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Honest conversations about fear, uncertainty, and what it means to build things when the ground keeps shifting.
Season One is sponsored by WorkOS and Augment Code.
00:01.53
Kent
So ah welcome to episode whatever this is of the Still Burning podcast. Michael, it's great to have you here.
00:08.70
Kent
Can you give us a quick introduction?
00:11.96
Michael
Sure thing. It's great to be here, Kent. So I'm Michael Grinich. I'm the founder of WorkOS. And WorkOS is a company that helps other companies, SaaS businesses, developers, with enterprise features in their app. So when you build the next great product and you want to go sell it to bigger customers and grow your business,
00:29.96
Michael
You'll probably talk to like security IT t people and procurement, and they'll ask for things like single sign-on, SSO, SAML authentication, SKIM provisioning, access control, permissions, logging, essentially all this stuff that isn't really the fun stuff to build as you're a developer. It's really complicated. It's a lot of integration stuff.
00:48.17
Michael
We like we like to say that we help make your app enterprise-ready and help you grow and scale.
00:55.32
Kent
And that was ah obviously a well-polished, distilled, carefully crafted message. How did you get excited? But your excitement about the topic comes through. How did you get excited about enterprise-ready features?
01:13.25
Michael
Yeah, sometimes joke as ah as a child, I was drawn to enterprise infrastructure. No, the no one is, of course. is like you know ah I started a company before this where we had built an email client, like an email app, kind of like Superhuman or Gmail.
01:28.80
Michael
And this is back in like 2013, 2014.
01:32.80
Michael
um And we took the same playbook as all of these other SaaS businesses. I had actually interned at Dropbox before that. So the same bottom up, freemium, now we call it PLG, you know that that motion to build products.
01:44.82
Michael
We got a bunch of users. People really love the app, like the design and the experience of it was great. But we hit all these headwinds trying to actually sell it into businesses. And really businesses are the ones that pay for software. Consumers might use it. you know Individuals might might might download a new stuff, but it's businesses that actually you know drive forward the commercial side.
02:02.94
Michael
And I realized that this is just this huge gap. Every single company building products was going to hit it. And it it it kind of fit the same type of infrastructure you know layer problem space that I'd seen companies like Plaid or Stripe do and you know in in FinTech and like Twilio had done for communications. you know Twilio is like this aggregator system for sending SMS.
02:24.16
Michael
And so I looked at it. This is after i after I left. And I was like, I think this is this problem. You can actually kind of dissect it and build a service layer to to solve it. And I love building things for developers.
02:34.72
Michael
I mean, I think that's anybody probably listening that's like a developer, an engineer.
02:36.25
Kent
Mm-hmm.
02:38.56
Michael
I'm an engineer by you know by by training and and still write code. um There's nothing better than building a service or a tool or a platform for other engineers. It's really hard to do, but it's I think it's kind of the ultimate version of baking software. It's building software for other software people.
02:53.91
Michael
And so decided to try to solve this problem. So I'm not like an IT t guy. I'm not like an enterprise you know security person. I'm a developer tool fanatic. But we took a lot of inspiration from companies like Stripe.
03:06.10
Michael
And then we get to work with all the really exciting, cool you know companies that are out there by building infrastructure for them.
03:12.19
Kent
Yeah, I think that's one of the interesting things about your position right now is because you're selling picks and shovels into a gold rush, you get to see what everybody's using the picks and shovels for.
03:29.34
Kent
What is, have you comment on, are are there things about that that have surprised you?
03:29.94
Michael
Yeah.
03:35.40
Kent
Like I would have never guessed that somebody would need enterprise authentication for x
03:47.50
Kent
Thank you.
03:47.98
Michael
we're not a brand new company. We've we've been around doing this for a while. And so you know we power these these capabilities inside of you know previous era companies.
03:55.97
Michael
They're still growing like Vercel, Webflow, Carta, Vercel. ah We also do it now for ChatGPT and Claude and Cursor and Perplexity and all these AI products.
04:08.26
Michael
um So what I end up seeing is that all of these companies actually end up going through kind of the same go-to-market motion as they go upmarket. They all think they're unique and different, how they go sell to enterprise and how they how they hire sales or think about pricing or all of that. But if you look across all of them, you're like, they're kind of all doing the same thing.
04:24.68
Michael
They have different products. They have different you know things that they solve for businesses, but they're all sort of doing the same thing. The biggest change by far over the last year, year and a half, is everybody's growing faster.
04:36.19
Michael
The software industry is just is just like the the the light speed has been turned up.
04:36.88
Kent
Mm-hmm.
04:40.36
Michael
We can all go faster, grow grow bigger. Bigger companies are adopting software faster than they ever have before. the market is larger. Just the TAM has gotten bigger. And so I think this is what we're seeing generally across the ecosystem is like,
04:54.31
Michael
The AI wave is pushing everybody forward, not just the big AI companies. you know Everyone sees the anthropic revenue or whatever blog posts, tweets, or you know things that people talk about.
05:04.83
Michael
but But the entire industry is moving faster and and going bigger. And it's just it's super exciting to have some viewpoint into all of that.
