long-term maintenance of the software, like you should always ground yourself on not like I was able to demonstrate a very quick example of a product. I encourage people to think about like the full system.
41:57It require like these systems require a lot of love to maintain, right?
42:04The area where I fully encourage people to throw away SaaS, there's a number of them. One is there's four or five bespoke tools that are trying to do the same thing. And they were conceived for oh, the person doesn't know how to write code.
42:24Therefore, you know, the classic like drag-and-drop builder of swords and whatnot. Now that code is free and that everything is code. This is a very profound insight, right? Like you can generate videos with code. You can generate images with code. You can solve math problems with code. Everything is code. The coding agent is truly one of the most miraculous It's like the browser.
42:49It in terms of what the web browser did for the internet the coding agent is doing for AGI. And so in for a lot of problems a coding agent plus deployed over cell has allowed us to delete four or five vendors. And and so I call that a sort of a simplification.
43:08And and the things that it was replacing were the sort of this lowest common denominator not best in class solution but like trying to like make it approach making making something approachable or whatnot. There is also tools that refuse to be agentic that you should delete like the plague.
43:25So if something is not exposing its data and capability in a way that agents can consume they're breaking this new loop that I just talked about that is so amazing.
43:35Like if a if a if a tool that I have does not speak agent then it's not enabling this miraculous invention of the web browser the coding agent. It's like someone that opted out of the internet in the early days. They were like, "Ah, yeah, I'm not going to do that www thing."
43:53Then how would you maybe some people might argue that they do that because like they have a data moat and like they they don't want to expose. Yeah.
44:00Yeah. I genuinely don't care, right?
44:02It's the same thing I mentioned about headless like at the end of day I'm the customer I want access to my data. I have this incredible superpower of the coding agent that takes in data spits out deployment and I want to use it. And so what I love about the success that MCP is seeing is that MCP is almost like the new HTTP.
44:28Right? So like we built HTTP which is the hypertext uh transfer protocol to deliver HTML for humans build beautiful pages. Now we're building in the protocols to speak agent. That this is essentially what I mentioned that tool is agentic. That's for you. It tells you are you speaking agent? Are you giving highly digested or digestible markdown text to the agent when they browse your website.
44:57Are you giving them MCP so they can make all of these transactions faster?
45:02And so that's another category of tool that we've deleted is the one that is not playing well with with agents. And it's not just that they these tools ship an an MCP and they say, "Okay, cool. Like I'm agent ready." Sometimes it's the performance.
45:20Agent loops call these APIs over and over and over again. And so they have to be, you know, they don't have to have a clunky rate limits. They have to have data consistency. Like you I mean, going back to like the airplane example, you'd be surprised about how we're how many broken systems we've built the whole modern software world on. Systems whose APIs lie to you
45:47or break down all the time. And poor engineers before had agents on the other side who built all kinds of hacks and and brittle systems around these APIs. So you're seeing this I don't I mean, I'm I'm as I say this, I'm sure people are thinking about one system or another that is like breaking down under agentic pressure, is what I would call it.
46:11And you know, one of the things that I going back to the beginning of the conversation, when we bet on the cloud I had this aspiration that a simple system could scale to billions of people. And from time to time I would get naysayers saying, "Well, no. You know what? Like I don't really think that that scale will ever come for me." And I always loved the cloud because it would give you that option value.
46:37One day, and I I think no one could have expected that agents would be that thing, but agents are asking for your data and and calling your APIs at a million times the rate that a human would.
46:50It increases your likelihood of hitting scale.
46:52Exactly. The the scale is here.
46:55And you need a lot of compute.
46:58And you know, when we designed fluid computer at Vercel, that was our aspiration. You can scale to zero, which is kind of nuts. Like if the app is not being accessed, we don't even allocate the memory and CPU.
47:10But you can also scale. I've seen unbelievable things. You know, saturating 20 different regions for how much this given system is growing, right? And so, that's what you need to do to set yourself up for today. It's It's not only designing for ages, but making sure that you can meet their demands.
47:29And they're compute hungry.
47:31One question we ask every single guest who comes I hadn't asked you is what's the most challenging moment of your career. I usually use the word darkest, but some people don't like that word.
47:43And what what it taught you about leadership?
47:46Darkest was probably incidentally related like which launched me into this period of like um meditation and and spi- spirituality was uh here in SF um our household caught fire one day.
48:02A neighbor was smoking um back when people in SF smoked or It's coming back. Sadly, it's coming back.
48:10I guess. Um So, in the middle of the night the freaking house caught fire.
48:15Um and I lost all my material possessions, which was not it was not a lot. But it was like that moment of like wow, I have to start start from scratch in every aspect of my life. Start from scratch um from like I survived cuz not everyone made it out of that house um let's just say healthy. Like there were two people that had very severe um
48:44damage to their body. So, when I came out, I was like I start starting over from every point of view, like materially and spiritually. And also like that those near-death moments are like wow, like true true wake-up calls. Um this one is not actionable.
