[LIVE] Anthropic Distillation & How Models Cheat (SWE-Bench Dead) | Nathan Lambert & Sebastian Raschka

Turbopuffer came out of a reading app.In 2022, Simon was helping his friends at Readwise scale their infra for a highly requested feature: article recommendations and semantic search. Readwise was paying ~$5k/month for their relational database and vector search would cost ~$20k/month making the feature too expensive to ship. In 2023 after mulling over the problem from Readwise, Simon decided he wanted to “build a search engine” which became Turbopuffer.We discuss:• Simon’s path: Denmark → Shopify infra for nearly a decade → “angel engineering” across startups like Readwise, Replicate, and Causal → turbopuffer almost accidentally becoming a company • The Readwise origin story: building an early recommendation engine right after the ChatGPT moment, seeing it work, then realizing it would cost ~$30k/month for a company spending ~$5k/month total on infra and getting obsessed with fixing that cost structure • Why turbopuffer is “a search engine for unstructured data”: Simon’s belief that models can learn to reason, but can’t compress the world’s knowledge into a few terabytes of weights, so they need to connect to systems that hold truth in full fidelity • The three ingredients for building a great database company: a new workload, a new storage architecture, and the ability to eventually support every query plan customers will want on their data • The architecture bet behind turbopuffer: going all in on object storage and NVMe, avoiding a traditional consensus layer, and building around the cloud primitives that only became possible in the last few years • Why Simon hated operating Elasticsearch at Shopify: years of painful on-call experience shaped his obsession with simplicity, performance, and eliminating state spread across multiple systems • The Cursor story: launching turbopuffer as a scrappy side project, getting an email from Cursor the next day, flying out after a 4am call, and helping cut Cursor’s costs by 95% while fixing their per-user economics • The Notion story: buying dark fiber, tuning TCP windows, and eating cross-cloud costs because Simon refused to compromise on architecture just to close a deal faster • Why AI changes the build-vs-buy equation: it’s less about whether a company can build search infra internally, and more about whether they have time especially if an external team can feel like an extension of their own • Why RAG isn’t dead: coding companies still rely heavily on search, and Simon sees hybrid retrieval semantic, text, regex, SQL-style patterns becoming more important, not less • How agentic workloads are changing search: the old pattern was one retrieval call up front; the new pattern is one agent firing many parallel queries at once, turning search into a highly concurrent tool call • Why turbopuffer is reducing query pricing: agentic systems are dramatically increasing query volume, and Simon expects retrieval infra to adapt to huge bursts of concurrent search rather than a small number of carefully chosen calls • The philosophy of “playing with open cards”: Simon’s habit of being radically honest with investors, including telling Lachy Groom he’d return the money if turbopuffer didn’t hit PMF by year-end • The “P99 engineer”: Simon’s framework for building a talent-dense company, rejecting by default unless someone on the team feels strongly enough to fight for the candidate —Simon Hørup Eskildsen• LinkedIn: https://www.linkedin.com/in/sirupsen• X: https://x.com/Sirupsen• https://sirupsen.com/aboutturbopuffer• https://turbopuffer.com/Full Video PodTimestamps00:00:00 The PMF promise to Lachy Groom00:00:25 Intro and Simon's background00:02:19 What turbopuffer actually is00:06:26 Shopify, Elasticsearch, and the pain behind the company00:10:07 The Readwise experiment that sparked turbopuffer00:12:00 The insight Simon couldn’t stop thinking about00:17:00 S3 consistency, NVMe, and the architecture bet00:20:12 The Notion story: latency, dark fiber, and conviction00:25:03 Build vs. buy in the age of AI00:26:00 The Cursor story: early launch to breakout customer00:29:00 Why code search still matters00:32:00 Search in the age of agents00:34:22 Pricing turbopuffer in the AI era00:38:17 Why Simon chose Lachy Groom00:41:28 Becoming a founder on purpose00:44:00 The “P99 engineer” philosophy00:49:30 Bending software to your will00:51:13 The future of turbopuffer00:57:05 Simon’s tea obsession00:59:03 Tea kits, X Live, and P99 LiveTranscriptSimon Hørup Eskildsen: I don’t think I’ve said this publicly before, but I just called Lockey and was like, local Lockie. Like if this doesn’t have PMF by the end of the year, like we’ll just like return all the money to you. But it’s just like, I don’t really, we, Justine and I don’t wanna work on this unless it’s really working.So we want to give it the best shot this year and like we’re really gonna go for it. We’re gonna hire a bunch of people. We’re just gonna be honest with everyone. Like when I don’t know how to play a game, I just play with open cards. Lockey was the only person that didn’t, that didn’t freak out. He was like, I’ve never heard anyone say that before.Alessio: Hey everyone, welcome to the Leading Space podcast. This is Celesio Pando, Colonel Laz, and I’m joined by Swix, editor of Leading Space.swyx: Hello. Hello, uh, we’re still, uh, recording in the Ker studio for the first time. Very excited. And today we are joined by Simon Eski. Of Turbo Farer welcome.Simon Hørup Eskildsen: Thank you so much for having me.swyx: Turbo Farer has like really gone on a huge tear, and I, I do have to mention that like you’re one of, you’re not my newest member of the Danish AHU Mafia, where like there’s a lot of legendary programmers that have come out of it, like, uh, beyond Trotro, Rasmus, lado Berg and the V eight team and, and Google Maps team.Uh, you’re mostly a Canadian now, but isn’t that interesting? There’s so many, so much like strong Danish presence.Simon Hørup Eskildsen: Yeah, I was writing a post, um, not that long ago about sort of the influences. So I grew up in Denmark, right? I left, I left when, when I was 18 to go to Canada to, to work at Shopify. Um, and so I, like, I’ve, I would still say that I feel more Danish than, than Canadian.This is also the weird accent. I can’t say th because it, this is like, I don’t, you know, my wife is also Canadian, um, and I think. I think like one of the things in, in Denmark is just like, there’s just such a ruthless pragmatism and there’s also a big focus on just aesthetics. Like, they’re like very, people really care about like where, what things look like.Um, and like Canada has a lot of attributes, US has, has a lot of attributes, but I think there’s been lots of the great things to carry. I don’t know what’s in the water in Ahu though. Um, and I don’t know that I could be considered part of the Mafi mafia quite yet, uh, compared to the phenomenal individuals we just mentioned.Barra OV is also, uh, Danish Canadian. Okay. Yeah. I don’t know where he lives now, but, and he’s the PHP.swyx: Yeah. And obviously Toby German, but moved to Canada as well. Yes. Like this is like import that, uh, that, that is an interesting, um, talent move.Alessio: I think. I would love to get from you. Definition of Turbo puffer, because I think you could be a Vector db, which is maybe a bad word now in some circles, you could be a search engine.It’s like, let, let’s just start there and then we’ll maybe run through the history of how you got to this point.Simon Hørup Eskildsen: For sure. Yeah. So Turbo Puffer is at this point in time, a search engine, right? We do full text search and we do vector search, and that’s really what we’re specialized in. If you’re trying to do much more than that, like then this might not be the right place yet, but Turbo Buffer is all about search.The other way that I think about it is that we can take all of the world’s knowledge, all of the exabytes and exabytes of data that there is, and we can use those tokens to train a model, but we can’t compress all of that into a few terabytes of weights, right? Compress into a few terabytes of weights, how to reason with the world, how to make sense of the knowledge.But we have to somehow connect it to something externally that actually holds that like in full fidelity and truth. Um, and that’s the thing that we intend to become. Right? That’s like a very holier than now kind of phrasing, right? But being the search engine for unstructured, unstructured data is the focus of turbo puffer at this point in time.Alessio: And let’s break down. So people might say, well, didn’t Elasticsearch already do this? And then some other people might say, is this search on my data, is this like closer to rag than to like a xr, like a public search thing? Like how, how do you segment like the different types of search?Simon Hørup Eskildsen: The way that I generally think about this is like, there’s a lot of database companies and I think if you wanna build a really big database company, sort of, you need a couple of ingredients to be in the air.We don’t, which only happens roughly every 15 years. You need a new workload. You basically need the ambition that every single company on earth is gonna have data in your database. Multiple times you look at a company like Oracle, right? You will, like, I don’t think you can find a company on earth with a digital presence that it not, doesn’t somehow have some data in an Oracle database.Right? And I think at this point, that’s also true for Snowflake and Databricks, right? 15 years later it’s, or even more than that, there’s not a company on earth that doesn’t, in. Or directly is consuming Snowflake or, or Databricks or any of the big analytics databases. Um, and I think we’re in that kind of moment now, right?I don’t think you’re gonna find a company over the next few years that doesn’t directly or indirectly, um, have all their data available for, for search and connect it to ai. So you need that new workload, like you need something to be happening where there’s a new workload that causes that to happen, and that new workload is connecting very large amounts of data to ai.The second thing you need. The second condition to build a big database company is that you need some new underlying change in the storage architecture that is not possible from the databases that have come before you. If you look at Snowflake and Databricks, right, commoditized, like massive fleet of HDDs, like that was not possible in it.It just wasn’t in the air in the nineties, right? So you just didn’t, we just didn’t build these systems. S3 and and and so on was not around. And I think the architecture that is now possible that wasn’t possible 15 years ago is to go all in on NVME SSDs. It requires a particular type of architecture for the database that.It’s difficult to retrofit onto the databases that are already there, including the ones you just mentioned. The second thing is to go all in on OIC storage, more so than we could have done 15 years ago. Like we don’t have a consensus layer, we don’t really have anything. In fact, you could turn off all the servers that Turbo Buffer has, and we would not lose any data because we have all completely all in on OIC storage.And this means that our architecture is just so simple. So that’s the second condition, right? First being a new workload. That means that every company on earth, either indirectly or directly, is using your database. Second being, there’s some new storage architecture. That means that the, the companies that have come before you can do what you’re doing.I think the third thing you need to do to build a big database company is that over time you have to implement more or less every Cory plan on the data. What that means is that you. You can’t just get stuck in, like, this is the one thing that a database does. It has to be ever evolving because when someone has data in the database, they over time expect to be able to ask it more or less every question.So you have to do that to get the storage architecture to the limit of what, what it’s capable of. Those are the three conditions.swyx: I just wanted to get a little bit of like the motivation, right? Like, so you left Shopify, you’re like principal, engineer, infra guy. Um, you also head of kernel labs, uh, inside of Shopify, right?And then you consulted for read wise and that it kind of gave you that, that idea. I just wanted you to tell that story. Um, maybe I, you’ve told it before, but, uh, just introduce the, the. People to like the, the new workload, the sort of aha moment for turbo PufferSimon Hørup Eskildsen: For sure. So yeah, I spent almost a decade at Shopify.I was on the infrastructure team, um, from the fairly, fairly early days around 2013. Um, at the time it felt like it was growing so quickly and everything, all the metrics were, you know, doubling year on year compared to the, what companies are contending with today. It’s very cute in growth. I feel like lot some companies are seeing that month over month.Um, of course. Shopify compound has been compounding for a very long time now, but I spent a decade doing that and the majority of that was just make sure the site is up today and make sure it’s up a year from now. And a lot of that was really just the, um, you know, uh, the Kardashians would drive very, very large amounts of, of data to, to uh, to Shopify as they were rotating through all the merch and building out their businesses.And we just needed to make sure we could handle that. Right. And sometimes these were events, a million requests per second. And so, you know, we, we had our own data centers back in the day and we were moving to the cloud and there was so much sharding work and all of that that we were doing. So I spent a decade just scaling databases ‘cause that’s fundamentally what’s the most difficult thing to scale about these sites.The database that was the most difficult for me to scale during that time, and that was the most aggravating to be on call for, was elastic search. It was very, very difficult to deal with. And I saw a lot of projects that were just being held back in their ambition by using it.swyx: And I mean, self-hosted.Self-hosted. ‘causeSimon Hørup Eskildsen: it’s, yeah, and it commercial, this is like 2015, right? So it’s like a very particular vintage. Right. It’s probably better at a lot of these things now. Um, it was difficult to contend with and I’m just like, I just think about it. It’s an inverted index. It should be good at these kinds of queries and do all of this.And it was, we, we often couldn’t get it to do exactly what we needed to do or basically get lucine to do, like expose lucine raw to, to, to what we needed to do. Um, so that was like. Just something that we did on the side and just panic scaled when we needed to, but not a particular focus of mine. So I left, and when I left, I, um, wasn’t sure exactly what I wanted to do.I mean, it spent like a decade inside of the same company. I’d like grown up there. I started working there when I was 18.swyx: You only do Rails?Simon Hørup Eskildsen: Yeah. I mean, yeah. Rails. And he’s a Rails guy. Uh, love Rails. So good. Um,Alessio: we all wish we could still work in Rails.swyx: I know know. I know, but some, I tried learning Ruby.It’s just too much, like too many options to do the same thing. It’s, that’s my, I I know there’s a, there’s a way to do it.Simon Hørup Eskildsen: I love it. I don’t know that I would use it now, like given cloud code and, and, and cursor and everything, but, um, um, but still it, like if I’m just sitting down and writing a teal code, that’s how I think.But anyway, I left and I wasn’t, I talked to a couple companies and I was like, I don’t. I need to see a little bit more of the world here to know what I’m gonna like focus on next. Um, and so what I decided is like I was gonna, I called it like angel engineering, where I just hopped around in my friend’s companies in three months increments and just helped them out with something.Right. And, and just vested a bit of equity and solved some interesting infrastructure problem. So I worked with a bunch of companies at the time, um, read Wise was one of them. Replicate was one of them. Um, causal, I dunno if you’ve tried this, it’s like a, it’s a spreadsheet engine Yeah. Where you can do distribution.They sold recently. Yeah. Um, we’ve been, we used that in fp and a at, um, at Turbo Puffer. Um, so a bunch of companies like this and it was super fun. And so we’re the Chachi bt moment happened, I was with. With read Wise for a stint, we were preparing for the reader launch, right? Which is where you, you cue articles and read them later.And I was just getting their Postgres up to snuff, like, which basically boils down to tuning, auto vacuum. So I was doing that and then this happened and we were like, oh, maybe we should build a little recommendation engine and some features to try to hook in the lms. They were not that good yet, but it was clear there was something there.And so I built a small recommendation engine just, okay, let’s take the articles that you’ve recently read, right? Like embed all the articles and then do recommendations. It was good enough that when I ran it on one of the co-founders of Rey’s, like I found out that I got articles about, about having a child.I’m like, oh my God, I didn’t, I, I didn’t know that, that they were having a child. I wasn’t sure what to do with that information, but the recommendation engine was good enough that it was suggesting articles, um, about that. And so there was, there was recommendations and uh, it actually worked really well.But this was a company that was spending maybe five grand a month in total on all their infrastructure and. When I did the napkin math on running the embeddings of all the articles, putting them into a vector index, putting it in prod, it’s gonna be like 30 grand a month. That just wasn’t tenable. Right?Like Read Wise is a proudly bootstrapped company and it’s paying 30 grand for infrastructure for one feature versus five. It just wasn’t tenable. So sort of in the bucket of this is useful, it’s pretty good, but let us, let’s return to it when the costs come down.swyx: Did you say it grows by feature? So for five to 30 is by the number of, like, what’s the, what’s the Scaling factor scale?It scales by the number of articles that you embed.Simon Hørup Eskildsen: It does, but what I meant by that is like five grand for like all of the other, like the Heroku, dinos, Postgres, like all the other, and this then storage is 30. Yeah. And then like 30 grand for one feature. Right. Which is like, what other articles are related to this one.Um, so it was just too much right to, to power everything. Their budget would’ve been maybe a few thousand dollars, which still would’ve been a lot. And so we put it in a bucket of, okay, we’re gonna do that later. We’ll wait, we will wait for the cost to come down. And that haunted me. I couldn’t stop thinking about it.I was like, okay, there’s clearly some latent demand here. If the cost had been a 10th, we would’ve shipped it and. This was really the only data point that I had. Right. I didn’t, I, I didn’t, I didn’t go out and talk to anyone else. It was just so I started reading Right. I couldn’t, I couldn’t help myself.Like I didn’t know what like a vector index is. I, I generally barely do about how to generate the vectors. There was a lot of hype about, this is a early 2023. There was a lot of hype about vector databases. There were raising a lot of money and it’s like, I really didn’t know anything about it. It’s like, you know, trying these little models, fine tuning them.Like I was just trying to get sort of a lay of the land. So I just sat down. I have this. A GitHub repository called Napkin Math. And on napkin math, there’s just, um, rows of like, oh, this is how much bandwidth. Like this is how many, you know, you can do 25 gigabytes per second on average to dram. You can do, you know, five gigabytes per second of rights to an SSD, blah blah.All of these numbers, right? And S3, how many you could do per, how much bandwidth can you drive per connection? I was just sitting down, I was like, why hasn’t anyone build a database where you just put everything on O storage and then you puff it into NVME when you use the data and you puff it into dram if you’re, if you’re querying it alive, it’s just like, this seems fairly obvious and you, the only real downside to that is that if you go all in on o storage, every right will take a couple hundred milliseconds of latency, but from there it’s really all upside, right?You do the first go, it takes half a second. And it sort of occurred to me as like, well. The architecture is really good for that. It’s really good for AB storage, it’s really good for nvm ESSD. It’s, well, you just couldn’t have done that 10 years ago. Back to what we were talking about before. You really have to build a database where you have as few round trips as possible, right?This is how CPUs work today. It’s how NVM E SSDs work. It’s how as, um, as three works that you want to have a very large amount of outstanding requests, right? Like basically go to S3, do like that thousand requests to ask for data in one round trip. Wait for that. Get that, like, make a new decision. Do it again, and try to do that maybe a maximum of three times.But no databases were designed that way within NVME as is ds. You can drive like within, you know, within a very low multiple of DRAM bandwidth if you use it that way. And same with S3, right? You can fully max out the network card, which generally is not maxed out. You get very, like, very, very good bandwidth.And, but no one had built a database like that. So I was like, okay, well can’t you just, you know, take all the vectors right? And plot them in the proverbial coordinate system. Get the clusters, put a file on S3 called clusters, do json, and then put another file for every cluster, you know, cluster one, do js O cluster two, do js ON you know that like it’s two round trips, right?So you get the clusters, you find the closest clusters, and then you download the cluster files like the, the closest end. And you could do this in two round trips.swyx: You were nearest neighbors locally.Simon Hørup Eskildsen: Yes. Yes. And then, and you would build this, this file, right? It’s just like ultra simplistic, but it’s not a far shot from what the first version of Turbo Buffer was.Why hasn’t anyone done thatAlessio: in that moment? From a workload perspective, you’re thinking this is gonna be like a read heavy thing because they’re doing recommend. Like is the fact that like writes are so expensive now? Oh, with ai you’re actually not writing that much.Simon Hørup Eskildsen: At that point I hadn’t really thought too much about, well no actually it was always clear to me that there was gonna be a lot of rights because at Shopify, the search clusters were doing, you know, I don’t know, tens or hundreds of crew QPS, right?