05:13.86
Kent
Yeah, i was I was at Gusto for a while and we had a similar view into small businesses because we could see their payroll. Before the economic numbers came out, we could see how things were shifting because people have to get paid.
05:31.42
Kent
And if payroll went up or went down, we knew about it before.
05:31.66
Michael
Yeah.
05:36.06
Kent
Can you see... Can you see in your numbers that that ah positive second derivative, that growth is growing faster?
05:49.14
Michael
Yeah, definitely. I mean, we see it in our own revenue as a company. and We just raised our Series C few months ago, and and that it was like directly a result of our acceleration as a business. were We're not really building that much different stuff. Pretty similar to what we were before. It's just the the tide is bigger. you know The wave is bigger.
06:06.66
Michael
um And I think it's it's a few different things if you if you kind of split it into pieces. Like, why is this happening? Yeah. um The first in my mind is just that it's faster to build stuff.
06:16.24
Kent
Yeah.
06:18.27
Michael
Like if if we only had the coding models, that's it. It was just like we could write software faster. That alone would create um a run up in the market, like a super cycle.
06:28.96
Michael
so So the fact that we have these coding agents to just build things, you've probably seen it using Claude. It's like this thing will take 12 weeks and you're like, nope, we're going to do it in 20 minutes, you know.
06:37.80
Kent
Oh, that's some kind of either genius or bullshit marketing. Whoever came up with that. here's a Here's six months worth of work. Bing, it's done.
06:48.64
Kent
It's like a microwave.
06:49.64
Michael
I think it's because it used to be true. It's like in the pre-training. You know, Claude is probably like, that's probably like an accurate estimation of the software development timeline without, you know, the the coding agents.
06:53.02
Kent
Oh, sure.
07:00.86
Michael
But clearly, like we have this time machine, this compression machine. So that that by itself would result, I think, in a technology shift. But we have that plus... the capabilities of the AI models make your product better.
07:14.46
Michael
I think it's actually kind of like a human computer interaction shift.
07:14.83
Kent
Yeah. Right.
07:17.56
Michael
you know you can it makes software more human. You can talk to stuff in natural language. like I never want to write SQL ever again, like for BI stuff, for for business intelligence. I just want to answer the question I have about the company. I can write SQL. I can figure it out.
07:31.62
Michael
But in that mode, when I'm just thinking about the business, thinking have a question, I just want to write the question. And so that's a huge jump in just terms of capabilities of human interaction with software. That alone would be a huge technology shift.
07:44.00
Michael
I think the third one is that bigger companies are transitioning faster. you know it's The most surprising thing to me is actually the rate at which the large companies are changing. Small companies, startups, they always change quickly.
07:55.83
Michael
They move on a dime. They pivot really quickly. But it's usually the big the big incumbents, the large organizations, the legacy you know whatever systems. Those businesses are slow to change historically.
08:06.71
Kent
Yeah. Right.
08:07.46
Michael
I suspect some of it is because of COVID actually. Like during COVID, every company had to shift really fast. And so these enormous organizations had to move to remote work. They had to adopt different tools and process. They were forced into it. they didn't have a choice.
08:21.06
Michael
They did five years of you know IT t transformation in like five weeks. as they shifted and so now they believe that they can do it and so they're all adopting ai extremely fast you know you hear this if you if you talk to people at the foundation model labs the scale at which these big companies are signing deals and adopting the the technology is extremely quick so there's ah there's a buyer appetite on that other side um you know and in each each of these things individually i think would cause like an enormous technology shift but if you put them together
08:43.28
Kent
Right.
08:50.72
Michael
And then you add capital on top, you add this like, you know, rocket fuel to the fire, which the the whole capitalistic machine that we've built for many years is kind of, it's almost like perfectly designed for building what we're doing right now, pouring you know hundreds of billions of dollars, trillions of dollars in the data centers and energy and ships and the whole stack.
09:09.20
Michael
Like we're kind of, it's almost like we're kind of activating the entire economy in America around the transformation of AI in a way that we haven't ever really done before with the exception of maybe like either building the railroads or wars that we've been in, you know, but it's not a war, right?
09:24.80
Kent
Yeah. Mm-hmm.
09:28.22
Michael
It's it's this this race towards like super intelligence. And so I think just you put all those things together and it's just a totally different thing. if If you look back to the internet era, I spent a lot of time studying, you know, the.com boom, there's some parallels to it, but this is like, it's very different on a lot of different dimensions. Like you can't just tie it one-to-one and say, this is just a hype, you know, cycle. Of course there's going to be overinvestment in some places, but there's a lot of very real different things that are happening that are, that are changing. So it's by far, I think it's going to be the most exciting moment of of our careers. You know, this moment right now, as it's going through, and it's,
10:03.53
Kent
Oh, absolutely. I'm i'm delighted that i'm I'm still active and programming at a moment when programming, like the the scale of things that I can imagine tackling just grew by 100.
10:21.34
Kent
And all these projects.
10:23.96
Kent
Right.
10:25.62
Kent
Yeah.
10:25.43
Michael
It's incredible.
10:25.74
Kent
Yeah, yeah. Yeah, and all these projects that I'd sort of salted away in the back of my, oh, wouldn't it be great if I could build a special purpose database for blah, blah, blah. Oh, God.