49:00It's not like, "Hey, put yourself in a near-death mode so that you can like advance your consciousness." But like I I do think there's an appreciation of every day. Uh or when you hear about people like um falling ill or or things of that nature, just like the appreciation of uh life that comes from the dark moments. And and and that one that one is a more personal, of course, like it extended into career. I was building my first startup here in SF by myself, super young.
49:29Um that was probably the darkest, I would say.
49:32Yeah, first startup and fire. When it when it rains, it storms.
49:37But there's been many.
49:38Yeah. I'm sure. I'm sure.
49:39If people had a any any question whether, you know, there's there is or there isn't uh such situations, it's it's in everyone's lives.
49:47Yep. Well, thanks for sharing that.
49:49So, you have six kids now.
49:52Which is incredible.
49:55Uh a lot of how you've learned in your life is by tackling hard problems and coding and and building things. Um in the elevator, you talked about how if you could teach one course, it would be how to think. I'm curious how you are raising sub-agents to think and actually learn how to think in a world where everything is so easy to do.
50:16So, there's a number of things, you know, one of the gifts of having six children is that I've now sampled through a probability distribution of all kinds of different personalities and preferences and abilities. It's nuts. I I I truly believe that we're not all going to uh be equally good at everything.
50:38I think life is truly a journey of discovery of the ikigai, the what the Japanese word for like the overlap between the things that are good for the world, the things that you love doing, the things that uh I I don't know if this is an ikigai, but like create economic value, like finding that overlap is what I spend a big chunk of my time on for and helping my kids discover that overlap is is interesting.
51:04Um the other one and and even for myself I like to look back on my journey as an engineer and there were certain things that I gravitated to. Like building tools.
51:15Or um even even to building reliable infrastructure. I'm I was so neurotic about like even one error slipping through a log and there's elements of my personality that fit this overlap of what you're good at, what it's good for the world, what creates economic value, etc. etc. that I discovered through the journey.
51:38Um user experience is another one or like design and and things like that. So for my kids, so helping facilitate that journey of discovery is one. Um I'm going to help them harness the power of agents so that this is what I mean by learning how to think.
51:57So when you think and using my sort of eating my own dog food, you have tools at your disposal. I think over time, whether you realize it or not you've accumulated tools for thought.
52:14Thought frameworks, etc.
52:17And and you almost have like power-ups. The personal computer was a power-up to your intellect. Googling was a power-up to your intellect. You know, it's almost like um if you think about a system having L1, L2, L3 caches and memory, like I've expanded my memory through Google.
52:40I think now we're we're going to have the same with agents. So I want to make sure that and I'm even speaking for myself, my foundation is to be really solid and then now I have all of these tools at my my disposal that I can use as power-ups of my intellect, of my creativity. I would still want to live in a world so for for example, one of my kids is amazing at drawing. Way better than I could ever draw.
53:03And I actually kind of like that can draw with a pencil.
53:07It would suck if he doesn't learn that there's all of this amplification tooling now, that there's all of these cool models, and that he can even build his own tools now for design and for sort of channeling that that creativity as well. And so, I'm going to spend a lot of time making sure that they learn these new tools. Much like, you know, it's interesting. If you had asked me the same question 5 years ago, I'd be saying, "Well, I'm I'm teaching them JavaScript. I'm teaching them about the
53:37basics of programming languages." I think for some of them I will. Much like the guy that can draw with a pencil, you know, like we'll scale up further from there. I think the guy that one day wants to build like, I don't know, um a space uh mission control systems, uh will spend some time on like, you know, hardcore systems engineering and and and things like that as well. And then later on these tools.
54:05Yeah. So, it sounds like letting them find their curiosities and then scaling once they've built that foundation.
54:10Yes. That's beautifully put.
54:12So, not everyone is going to have the privilege of having a one-on-one conversation with you, but they will be able to talk to your Delphi. So, if there is one conversation that you hope people have with your Delphi, what do you hope that is?
54:26Funny enough, you know, now that you've inspired me, I will also give my Delphi to my kids so that they learn more from me. Um I think it would be uh you know, there's a meta here, which is that in order to get to where I I I am and get to where I'm going to be, there's been so much of working on myself.
54:49I think going back to the inputs and outputs metaphor, you come because you've watched the outputs. You'll stay because you want to learn how the sausage is made. And that's more of the sort of meta skill set.
55:04The how do you live your life, how do think? How you work on yourself? Those kinds of things, I think are are the interesting bits. It also incidentally they're broadly applicable. Like there's things that I do that I could probably like apply to like becoming a great cook or yeah, to drawing. And again, you know, you have limited interest, limited time and you go from there.
55:27All right, well I'll I'll definitely be having that conversation with your Delphi.
55:30[music] Thank you so much for coming. This is great. Thanks for tuning in. If you enjoyed today's episode and want personalized advice from Guillermo, head to the link in the comments or description to ask his digital mind on Delphi.