‘cause you just have to have a human sit and type in. But we did, you know, I don’t know how many updates there were per second. I’m sure it was in the millions, right into the cluster. So I always knew there was like a 10 to 100 ratio on the read write. In the read wise use case. It’s, um, even, even in the read wise use case, there’d probably be a lot fewer reads than writes, right?There’s just a lot of churn on the amount of stuff that was going through versus the amount of queries. Um, I wasn’t thinking too much about that. I was mostly just thinking about what’s the fundamentally cheapest way to build a database in the cloud today using the primitives that you have available.And this is it, right? You just, now you have one machine and you know, let’s say you have a terabyte of data in S3, you paid the $200 a month for that, and then maybe five to 10% of that data and needs to be an NV ME SSDs and less than that in dram. Well. You’re paying very, very little to inflate the data.swyx: By the way, when you say no one else has done that, uh, would you consider Neon, uh, to be on a similar path in terms of being sort of S3 first and, uh, separating the compute and storage?Simon Hørup Eskildsen: Yeah, I think what I meant with that is, uh, just build a completely new database. I don’t know if we were the first, like it was very much, it was, I mean, I, I hadn’t, I just looked at the napkin math and was like, this seems really obvious.So I’m sure like a hundred people came up with it at the same time. Like the light bulb and every invention ever. Right. It was just in the air. I think Neon Neon was, was first to it. And they’re trying, they’re retrofitted onto Postgres, right? And then they built this whole architecture where you have, you have it in memory and then you sort of.You know, m map back to S3. And I think that was very novel at the time to do it for, for all LTP, but I hadn’t seen a database that was truly all in, right. Not retrofitting it. The database felt built purely for this no consensus layer. Even using compare and swap on optic storage to do consensus. I hadn’t seen anyone go that all in.And I, I mean, there, there, I’m sure there was someone that did that before us. I don’t know. I was just looking at the napkin mathswyx: and, and when you say consensus layer, uh, are you strongly relying on S3 Strong consistency? You are. Okay.SoSimon Hørup Eskildsen: that is your consensus layer. It, it is the consistency layer. And I think also, like, this is something that most people don’t realize, but S3 only became consistent in December of 2020.swyx: I remember this coming out during COVID and like people were like, oh, like, it was like, uh, it was just like a free upgrade.Simon Hørup Eskildsen: Yeah.swyx: They were just, they just announced it. We saw consistency guys and like, okay, cool.Simon Hørup Eskildsen: And I’m sure that they just, they probably had it in prod for a while and they’re just like, it’s done right.And people were like, okay, cool. But. That’s a big moment, right? Like nv, ME SSDs, were also not in the cloud until around 2017, right? So you just sort of had like 2017 nv, ME SSDs, and people were like, okay, cool. There’s like one skew that does this, whatever, right? Takes a few years. And then the second thing is like S3 becomes consistent in 2020.So now it means you don’t have to have this like big foundation DB or like zookeeper or whatever sitting there contending with the keys, which is how. You know, that’s what Snowflake and others have do so muchswyx: for goneSimon Hørup Eskildsen: Exactly. Just gone. Right? And so just push to the, you know, whatever, how many hundreds of people they have working on S3 solved and then compare and swap was not in S3 at this point in time,swyx: by the way.Uh, I don’t know what that is, so maybe you wanna explain. Yes. Yeah.Simon Hørup Eskildsen: Yes. So, um, what Compare and swap is, is basically, you can imagine that if you have a database, it might be really nice to have a file called metadata json. And metadata JSON could say things like, Hey, these keys are here and this file means that, and there’s lots of metadata that you have to operate in the database, right?But that’s the simplest way to do it. So now you have might, you might have a lot of servers that wanna change the metadata. They might have written a file and want the metadata to contain that file. But you have a hundred nodes that are trying to contend with this metadata that JSON well, what compare and Swap allows you to do is basically just you download the file, you make the modifications, and then you write it only if it hasn’t changed.While you did the modification and if not you retry. Right? Should just have this retry loops. Now you can imagine if you have a hundred nodes doing that, it’s gonna be really slow, but it will converge over time. That primitive was not available in S3. It wasn’t available in S3 until late 2024, but it was available in GCP.The real story of this is certainly not that I sat down and like bake brained it. I was like, okay, we’re gonna start on GCS S3 is gonna get it later. Like it was really not that we started, we got really lucky, like we started on GCP and we started on GCP because tur um, Shopify ran on GCP. And so that was the platform I was most available with.Right. Um, and I knew the Canadian team there ‘cause I’d worked with them at Shopify and so it was natural for us to start there. And so when we started building the database, we’re like, oh yeah, we have to build a, we really thought we had to build a consensus layer, like have a zookeeper or something to do this.But then we discovered the compare and swap. It’s like, oh, we can kick the can. Like we’ll just do metadata r json and just, it’s fine. It’s probably fine. Um, and we just kept kicking the can until we had very, very strong conviction in the idea. Um, and then we kind of just hinged the company on the fact that S3 probably was gonna get this, it started getting really painful in like mid 2024.‘cause we were closing deals with, um, um, notion actually that was running in AWS and we’re like, trust us. You, you really want us to run this in GCP? And they’re like, no, I don’t know about that. Like, we’re running everything in AWS and the latency across the cloud were so big and we had so much conviction that we bought like, you know, dark fiber between the AWS regions in, in Oregon, like in the InterExchange and GCP is like, we’ve never seen a startup like do like, what’s going on here?And we’re just like, no, we don’t wanna do this. We were tuning like TCP windows, like everything to get the latency down ‘cause we had so high conviction in not doing like a, a metadata layer on S3. So those were the three conditions, right? Compare and swap. To do metadata, which wasn’t in S3 until late 2024 S3 being consistent, which didn’t happen until December, 2020.Uh, 2020. And then NVMe ssd, which didn’t end in the cloud until 2017.swyx: I mean, in some ways, like a very big like cloud success story that like you were able to like, uh, put this all together, but also doing things like doing, uh, bind our favor. That that actually is something I’ve never heard.Simon Hørup Eskildsen: I mean, it’s very common when you’re a big company, right?You’re like connecting your own like data center or whatever. But it’s like, it was uniquely just a pain with notion because the, um, the org, like most of the, like if you’re buying in Ashburn, Virginia, right? Like US East, the Google, like the GCP and, and AWS data centers are like within a millisecond on, on each other, on the public exchanges.But in Oregon uniquely, the GCP data center sits like a couple hundred kilometers, like east of Portland and the AWS region sits in Portland, but the network exchange they go through is through Seattle. So it’s like a full, like 14 milliseconds or something like that. And so anyway, yeah. It’s, it’s, so we were like, okay, we can’t, we have to go through an exchange in Portland.Yeah. Andswyx: you’d rather do this than like run your zookeeper and likeSimon Hørup Eskildsen: Yes. Way rather. It doesn’t have state, I don’t want state and two systems. Um, and I think all that is just informed by Justine, my co-founder and I had just been on call for so long. And the worst outages are the ones where you have state in multiple places that’s not syncing up.So it really came from, from a a, like just a, a very pure source of pain, of just imagining what we would be Okay. Being woken up at 3:00 AM about and having something in zookeeper was not one of them.swyx: You, you’re talking to like a notion or something. Do they care or do they just, theySimon Hørup Eskildsen: just, they care about latency.swyx: They latency cost. That’s it.Simon Hørup Eskildsen: They just cared about latency. Right. And we just absorbed the cost. We’re just like, we have high conviction in this. At some point we can move them to AWS. Right. And so we just, we, we’ll buy the fiber, it doesn’t matter. Right. Um, and it’s like $5,000. Usually when you buy fiber, you buy like multiple lines.And we’re like, we can only afford one, but we will just test it that when it goes over the public internet, it’s like super smooth. And so we did a lot of, anyway, it’s, yeah, it was, that’s cool.Alessio: You can imagine talking to the GCP rep and it’s like, no, we’re gonna buy, because we know we’re gonna turn, we’re gonna turn from you guys and go to AWS in like six months.But in the meantime we’ll do this. It’sSimon Hørup Eskildsen: a, I mean, like they, you know, this workload still runs on GCP for what it’s worth. Right? ‘cause it’s so, it was just, it was so reliable. So it was never about moving off GCP, it was just about honesty. It was just about giving notion the latency that they deserved.Right. Um, and we didn’t want ‘em to have to care about any of this. We also, they were like, oh, egress is gonna be bad. It was like, okay, screw it. Like we’re just gonna like vvc, VPC peer with you and AWS we’ll eat the cost. Yeah. Whatever needs to be done.Alessio: And what were the actual workloads? Because I think when you think about ai, it’s like 14 milliseconds.It’s like really doesn’t really matter in the scheme of like a model generation.Simon Hørup Eskildsen: Yeah. We were told the latency, right. That we had to beat. Oh, right. So, so we’re just looking at the traces. Right. And then sort of like hand draw, like, you know, kind of like looking at the trace and then thinking what are the other extensions of the trace?Right. And there’s a lot more to it because it’s also when you have, if you have 14 versus seven milliseconds, right. You can fit in another round trip. So we had to tune TCP to try to send as much data in every round trip, prewarm all the connections. And there was, there’s a lot of things that compound from having these kinds of round trips, but in the grand scheme it was just like, well, we have to beat the latency of whatever we’re up against.swyx: Which is like they, I mean, notion is a database company. They could have done this themselves. They, they do lots of database engineering themselves. How do you even get in the door? Like Yeah, just like talk through that kind of.Simon Hørup Eskildsen: Last time I was in San Francisco, I was talking to one of the engineers actually, who, who was one of our champions, um, at, AT Notion.And they were, they were just trying to make sure that the, you know, per user cost matched the economics that they needed. You know, Uhhuh like, it’s like the way I think about, it’s like I have to earn a return on whatever the clouds charge me and then my customers have to earn a return on that. And it’s like very simple, right?And so there has to be gross margin all the way up and that’s how you build the product. And so then our customers have to make the right set of trade off the turbo Puffer makes, and if they’re happy with that, that’s great.swyx: Do you feel like you’re competing with build internally versus buy or buy versus buy?Simon Hørup Eskildsen: Yeah, so, sorry, this was all to build up to your question. So one of the notion engineers told me that they’d sat and probably on a napkin, like drawn out like, why hasn’t anyone built this? And then they saw terrible. It was like, well, it literally that. So, and I think AI has also changed the buy versus build equation in terms of, it’s not really about can we build it, it’s about do we have time to build it?I think they like, I think they felt like, okay, if this is a team that can do that and they, they feel enough like an extension of our team, well then we can go a lot faster, which would be very, very good for them. And I mean, they put us through the, through the test, right? Like we had some very, very long nights to to, to do that POC.And they were really our biggest, our second big customer off the cursor, which also was a lot of late nights. Right.swyx: Yeah. That, I mean, should we go into that story? The, the, the sort of Chris’s story, like a lot, um, they credit you a lot for. Working very closely with them. So I just wanna hear, I’ve heard this, uh, story from Sole’s point of view, but like, I’m curious what, what it looks like from your side.Simon Hørup Eskildsen: I actually haven’t heard it from Sole’s point of view, so maybe you can now cross reference it. The way that I remember it was that, um, the day after we launched, which was just, you know, I’d worked the whole summer on, on the first version. Justine wasn’t part of it yet. ‘cause I just, I didn’t tell anyone that summer that I was working on this.I was just locked in on building it because it’s very easy otherwise to confuse talking about something to actually doing it. And so I was just like, I’m not gonna do that. I’m just gonna do the thing. I launched it and at this point turbo puffer is like a rust binary running on a single eight core machine in a T Marks instance.And me deploying it was like looking at the request log and then like command seeing it or like control seeing it to just like, okay, there’s no request. Let’s upgrade the binary. Like it was like literally the, the, the, the scrappiest thing. You could imagine it was on purpose because just like at Shopify, we did that all the time.Like, we like move, like we ran things in tux all the time to begin with. Before something had like, at least the inkling of PMF, it was like, okay, is anyone gonna hear about this? Um, and one of the cursor co-founders Arvid reached out and he just, you know, the, the cursor team are like all I-O-I-I-M-O like, um, contenders, right?So they just speak in bullet points and, and facts. It was like this amazing email exchange just of, this is how many QPS we have, this is what we’re paying, this is where we’re going, blah, blah, blah. And so we’re just conversing in bullet points. And I tried to get a call with them a few times, but they were, so, they were like really writing the PMF bowl here, just like late 2023.And one time Swally emails me at like five. What was it like 4:00 AM Pacific time saying like, Hey, are you open for a call now? And I’m on the East coast and I, it was like 7:00 AM I was like, yeah, great, sure, whatever. Um, and we just started talking and something. Then I didn’t know anything about sales.It was something that just comp compelled me. I have to go see this team. Like, there’s something here. So I, I went to San Francisco and I went to their office and the way that I remember it is that Postgres was down when I showed up at the office. Did SW tell you this? No. Okay. So Postgres was down and so it’s like they were distracting with that.And I was trying my best to see if I could, if I could help in any way. Like I knew a little bit about databases back to tuning, auto vacuum. It was like, I think you have to tune out a vacuum. Um, and so we, we talked about that and then, um, that evening just talked about like what would it look like, what would it look like to work with us?And I just said. Look like we’re all in, like we will just do what we’ll do whatever, whatever you tell us, right? They migrated everything over the next like week or two, and we reduced their cost by 95%, which I think like kind of fixed their per user economics. Um, and it solved a lot of other things. And we were just, Justine, this is also when I asked Justine to come on as my co-founder, she was the best engineer, um, that I ever worked with at Shopify.She lived two blocks away and we were just, okay, we’re just gonna get this done. Um, and we did, and so we helped them migrate and we just worked like hell over the next like month or two to make sure that we were never an issue. And that was, that was the cursor story. Yeah.swyx: And, and is code a different workload than normal text?I, I don’t know. Is is it just text? Is it the same thing?Simon Hørup Eskildsen: Yeah, so cursor’s workload is basically, they, um, they will embed the entire code base, right? So they, they will like chunk it up in whatever they would, they do. They have their own embedding model, um, which they’ve been public about. Um, and they find that on, on, on their evals.It. There’s one of their evals where it’s like a 25% improvement on a very particular workload. They have a bunch of blog posts about it. Um, I think it works best on larger code basis, but they’ve trained their own embedding model to do this. Um, and so you’ll see it if you use the cursor agent, it will do searches.And they’ve also been public around, um, how they’ve, I think they post trained their model to be very good at semantic search as well. Um, and that’s, that’s how they use it. And so it’s very good at, like, can you find me on the code that’s similar to this, or code that does this? And just in, in this queries, they also use GR to supplement it.swyx: Yeah.Simon Hørup Eskildsen: Um, of courseswyx: it’s been a big topic of discussion like, is rag dead because gr you know,Simon Hørup Eskildsen: and I mean