10:39.60
Kent
You know, that's just going to be so much work. Never mind. All of those are back in play.
10:46.54
Kent
So I use the word geek to talk about my my audience of people that I've been talking to my whole career and and I use G. Paul Hill's definition of geek which is someone who's highly creative, highly technical and highly desirous of being both.
11:07.46
Kent
um You strike me as a geek. when When did you know that that was a thing about you that maybe distinguished you from other people?
11:19.89
Michael
I've always been like a bit kind of obsessive about when I get into things. I like going deep, you know, I think even as a child, I tended not to have like, um, kind of like cursory interests.
11:25.14
Kent
Yeah.
11:35.04
Michael
I would like go deep on stuff and really learn a lot and read a ton of books and just fully absorb it kind of like a sponge. Um,
11:45.15
Michael
But there was a turning point for me, I think, when I realized I could actually like make stuff, that I wasn't just a consumer of it. i grew up I grew up in this small town in Oregon, kind of a rural farm town.
11:56.100
Michael
And i had in McMinnville, Oregon, it's um it's it's beautiful.
11:57.93
Kent
What part of Oregon? OK. Up here, Portland.
12:02.70
Michael
It's in the Willamette Valley. But it's it's a pretty ah rural area. it's It's like an hour and a half outside of Portland. you know and I think I had this perception that like the world was like pretty static and not something I could change and sort of a different,
12:21.33
Michael
It's a different ecosystem. would read books and watch movies and you know watch TV and read newspapers and stuff. but But that was created by people that were not me, you know people somewhere else, some some other some other world.
12:32.44
Kent
Right.
12:35.48
Michael
um And it wasn't really until I was probably like 18 or 19 that I realized, hey, all of this stuff is kind of malleable. like If you really want to go after something, you know you can You can make something happen. And all the people that have made things happen in the world kind of just did that. They just they just were normal people. They weren't you know you know gods that came down from the heavens or you know had some some bestowed you know like ability. They just worked really, really, really hard.
13:05.04
Michael
And now people have taken to this term agency. I think it's like ah the idea that you can be the the change agent.
13:10.37
Kent
Mm-hmm.
13:12.95
Michael
But I distinctly remember when that kind of switched to my mind when I realized that. And I think that was like the moment that kind of combined with the geek interest or going deep on stuff. I was like, I can go deep on stuff and also change the trajectory of my life or things I'm interested in or things I can work on.
13:32.77
Michael
And that's really what kind of drove me into to technology industry and startups. Like actually when I was a student and and in college, I was a architecture student for a while. And then I switched to physics and I took a bunch of physics physics classes.
13:43.48
Kent
Okay. Mm-hmm.
13:46.07
Michael
I love physics still and in mathematics. But the thing that got me into software was being able to build stuff and then see people use it and realize this is a, like software I felt like was the highest leverage thing.
13:58.07
Michael
You know, you could be, you could be like a single person with like a your MacBook at a coffee shop and build a thing for like a million people. That's like, that's very hard to do in other areas. Like you can't,
14:09.61
Michael
You know, if you're like an architect, it takes like 100 people to make a building. You know, if you're a physicist, it's like decades before you like maybe do some breakthrough research that maybe impact someone eventually. The only other people I can think of that could have such high leverage and impact in the world were like artists, like ah like a musician, you know, or something that has like a big following or like cult leaders, you know, like folks like that.
14:32.60
Kent
Yeah. Yeah, this is a business model that doesn't attract me.
14:35.72
Michael
Not great, not great.
14:36.17
Kent
so
14:36.92
Michael
Yeah, like historically not great. um But ah but i was like with software, you know, in particular, because there's no marginal cost to additional distribution. It's not like a a widget you have to make or a physical thing. i was like, I can make this stuff and get into the hands of people. They just go to the website, click the thing, use it, you know, and and I can change their their life. So I got very interested in the software world from a perspective of like that high impact, high high agency.
15:01.90
Michael
And I think that, you know, following that forward, building tools for developers is kind of a distillation of that. Like if you can build software for other software people, your impact is sort of the the set of all the things your developer customers build, all of their customers' customers.
15:08.95
Kent
Mm-hmm.
15:18.51
Michael
And that's that can be an enormous set. You know, you think about platforms like AWS, like the amount of impact that's had in the world, all the derived businesses on top of it, it's it's it's extraordinary. It's like impossible to measure, you know.
15:31.79
Kent
And that that creative impulse, that going from, this is what I i love in different media is is going from that, there's this thought in my head, which I now can't get out of my head until I make a thing in the world and then I see the thing in the world and it feels so gratifying. you know This morning there wasn't a painting and now there is a painting or or I've learned a new song or I've written a new story or written software. It's ah that that same kind of itch.
16:07.49
Kent
Somehow the the the energy builds and then you decide, okay, I'm going to make this thing and then you make it and then there it is. And ah that just feels so good.
16:18.27
Michael
Yeah, i often call it like the itchy brain, you know, feeling.
16:21.53
Kent
Oh, yes.
16:23.13
Michael
ah You know, the most miserable i've I've been in my whole life, I think, was um when I wasn't working. I had this period between that first company and the second one, WorkOS, where i i took like a year and a half, year and change off, year and a half.
16:38.05
Michael
And I was just trying to come up with ideas of what to do next and like, you know exercise and kind of just catch up on life stuff and take a break. I was kind of miserable. I was like... you know I felt a little bit like a like a dog without like a tennis ball to chew or something like that.
16:53.29
Michael
just kind of like eating the furniture you know and and just kind of aimless. And so I have found that like if there's a thing I can run after focus on, it helps me feel like alive and and useful you know in the world.
17:02.20
Kent
Hmm.
17:06.98
Michael
I think the that the thing that made me not want to continue in in school, you know I graduated but not go go to graduate school and PhD and all that stuff, so I just got this feeling that I wasn't doing anything for the world. I had spent, you know, at that point, i guess, you know, 16 years, 12 years in and elementary school and in high school and then four in college, just kind of consuming, just going to class, doing problem sets, reading stuff. I do projects for, you know, classes, but the projects were to demonstrate my aptitude and learn things. They weren't to help anybody.
17:41.53
Michael
And I just, I just felt this desire to like, you know, make things, but, but as a, as a way to connect with people, as a way to just like be connected in the world and be, be sort of part of like the, you know, global human ecosystem that we have.
17:57.56
Michael
And, and, and yeah, I just wanted to be connected.
17:58.69
Kent
Oh, interesting. Yeah, I think i think my my my motivation is a bit more selfish than that. I get that itchy brain, and i know it's not going to go away until I make the thing.
18:11.42
Kent
So I make the thing, and some of them...
18:12.01
Michael
mean, that's definitely part of it too. Yeah. It's like, kind of have a the the energy inside that just has to like, it just has to come out.
18:22.67
Michael
It's like a compulsion. Sometimes when I hang out with other, you know, like founder, founders of companies, I sometimes feel like we all have the same kind of mental disorder a little bit.
18:24.84
Kent
Yeah.
18:33.76
Michael
We all have this like compulsion to like make stuff or produce things.
18:37.01
Kent
Mm-hmm.
18:37.73
Michael
And it comes from different dimensions, you know, but the ones, i think the ones that do it for long periods of time, like, Like if you're look if you're doing it for the the validation external validation, you know, like it's it's a continuation of like wanting to please your parents when you were young and then in college get good grades and get a good job. And now you're like, oh, if I do the startup and make a bunch of money, then every people will love me.
19:00.64
Michael
that That actually burns out pretty pretty quickly. Like that that that drive like ends up... you kind of get cooked um i've seen it happen a bunch but if it comes from this place of like just wanting to make stuff you're just like i just want to keep keep pushing and creating and pushing the world forward and like exploring things and um that's like you know i've uh i heard this story once of uh there's some folks that were climbing and in the Himalaya.
19:26.88
Michael
And there's this guy who was a Western, like I think American climber with Sherpa that was like his guide.
19:32.91
Kent
Thank you.
19:33.38
Michael
And he was climbing and like getting totally, totally exhausted, like unable to continue. And the Sherpa was like, Fine. just Just cooking, like just so climbing.
19:44.41
Michael
And so the guy asked the Sherpa, like, what is it that lets you do this? Like, why why are you able to do this thing that I cannot? You know, because I'm strong and healthy and trained and all this stuff. And the Sherpa said to him, like, you know, when you climb, you look at the summit and you're constantly looking at the top.
19:59.49
Michael
And when I climb, I just look at the step in front of me. And this like different perspective of like the end goal being this exhausting thing versus just being in the process step by step by step.
20:10.17
Michael
i think I think it's a lot of, you if you just kind of are present and you look at the step in front of you and you can enjoy that. if You can just enjoy the day. You know, you'll you'll enjoy the week. You'll enjoy the month. You'll enjoy the year. You'll enjoy your life. So that's it's I think finding that type of motivation, whether it's liking to build stuff or connecting with people or expressing something, it's it's the sustainable kind of more durable place to live from.
20:34.91
Kent
ah do you think that Do you feel any evolution of your creative impulse coming? Like you'd like to go into, I don't know, philanthropy, or you'd like to go into coaching kids' soccer, or you'd like to...
20:46.67
Michael
Aha.
20:52.22
Kent
Or or are you pretty... and't even I have so many irons in the fire and something else comes along and I just think, oh God, another thing. Okay. I guess I have to do that too.
21:06.11
Kent
So I guess i'm I'm wondering if you have that same thing or if you if you're quite focused on WorkOS, building a company, building services.
21:18.84
Michael
I'm not sure if I would be a good kid's soccer coach.
21:23.39
Kent
I got kicked out, so.
21:23.49
Michael
I don't, I don't, yeah, don't have children now, but I i suspect, ah you know, I, I like, I, I like doing things really well, like excellence.
21:34.08
Michael
Um,
21:34.61
Kent
Ooh, that's a heavy burden to bear.
21:38.08
Michael
Yeah, but it's also like just kind of a the satisfying, i find I feel like the satisfying way to live. it's not It's not like excellence because you're trying to make other, you're trying to do better than other people or show off or something. it's It's more like just excellence in everything you do as the line.