like, I just, we, we see lots of demand from the coding company to ethicsswyx: search in every part. Yes.Simon Hørup Eskildsen: Uh, we, we, we see demand. And so, I mean, I’m. I like case studies. I don’t like, like just doing like thought pieces on this is where it’s going.And like trying to be all macroeconomic about ai, that’s has turned out to be a giant waste of time because no one can really predict any of this. So I just collect case studies and I mean, cursor has done a great job talking about what they’re doing and I hope some of the other coding labs that use Turbo Puffer will do the same.Um, but it does seem to make a difference for particular queries. Um, I mean we can also do text, we can also do RegX, but I should also say that cursors like security posture into Tur Puffer is exceptional, right? They have their own embedding model, which makes it very difficult to reverse engineer. They obfuscate the file paths.They like you. It’s very difficult to learn anything about a code base by looking at it. And the other thing they do too is that for their customers, they encrypt it with their encryption keys in turbo puffer’s bucket. Um, so it’s, it’s, it’s really, really well designed.swyx: And so this is like extra stuff they did to work with you because you are not part of Cursor.Exactly like, and this is just best practice when working in any database, not just you guys. Okay. Yeah, that makes sense. Yeah. I think for me, like the, the, the learning is kind of like you, like all workloads are hybrid. Like, you know, uh, like you, you want the semantic, you want the text, you want the RegX, you want sql.I dunno. Um, but like, it’s silly to like be all in on like one particularly query pattern.Simon Hørup Eskildsen: I think, like I really like the way that, um, um, that swally at cursor talks about it, which is, um, I’m gonna butcher it here. Um, and you know, I’m a, I’m a database scalability person. I’m not a, I, I dunno anything about training models other than, um, what the internet tells me and what.The way he describes is that this is just like cash compute, right? It’s like you have a point in time where you’re looking at some particular context and focused on some chunk and you say, this is the layer of the neural net at this point in time. That seems fundamentally really useful to do cash compute like that.And, um, how the value of that will change over time. I’m, I’m not sure, but there seems to be a lot of value in that.Alessio: Maybe talk a bit about the evolution of the workload, because even like search, like maybe two years ago it was like one search at the start of like an LLM query to build the context. Now you have a gentech search, however you wanna call it, where like the model is both writing and changing the code and it’s searching it again later.Yeah. What are maybe some of the new types of workloads or like changes you’ve had to make to your architecture for it?Simon Hørup Eskildsen: I think you’re right. When I think of rag, I think of, Hey, there’s an 8,000 token, uh, context window and you better make it count. Um, and search was a way to do that now. Everything is moving towards the, just let the agent do its thing.Right? And so back to the thing before, right? The LLM is very good at reasoning with the data, and so we’re just the tool call, right? And that’s increasingly what we see our customers doing. Um, what we’re seeing more demand from, from our customers now is to do a lot of concurrency, right? Like Notion does a ridiculous amount of queries in every round trip just because they can’t.And I’m also now, when I use the cursor agent, I also see them doing more concurrency than I’ve ever seen before. So a bit similar to how we designed a database to drive as much concurrency in every round trip as possible. That’s also what the agents are doing. So that’s new. It means just an enormous amount of queries all at once to the dataset while it’s warm in as few turns as possible.swyx: Can I clarify one thing on that?Simon Hørup Eskildsen: Yes.swyx: Is it, are they batching multiple users or one user is driving multiple,Simon Hørup Eskildsen: one user driving multiple, one agent driving.swyx: It’s parallel searching a bunch of things.Simon Hørup Eskildsen: Exactly.swyx: Yeah. Yeah, exactly. So yeah, the clinician also did, did this for the fast context thing, like eight parallel at once.Simon Hørup Eskildsen: Yes.swyx: And, and like an interesting problem is, well, how do you make sure you have enough diversity so you’re not making the the same request eight times?Simon Hørup Eskildsen: And I think like that’s probably also where the hybrid comes in, where. That’s another way to diversify. It’s a completely different way to, to do the search.That’s a big change, right? So before it was really just like one call and then, you know, the LLM took however many seconds to return, but now we just see an enormous amount of queries. So the, um, we just see more queries. So we’ve like tried to reduce query, we’ve reduced query pricing. Um, this is probably the first time actually I’m saying that, but the query pricing is being reduced, like five x.Um, and we’ll probably try to reduce it even more to accommodate some of these workloads of just doing very large amounts of queries. Um, that’s one thing that’s changed. I think the right, the right ratio is still very high, right? Like there’s still a, an enormous amount of rights per read, but we’re starting probably to see that change if people really lean into this pattern.Alessio: Can we talk a little bit about the pricing? I’m curious, uh, because traditionally a database would charge on storage, but now you have the token generation that is so expensive, where like the actual. Value of like a good search query is like much higher because they’re like saving inference time down the line.How do you structure that as like, what are people receptive to on the other side too?Simon Hørup Eskildsen: Yeah. I, the, the turbo puffer pricing in the beginning was just very simple. The pricing on these on for search engines before Turbo Puffer was very server full, right? It was like, here’s the vm, here’s the per hour cost, right?Great. And I just sat down with like a piece of paper and said like, if Turbo Puffer was like really good, this is probably what it would cost with a little bit of margin. And that was the first pricing of Turbo Puffer. And I just like sat down and I was like, okay, like this is like probably the storage amp, but whenever on a piece of paper I, it was vibe pricing.It was very vibe price, and I got it wrong. Oh. Um, well I didn’t get it wrong, but like Turbo Puffer wasn’t at the first principle pricing, right? So when Cursor came on Turbo Puffer, it was like. Like, I didn’t know any VCs. I didn’t know, like I was just like, I don’t know, I didn’t know anything about raising money or anything like that.I just saw that my GCP bill was, was high, was a lot higher than the cursor bill. So Justine and I was just like, well, we have to optimize it. Um, and I mean, to the chagrin now of, of it, of, of the VCs, it now means that we’re profitable because we’ve had so much pricing pressure in the beginning. Because it was running on my credit card and Justine and I had spent like, like tens of thousands of dollars on like compute bills and like spinning off the company and like very like, like bad Canadian lawyers and like things like to like get all of this done because we just like, we didn’t know.Right. If you’re like steeped in San Francisco, you’re just like, you just know. Okay. Like you go out, raise a pre-seed round. I, I never heard a word pre-seed at this point in time.swyx: When you had Cursor, you had Notion you, you had no funding.Simon Hørup Eskildsen: Um, with Cursor we had no funding. Yeah. Um, by the time we had Notion Locke was, Locke was here.Yeah. So it was really just, we vibe priced it 100% from first Principles, but it wasn’t, it, it was not performing at first principles, so we just did everything we could to optimize it in the beginning for that, so that at least we could have like a 5% margin or something. So I wasn’t freaking out because Cursor’s bill was also going like this as they were growing.And so my liability and my credit limit was like actively like calling my bank. It was like, I need a bigger credit. Like it was, yeah. Anyway, that was the beginning. Yeah. But the pricing was, yeah, like storage rights and query. Right. And the, the pricing we have today is basically just that pricing with duct tape and spit to try to approach like, you know, like a, as a margin on the physical underlying hardware.And we’re doing this year, you’re gonna see more and more pricing changes from us. Yeah.swyx: And like is how much does stuff like VVC peering matter because you’re working in AWS land where egress is charged and all that, you know.Simon Hørup Eskildsen: We probably don’t like, we have like an enterprise plan that just has like a base fee because we haven’t had time to figure out SKU pricing for all of this.Um, but I mean, yeah, you can run turbo puffer either in SaaS, right? That’s what Cursor does. You can run it in a single tenant cluster. So it’s just you. That’s what Notion does. And then you can run it in, in, in BYOC where everything is inside the customer’s VPC, that’s what an for example, philanthropic does.swyx: What I’m hearing is that this is probably the best CRO job for somebody who can come in and,Simon Hørup Eskildsen: I mean,swyx: help you with this.Simon Hørup Eskildsen: Um, like Turbo Puffer hired, like, I don’t know what, what number this was, but we had a full-time CFO as like the 12th hire or something at Turbo Puffer, um, I think I hear are a lot of comp.I don’t know how they do it. Like they have a hundred employees and not a CFO. It’s like having a CFO is like a runningswyx: business man. Like, you know,Simon Hørup Eskildsen: it’s so good. Yeah, like money Mike, like he just, you know, just handles the money and a lot of the business stuff and so he came in and just hopped with a lot of the operational side of the business.So like C-O-O-C-F-O, like somewhere in between.swyx: Just as quick mention of Lucky, just ‘cause I’m curious, I’ve met Lock and like, he’s obviously a very good investor and now on physical intelligence, um, I call it generalist super angel, right? He invests in everything. Um, and I always wonder like, you know, is there something appealing about focusing on developer tooling, focusing on databases, going like, I’ve invested for 10 years in databases versus being like a lock where he can maybe like connect you to all the customers that you need.Simon Hørup Eskildsen: This is an excellent question. No, no one’s asked me this. Um, why lockey? Because. There was a couple of people that we were talking to at the time and when we were raising, we were almost a little, we were like a bit distressed because one of our, one of our peers had just launched something that was very similar to Turbo Puffer.And someone just gave me the advice at the time of just choose the person where you just feel like you can just pick up the phone and not prepare anything. And just be completely honest, and I don’t think I’ve said this publicly before, but I just called Lockey and was like local Lockie. Like if this doesn’t have PMF by the end of the year, like we’ll just like return all the money to you.But it’s just like, I don’t really, we, Justine and I don’t wanna work on this unless it’s really working. So we want to give it the best shot this year and like we’re really gonna go for it. We’re gonna hire a bunch of people and we’re just gonna be honest with everyone. Like when I don’t know how to play a game, I just play with open cards and.Lockey was the only person that didn’t, that didn’t freak out. He was like, I’ve never heard anyone say that before. As I said, I didn’t even know what a seed or pre-seed round was like before, probably even at this time. So I was just like very honest with him. And I asked him like, Lockie, have you ever have, have you ever invested in database company?He was just like, no. And at the time I was like, am I dumb? Like, but I think there was something that just like really drew me to Lockie. He is so authentic, so honest, like, and there was something just like, I just felt like I could just play like, just say everything openly. And that was, that was, I think that that was like a perfect match at the time, and, and, and honestly still is.He was just like, okay, that’s great. This is like the most honest, ridiculous thing I’ve ever heard anyone say to me. But like that, like that, whyswyx: is this ridiculous? Say competitor launch, this may not work out. It wasSimon Hørup Eskildsen: more just like. If this doesn’t work out, I’m gonna close up shop by the end of the mo the year, right?Like it was, I don’t know, maybe it’s common. I, I don’t know. He told me it was uncommon. I don’t know. Um, that’s why we chose him and he’d been phenomenal. The other people were talking at the, at the time were database experts. Like they, you know, knew a lot about databases and Locke didn’t, this turned out to be a phenomenal asset.Right. I like Justine and I know a lot about databases. The people that we hire know a lot about databases. What we needed was just someone who didn’t know a lot about databases, didn’t pretend to know a lot about databases, and just wanted to help us with candidates and customers. And he did. Yeah. And I have a list, right, of the investors that I have a relationship with, and Lockey has just performed excellent in the number of sub bullets of what we can attribute back to him.Just absolutely incredible. And when people talk about like no ego and just the best thing for the founder, I like, I don’t think that anyone, like even my lawyer is like, yeah, Lockey is like the most friendly person you will find.swyx: Okay. This is my most glow recommendation I’ve ever heard.Alessio: He deserves it.He’s very special.swyx: Yeah. Yeah. Yeah. Okay. Amazing.Alessio: Since you mentioned candidates, maybe we can talk about team building, you know, like, especially in sf, it feels like it’s just easier to start a company than to join a company. Uh, I’m curious your experience, especially not being n SF full-time and doing something that is maybe, you know, a very low level of detail and technical detail.Simon Hørup Eskildsen: Yeah. So joining versus starting, I never thought that I would be a founder. I would start with it, like Turbo Puffer started as a blog post, and then it became a project and then sort of almost accidentally became a company. And now it feels like it’s, it’s like becoming a bigger company. That was never the intention.The intentions were very pure. It’s just like, why hasn’t anyone done this? And it’s like, I wanna be the, like, I wanna be the first person to do it. I think some founders have this, like, I could never work for anyone else. I, I really don’t feel that way. Like, it’s just like, I wanna see this happen. And I wanna see it happen with some people that I really enjoy working with and I wanna have fun doing it and this, this, this has all felt very natural on that, on that sense.So it was never a like join versus versus versus found. It was just dis found me at the right moment.Alessio: Well I think there’s an argument for, you should have joined Cursor, right? So I’m curious like how you evaluate it. Okay, I should actually go raise money and make this a company versus like, this is like a company that is like growing like crazy.It’s like an interesting technical problem. I should just build it within Cursor and then they don’t have to encrypt all this stuff. They don’t have to obfuscate things. Like was that on your mind at all orSimon Hørup Eskildsen: before taking the, the small check from Lockie, I did have like a hard like look at myself in the mirror of like, okay, do I really want to do this?And because if I take the money, I really have to do it right. And so the way I almost think about it’s like you kind of need to ha like you kind of need to be like fucked up enough to want to go all the way. And that was the conversation where I was like, okay, this is gonna be part of my life’s journey to build this company and do it in the best way that I possibly can’t.Because if I ask people to join me, ask people to get on the cap table, then I have an ultimate responsibility to give it everything. And I don’t, I think some people, it doesn’t occur to me that everyone takes it that seriously. And maybe I take it too seriously, I don’t know. But that was like a very intentional moment.And so then it was very clear like, okay, I’m gonna do this and I’m gonna give it everything.Alessio: A lot of people don’t take it this seriously. But,swyx: uh, let’s talk about, you have this concept of the P 99 engineer. Uh, people are 10 x saying, everyone’s saying, you know, uh, maybe engineers are out of a job. I don’t know.But you definitely see a P 99 engineer, and I just want you to talk about it.Simon Hørup Eskildsen: Yeah, so the P 99 engineer was just a term that we started using internally to talk about candidates and talk about how we wanted to build the company. And you know, like everyone else is, like we want a talent dense company.And I think that’s almost become trite at this point. What I credit the cursor founders a lot with is that they just arrived there from first principles of like, we just need a talent dense, um, talent dense team. And I think I’ve seen some teams that weren’t talent dense and like seemed a counterfactual run, which if you’ve run in been in a large company, you will just see that like it’s just logically will happen at a large company.Um, and so that was super important to me and Justine and it’s very difficult to maintain. And so we just needed, we needed wording for it. And so I have a document called Traits of the P 99 Engineer, and it’s a bullet point list. And I look at that list after every single interview that I do, and in every single recap that we do and every recap we end with.End with, um, some version of I’m gonna reject this candidate completely regardless of what the discourse was, because I wanna see people fight for this person because the default should not be, we’re gonna hire this person. The default should be, we’re definitely not hiring this person. And you know, if everyone was like, ah, maybe throw a punch, then this is not the right.swyx: Do, do you operate, like if there’s one cha there must have at least one champion who’s like, yes, I will put my career on, on, on the line for this. You know,Simon Hørup Eskildsen: I think career on the line,swyx: maybe a chair, butSimon Hørup Eskildsen: yeah. You know, like, um, I would say so someone needs to like, have both fists up and be like, I’d fight.Right? Yeah. Yeah. And if one person said, then, okay, let’s do it. Right?swyx: Yeah.Simon Hørup Eskildsen: Um. It doesn’t have to be absolutely everyone. Right? And like the interviews are always the sign that you’re checking for different attributes. And if someone is like knocking it outta the park in every single attribute, that’s, that’s fairly rare.Um, but that’s really important. And so the traits of the P 99 engineer, there’s lots of them. There’s also the traits of the p like triple nine engineer and the quadruple nine engineer. This is like, it’s a long list.swyx: Okay.Simon Hørup Eskildsen: Um, I’ll give you some samples, right. Of what we, what we look for. I think that the P 99 engineer has some history of having bent, like their trajectory or something to their will.Right? Some moment where it was just, they just, you know, made the computer do what it needed to do. There’s something like that, and it will, it will occur to have them at some point in their career. And, uh. Hopefully multiple times. Right.swyx: Gimme an example of one of your engineers that like,Simon Hørup Eskildsen: I’ll give an eng.Uh, so we, we, we launched this thing called A and NV three. Um, we could, we’re also, we’re working on V four and V five right now, but a and NV three can search a hundred billion vectors with a P 50 of around 40 milliseconds and a p 99 of 200 milliseconds. Um, maybe other people have done this, I’m sure Google and others have done this, but, uh, we haven’t seen anyone, um, at least not in like a public consumable SaaS that can do this.And that was an engineer, the chief architect of Turbo Puffer, Nathan, um, who more or less just bent this, the software was not capable of