21:52.33
Michael
Like, you know, it's like how how you do anything is how you do everything.
21:53.98
Kent
Yeah.
21:58.17
Michael
um
21:58.29
Kent
Mm-hmm.
21:59.58
Michael
and And I think it's just a, you you can choose everything.
22:01.67
Kent
Mm-hmm.
22:03.13
Michael
to pursue excellence in your life. And that's, it's not really what like maybe kids, assuming it's see of young kids, soccer is about. um I'm also competitive. I actually really, I you know played sports in college and and and growing up and I wasn't like a crazy athlete, but I like winning a lot. And um and it's it's not it's not the feeling of like making other people lose. It's like me, myself accomplishing something, you know, like the the piece of that. Yeah.
22:31.84
Michael
And so i think I might, I might not be a, the other parents would probably be like, why are you trying to turn these kids into like, you know, a world cup team or something. Um, but I think I like to, I like to challenge people and figure out where's excellence.
22:46.96
Michael
it's It's much more of a, I've done a bunch of angel investing. And so I've seen it across a bunch of companies. And like, I actually think that the product market fit, you know, search process is is as much randomness as it is
22:58.17
Kent
Yeah.
23:02.53
Michael
you know, like directed control. It's the reason why if someone had an algorithm to figure out exactly how to do it, it would win out in the market. The closest that exists that is Y Combinator, which their kind of algorithm is like, wake up, talk to users, write code, exercise, go to sleep. It's just like, do that every day, you know, which is really not an algorithm. It's just like, go get a lot of shots on goal. Just try a lot of stuff.
23:30.15
Michael
um And so i think I think it is like very challenging to get to a place where we have gotten, I feel very i feel very fortunate, I feel very lucky. i ascribe more of it to luck than I do to some you know some clairvoyance or something about the market.
23:45.19
Michael
um But now that we're in it, what's what's interesting I found at this stage, we're like 120 people or something and and have a ton of customers. The problems actually get more interesting. I used to think that the very beginning phase was the most interesting, because like you have nothing, And the world is wide open and you're trying to figure out the product and like world's your oyster.
24:07.24
Michael
But it turns out like there's there's so much that's out of your control at that phase because you're just trying to find something that connects with the market.
24:15.71
Kent
You're waiting for the double sixes.
24:17.92
Michael
Yeah. you're just And before you have that, you got nothing. you can't You can't do big moves. No one pays attention to you. You don't have users. You don't to anything. Now at this phase, like we have a really strong team. We can do a lot of stuff. We can matter in the world. We can be really impactful. And so I actually find that I enjoy it more now. the The ability for us to go and push things forward, to work with these...
24:39.59
Michael
you know, significant companies in the world to to be a small part of the success and support them, i actually find more satisfying. I thought previously I was like an early stage guy, because like like coming up with ideas and building stuff. But from like a company building and world impact perspective and leverage, this is way more interesting where we are now.
24:55.71
Kent
interesting. Yeah, I've i've never scaled a company, but I've had ideas.
25:03.61
Michael
mm-hmm
25:03.66
Kent
And like JUnit became big and popular. um So i've I've seen some of the,
25:13.53
Kent
some of that challenge of scaling and I i never find found those problems fun. So interesting.
25:23.85
Michael
There's definitely problems with it. Yeah. I mean, there's like, I think there's stuff that no one likes dealing with, you know, as you build a company. It's like getting your teeth cleaned, you know, it's like eight kind of HR stuff and performance team. And, um you know, the hard the hardest thing about the job is like when, when people aren't performing well and you need to like let them go from the company, it's it's devastating. I mean, it sucks. It's terrible. It's, it's a bad day for everyone, especially the person that you're letting go, you know?
25:51.55
Michael
um And, and that's,
25:52.86
Kent
yeah You wouldn't have hire them if you if you thought they couldn't do the job.
25:56.51
Michael
of course Of course not. Of course not. So it's disappointing them, it's disappointing you, it's disappointing their coworkers. you know but the But the role, i think I think, I really believe this strongly, that the role of leadership, management a company, is to create the highest performing, strongest possible team.
26:12.38
Michael
Like if you, if you, if you, commit to your team that you're going to create the best possible environment for them to do great work, you have to have the integrity to correct when when you know things don't line up in that way for folks in the team.
26:15.97
Kent
Yeah. Mm-hmm.
26:25.70
Michael
So there's things like that, which just it just sucks. It's it's like a it's an important thing to do. It's necessary. It's not fun. um But I think those are the things that I do, you know not because I enjoy them, but because I enjoy the company and the direction we're going. And I have this kind of commitment to our customers as well.
26:43.90
Michael
And the other parts of it, the fun parts, make up for it in spades.
26:49.14
Kent
Interesting. Yeah, I've seen teams that needed one person to join and it dramatically changed the the atmosphere, the energy of the team. And I've seen teams where one person left and it dramatically changed it, either for the the better or for the worse, like but huge changes. And the other 10, 20, 30 people were exactly the same.
27:16.98
Kent
But the collective performance changes a lot, which gives me hope that leadership does have leverage.
27:26.42
Kent
Sometimes i yeah I wake up in the night and I think, yeah, does does any of that large scale stuff really matter? And then I look at a situation like that and I go, yeah, definitely does.
27:38.71
Michael
Yeah, the team structure matters a lot. And it's it's hard to to know. You can't simulate all possible futures.
27:46.30
Kent
Right.
27:46.47
Michael
Oftentimes for for those team changes, you don't you don't know until you kind of make it, you know, what what the change is going to be or how the outcomes are going to be. And so I often feel like With engineering stuff, when I'm building things, I try to get as much information as possible, spend as much time as possible to make a decision, you know build stuff, like think about architecture.
28:02.57
Kent
Mm-hmm.
28:04.61
Michael
When we're thinking about ah designs of platform systems, go talk to other people that have built stuff. you know Figure out how they did it at different companies and learn from that. but But things are around building teams and companies and kind of the capital L leadership things, you can read some books.
28:17.89
Michael
There's like kind of general principles around things, but it's really hard. I think it's the reason why there aren't you know There's a lot of books about the getting started phase of companies. It's a lot of lean startup, you know how do you get going and and come up with ideas.
28:31.43
Michael
There's not that many books about the later stages of leadership and growth in companies, good ones.
28:34.85
Kent
yeah right
28:35.45
Michael
you know I think it's because it's pretty situational dependent. And you're usually making the these decisions on a low amount of information. You have 10% to 15% of the information of the picture, and you need to make a decision then.
28:48.05
Michael
if If you wait until you have 90% of the information, you're screwed, you know, like it it's gone way too far, you know, it's, it's, it's metastasized. And so that's one of the challenges I think is kind of like seeing things and extrapolating and being able to make choices and judgment is, is the hardest thing to learn.
29:06.20
Kent
I think the the difficult thing about reflecting on so I talk about the three X's, explore when you're just trying to find product market fit.
29:17.65
Kent
then you Then you find something and and the all the rules of the game change and now you're expanding as fast as possible. And ah people find that, I think, very,
29:31.19
Kent
anxiety producing. It's it's exciting. It's it's ah devours all of your attention. But then you get out of it. And I think people a little like how it women don't remember the details of childbirth.
29:49.33
Kent
It's like, ah You know, a little PTSD, a little. And and then people retcon it. and they Oh, we our success was inevitable. Some people tell that story, which is not true.
30:02.61
Kent
And other people tell the, you know, cliffhanger, barely, you know, the the fedex the FedEx guy playing blackjack to make payroll story.
30:13.52
Kent
And none of those are the truth. There are, it's a different set of skills in that expand phase. And then you have to transition to the extract phase where you can pull capital out of what you've done to feed into the next round of things.
30:28.44
Kent
And all three of those are very different. they They look the same. There's a company, there's a code, but The trade-offs are all completely cattywampus between those phases. and and it is and And people are not, like cognitive biases keep you from accurately reflecting on the most painful, the most under-specified parts of that curve.
31:04.50
Michael
Yeah, you know it often feels like it's a different company every six months.
31:09.85
Kent
Mm-hmm.
31:10.32
Michael
like The name of the door is the same. The paycheck comes from the same corporation. but and And many of the people are the same. you know Most of the people are the same. But but the the phase you need to move into is very different. you know And like the requirements, I think in particular from managers or leaders, like engineers writing code or just kind of building stuff, they're very adaptable.
31:32.48
Michael
But there's a lot of changes happening right now in engineering management. you know Like the role of the pure people manager is is kind of evaporating. I don't know. People management is still very important, obviously. But this idea of like people that kind of get hands off. They're like, I delegate to others or I defer. And my job is to create like this you know kind of psychological safety in the organization of process and and systems.
31:57.06
Michael
That's fallen out in favor of people that are really driving forward customer us usage and value and and and you know driving forward like product shipping and finding business impact, know being very hands-on with teams driving forward that.
32:11.38
Michael
and And I think this is also why you're seeing a lot of even like CTOs of big companies go back to writing code or picking up you know these AI coding tools to actually drive the business value themselves.
32:22.58
Michael
It's really extraordinary how this technology shift in terms of the capabilities of engineers, like what can we make, has changed management.
32:27.17
Kent
Yeah.
32:29.52
Michael
it's actually It's actually really drastically changed the you know management practice for engineering, what companies are looking for. And i I think that might happen across a bunch of different domains. It might happen also across finance and legal and you know sales and support, not just in and engineering.
32:48.63
Kent
So I've spent a bunch of my career, yes, Ann, I've spent a bunch of my career coaching engineers and engineering managers one-on-one. was the beneficiary of that kind of mentorship early in my career.
33:06.46
Kent
um
33:08.56
Kent
Where is that that sense of coaching or mentorship
33:16.62
Kent
One place that happens or happened was in one ah weekly one-on-ones with your direct manager. And they'd go over, you know, so sometimes it was sort of status update, but sometimes it'd be like, oh yeah, I see a trend. you You tend to do this kind of thing. Why don't you try that kind of thing? And some managers were better at it and some worse.
33:38.31
Kent
um But... um if If a manager now has 50 direct reports, where's that mentoring coming from or is that even that obsolete?