this and he just made it capable for a very particular workload in like a, you know, six to eight week period with the help of a lot of the team. Right. It’s been, been, there’s numerous of examples of that, like at, at turbo puff, but that’s like really bending the software and X 86 to your will.It was incredible to watch. Um. You wanna see some moments like that?swyx: Isn’t that triple nine?Simon Hørup Eskildsen: Um, I think Nathan, what’s calledAlessio: group nine, that was only nine. I feel like this is too high forSimon Hørup Eskildsen: Nathan. Nathan is, uh, Nathan is like, yeah, there’s a lot of nines. Okay. After that p So I think that’s one trait. I think another trait is that, uh, the P 99 spends a lot of time looking at maps.Generally it’s their preferred ux. They just love looking at maps. You ever seen someone who just like, sits on their phone and just like, scrolls around on a map? Or did you not look at maps A lot? You guys don’t look atswyx: maps? I guess I’m not feeling there. I don’t know, butSimon Hørup Eskildsen: you just dis What about trains?Do you like trains?swyx: Uh, I mean they, not enough. Okay. This is just like weapon nice. Autism is what I call it. Like, like,Simon Hørup Eskildsen: um, I love looking at maps, like, it’s like my preferred UX and just like I, you know, I likeswyx: lotsAlessio: of, of like random places, soswyx: like,youswyx: know.Alessio: Yes. Okay. There you go. So instead of like random places, like how do you explore the maps?Simon Hørup Eskildsen: No, it’s, it’s just a joke.swyx: It’s autism laugh. It’s like you are just obsessed by something and you like studying a thing.Simon Hørup Eskildsen: The origin of this was that at some point I read an interview with some IOI gold medalistswyx: Uhhuh,Simon Hørup Eskildsen: and it’s like, what do you do in your spare time? I was just like, I like looking at maps.I was like, I feel so seen. Like, I just like love, like swirling out. I was like, oh, Canada is so big. Where’s Baffin Island? I don’t know. I love it. Yeah. Um, anyway, so the traits of P 99, P 99 is obsessive, right? Like, there’s just like, you’ll, you’ll find traits of that we do an interview at, at, at, at turbo puffer or like multiple interviews that just try to screen for some of these things.Um, so. There’s lots of others, but these are the kinds of traits that we look for.swyx: I’ll tell you, uh, some people listen for like some of my dere stuff. Uh, I do think about derel as maps. Um, you draw a map for people, uh, maps show you the, uh, what is commonly agreed to be the geographical features of what a boundary is.And it shows also shows you what is not doing. And I, I think a lot of like developer tools, companies try to tell you they can do everything, but like, let’s, let’s be real. Like you, your, your three landmarks are here, everyone comes here, then here, then here, and you draw a map and, and then you draw a journey through the map.And like that. To me, that’s what developer relations looks like. So I do think about things that way.Simon Hørup Eskildsen: I think the P 99 thinks in offs, right? The P 99 is very clear about, you know, hey, turbo puffer, you can’t run a high transaction workload on turbo puffer, right? It’s like the right latency is a hundred milliseconds.That’s a clear trade off. I think the P 99 is very good at articulating the trade offs in every decision. Um. Which is exactly what the map is in your case, right?swyx: Uh, yeah, yeah. My, my, my world. My world.Alessio: How, how do you reconcile some of these things when you’re saying you bend the will the computer versus like the tradeoffs?You know, I think sometimes it’s like, well, these are the tradeoffs, but the three nines, it’s like, actually it’s not a real trade off because we can make something that nobody has ever made before and actually make it work.Simon Hørup Eskildsen: The way I think about the bending trajectory to your will is, um, if you sit down and do the napkin math, right, where you’re just like, okay, like if I have a hundred machines, they have this many terabytes of disc, they have this bandwidth, whatever, right?And you sit down and you just do the like high school napkin math on this is how many qps we should be able to drive to it. Similar to how I did the vibe pricing, right? If you can sit down and do that, and then you observe the real system and you see, oh, we’re off by like 10 x bendings trajectory to your will is like just making the software get closer and closer to that first principle line.The P 99 might even be able to cross the line Right. By finding even more optimizations than, than, than from first principle. So bending the software to your rail is about that, right? Like a hundred millisecond P 99 to um, to S3. I mean now you’re talking like someone really high agency that like goes to Seattle finds CS three team and it’s like, how are we gonna make this 10?You know, like it’s that, that’s not quite what we talk about. Right. But yeah.swyx: What’s the future? Turbo Puffer.Simon Hørup Eskildsen: Turbo Puffer started out act one of Turbo Puffer was vector search. That was all we did to begin with Act two of Turbo Puffer is. Is and was full text Search Turbo Puffer today has a fairly start of the state-of-the-art full text search engine.Um, we beat Lucine on some queries, in particular very long queries that we’ve optimized for because those are the text search queries we see today. They’re generated by LLMs or augmented by LLMs. Um, and we see them on Webscale datasets, right? Like someone searching for a very long texturing on all of Common Crawl.We beat Lucine on some of those benchmarks and we expect to continue to beat Lucine on more and more queries. Um, that’s the performance and scale. Turbo Puffer does phenomenally now at full text search performance at scale. What we work on now is more and more features for full tech search. People expect a lot of features with full tech search.And full tech search is still very valuable, right? If you go in and you press Command K and you search for si. Embedding based search might be like, oh, this is something agreeable. ‘cause that seat that’s yes, in Spanish, right,Alessio: an Italian too,Simon Hørup Eskildsen: but in full night search. That’s the prefix of maybe a document of like, you know, these are all the reasons I hate Simon, right?Like this, this is like, that’s a completely different. So that augmentation to like how the human brain works and mapping like data to user is very important, but it’s a lot of features. That feature grind is what we’re firmly on and you will see us just adding to the change log every month, just more and more full tech search features.Um, so we’re like fully compatible and we see we’re seeing people move from some of the traditional search engine onto Turbo Puffer, um, for that. That’s a big focus of Turbo Puffer this year. The other, the other focus of, of Turbo Puffer this year is just on scale. We’re seeing more and more companies that wanna search basically common crawl level types of data sets.Um, both internally a companies and externally at, at a time like Cory, like a hundred billion vectors or a hundred billion documents at once. This is tricky and we wanna make it cheaper and we wanna make it faster. Um, that’s a big focus for Turbo Puffer this year. That’s, you know, we just released a NNV three, which we talked about before.We are working on A-N-N-V-V four and we’re also have planned when we’re gonna do with a and NV five. Right. And then on full Tech search, we’re working on a lot of these features. We’ll be like FTSV three, but it will all roll out incrementally. Um, those are some of the really big features. And then the other thing is, um, our dashboard.Have any of you ever locked into the Turbo Hover dashboard? It’s not very much there. It almost looks like if, um, a founder two years ago just sat down and wrote enough dashboard that there was at least something there, and then other people just sort of added stuff on for the next two, like the, the following two years, and then at some point SSO and other things to just catch up.And it may or may not be have what happened, but adding like, I want PHP my admin back. Like, do you, do you guys remember? Like, it was, it was so good. Right? And I think that that like software hardware integration between the, the, the dashboard of the console of the database and the database itself. Um, I’m, I’m really excited for that.There’s lots of other things, um, that are gonna come out in the next two. Like we talked a bit about some, some pricing and, and things like that, but those would be some of the big hitters. Right Nowswyx: you talk about eras of like turbo profile. I, I just, I have to ask like, yes, there’s the stuff that you’re working on this year, but like I’m sure in your mind you already have the next phase that you’re already thinking aboutSimon Hørup Eskildsen: Act three.swyx: Yes. Act four. Yeah.Simon Hørup Eskildsen: Act five.swyx: What I say about that, the candidates, you don’t have to decide. Yeah, but you know,Simon Hørup Eskildsen: I, I’ll just say that if you wanna build a big database company, the database over time has to implement more or less every quarry plan. Because when you have your data in a database, you expect it to over time, not just search, but also, Hey, I want to aggregate this column, I want to join this data, all of that.But when you’re a startup, your only moat is really just focus. You have to lay out the vaccine and you have to not get overeager. And I think we’ve seen some of our peers get very overeager and overextend themselves. And what I keep telling the team, I was just having breakfast this morning with our CTO and and chief architect, we were talking about like what we’re most likely to regret at the end of the year is having tried to do too much.Um, and so Act three candidates could be, you know, a bunch of simpler ola queries, right? It could be, um, lending ourselves a little bit more into, we see some people who wanna do traces and logging and things like that. Some very simple use cases. Could be that, right? It could be maybe some time series.Some people are trying to do that, right? Like, there’s lots of different things that you can do with turbo puffer, but for now, the, like, if you’re trying, trying to do not search on turbo puffers, the primary use case, you probably shouldn’t, but we see some customers that are like, oh, um, like at some point Cursor moved like 20 terabytes of Postgres data into Turbo Puffer because it’s like, it’s di it’s there, it works.And these particular query plants we know work well. And so they just moved it all to defer sharding. Um, so we look for patterns like that in what future acts of turban puffer are going to be before firmly doubling down on them. But we wouldn’t, if. Today, if you’re using Turbo Puffer, it should be because search is very important to you.And then we might do a lot of accelerated queries to that, but that should not be the main reason to go to Turbo Puffer at this point in time.swyx: Yeah. Uh, you didn’t mention, uh, one thing I was looking for was graph type queries, like graph, database, graph, uh, queries. Can you basically trivially replicate this with what you already have?Simon Hørup Eskildsen: We see some people doingswyx: that, right? Because you have parallel queries and it’s It’s the same thing.Simon Hørup Eskildsen: Exactly. So we see some people doing that, right? Like at the under, like is just a kv, right? And then we expose things on top of it. So we are seeing people do that. And I think, you know, our roadmap is very much just the database that connects AI to a very large amount of data is what the path is to do that in the right order, which is what a good startup is around what is the order to do things in.Our customers are P 99, and they will tell us what they care most about next. And so some of them are doing graphs now, and if they need more graph database features, they’ll be banking our door and we’ll prioritize accordingly.swyx: Tea. Okay. Give us the tea. Uh, this, you, you, uh, you kindly gifted us your favorite tea.This is Yabu Keita Kacha, uh, from the Green Tea Shop. That’s right. Talk about your love of tea.Simon Hørup Eskildsen: Yeah, we, we were just talking beforehand about, um, um, um. Caffeine, I think, um, and, uh, especially when I’m on a trip like this to San Francisco, I consume a lot of caffeine. Um, but this is my preferred, uh, preferred caffeine.It’s this green tea. I have an Airtable with 200 teas that I’ve tried over time, over the past, like 15 years, and this one is my favorite. Now, when you drink a tea, um, there’s different, there’s like six different types of tea. I like green tea in particular. I generally prefer Chinese green tea. And I don’t really like Japanese green tea, but this little prefecture somewhere in Japan has specialized in like, they’re like Japanese, but doing it the Chinese way and it’s just phenomenal.But then the interesting thing about the tea world is that all of the different, um, like you can find this particular tea, there’s probably, you know, hundreds of. Places that sell it, but they all go to a different family right on whatever mountain that they have. These like chameleon, ensis, bush bushes on and this woman, Japanese woman in Toronto from the Green tea shop, um, I don’t know, she’s just like, I has found a really good family.‘cause that’s the best one. The best time of years to get this is in a few months when they do the spring harvest. Uh, now it’s like kind of old. Um, it’s just like, I love the spring for the fresh tea, so I hope you enjoy it. But it’s not the right time of year.swyx: It’s out of season. Yeah. I, I, I actually didn’t even know Tea has seasons.This is unsophisticated, but I, I think it, like, it ties in with like, you know, loving maps and being obsessed and being keen on united in everything that you do. Um, yeah. But. That’s great.Alessio: Awesome. Well, as we were saying, we have instant hot water at Kernel. So, uh, MET lover can come by any,Simon Hørup Eskildsen: I I have a little ticket where I bring a, uh, where I bring like a little thermometer to like a little thermoworks thermometer.Um, last Friday when we do demos, I have this thing where if there’s not enough demos, then I fill the remaining time talking about something completely ridiculous as an incentive for people to actually demo. And last night in time, I spent 20 minutes do, walking through my air table and going through my entire tea travel kit, including the, the, the temperature monitor.‘cause like Yeah, you’ll show up. There’s only a boiler. You can’t get it to the right. Yeah. You know, you need this at 80 degrees, but anyway. Yeah, sorry.Alessio: Yeah, we have a, we have electric kettle with the temperature thing at home.swyx: I would watch this. You should start a company, YouTube, but it doesn’t have anything about search.It just has and like other brands,Simon Hørup Eskildsen: I don’t think I could talk, but something that I started doing. Do you, um, do you two know Sam Lambert of, of course, planet Scale? Ofswyx: course.Simon Hørup Eskildsen: Um,swyx: very outspoken guy.Simon Hørup Eskildsen: I love the guy and we just, um, we just last, like last week we just went on X live and just sat and like shut the s**t for like an hour and I think we’ll probably do that again.Yes. We’ll probably come up there. Well, I don’t know what we’ll call it. Maybe P 99 live or the P 99 pod or something like that.swyx: Um, P pod.Simon Hørup Eskildsen: P pod.swyx: Uh, cool. Well thank you so much for your time. I know you have to go, uh, but this is a, a blast and you’re clearly very passionate and charismatic, so, uh, I I bet you’ll get some, uh, P nine nine engineers outta this podcast.Yeah.Simon Hørup Eskildsen: Thank you so much for having me. It was a pleasure. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.latent.space/subscribe

Join Kyle, Nader, Vibhu, and swyx live at NVIDIA GTC next week!Now that AIE Europe tix are ~sold out, our attention turns to Miami and World’s Fair!The definitive AI Accelerator chip company has more than 10xed this AI Summer:And is now a $4.4 trillion megacorp… that is somehow still moving like a startup. We are blessed to have a unique relationship with our first ever NVIDIA guests: Kyle Kranen who gave a great inference keynote at the first World’s Fair and is one of the leading architects of NVIDIA Dynamo (a Datacenter scale inference framework supporting SGLang, TRT-LLM, vLLM), and Nader Khalil, a friend of swyx from our days in Celo in The Arena, who has been drawing developers at GTC since before they were even a glimmer in the eye of NVIDIA:Nader discusses how NVIDIA Brev has drastically reduced the barriers to entry for developers to get a top of the line GPU up and running, and Kyle explains NVIDIA Dynamo as a data center scale inference engine that optimizes serving by scaling out, leveraging techniques like prefill/decode disaggregation, scheduling, and Kubernetes-based orchestration, framed around cost, latency, and quality tradeoffs. We also dive into Jensen’s “SOL” (Speed of Light) first-principles urgency concept, long-context limits and model/hardware co-design, internal model APIs (https://build.nvidia.com), and upcoming Dynamo and agent sessions at GTC.Full Video pod on YouTubeTimestamps00:00 Agent Security Basics00:39 Podcast Welcome and Guests07:19 Acquisition and DevEx Shift13:48 SOL Culture and Dynamo Setup27:38 Why Scale Out Wins29:02 Scale Up Limits Explained30:24 From Laptop to Multi Node33:07 Cost Quality Latency Tradeoffs38:42 Disaggregation Prefill vs Decode41:05 Kubernetes Scaling with Grove43:20 Context Length and Co Design57:34 Security Meets Agents58:01 Agent Permissions Model59:10 Build Nvidia Inference Gateway01:01:52 Hackathons And Autonomy Dreams01:10:26 Local GPUs And Scaling Inference01:15:31 Long Running Agents And SF ReflectionsTranscriptAgent Security BasicsNader: Agents can do three things. They can access your files, they can access the internet, and then now they can write custom code and execute it. You literally only let an agent do two of those three things. If you can access your files and you can write custom code, you don’t want internet access because that’s one to see full vulnerability, right?If you have access to internet and your file system, you should know the full scope of what that agent’s capable of doing. Otherwise, now we can get injected or something that can happen. And so that’s a lot of what we’ve been thinking about is like, you know, how do we both enable this because it’s clearly the future.But then also, you know, what, what are these enforcement points that we can start to like protect?swyx: All right.Podcast Welcome and Guestsswyx: Welcome to the Lean Space podcast in the Chromo studio. Welcome to all the guests here. Uh, we are back with our guest host Viu. Welcome. Good to have you back. And our friends, uh, Netter and Kyle from Nvidia. Welcome.Kyle: Yeah, thanks for having us.swyx: Yeah, thank you. Actually, I don’t even know your titles.Uh, I know you’re like architect something of Dynamo.Kyle: Yeah. I, I’m one of the engineering leaders [00:01:00] and a architects of Dynamo.swyx: And you’re director of something and developers, developer tech.Nader: Yeah.swyx: You’re the developers, developers, developers guy at nvidia,Nader: open source agent marketing, brev,swyx: and likeNader: Devrel tools and stuff.swyx: Yeah. BeenNader: the focus.swyx: And we’re, we’re kind of recording this ahead of Nvidia, GTC, which is coming to town, uh, again, uh, or taking over town, uh, which, uh, which we’ll all be at. Um, and we’ll talk a little bit about your sessions and stuff. Yeah.Nader: We’re super excited for it.GTC Booth Stunt Storiesswyx: One of my favorite memories for Nader, like you always do like marketing stunts and like while you were at Rev, you like had this surfboard that you like, went down to GTC with and like, NA Nvidia apparently, like did so much that they bought you.Like what, what was that like? What was that?Nader: Yeah. Yeah, we, we, um. Our logo was a chaka. We, we, uh, we were always just kind of like trying to keep true to who we were. I think, you know, some stuff, startups, you’re like trying to pretend that you’re a bigger, more mature company than you are. And it was actually Evan Conrad from SF Compute who was just like, you guys are like previousswyx: guest.Yeah.Nader: Amazing. Oh, really? Amazing. Yeah. He