33:53.04
Michael
It's a great question. I'm not sure. i do think that software engineering, as we kind of saw it over the last 10, 15 years, like cloud, web, mobile, software engineering stuff,
34:04.84
Michael
um it's pretty unique. you know there's there's like in in other industries, it's very rare, essentially doesn't exist, that you can go into a four-year university program and graduate and immediately start working in the field making six figures.
34:10.34
Kent
Yeah. Mm-hmm.
34:22.14
Michael
You know, now, like, you know, if you think of people joining Lyft and Facebook and whatever, like making 200K a year. Just coming out of undergrad, you know, at at a university. um That does not happen in mechanical engineering.
34:34.99
Michael
It does not happen in chemical engineering. It doesn't happen in architecture, civil engineering. It certainly doesn't happen in medicine. or ah you know the fields of like you know becoming an attorney in the legal space.
34:46.55
Kent
you
34:48.03
Michael
You clerk for someone for many years. So in all these other professional industries, where it's a highly skilled labor force that requires many years of training and and experience to to work up to, there is a process around several years of apprenticeship or additional school.
35:01.68
Michael
you know In architecture, you go to school for another five years after your undergrad. And that is where people learn and develop and they do summer internships and they do, you know, they kind of get, even ah in in the medical space, you know, you have a residency, you might have a fellowship even to do specialized training.
35:18.07
Michael
we We didn't have that in software. You just get hired in as like an L3 at Meta and boom, you're getting paid a ton and you you know take the bus to work and get nice fancy lunches and you know that's that's the process. And so I think it's gonna it's it's not gonna evaporate, but it'll look different. It'll look more like other industries. There'll be more education.
35:38.32
Michael
that happens in schools. It'll be more specialized. When people get roles, I think they'll probably get paid more. you know Once you become a doctor, once you go through the whole medical system, like your first paycheck is is enormous, essentially, after your residency completes.
35:52.22
Michael
um I think it'll kind of look more like that.
36:11.03
Michael
um And then you get hired as a as an expert into this company where the the team, the technology team is relatively small, you don't need 100 engineers, you need like 10 in the company to manage the whole thing.
36:21.86
Michael
And that would look a little bit more close to what it is in the legal profession or what it is in these other systems where there's a lot of you know things built up um but those might change too like i think finance and accounting is up for a big shift you don't really need typical kind of like mechanical accountants doing stuff you need more like strategic finance you need more people thinking about the business model architecture But this thing we had in software engineering for like this moment in time, you know, where like there was this insane demand and like increased
36:53.34
Michael
It was actually providing enormous value to companies. So there was this huge talent demand to the point of us also reaching offshore. You know, we'd go hire coding teams, you know, in other countries.
37:03.47
Michael
I think that has just shifted because the marginal cost of creating software has gone essentially to zero, that the you know, the the cost of writing code. And so we'll see that talent balance out. And it's clear that there's still some engineers, a lot of engineers that we'll still need. We'll probably need in many ways, like more engineers than in the past, because there's more software that's going to get written. But the role of the engineer is going to be different.
37:24.01
Michael
I think it'll be more specialized.
37:24.38
Kent
Yeah, that, So I see that trend also and i always get interested when trends collide.
37:26.95
Michael
Yeah. And so they'll there'll be a process through which we we kind of make that transition and we train up the next set.
37:38.53
Kent
The other trend is de-skilling of software where you need, the the barrier to get something working is dropping.
37:51.76
Kent
So we're going to get more, less skilled people making the kind of decisions that more skilled people used to make.
38:02.68
Michael
Yeah, that's an interesting take.
38:04.04
Kent
And like it's a tug of war, and I don't know which which way that one's going to play out, but it will be interesting to see.
38:04.39
Michael
really thought about it like that. Yeah, yeah.
38:10.97
Kent
the the The point about the marginal cost of software going to zero um e is to me, the I think the the accounting for that is incomplete.
38:24.99
Kent
Okay, i have the I have this feature finished, but how much is this going to cost me to operate?
38:25.41
Michael
Hmm.
38:30.45
Kent
Well, what's the error rate? What's the business cost of the errors that come out of it?
38:35.24
Michael
Thank
38:36.41
Kent
So if we if we say, okay, shipped is done or it's merged, I'm finished. you know the The tendency is always to,
38:48.16
Kent
to have smaller and smaller scopes so that I can have plausible deniability. You know, I say, okay, well, my feature's finished. I'm done, and a big part of my career has been trying to encourage people to expand their scope.
39:04.26
Kent
so Somebody i was listening to a podcast, was out walking this morning, and and somebody was saying, well, I wish there was some way to measure the difference that AI makes in software. And I'm just thinking profit.
39:19.85
Kent
Profit, that's the measure. Yes, it's difficult to attribute Okay, now i now I can generate more lines of code. Does does that result in more profit or less?
39:32.39
Kent
but But people want to they want that small, okay, the number of lines. Okay, no, no, not number. The number of PR. No, no, not the number of PR. You know, the the the number that we actually care about staring us in the face, it's just difficult to and analyze.
39:43.81
Michael
Yeah.
39:49.18
Michael
I actually don't think it's profit, if you're going to measure I think it's speed is the thing. And
39:57.20
Kent
Starting when and and stopping when?
39:57.32
Michael
I actually don't. Yeah, like, that's good way to say this. Like, a So if if you were measuring profit, you know just saying like this company is like more profitable or effective, um I think the the way you would have to do that test is have only one company in the world using AI and see it baseline against the previous way of executing.
40:18.79
Michael
But the challenge is like everybody is doing this now.
40:21.92
Kent
Yeah.
40:22.19
Michael
So there's this there's this thing i read. describing an evolutionary theory called the, it's like the Red Queen evolutionary theory. You remember from Alice in Wonderland story where Alice is is running and running as fast as she can and running as fast she can, the Red Queen is just right next to her the whole time.
40:33.01
Kent
Yeah. Yeah. Mm-hmm.
40:41.06
Michael
um she can't She can't outrun the Red Queen. And it's this idea that in evolution, in the in the wild, you know, and with animals, every single animal is like at its complete limit in terms of striving to survive, trying to evolve. It's it's not like there's a baseline that's not maxed out. Everything's fully maxed out just for survival, just just to exist.
41:04.43
Michael
It's just gonna be like we're all running at the same pace. And so I don't know if we'll actually be more profitable, but I think what'll happen is companies will be able to explore ideas faster, will be able to experiment with things faster, will be able to look at new markets more quickly.
41:19.02
Michael
you know It'll just be more competitive. Just the game has increased in intensity everywhere, universally. And so the main the main thing to do is just if you don't make this transition,
41:30.72
Michael
if you're still running at the lower pace, you'll just fall away. But the whole ecosystem will move forward.
41:34.79
Kent
Yeah. Yeah. Mm-hmm.
41:36.45
Michael
And the level of profit or growth will actually probably ah change.
41:53.37
Michael
They've polluted the rivers and the you know the skies. and And they go through this period of kind of the the dirty transformation. And then eventually, like they clean it up. you know like We did this out in America 100-some years ago.
42:06.27
Michael
that's the phase we're going through right now. Like when when people are talking about, oh, we used our whole token budget for the year and it's only May. It's like, well, like how did you know what the budget was supposed to be? You know, how how expensive is it going to be to go to the moon for the first time?
42:15.08
Kent
Right. Right. Right. Right.
42:18.58
Michael
We had no idea. We just spend whatever it takes, you know, and then and then once you get a baseline, you can optimize from it. But the thing people I think miss right now is that they don't realize we're in this moment of transformation. They think we're just in a moment of of kind of acceleration or or becoming more productive, but it's actually a step function shift. And the goal for all these companies should be to get to the other side of the change as fast as you can and and to figure out this new way of working. And I'm seeing it across like all the organizations the world. they're therere they really
42:51.14
Kent
Oh, last question, what scares you about this? What what wakes you up at night?
42:58.18
Michael
I'm generally a pretty big optimist. So i think that i think that we as people, we as humans are, ah maybe it's our our natural evolution state as animals. We're very good at imagining the negative, the fears. What if the lion reaches out and runs after me? What if the snake bites me? But we're not very good at imagining like what if everything goes right and and what's the upside in it? So I'm naturally kind of, I try to bias that way and be more of an optimist.
43:27.16
Michael
um i think what I think maybe more what concerns me is that this scale of shift, like everyone's talking about AI, it's in all the newspapers, you know it's in TV and stuff.
43:32.39
Kent
Mm-hmm.
43:38.43
Michael
But it's so different that I think people are a little bit fatigued thinking it's just a big technology wave and a shift because they've they've seen crypto, they've seen VR, they've seen the things that that didn't work out. And so they're like oh, this is just another you know technology wave, not realizing that at its core, it has this this momentum around being a labor disruption.
43:56.87
Michael
It's going change the way we work, productivity. And that's the reason why it's going to be so enormous. but it's also gonna have ah extraordinary effects across society and across what it means to work and have jobs.
44:08.41
Michael
And and I agree with Dario you know from from Anthropic around it becoming an enormous like white collar labor disruption. I think i just it's it seems like it's gonna do that.
44:15.46
Kent
Yeah.
44:18.14
Michael
And so I think the scale at that like that change, we we haven't really seen before. you know We haven't really seen that scale of white collar change. And I think we just need, i think it'll be okay on the other side of it. Like we'll we'll make it through it, but I just think it's going to be a big shock to the system.
44:32.60
Michael
And i want more people leaning into it, seeing it, you know, it's kind of like if you ever um ah go go like kayaking, if you ever, like I love kayaking in the Bay and and in San Francisco and stuff. When there's a wave coming at you, when you're kayaking, the most stable position is to be go straight into the wave.
44:48.47
Michael
be paddling, actively going into it. If you're not paddling or you're sideways, you're kind of offset, that's when you can get flipped. you know And so I just want people to paddle into the wave, realize that this is a thing that's happening. And it's going to be great, but it's going to be a big ah big wave to go over. and And the way to hit it is head on.
45:06.64
Kent
All right, thank you so much for your time.
45:09.35
Michael
Thanks for having me, Kent. It's great to see you.