was just like, guys, you’re two dudes in the room. Why are you [00:02:00] pretending that you’re not? Uh, and so then we were like, okay, let’s make the logo a shaka. We brought surfboards to our booth to GTC and the energy was great. Yeah. Some palm trees too. They,Kyle: they actually poked out over like the, the walls so you could, you could see the bread booth.Oh, that’s so funny. AndNader: no one else,Kyle: just from very far away.Nader: Oh, so you remember it backKyle: then? Yeah I remember it pre-acquisition. I was like, oh, those guys look cool,Nader: dude. That makes sense. ‘cause uh, we, so we signed up really last minute, and so we had the last booth. It was all the way in the corner. And so I was, I was worried that no one was gonna come.So that’s why we had like the palm trees. We really came in with the surfboards. We even had one of our investors bring her dog and then she was just like walking the dog around to try to like, bring energy towards our booth. Yeah.swyx: Steph.Kyle: Yeah. Yeah, she’s the best,swyx: you know, as a conference organizer, I love that.Right? Like, it’s like everyone who sponsors a conference comes, does their booth. They’re like, we are changing the future of ai or something, some generic b******t and like, no, like actually try to stand out, make it fun, right? And people still remember it after three years.Nader: Yeah. Yeah. You know what’s so funny?I’ll, I’ll send, I’ll give you this clip if you wanna, if you wanna add it [00:03:00] in, but, uh, my wife was at the time fiance, she was in medical school and she came to help us. ‘cause it was like a big moment for us. And so we, we bought this cricket, it’s like a vinyl, like a vinyl, uh, printer. ‘cause like, how else are we gonna label the surfboard?So, we got a surfboard, luckily was able to purchase that on the company card. We got a cricket and it was just like fine tuning for enterprises or something like that, that we put on the. On the surfboard and it’s 1:00 AM the day before we go to GTC. She’s helping me put these like vinyl stickers on.And she goes, you son of, she’s like, if you pull this off, you son of a b***h. And so, uh, right. Pretty much after the acquisition, I stitched that with the mag music acquisition. I sent it to our family group chat. Ohswyx: Yeah. No, well, she, she made a good choice there. Was that like basically the origin story for Launchable is that we, it was, and maybe we should explain what Brev is andNader: Yeah.Yeah. Uh, I mean, brev is just, it’s a developer tool that makes it really easy to get a GPU. So we connect a bunch of different GPU sources. So the basics of it is like, how quickly can we SSH you into a G, into a GPU and whenever we would talk to users, they wanted A GPU. They wanted an A 100. And if you go to like any cloud [00:04:00] provisioning page, usually it’s like three pages of forms or in the forms somewhere there’s a dropdown.And in the dropdown there’s some weird code that you know to translate to an A 100. And I remember just thinking like. Every time someone says they want an A 100, like the piece of text that they’re telling me that they want is like, stuffed away in the corner. Yeah. And so we were like, what if the biggest piece of text was what the user’s asking for?And so when you go to Brev, it’s just big GPU chips with the type that you want withswyx: beautiful animations that you worked on pre, like pre you can, like, now you can just prompt it. But back in the day. Yeah. Yeah. Those were handcraft, handcrafted artisanal code.Nader: Yeah. I was actually really proud of that because, uh, it was an, i I made it in Figma.Yeah. And then I found, I was like really struggling to figure out how to turn it from like Figma to react. So what it actually is, is just an SVG and I, I have all the styles and so when you change the chip, whether it’s like active or not it changes the SVG code and that somehow like renders like, looks like it’s animating, but it, we just had the transition slow, but it’s just like the, a JavaScript function to change the like underlying SVG.Yeah. And that was how I ended up like figuring out how to move it from from Figma. But yeah, that’s Art Artisan. [00:05:00]Kyle: Speaking of marketing stunts though, he actually used those SVGs. Or kind of use those SVGs to make these cards.Nader: Oh yeah. LikeKyle: a GPU gift card Yes. That he handed out everywhere. That was actually my first impression of thatNader: one.Yeah,swyx: yeah, yeah.Nader: Yeah.swyx: I think I still have one of them.Nader: They look great.Kyle: Yeah.Nader: I have a ton of them still actually in our garage, which just, they don’t have labels. We should honestly like bring, bring them back. But, um, I found this old printing press here, actually just around the corner on Ven ness. And it’s a third generation San Francisco shop.And so I come in an excited startup founder trying to like, and they just have this crazy old machinery and I’m in awe. ‘cause the the whole building is so physical. Like you’re seeing these machines, they have like pedals to like move these saws and whatever. I don’t know what this machinery is, but I saw all three generations.Like there’s like the grandpa, the father and the son, and the son was like, around my age. Well,swyx: it’s like a holy, holy trinity.Nader: It’s funny because we, so I just took the same SVG and we just like printed it and it’s foil printing, so they make a a, a mold. That’s like an inverse of like the A 100 and then they put the foil on it [00:06:00] and then they press it into the paper.And I remember once we got them, he was like, Hey, don’t forget about us. You know, I guess like early Apple and Cisco’s first business cards were all made there. And so he was like, yeah, we, we get like the startup businesses but then as they mature, they kind of go somewhere else. And so I actually, I think we were talking with marketing about like using them for some, we should go back and make some cards.swyx: Yeah, yeah, yeah. You know, I remember, you know, as a very, very small breadth investor, I was like, why are we spending time like, doing these like stunts for GPUs? Like, you know, I think like as a, you know, typical like cloud hard hardware person, you go into an AWS you pick like T five X xl, whatever, and it’s just like from a list and you look at the specs like, why animate this GP?And, and I, I do think like it just shows the level of care that goes throughout birth and Yeah. And now, and also the, and,Nader: and Nvidia. I think that’s what the, the thing that struck me most when we first came in was like the amount of passion that everyone has. Like, I think, um, you know, you talk to, you talk to Kyle, you talk to, like, every VP that I’ve met at Nvidia goes so close to the metal.Like, I remember it was almost a year ago, and like my VP asked me, he’s like, Hey, [00:07:00] what’s cursor? And like, are you using it? And if so, why? Surprised at this, and he downloaded Cursor and he was asking me to help him like, use it. And I thought that was, uh, or like, just show him what he, you know, why we were using it.And so, the amount of care that I think everyone has and the passion, appreciate, passion and appreciation for the moment. Right. This is a very unique time. So it’s really cool to see everyone really like, uh, appreciate that.swyx: Yeah.Acquisition and DevEx Shiftswyx: One thing I wanted to do before we move over to sort of like research topics and, uh, the, the stuff that Kyle’s working on is just tell the story of the acquisition, right?Like, not many people have been, been through an acquisition with Nvidia. What’s it like? Uh, what, yeah, just anything you’d like to say.Nader: It’s a crazy experience. I think, uh, you know, we were the thing that was the most exciting for us was. Our goal was just to make it easier for developers.We wanted to find access to GPUs, make it easier to do that. And then all, oh, actually your question about launchable. So launchable was just make one click exper, like one click deploys for any software on top of the GPU. Mm-hmm. And so what we really liked about Nvidia was that it felt like we just got a lot more resources to do all of that.I think, uh, you [00:08:00] know, NVIDIA’s goal is to make things as easy for developers as possible. So there was a really nice like synergy there. I think that, you know, when it comes to like an acquisition, I think the amount that the soul of the products align, I think is gonna be. Is going speak to the success of the acquisition.Yeah. And so it in many ways feels like we’re home. This is a really great outcome for us. Like we you know, I love brev.nvidia.com. Like you should, you should use it’s, it’s theKyle: front page for GPUs.Nader: Yeah. Yeah. If you want GP views,Kyle: you go there, getswyx: it there, and it’s like internally is growing very quickly.I, I don’t remember You said some stats there.Nader: Yeah, yeah, yeah. It’s, uh, I, I wish I had the exact numbers, but like internally, externally, it’s been growing really quickly. We’ve been working with a bunch of partners with a bunch of different customers and ISVs, if you have a solution that you want someone that runs on the GPU and you want people to use it quickly, we can bundle it up, uh, in a launchable and make it a one click run.If you’re doing things and you want just like a sandbox or something to run on, right. Like open claw. Huge moment. Super exciting. Our, uh, and we’ll talk into it more, but. You know, internally, people wanna run this, and you, we know we have to be really careful from the security implications. Do we let this run on the corporate network?Security’s guidance was, Hey, [00:09:00] run this on breath, it’s in, you know, it’s, it’s, it’s a vm, it’s sitting in the cloud, it’s off the corporate network. It’s isolated. And so that’s been our stance internally and externally about how to even run something like open call while we figure out how to run these things securely.But yeah,swyx: I think there’s also like, you almost like we’re the right team at the right time when Nvidia is starting to invest a lot more in developer experience or whatever you call it. Yeah. Uh, UX or I don’t know what you call it, like software. Like obviously NVIDIA is always invested in software, but like, there’s like, this is like a different audience.Yeah. It’s aNader: widerKyle: developer base.swyx: Yeah. Right.Nader: Yeah. Yeah. You know, it’s funny, it’s like, it’s not, uh,swyx: so like, what, what is it called internally? What, what is this that people should be aware that is going on there?Nader: Uh, what, like developer experienceswyx: or, yeah, yeah. Is it’s called just developer experience or is there like a broader strategy hereNader: in Nvidia?Um, Nvidia always wants to make a good developer experience. The thing is and a lot of the technology is just really complicated. Like, it’s not, it’s uh, you know, I think, um. The thing that’s been really growing or the AI’s growing is having a huge moment, not [00:10:00] because like, let’s say data scientists in 2018, were quiet then and are much louder now.The pie is com, right? There’s a whole bunch of new audiences. My mom’s wondering what she’s doing. My sister’s learned, like taught herself how to code. Like the, um, you know, I, I actually think just generally AI’s a big equalizer and you’re seeing a more like technologically literate society, I guess.Like everyone’s, everyone’s learning how to code. Uh, there isn’t really an excuse for that. And so building a good UX means that you really understand who your end user is. And when your end user becomes such a wide, uh, variety of people, then you have to almost like reinvent the practice, right? Yeah. You haveKyle: to, and actually build more developer ux, right?Because the, there are tiers of developer base that were added. You know, the, the hackers that are building on top of open claw, right? For example, have never used gpu. They don’t know what kuda is. They, they, they just want to run something.Nader: Yeah.Kyle: You need new UX that is not just. Hey, you know, how do you program something in Cuda and run it?And then, and then we built, you know, like when Deep Learning was getting big, we built, we built Torch and, and, but so recently the amount of like [00:11:00] layers that are added to that developer stack has just exploded because AI has become ubiquitous. Everyone’s using it in different ways. Yeah. It’sNader: moving fast in every direction.Vertical, horizontal.Vibhu: Yeah. You guys, you even take it down to hardware, like the DGX Spark, you know, it’s, it’s basically the same system as just throwing it up on big GPU cluster.Nader: Yeah, yeah, yeah. It’s amazing. Blackwell.swyx: Yeah. Uh, we saw the preview at the last year’s GTC and that was one of the better performing, uh, videos so far, and video coverage so far.Awesome. This will beat it. Um,Nader: that wasswyx: actually, we have fingersNader: crossed. Yeah.DGX Spark and Remote AccessNader: Even when Grace Blackwell or when, um, uh, DGX Spark was first coming out getting to be involved in that from the beginning of the developer experience. And it just comes back to what youswyx: were involved.Nader: Yeah. St. St.swyx: Mars.Nader: Yeah. Yeah. I mean from, it was just like, I, I got an email, we just got thrown into the loop and suddenly yeah, I, it was actually really funny ‘cause I’m still pretty fresh from the acquisition and I’m, I’m getting an email from a bunch of the engineering VPs about like, the new hardware, GPU chip, like we’re, or not chip, but just GPU system that we’re putting out.And I’m like, okay, cool. Matters. Now involved with this for the ux, I’m like. What am I gonna do [00:12:00] here? So, I remember the first meeting, I was just like kind of quiet as I was hearing engineering VPs talk about what this box could be, what it could do, how we should use it. And I remember, uh, one of the first ideas that people were idea was like, oh, the first thing that it was like, I think a quote was like, the first thing someone’s gonna wanna do with this is get two of them and run a Kubernetes cluster on top of them.And I was like, oh, I think I know why I’m here. I was like, the first thing we’re doing is easy. SSH into the machine. And then, and you know, just kind of like scoping it down of like, once you can do that every, you, like the person who wants to run a Kubernetes cluster onto Sparks has a higher propensity for pain, then, then you know someone who buys it and wants to run open Claw right now, right?If you can make sure that that’s as effortless as possible, then the rest becomes easy. So there’s a tool called Nvidia Sync. It just makes the SSH connection really simple. So, you know, if you think about it like. If you have a Mac, uh, or a PC or whatever, if you have a laptop and you buy this GPU and you want to use it, you should be able to use it like it’s A-A-G-P-U in the cloud, right?Um, but there’s all this friction of like, how do you actually get into that? That’s part of [00:13:00] Revs value proposition is just, you know, there’s a CLI that wraps SSH and makes it simple. And so our goal is just get you into that machine really easily. And one thing we just launched at CES, it’s in, it’s still in like early access.We’re ironing out some kinks, but it should be ready by GTC. You can register your spark on Brev. And so now if youswyx: like remote managed yeah, local hardware. Single pane of glass. Yeah. Yeah. Because Brev can already manage other clouds anyway, right?Vibhu: Yeah, yeah. And you use the spark on Brev as well, right?Nader: Yeah. But yeah, exactly. So, so you, you, so you, you set it up at home you can run the command on it, and then it gets it’s essentially it’ll appear in your Brev account, and then you can take your laptop to a Starbucks or to a cafe, and you’ll continue to use your, you can continue use your spark just like any other cloud node on Brev.Yeah. Yeah. And it’s just like a pre-provisioned centerswyx: in yourNader: home. Yeah, exactly.swyx: Yeah. Yeah.Vibhu: Tiny little data center.Nader: Tiny little, the size ofVibhu: your phone.SOL Culture and Dynamo Setupswyx: One more thing before we move on to Kyle. Just have so many Jensen stories and I just love, love mining Jensen stories. Uh, my favorite so far is SOL. Uh, what is, yeah, what is S-O-L-S-O-LNader: is actually, i, I think [00:14:00] of all the lessons I’ve learned, that one’s definitely my favorite.Kyle: It’ll always stick with you.Nader: Yeah. Yeah. I, you know, in your startup, everything’s existential, right? Like we’ve, we’ve run out of money. We were like, on the risk of, of losing payroll, we’ve had to contract our team because we l ran outta money. And so like, um, because of that you’re really always forcing yourself to I to like understand the root cause of everything.If you get a date, if you get a timeline, you know exactly why that date or timeline is there. You’re, you’re pushing every boundary and like, you’re not just say, you’re not just accepting like a, a no. Just because. And so as you start to introduce more layers, as you start to become a much larger organization, SOL is is essentially like what is the physics, right?The speed of light moves at a certain speed. So if flight’s moving some slower, then you know something’s in the way. So before trying to like layer reality back in of like, why can’t this be delivered at some date? Let’s just understand the physics. What is the theoretical limit to like, uh, how fast this can go?And then start to tell me why. ‘cause otherwise people will start telling you why something can’t be done. But actually I think any great leader’s goal is just to create urgency. Yeah. [00:15:00] There’s an infiniteKyle: create compelling events, right?Nader: Yeah.Kyle: Yeah. So l is a term video is used to instigate a compelling event.You say this is done. How do we get there? What is the minimum? As much as necessary, as little as possible thing that it takes for us to get exactly here and. It helps you just break through a bunch of noise.swyx: Yeah.Kyle: Instantly.swyx: One thing I’m unclear about is, can only Jensen use the SOL card? Like, oh, no, no, no.Not everyone get the b******t out because obviously it’s Jensen, but like, can someone else be like, no, likeKyle: frontline engineers use it.Nader: Yeah. Every, I think it’s not so much about like, get the b******t out. It’s like, it’s like, give me the root understanding, right? Like, if you tell me something takes three weeks, it like, well, what’s the first principles?Yeah, the first principles. It’s like, what’s the, what? Like why is it three weeks? What is the actual yeah. What’s the actual limit of why this is gonna take three weeks? If you’re gonna, if you, if let’s say you wanted to buy a new computer and someone told you it’s gonna be here in five days, what’s the SOL?Well, like the SOL is like, I could walk into a Best Buy and pick it up for you. Right? So then anything that’s like beyond that is, and is that practical? Is that how we’re gonna, you know, let’s say give everyone in the [00:16:00] company a laptop, like obviously not. So then like that’s the SOL and then it’s like, okay, well if we have to get more than 10, suddenly there might be some, right?And so now we can kind of piece the reality back.swyx: So, so this is the. Paul Graham do things that don’t scale. Yeah. And this is also the, what people would now call behi agency. Yeah.Kyle: It’s actually really interesting because there’s a, there’s a second hardware angle to SOL that like doesn’t come up for all the org sol is used like culturally at aswyx: media for everything.I’m also mining for like, I think that can be annoying sometimes. And like someone keeps going IOO you and you’re like, guys, like we have to be stable. We have to, we to f*****g plan. Yeah.Kyle: It’s an interesting balance.Nader: Yeah. I encounter that with like, actually just with, with Alec, right? ‘cause we, we have a new conference so we need to launch, we have, we have goals of what we wanna launch by, uh, by the conference and like, yeah.At the end of the day, where isswyx: this GTC?Nader: Um, well this is like, so we, I mean we did it for CES, we did for GT CDC before that we’re doing it for GTC San Jose. So I mean, like every, you know, we have a new moment. Um, and we want to launch something. Yeah. And we want to do so at SOL and that does mean that some, there’s some level of prioritization that needs [00:17:00] to happen.And so it, it is difficult, right? I think, um, you have to be careful with what you’re pushing. You know, stability is important and that should be factored into S-O-L-S-O-L isn’t just like, build everything and let it break, you know, that, that’s part of the conversation. So as you’re laying, layering in all the details, one of them might be, Hey, we could build this, but then it’s not gonna be stable for X, y, z reasons.And so that was like, one of our conversations for CES was, you know, hey, like we, we can get this into early access registering your spark with brev. But there are a lot of things that we need to do in order to feel really comfortable from a security perspective, right? There’s a lot of networking involved before we deliver that to users.So it’s like, okay. Let’s get this to a point where we can at least let people experiment with it. We had it in a booth, we had it in Jensen’s keynote, and then let’s go iron out all the networking kinks. And that’s not easy. And so, uh, that can come later. And so that was the way that we layered that back in.Yeah. ButKyle: It’s not really about saying like, you don’t have to do the, the maintenance or operational work. It’s more about saying, you know, it’s kind of like [00:18:00] highlights how progress is incremental, right? Like, what is the minimum thing that we can get to. And then there’s SOL for like every component after that.But there’s the SOL to get you, get you to the, the starting line. And that, that’s usually how it’s asked. Yeah. On the other side, you know, like SOL came out of like hardware at Nvidia. Right. So SOL is like literally if we ran the accelerator or the GPU with like at basically full speed with like no other constraints, like how FAST would be able to make a program go.swyx: Yeah. Yeah. Right.Kyle: Soswyx: in, in training that like, you know, then you work back to like some percentage of like MFU for example.Kyle: Yeah, that’s a, that’s a great example. So like, there’s an, there’s an S-O-L-M-F-U, and then there’s like, you know, what’s practically achievable.swyx: Cool. Should we move on to sort of, uh, Kyle’s side?Uh, Kyle, you’re coming more from the data science world. And, uh, I, I mean I always, whenever, whenever I meet someone who’s done working in tabular stuff, graph neural networks, time series, these are basically when I go to new reps, I go to ICML, I walk the back halls. There’s always like a small group of graph people.Yes. Absolute small group of tabular people. [00:19:00] And like, there’s no one there. And like, it’s very like, you know what I mean? Like, yeah, no, like it’s, it’s important interesting work if you care about solving the problems that they solve.Kyle: Yeah.swyx: But everyone else is just LMS all the time.Kyle: Yeah. I mean it’s like, it’s like the black hole, right?Has the event horizon reached this yet in nerves? Um,swyx: but like, you know, those are, those are transformers too. Yeah. And, and those are also like interesting things. Anyway, uh, I just wanted to spend a little bit of time on, on those, that background before we go into Dynamo, uh, proper.Kyle: Yeah, sure. I took a different path to Nvidia than that, or I joined six years ago, seven, if you count, when I was an intern.So I joined Nvidia, like right outta college. And the first thing I jumped into was not what I’d done in, during internship, which was like, you know, like some stuff for autonomous vehicles, like heavyweight object detection. I jumped into like, you know, something, I’m like, recommenders, this is popular. Andswyx: yeah, he did RexiKyle: as well.Yeah, Rexi. Yeah. I mean that, that was the taboo data at the time, right? You have tables of like, audience qualities and item qualities, and you’re trying to figure out like which member of [00:20:00] the audience matches which item or, or more practically which item matches which member of the audience. And at the time, really it was like we were trying to enable.Uh, recommender, which had historically been like a little bit of a CP based workflow into something that like, ran really well in GPUs. And it’s since been done. Like there are a bunch of libraries for Axis that run on GPUs. Uh, the common models like Deeplearning recommendation model, which came outta meta and the wide and deep model, which was used or was released by Google were very accelerated by GPUs using, you know, the fast HBM on the chips, especially to do, you know, vector lookups.But it was very interesting at the time and super, super relevant because like we were starting to get like. This explosion of feeds and things that required rec recommenders to just actively be on all the time. And sort of transitioned that a little bit towards graph neural networks when I discovered them because I was like, okay, you can actually use graphical neural networks to represent like, relationships between people, items, concepts, and that, that interested me.So I jumped into that at [00:21:00] Nvidia and, and got really involved for like two-ish years.swyx: Yeah. Uh, and something I learned from Brian Zaro Yeah. Is that you can just kind of choose your own path in Nvidia.Kyle: Oh my God. Yeah.swyx: Which is not a normal big Corp thing. Yeah. Like you, you have a lane, you stay in your lane.Nader: I think probably the reason why I enjoy being in a, a big company, the mission is the boss probably from a startup guy. Yeah. The missionswyx: is the boss.Nader: Yeah. Uh, it feels like a big game of pickup basketball. Like, you know, if you play one, if you wanna play basketball, you just go up to the court and you’re like, Hey look, we’re gonna play this game and we need three.Yeah. And you just like find your three. That’s honestly for every new initiative that’s what it feels like. Yeah.Vibhu: It also like shows, right? Like Nvidia. Just releasing state-of-the-art stuff in every domain. Yeah. Like, okay, you expect foundation models with Nemo tron voice just randomly parakeet.Call parakeet just comes out another one, uh, voice. TheKyle: video voice team has always been producing.Vibhu: Yeah. There’s always just every other domain of paper that comes out, dataset that comes out. It’s like, I mean, it also stems back to what Nvidia has to do, right? You have to make chips years before they’re actually produced.Right? So you need to know, you need to really [00:22:00] focus. TheKyle: design process starts likeVibhu: exactlyKyle: three to five years before the chip gets to the market.Vibhu: Yeah. I, I’m curious more about what that’s like, right? So like, you have specialist teams. Is it just like, you know, people find an interest, you go in, you go deep on whatever, and that kind of feeds back into, you know, okay, we, we expect predictions.Like the internals at Nvidia must be crazy. Right? You know? Yeah. Yeah. You know, you, you must. Not even without selling to people, you have your own predictions of where things are going. Yeah. And they’re very based, very grounded. Right?Kyle: Yeah. It, it, it’s really interesting. So there’s like two things that I think that Amed does, which are quite interesting.Uh, one is like, we really index into passion. There’s a big. Sort of organizational top sound push to like ensure that people are working on the things that they’re passionate about. So if someone proposes something that’s interesting, many times they can just email someone like way up the chain that they would find this relevant and say like, Hey, can I go work on this?Nader: It’s actually like I worked at a, a big company for a couple years before, uh, starting on my startup journey and like, it felt very weird if you were to like email out of chain, if that makes [00:23:00] sense. Yeah. The emails at Nvidia are like mosh pitsswyx: shoot,Nader: and it’s just like 60 people, just whatever. And like they’re, there’s this,swyx: they got messy like, reply all you,Nader: oh, it’s in, it’s insane.It’s insane. They justKyle: help. You know, Maxim,Nader: the context. But, but that’s actually like, I’ve actually, so this is a weird thing where I used to be like, why would we send emails? We have Slack. I am the entire, I’m the exact opposite. I feel so bad for anyone who’s like messaging me on Slack ‘cause I’m so unresponsive.swyx: Your emailNader: Maxi, email Maxim. I’m email maxing Now email is a different, email is perfect because man, we can’t work together. I’m email is great, right? Because important threads get bumped back up, right? Yeah, yeah. Um, and so Slack doesn’t do that. So I just have like this casino going off on the right or on the left and like, I don’t know which thread was from where or what, but like the threads get And then also just like the subject, so you can have like working threads.I think what’s difficult is like when you’re small, if you’re just not 40,000 people I think Slack will work fine, but there’s, I don’t know what the inflection point is. There is gonna be a point where that becomes really messy and you’ll actually prefer having email. ‘cause you can have working threads.You can cc more than nine people in a thread.Kyle: You can fork stuff.Nader: You can [00:24:00] fork stuff, which is super nice and just like y Yeah. And so, but that is part of where you can propose a plan. You can also just. Start, honestly, momentum’s the only authority, right? So like, if you can just start, start to make a little bit of progress and show someone something, and then they can try it.That’s, I think what’s been, you know, I think the most effective way to push anything for forward. And that’s both at Nvidia and I think just generally.Kyle: Yeah, there’s, there’s the other concept that like is explored a lot at Nvidia, which is this idea of a zero billion dollar business. Like market creation is a big thing at Nvidia.Like,swyx: oh, you want to go and start a zero billion dollar business?Kyle: Jensen says, we are completely happy investing in zero billion dollar markets. We don’t care if this creates revenue. It’s important for us to know about this market. We think it will be important in the future. It can be zero billion dollars for a while.I’m probably minging as words here for, but like, you know, like, I’ll give an example. NVIDIA’s been working on autonomous driving for a a long time,swyx: like an Nvidia car.Kyle: No, they, they’veVibhu: used the Mercedes, right? They’re around the HQ and I think it finally just got licensed out. Now they’re starting to be used quite a [00:25:00] bit.For 10 years you’ve been seeing Mercedes with Nvidia logos driving.Kyle: If you’re in like the South San Santa Clara, it’s, it’s actually from South. Yeah. So, um. Zero billion dollar markets are, are a thing like, you know, Jensen,swyx: I mean, okay, look, cars are not a zero billion dollar market. But yeah, that’s a bad example.Nader: I think, I think he’s, he’s messaging, uh, zero today, but, or even like internally, right? Like, like it’s like, uh, an org doesn’t have to ruthlessly find revenue very quickly to justify their existence. Right. Like a lot of the important research, a lot of the important technology being developed that, that’s kind ofKyle: where research, research is very ide ideologically free at Nvidia.Yeah. Like they can pursue things that they wereswyx: Were you research officially?Kyle: I was never in research. Officially. I was always in engineering. Yeah. We in, I’m in an org called Deep Warning Algorithms, which is basically just how do we make things that are relevant to deep warning go fast.swyx: That sounds freaking cool.Vibhu: And I think a lot of that is underappreciated, right? Like time series. This week Google put out time. FF paper. Yeah. A new time series, paper res. Uh, Symantec, ID [00:26:00] started applying Transformers LMS to Yes. Rec system. Yes. And when you think the scale of companies deploying these right. Amazon recommendations, Google web search, it’s like, it’s huge scale andKyle: Yeah.Vibhu: You want fast?Kyle: Yeah. Yeah. Yeah. Actually it’s, it, I, there’s a fun moment that brought me like full circle. Like, uh, Amazon Ads recently gave a talk where they talked about using Dynamo for generative recommendation, which was like super, like weirdly cathartic for me. I’m like, oh my God. I’ve, I’ve supplanted what I was working on.Like, I, you’re using LMS now to do what I was doing five years ago.swyx: Yeah. Amazing. And let’s go right into Dynamo. Uh, maybe introduce Yeah, sure. To the top down and Yeah.Kyle: I think at this point a lot of people are familiar with the term of inference. Like funnily enough, like I went from, you know, inference being like a really niche topic to being something that’s like discussed on like normal people’s Twitter feeds.It’s,Nader: it’s on billboardsKyle: here now. Yeah. Very, very strange. Driving, driving, seeing just an inference ad on 1 0 1 inference at scale is becoming a lot more important. Uh, we have these moments like, you know, open claw where you have these [00:27:00] agents that take lots and lots of tokens, but produce, incredible results.There are many different aspects of test time scaling so that, you know, you can use more inference to generate a better result than if you were to use like a short amount of inference. There’s reasoning, there’s quiring, there’s, adding agency to the model, allowing it to call tools and use skills.Dyno sort came about at Nvidia. Because myself and a couple others were, were sort of talking about the, these concepts that like, you know, you have inference engines like VLMS, shelan, tenor, TLM and they have like one single copy. They, they, they sort of think about like things as like one single copy, like one replica, right?Why Scale Out WinsKyle: Like one version of the model. But when you’re actually serving things at scale, you can’t just scale up that replica because you end up with like performance problems. There’s a scaling limit to scaling up replicas. So you actually have to scale out to use a, maybe some Kubernetes type terminology.We kind of realized that there was like. A lot of potential optimization that we could do in scaling out and building systems for data [00:28:00] center scale inference. So Dynamo is this data center scale inference engine that sits on top of the frameworks like VLM Shilling and 10 T lm and just makes things go faster because you can leverage the economy of scale.The fact that you have KV cash, which we can define a little bit later, uh, in all these machines that is like unique and you wanna figure out like the ways to maximize your cash hits or you want to employ new techniques in inference like disaggregation, which Dynamo had introduced to the world in, in, in March, not introduced, it was a academic talk, but beforehand.But we are, you know, one of the first frameworks to start, supporting it. And we wanna like, sort of combine all these techniques into sort of a modular framework that allows you to. Accelerate your inference at scale.Nader: By the way, Kyle and I became friends on my first date, Nvidia, and I always loved, ‘cause like he always teaches meswyx: new things.Yeah. By the way, this is why I wanted to put two of you together. I was like, yeah, this is, this is gonna beKyle: good. It’s very, it’s very different, you know, like we’ve, we, we’ve, we’ve talked to each other a bunch [00:29:00] actually, you asked like, why, why can’t we scale up?Nader: Yeah.Scale Up Limits ExplainedNader: model, you said model replicas.Kyle: Yeah. So you, so scale up means assigning moreswyx: heavier?Kyle: Yeah, heavier. Like making things heavier. Yeah, adding more GPUs. Adding more CPUs. Scale out is just like having a barrier saying, I’m gonna duplicate my representation of the model or a representation of this microservice or something, and I’m gonna like, replicate it Many times.Handle, load. And the reason that you can’t scale, scale up, uh, past some points is like, you know, there, there, there are sort of hardware bounds and algorithmic bounds on, on that type of scaling. So I’ll give you a good example that’s like very trivial. Let’s say you’re on an H 100. The Maxim ENV link domain for H 100, for most Ds H one hundreds is heus, right?So if you scaled up past that, you’re gonna have to figure out ways to handle the fact that now for the GPUs to communicate, you have to do it over Infin band, which is still very fast, but is not as fast as ENV link.swyx: Is it like one order of magnitude, like hundreds or,Kyle: it’s about an order of magnitude?Yeah. Okay. Um, soswyx: not terrible.Kyle: [00:30:00] Yeah. I, I need to, I need to remember the, the data sheet here, like, I think it’s like about 500 gigabytes. Uh, a second unidirectional for ENV link, and about 50 gigabytes a second unidirectional for Infin Band. I, it, it depends on the, the generation.swyx: I just wanna set this up for people who are not familiar with these kinds of like layers and the trash speedVibhu: and all that.Of course.From Laptop to Multi NodeVibhu: Also, maybe even just going like a few steps back before that, like most people are very familiar with. You see a, you know, you can use on your laptop, whatever these steel viol, lm you can just run inference there. All, there’s all, you can, youcan run it on thatVibhu: laptop. You can run on laptop.Then you get to, okay, uh, models got pretty big, right? JLM five, they doubled the size, so mm-hmm. Uh, what do you do when you have to go from, okay, I can get 128 gigs of memory. I can run it on a spark. Then you have to go multi GPU. Yeah. Okay. Multi GPU, there’s some support there. Now, if I’m a company and I don’t have like.I’m not hiring the best researchers for this. Right. But I need to go [00:31:00] multi-node, right? I have a lot of servers. Okay, now there’s efficiency problems, right? You can have multiple eight H 100 nodes, but, you know, is that as a, like, how do you do that efficiently?Kyle: Yeah. How do you like represent them? How do you choose how to represent the model?Yeah, exactly right. That’s a, that’s like a hard question. Everyone asks, how do you size oh, I wanna run GLM five, which just came out new model. There have been like four of them in the past week, by the way, like a bunch of new models.swyx: You know why? Right? Deep seek.Kyle: No comment. Oh. Yeah, but Ggl, LM five, right?We, we have this, new model. It’s, it’s like a large size, and you have to figure out how to both scale up and scale out, right? Because you have to find the right representation that you care about. Everyone does this differently. Let’s be very clear. Everyone figures this out in their own path.Nader: I feel like a lot of AI or ML even is like, is like this. I think people think, you know, I, I was, there was some tweet a few months ago that was like, why hasn’t fine tuning as a service taken off? You know, that might be me. It might have been you. Yeah. But people want it to be such an easy recipe to follow.But even like if you look at an ML model and specificKyle: to you Yeah,Nader: yeah.Kyle: And the [00:32:00] model,Nader: the situation, and there’s just so much tinkering, right? Like when you see a model that has however many experts in the ME model, it’s like, why that many experts? I don’t, they, you know, they tried a bunch of things and that one seemed to do better.I think when it comes to how you’re serving inference, you know, you have a bunch of decisions to make and there you can always argue that you can take something and make it more optimal. But I think it’s this internal calibration and appetite for continued calibration.Vibhu: Yeah. And that doesn’t mean like, you know, people aren’t taking a shot at this, like tinker from thinking machines, you know?Yeah. RL as a service. Yeah, totally. It’s, it also gets even harder when you try to do big model training, right? We’re not the best at training Moes, uh, when they’re pre-trained. Like we saw this with LAMA three, right? They’re trained in such a sparse way that meta knows there’s gonna be a bunch of inference done on these, right?They’ll open source it, but it’s very trained for what meta infrastructure wants, right? They wanna, they wanna inference it a lot. Now the question to basically think about is, okay, say you wanna serve a chat application, a coding copilot, right? You’re doing a layer of rl, you’re serving a model for X amount of people.Is it a chat model, a coding model? Dynamo, you know, back to that,Kyle: it’s [00:33:00] like, yeah, sorry. So you we, we sort of like jumped off of, you know, jumped, uh, on that topic. Everyone has like, their own, own journey.Cost Quality Latency TradeoffsKyle: And I, I like to think of it as defined by like, what is the model you need? What is the accuracy you need?Actually I talked to NA about this earlier. There’s three axes you care about. What is the quality that you’re able to produce? So like, are you accurate enough or can you complete the task with enough, performance, high enough performance. Yeah, yeah. Uh, there’s cost. Can you serve the model or serve your workflow?Because it’s not just the model anymore, it’s the workflow. It’s the multi turn with an agent cheaply enough. And then can you serve it fast enough? And we’re seeing all three of these, like, play out, like we saw, we saw new models from OpenAI that you know, are faster. You have like these new fast versions of models.You can change the amount of thinking to change the amount of quality, right? Produce more tokens, but at a higher cost in a, in a higher latency. And really like when you start this journey of like trying to figure out how you wanna host a model, you, you, you think about three things. What is the model I need to serve?How many times do I need to call it? What is the input sequence link was [00:34:00] the, what does the workflow look like on top of it? What is the SLA, what is the latency SLA that I need to achieve? Because there’s usually some, this is usually like a constant, you, you know, the SLA that you need to hit and then like you try and find the lowest cost version that hits all of these constraints.Usually, you know, you, you start with those things and you say you, you kind of do like a bit of experimentation across some common configurations. You change the tensor parallel size, which is a form of parallelismVibhu: I take, it goes even deeper first. Gotta think what model.Kyle: Yes, course,ofKyle: course. It’s like, it’s like a multi-step design process because as you said, you can, you can choose a smaller model and then do more test time scaling and it’ll equate the quality of a larger model because you’re doing the test time scaling or you’re adding a harness or something.So yes, it, it goes way deeper than that. But from the performance perspective, like once you get to the model you need, you need to host, you look at that and you say, Hey. I have this model, I need to serve it at the speed. What is the right configuration for that?Nader: You guys see the recent, uh, there was a paper I just saw like a few days ago that, uh, if you run [00:35:00] the same prompt twice, you’re getting like double Just try itagain.Nader: Yeah, exactly.Vibhu: And you get a lot. Yeah. But the, the key thing there is you give the context of the failed try, right? Yeah. So it takes a shot. And this has been like, you know, basic guidance for quite a while. Just try again. ‘cause you know, trying, just try again. Did you try again? All adviceNader: in life.Vibhu: Just, it’s a paper from Google, if I’m not mistaken, right?Yeah,Vibhu: yeah. I think it, it’s like a seven bas little short paper. Yeah. Yeah. The title’s very cute. And it’s just like, yeah, just try again. Give it ask context,Kyle: multi-shot. You just like, say like, hey, like, you know, like take, take a little bit more, take a little bit more information, try and fail. Fail.Vibhu: And that basic concept has gone pretty deep.There’s like, um, self distillation, rl where you, you do self distillation, you do rl and you have past failure and you know, that gives some signal so people take, try it again. Not strong enough.swyx: Uh, for, for listeners, uh, who listen to here, uh, vivo actually, and I, and we run a second YouTube channel for our paper club where, oh, that’s awesome.Vivo just covered this. Yeah. Awesome. Self desolation and all that’s, that’s why he, to speed [00:36:00] on it.Nader: I’ll to check it out.swyx: Yeah. It, it’s just a good practice, like everyone needs, like a paper club where like you just read papers together and the social pressure just kind of forces you to just,Nader: we, we,there’sNader: like a big inference.Kyle: ReadingNader: group at a video. I feel so bad every time. I I, he put it on like, on our, he shared it.swyx: One, one ofNader: your guys,swyx: uh, is, is big in that, I forget es han Yeah, yeah,Kyle: es Han’s on my team. Actually. Funny. There’s a, there’s a, there’s a employee transfer between us. Han worked for Nater at Brev, and now he, he’s on my team.He wasNader: our head of ai. And then, yeah, once we got in, andswyx: because I’m always looking for like, okay, can, can I start at another podcast that only does that thing? Yeah. And, uh, Esan was like, I was trying to like nudge Esan into like, is there something here? I mean, I don’t think there’s, there’s new infant techniques every day.So it’s like, it’s likeKyle: you would, you would actually be surprised, um, the amount of blog posts you see. And ifswyx: there’s a period where it was like, Medusa hydra, what Eagle, like, youKyle: know, now we have new forms of decode, uh, we have new forms of specula, of decoding or new,swyx: what,Kyle: what are youVibhu: excited? And it’s exciting when you guys put out something like Tron.‘cause I remember the paper on this Tron three, [00:37:00] uh, the amount of like post train, the on tokens that the GPU rich can just train on. And it, it was a hybrid state space model, right? Yeah.Kyle: It’s co-designed for the hardware.Vibhu: Yeah, go design for the hardware. And one of the things was always, you know, the state space models don’t scale as well when you do a conversion or whatever the performance.And you guys are like, no, just keep draining. And Nitron shows a lot of that. Yeah.Nader: Also, something cool about Nitron it was released in layers, if you will, very similar to Dynamo. It’s, it’s, it’s essentially it was released as you can, the pre-training, post-training data sets are released. Yeah. The recipes on how to do it are released.The model itself is released. It’s full model. You just benefit from us turning on the GPUs. But there are companies like, uh, ServiceNow took the dataset and they trained their own model and we were super excited and like, you know, celebrated that work.ZoomVibhu: different. Zoom is, zoom is CGI, I think, uh, you know, also just to add like a lot of models don’t put out based models and if there’s that, why is fine tuning not taken off?You know, you can do your own training. Yeah,Kyle: sure.Vibhu: You guys put out based model, I think you put out everything.Nader: I believe I know [00:38:00]swyx: about base. BasicallyVibhu: without baseswyx: basic can be cancelable.Vibhu: Yeah. Base can be cancelable.swyx: Yeah.Vibhu: Safety training.swyx: Did we get a full picture of dymo? I, I don’t know if we, what,Nader: what I’d love is you, you mentioned the three axes like break it down of like, you know, what’s prefilled decode and like what are the optimizations that we can get with Dynamo?Kyle: Yeah. That, that’s, that’s, that’s a great point. So to summarize on that three axis problem, right, there are three things that determine whether or not something can be done with inference, cost, quality, latency, right? Dynamo is supposed to be there to provide you like the runtime that allows you to pull levers to, you know, mix it up and move around the parade of frontier or the preto surface that determines is this actually possible with inference And AI todayNader: gives you the knobs.Kyle: Yeah, exactly. It gives you the knobs.Disaggregation Prefill vs DecodeKyle: Uh, and one thing that like we, we use a lot in contemporary inference and is, you know, starting to like pick up from, you know, in, in general knowledge is this co concept of disaggregation. So historically. Models would be hosted with a single inference engine. And that inference engine [00:39:00] would ping pong between two phases.There’s prefill where you’re reading the sequence generating KV cache, which is basically just a set of vectors that represent the sequence. And then using that KV cache to generate new tokens, which is called Decode. And some brilliant researchers across multiple different papers essentially made the realization that if you separate these two phases, you actually gain some benefits.Those benefits are basically a you don’t have to worry about step synchronous scheduling. So the way that an inference engine works is you do one step and then you finish it, and then you schedule, you start scheduling the next step there. It’s not like fully asynchronous. And the problem with that is you would have, uh, essentially pre-fill and decode are, are actually very different in terms of both their resource requirements and their sometimes their runtime.So you would have like prefill that would like block decode steps because you, you’d still be pre-filing and you couldn’t schedule because you know the step has to end. So you remove that scheduling issue and then you also allow you, or you yourself, to like [00:40:00] split the work into two different ki types of pools.So pre-fill typically, and, and this changes as, as model architecture changes. Pre-fill is, right now, compute bound most of the time with the sequence is sufficiently long. It’s compute bound. On the decode side because you’re doing a full Passover, all the weights and the entire sequence, every time you do a decode step and you’re, you don’t have the quadratic computation of KV cache, it’s usually memory bound because you’re retrieving a linear amount of memory and you’re doing a linear amount of compute as opposed to prefill where you retrieve a linear amount of memory and then use a quadratic.You know,Nader: it’s funny, someone exo Labs did a really cool demo where for the DGX Spark, which has a lot more compute, you can do the pre the compute hungry prefill on a DG X spark and then do the decode on a, on a Mac. Yeah. And soVibhu: that’s faster.Nader: Yeah. Yeah.Kyle: So you could, you can do that. You can do machine strat stratification.Nader: Yeah.Kyle: And like with our future generation generations of hardware, we actually announced, like with Reuben, this [00:41:00] new accelerator that is prefilled specific. It’s called Reuben, CPX. SoKubernetes Scaling with GroveNader: I have a question when you do the scale out. Yeah. Is scaling out easier with Dynamo? Because when you need a new node, you can dedicate it to either the Prefill or, uh, decode.Kyle: Yeah. So Dynamo actually has like a, a Kubernetes component in it called Grove that allows you to, to do this like crazy scaling specialization. It has like this hot, it’s a representation that, I don’t wanna go too deep into Kubernetes here, but there was a previous way that you would like launch multi-node work.Uh, it’s called Leader Worker Set. It’s in the Kubernetes standard, and Leader worker set is great. It served a lot of people super well for a long period of time. But one of the things that it’s struggles with is representing a set of cases where you have a multi-node replica that has a pair, right?You know, prefill and decode, or it’s not paired, but it has like a second stage that has a ratio that changes over time. And prefill and decode are like two different things as your workload changes, right? The amount of prefill you’ll need to do may change. [00:42:00] The amount of decode that you, you’ll need to do might change, right?Like, let’s say you start getting like insanely long queries, right? That probably means that your prefill scales like harder because you’re hitting these, this quadratic scaling growth.swyx: Yeah.And then for listeners, like prefill will be long input. Decode would be long output, for example, right?Kyle: Yeah. So like decode, decode scale. I mean, decode is funny because the amount of tokens that you produce scales with the output length, but the amount of work that you do per step scales with the amount of tokens in the context.swyx: Yes.Kyle: So both scales with the input and the output.swyx: That’s true.Kyle: But on the pre-fold view code side, like if.Suddenly, like the amount of work you’re doing on the decode side stays about the same or like scales a little bit, and then the prefilled side like jumps up a lot. You actually don’t want that ratio to be the same. You want it to change over time. So Dynamo has a set of components that A, tell you how to scale.It tells you how many prefilled workers and decoded workers you, it thinks you should have, and also provides a scheduling API for Kubernetes that allows you to actually represent and affect this scheduling on, on, on your actual [00:43:00] hardware, on your compute infrastructure.Nader: Not gonna lie. I feel a little embarrassed for being proud of my SVG function earlier.swyx: No, itNader: wasreallyKyle: cute. I, Iswyx: likeNader: it’s all,swyx: it’s all engineering. It’s all engineering. Um, that’s where I’mKyle: technical.swyx: One thing I’m, I’m kind of just curious about with all with you see at a systems level, everything going on here. Mm-hmm. And we, you know, we’re scaling it up in, in multi, in distributed systems.Context Length and Co Designswyx: Um, I think one thing that’s like kind of, of the moment right now is people are asking, is there any SOL sort of upper bounds. In terms of like, let’s call, just call it context length for one for of a better word, but you can break it down however you like.Nader: Yeah.swyx: I just think like, well, yeah, I mean, like clearly you can engage in hybrid architectures and throw in some state space models in there.All, all you want, but it looks, still looks very attention heavy.Kyle: Yes. Uh, yeah. Long context is attention heavy. I mean, we have these hybrid models, um,swyx: to take and most, most models like cap out at a million contexts and that’s it. Yeah. Like for the last two years has been it.Kyle: Yeah. The model hardware context co-design thing that we’re seeing these days is actually super [00:44:00] interesting.It’s like my, my passion, like my secret side passion. We see models like Kimmy or G-P-T-O-S-S. I’m use these because I, I know specific things about these models. So Kimmy two comes out, right? And it’s an interesting model. It’s like, like a deep seek style architecture is MLA. It’s basically deep seek, scaled like a little bit differently, um, and obviously trained differently as well.But they, they talked about, why they made the design choices for context. Kimmy has more experts, but fewer attention heads, and I believe a slightly smaller attention, uh, like dimension. But I need to remember, I need to check that. Uh, it doesn’t matter. But they discussed this actually at length in a blog post on ji, which is like our pu which is like credit puswyx: Yeah.Kyle: Um, in, in China. Chinese red.swyx: Yeah.Kyle: It’s, yeah. So it, it’s, it’s actually an incredible blog post. Uh, like all the mls people in, in, in that, I’ve seen that on GPU are like very brilliant, but they, they talk about like the creators of Kimi K two [00:45:00] actually like, talked about it on, on, on there in the blog post.And they say, we, we actually did an experiment, right? Attention scales with the number of heads, obviously. Like if you have 64 heads versus 32 heads, you do half the work of attention. You still scale quadratic, but you do half the work. And they made a, a very specific like. Sort of barter in their system, in their architecture, they basically said, Hey, what if we gave it more experts, so we’re gonna use more memory capacity.But we keep the amount of activated experts the same. We increase the expert sparsity, so we have fewer experts act. The ratio to of experts activated to number of experts is smaller, and we decrease the number of attention heads.Vibhu: And kind of for context, what the, what we had been seeing was you make models sparser instead.So no one was really touching heads. You’re just having, uh,Kyle: well, they, they did, they implicitly made it sparser.Vibhu: Yeah, yeah. For, for Kimmy. They did,Kyle: yes.Vibhu: They also made it sparser. But basically what we were seeing was people were at the level of, okay, there’s a sparsity ratio. You want more total parameters, less active, and that’s sparsity.[00:46:00]But what you see from papers, like, the labs like moonshot deep seek, they go to the level of, okay, outside of just number of experts, you can also change how many attention heads and less attention layers. More attention. Layers. Layers, yeah. Yes, yes. So, and that’s all basically coming back to, just tied together is like hardware model, co-design, which isKyle: hardware model, co model, context, co-design.Vibhu: Yeah.Kyle: Right. Like if you were training a, a model that was like. Really, really short context, uh, or like really is good at super short context tasks. You may like design it in a way such that like you don’t care about attention scaling because it hasn’t hit that, like the turning point where like the quadratic curve takes over.Nader: How do you consider attention or context as a separate part of the co-design? Like I would imagine hardware or just how I would’ve thought of it is like hardware model. Co-design would be hardware model context co-designKyle: because the harness and the context that is produced by the harness is a part of the model.Once it’s trained in,Vibhu: like even though towards the end you’ll do long context, you’re not changing architecture through I see. Training. Yeah.Kyle: I mean you can try.swyx: You’re saying [00:47:00] everyone’s training the harness into the model.Kyle: I would say to some degree, orswyx: there’s co-design for harness. I know there’s a small amount, but I feel like not everyone has like gone full send on this.Kyle: I think, I think I think it’s important to internalize the harness that you think the model will be running. Running into the model.swyx: Yeah. Interesting. Okay. Bash is like the universal harness,Kyle: right? Like I’ll, I’ll give. An example here, right? I mean, or just like a, like a, it’s easy proof, right? If you can train against a harness and you’re using that harness for everything, wouldn’t you just train with the harness to ensure that you get the best possible quality out of,swyx: Well, the, uh, I, I can provide a counter argument.Yeah, sure. Which is what you wanna provide a generally useful model for other people to plug into their harnesses, right? So if youKyle: Yeah. Harnesses can be open, open source, right?swyx: Yeah. So I mean, that’s, that’s effectively what’s happening with Codex.Kyle: Yeah.swyx: And, but like you may want like a different search tool and then you may have to name it differently or,Nader: I don’t know how much people have pushed on this, but can you.Train a model, would it be, have you have people compared training a model for the for the harness versus [00:48:00] like post training forswyx: I think it’s the same thing. It’s the same thing. It’s okay. Just extra post training. INader: see.swyx: And so, I mean, cognition does this course, it does this where you, you just have to like, if your tool is slightly different, um, either force your tool to be like the tool that they train for.Hmm. Or undo their training for their tool and then Oh, that’s re retrain. Yeah. It’s, it’s really annoying and like,Kyle: I would hope that eventually we hit like a certain level of generality with respect to training newswyx: tools. This is not a GI like, it’s, this is a really stupid like. Learn my tool b***h.Like, I don’t know if, I don’t know if I can say that, but like, you know, um, I think what my point kind of is, is that there’s, like, I look at slopes of the scaling laws and like, this slope is not working, man. We, we are at a million token context, okay, maybe next year, 2 million, we’re not going to a hundred trillion, you know, like this, this, oh, there’s so many interesting ways to get this Doesn’t work.Just doesn’t work.Nader: What’s kind of funny is whenever there, I, I feel like we always want to see a trend that we can predict, but every time something’s come, it’s been like a leapfrog. So I, I imagine I, I don’t know how we go from one to two, but I imagine what, what’s likely to happen is [00:49:00] we break through that from some newKyle: Yeah.There’s actually, there’s an interesting formalization of this. There, there’s an essay. It’s a pretty interesting essay by Leopold Ashton Brener called Situational Awareness.swyx: Okay? Yes.Kyle: He introduces a concept awareness called an un hobbler, right? So he, you know, Leopold in this essay details, Hey, I want to get.You know, like, I wanna get to this point in intelligence and I think that it is four orders of magnitude worth of like compute and data and training away. And you know, he says, oh yeah, I think data centers can scale up by about this much. I think that you can do, scale up the data and some other things by this much.But one of the things that like makes the rest of that order of magnitude growth, PO possibilities is un hobbler, like these scientific discoveries that are discovered during. You know, model architecture, search or training that really, really, really impact how, how you are able to scale. Like a, a good example of this might be that like we see like a mo a lot of models that are, [00:50:00] and this is probably a very tiny on hobbler.But is important for the performance perspective. We see a lot of models that are like trained with multi token prediction natively in during pre-training.And per deep seek in their paper they say, Hey, decided this actually helped us in ensure sta more stable convergence. But they’re like, un Hobbs that are like that.And then they’re like, rather large on hobbler. Right. Like architecturally, a lot of our models, like we had different types of attention. And one of the problems with attention is like, you have a lot of kv, but people found like different forms of attention, like group query attention and, uh, like MLA in deep seek multi-head latent attention that like decrease the burden that KV has on the model, which allows you to grow like longer in context.swyx: Yeah. And that, that was very drastic for deeps seek.Kyle: Yeah. This was like, yeah, it for context like the, the total, I think the total context length of deeps seek is 128,000 tokens or might be 256,000 with rope extension. That entire context, I think it’s 128,000 fits into eight gigabytes. Previously context, like I think the, the llama four or five B context [00:51:00] of a similar size was like 40 or 80 gigabytes in the same precision.swyx: Yeah.Kyle: Um, so like those in Hobbler like really decrease the stuff of that size. And I wouldn’t be surprised if we do see the ability to like, break through to like 10 million, 20 million, a hundred million context through the an un hobbler showing up. Iswyx: see.Kyle: And it’s just science.swyx: So more deep learning algorithms is whatKyle: I’m hearing.Yeah. More deep learning algorithms. Um,swyx: yeah,Kyle: I, I could, I could actually playing pickupswyx: and he hasKyle: room to, I I could actually give you an, an example like of like a, a theory, not a theory theory, but something theoretical and a hobarNader: that you’re excited about or,Kyle: well, and, and a hobar that, I mean, I haven’t seen, so it could be a tar pit and it could not, just, not work.But, uh, I, I would be really excited to see a model that does prefill and decode differently. So a model that does, uh, prefill like locally, like document wise, prefill, like it doesn’t in chunks, and then you do decode globally across like the entire sequence because it, logically to me it doesn’t seem like you would necessarily need to [00:52:00] have KV b associative between documents that have like, no, no mutual association.But that like places a lot of burden on prefilled to like, or sorry, on, on decode and pure attention within the decode phase to like make those connections since the KV is like static at that point. And you see other techniques that are interesting like this too. But if, if you’re able to do that, like.If Prefill becomes local and decode is, is still global, you solve that prefilled quadratic scaling problem because you have a bunch of like small chunks that you prefill independently.swyx: Okay. All right. Well, let’s, uh, wait and see, but I, I think it’ll be pretty exciting.Kyle: Fingers crossed.swyx: Yeah, fingers crossed.Yeah. Yeah.Vibhu: I’m excited for prefilled decode on separate hardware. So like yeah. CR acquisition, right. Can we decode on the gr Can we get super fast?Kyle: I don’t think I’m allowed to comment on this.swyx: Mark is gonna shoot arrows at us.Nader: Uh, he’s got a blow dark, he’s in the room, justKyle: like,Nader: like go to sleep.Yeah. Yeah.swyx: ButNader: I’m, I’m super excited to see the team come in and like, you know, I’ve gotten the, the pleasure of working with some of the, the GR people coming in. So, you know, yeah, I,swyx: I know Sonny, [00:53:00] we’ve had him, uh, at the sameKyle: conference thatswyx: you are at.Nader: Yeah.swyx: Um, and, uh, I, I think you’re, you guys are gonna be doing some sessions at G tc.I don’t know if you wanna, this is a good place to plug them.Kyle: Yeah, yeah, yeah. So, I can’t speak to any LPU related sessions at G tc. I have no idea about that. Oh, no, that was,swyx: no. YoursKyle: on the, on the GR side. Yeah. I use the associative NVIDIA U Yeah. Um, on the, on the Nvidia Dynamo side, we’re, we’re giving, there are a large number of sessions.For those that aren’t aware, you can actually search. All of these sessions for GTC online, just go to the GTC website. I don’t know what the URL is, but go there. Google it. Yeah. Uh, and you can just look up Dynamo and you’ll get all the sessions. There’re about 20. There are a couple that are hosted by the Dynamo team.There are a couple that are hosted by people that use Dynamo that wanna show off the results they’ve been able to get. But there are two that I’m really excited about. Uh, one is just the General Dynamo tutorial, and this is the, I’m going out with Harry, who’s our lead product manager for Dynamo.And we’re sort of talking about like how to use Dynamo to get better performance and also like where we see Dynamo going in the future. And [00:54:00] then there’s another session that I’m doing with one of our agents teams at Nvidia to talk about sort of the future of agents in production inference. Yeah. So we’re talking about, there’s like this new horizon with respect to agents because we have these harnesses that actually impart structure on upon calls.Like if you, if you compare like, the past and the, and the present with respect to like how LM calls work. Like in the early days when they were chatbots, like every call was like very different. There was basically no structure. You could assume that like people, you, if it was conversational, there might be like some implicit structure because you have, you know, a multi-term conversation.But agency have this, this harness that, like abides by rules, right? So it imparts direct structure onto the context. And you see this, there was an interesting Twitter post about how Claude code like structures, its context so that you get as many cts as possible.And I think it was by one of the, the PMs for Claude code.And he, he wrote about it. And that type of structure that the harness can impart actually like goes hand in [00:55:00] hand with the. Inference co-design. So I’m doing a talk, I, I don’t know the session name or the session number, but I’m, I’m doing a talk, uh, you can look at me up by name on, on the GTC website, on how we accelerate agents and where we see specific optimizations for agents going in Dynamo and in inference in general.swyx: Yeah. I think there’s only 1:00 PM for cloud code and it’s wo the rest. There’s, there’s Devrel, there’s Boris. Maybe it was maybe Devrel. Yeah, exactly. I mean, let’s go into agents. I think this was like the last part of the, the, the discussion we planned. Yeah. How have we not talked about agents also with you guys?Well, we scheduled, it was like, I was like, okay, you know, like, let’s have like cohesive sections or,Vibhu: I mean, there’s the big news, right? The NVIDIA’s a huge. Like deployment of Codex. Yeah, videoswyx: uses everything. I mean, we use this cursor and we uses code,Vibhu: but that’s, that’s a pretty big deployment, right?Like, that’s tens of thousands of people.Nader: Totally. Yeah.Vibhu: We’re super What? That’s,Nader: yeah. I, it goes back to the mosh pit of emails we kind of mentioned earlier, or just the like, um, how fluid the org feels. So when there’s new technology, people will just email it out and everyone will try it.[00:56:00] And if it, if it’s making people’s lives easier, it’ll spread like wildfire.Kyle: A lot of times Jensen will get it and it’ll be like, let’s make this work. Yeah. Across the company. Let’s make this work right now,Nader: honestly, uh, if I was a startup, I feel like a cool hack. If you have something that’s going to save an Nvidia time they’ll spread it to a couple and the same thing.Right? It’ll just spread like wildfire. Okay.Vibhu: Careful before your email blows up from startups. Well,Nader: You gotta know the person. Right? But no, I, um, I, yeah, so I mean, we, I love using Codex. It’s been a ton of fun. Yeah. Uh, I’ve been using it personally. I’ve been using it at work. It’s been, um.Yeah, I dunno. It’s been great to see the rollout, something really funny. Uh, on the data we got, uh, codex and cloud code access. I found this person, uh, his name’s Carlos at the company. He wrote an Outlook, CLI.Kyle: Oh yeah.Nader: And, uh, just the CLI for email. And this was, I’veKyle: been using that,Nader: yeah, maybe like four or five weeks ago.And, uh, the site, so once I got like Codex access I. Installed the CLI, it had a skill and I just asked it to go through all of my emails, which it’s very messy. So if I don’t respond to your email, I’m really sorry. But I asked it to gimme a summary, highlight any [00:57:00] escalations that I should look at, put any thread that it thinks I should respond to in a folder, and then archive everything.And it did. So if I missed your email, it’s because it didn’t get,swyx: so I should put a prompt injection in my V to Yeah, yeah. What you should do is just FaceTime. Yeah. Um, my, yeah, my SLA is highest on FaceTime,Nader: but that was, it was magic. And so I, I sent it in a big email thread to like 500 people. A bunch of folks tried it out.I started like FaceTiming whoever I could at the company to get them set up with this.swyx: Yeah. Um, that specific example mm-hmm. You guys deal with like some pretty. Sensitive emails.Nader: Yeah.swyx: Is there a security review with this?Security Meets Agentsswyx: ‘cause like one guy made, made it for himself, but like it’s not meant for all theNader: security team and Nvidia is incredible.Like, shout out to them. They’re, they’re, they’re trying to, we have a, we have an amazing security team ‘cause they’re progressive and they know that this isKyle: really important technology and you have to bring it in. If you think about like, if you work at a big company, your laptop’s usually very locked down ifNader: you can only access certain things.Nvidia engineers have those restrictions aren’t there. So you’re expected to understand the risks when you try things out. And so. Very quickly, you know, made sure to [00:58:00] chime in security on what we were doing.Agent Permissions ModelNader: There’s actually a lot that we’ve been thinking about, especially with open claw, right? Like there’s, you know, agents can do three things.Yeah. A agents can do three things. They can access your files, they can access the internet, and then now they can write custom code, uh, and execute it. And you literally only let an agent do two of those three things. If you can access your files and you can write custom code, you don’t want internet access because that’s one to see full vulnerability, right?If you have access to internet and your file system, you should know the full scope of what that agent’s capable of doing. Otherwise, malware can get injected or something that can happen. And so that’s a lot of what we’ve been thinking about is like, you know, how do we both enable this because it’s clearly the future.But then also, you know, what, what are these enforcement points that we can start to like protect?swyx: And is there any directive of like, Hey, we have a company account or a company agreement with open ai, we use open AI models here, or like choose whatever.Nader: No, no. So, so I would never put any company data in a model that’s not either, that we don’t even, it has to most security.Yeah. Yeah. I like how,swyx: how that goes. Uh, you know, obviously you could run your own [00:59:00] models. You Nemo and, and we, right, we, we as an, we have an internal cluster, so, you know, of course in random,Kyle: uh, yeah.swyx: Yeah.Nader: I think we’re dynamo’s first customers. Let’s goBuild Nvidia Inference GatewayKyle: actually, uh, there’s a funny story about like how I got the experience that informed what we needed for Dynamo at one point.There’s a website called build done n video.com and also for us infra dun n video com. That is allows people to try models. It gives an a p service. You can call the model with like a rest, API, and you know, you get a response. I ran the model side for that and it was at one point the largest inference deployment and still may actually be the largest inference deployment in video.I’ve, I’ve since like, handed it off to some people and they’re doing a wonderful by way. This is a extremelyNader: underknown or less known resource. Vil diamond v.com. You can get any of these open source models. And it’s rate limited, but it’s free. So it’s perfect for hackers to,Kyle: and, and the SLA on getting models day zero models up is like a day.Yeah.Kyle: Like they’re, they’re incredibly good at like figuring out the right way to host the model to [01:00:00] get it up there as soon as it comes out.swyx: You ran this?Kyle: Yeah, I ran, I ran it a long time ago. It was originally called Nvidia AI Playground, then it was called AI Foundational insert. Yeah. And then it was called Build Nvidia call.And I, I ran the model side of it. So there were, there was a large multi-organizational team. I ran how, which models should we host? How should we host them and like what’s the proportion of them? And then of course there was like an SRE team that like made sure that things ran well and scaled the models as well.But I ran like, you know, model, how do we get the model to silicon? And then, which model also worked with our product team Determine like which models were important a very long time ago.Yeah. Yeah. There’s also like a middle ground in between there, right? This is like for the hacker. Try anything.There’s the Brev console, then there’s Dynamo, there was also nims, right?Kyle: Yes.I remember it had its little moment, like a year or two ago. Is it still?Nader: Yeah. NIM is, uh, you know, inference, uh, oil. I, I think it like for something is it is a log or acronym. Yeah. It [01:01:00] just, just a name. But, um, yeah, NIM is, uh, how enterprises can take our uh, any of the, any of this technology and run it with support and all of that.And so that includes Daniel Mo. That includes, I don’t know all of our other optimizations that are packers up for Enterprise. Yep.swyx: Anyway, so, so you, you got a bunch of experience start running the sort of internal inference gateway playgrounds.Kyle: Yeah, I got And Bill also built how build NVIDIA’s first internal like vs.Code thing. We call it MB code.swyx: That’s what I, uh, extension.Kyle: Yeah, it was, it was a V first,like the fork vs code.swyx: We jokes absolutely not. It just a while back they like, we should have a fourth vs. Code hackathon where you, that’s four. It’s the best four V vs code. We,we were, we were doing a hack how make a billion dollars, someone from VS code was there and he was like somewhat down to get involved and I was like,swyx: oh, you should do that.That’s all. Then the cool thing became four chrome hackathonChrome,swyx: And no, no, no IDs or not cooling.Nader: I saw, what’s it called?Hackathons And Autonomy DreamsNader: I was talking to Joseph, uh, from Robo Flow and uh, they’re partnering crime. We were talking about how with the new Alpha Mayo model, so Nvidia just [01:02:00] released an open source. Uh, the, the Mercedes cars that you saw drag, she on Frazey?swyx: Yeah.Nader: Released. Will you open source, a autonomous driving model? Uh, I already, yeah, so we were thinking like, could we hackathon a driverless car? Like I have my old car. Let’s just try it.swyx: We’ll take it,Nader: take it to like, click train with a treasure eye, like in the middle of the day. Just like, just see, let everyone, like how many, how many cameras do we need?Right? Like, 1, 2,swyx: 3, 4. They don’t. Five, six.Nader: I don’t know. I, yeah. But, um, I think we’re gonna try, you just do it with us.swyx: We can see, we could evenNader: have a race. It’s like the first person to automate theirswyx: driving. Let me over a weekend. We do have an autonomy track at Will’s fair. Uh, WiMo was there like Yeah.Nvidia did send people that for Goot. Not because he didn’t have the driving thing yet.Nader: Yeah.swyx: Yeah. It’s, that’s cool.Yeah. I think comma, comma also has a version of this comma have open source driving. They’ve, they’ve done a fun hackathon onswyx: music and he and I also, ‘cause I, I really, what I really want is a Tesla with Tesla level self-driving.Yeah.swyx: But as a smart car, like a two seater. That’s the basic CPA wheelchair with a [01:03:00] roofand only thing they make them, but the demand has d they, no, they realize this probably five years. Yeah. Really?swyx: Yeah.They were d manufacturer.Kyle: I thought it is one of those things, we’ll, where we’ll see someone buy the brand and it’ll be revived.swyx: I, I would buy it like IKyle: probably. Someone hears this go byswyx: your car. Yeah. Yeah. That’s crazy. Nobody Mercedes, because they, they’re like, I think 10 Mercedes, Mercedes, uh, I in Mercedes usedto make them, I don’t know. I feel like they own the brand and you outswyx: that’s your dream might come true enough. Okay.We we’re time notify and, and I was like, every time I, I try to park in San Francisco, I I have to buy a smart car because like 20% of the parking lots in San Francisco only fit smart cars.Nader: Yeah. So, Hey, really?swyx: That’s where, I mean, it’s mallNader: even it was late here trying to, this comes from someone that like, basically doesKyle: not drive.Nader: That’s where the, the Vepa was a life hack. Yeah, exactly. Yeah. You know what happened to the Vespa? Um, I used to have [01:04:00] this yellow Vespa, uh, I left it outside the hacker house when we moved out. It trend. Um, it’s just, it was always there. And then like a month ago. It’s not there anymore. I’ve been meeting today.I don’t dunno. You could, it’s actually tv. You forgot about it.swyx: Yeah.Nader: And left.swyx: Yeah. Yeah. No, this, it’s probably hazard. And speaking of hackathons, I also wanted say, give a big shout out to the world. Shortest hackathon. Let’s go. Uh, you did twice. You gonna watch aNader: handful of times? Yeah. There’s gonna be one at G tc.Oh, we’re doing pretty much we have a bunch of challenges that No, we haven’t released. And you get to bring your agent to come and attempt to, uh, go through thoseKyle: challeng again. It’s like a zero, the zero minute hackathon idea, which you just, you just bring your, I I approached eight, nine along a long time ago.You just bring your agent and then you press the go button. You’re not allowed to code. It’s just the Asian doing bond.It’s a good hidden email, right?Kyle: Yeah.Do you make a jar? You makeKyle: I there something I would love to see from cognition or someone else be like, come bring your agent. Drop it inbecause you don’t, you don’t know you like supervisor.Well let be [01:05:00] a, you know, operate a browser, order a pizza. We’ll just see like that snake it, you know,swyx: andKyle: you don’t know what theswyx: taskKyle: is. Yeah. You dunno what the task is like, or just like, you don’t even know what the judging categories are and then you give it the judging categories. Like, try as much as possible.It’s great though. It turns into like, yeah, so let’s build something on dining party. It’s a great business. See,Kyle: anyway, funny story.Agent UX And CLI EverywhereKyle: Actually, we have a couple of people at Nvidia, we’ve been working with security to like bring agents really close to compute. So we now have like stuff where we can like tell Dynamo, like go run some experience with Dynamo, like on, X cluster and just like try it right now, like queue up once you get queued, like, send this request load and we’ve actually been able to like, just like, you know, like one shot problems like.We used to have this problem where you know, with Dynamo you have to like find the right configurations and we, sort of do it automatically for some parts of it, but you have to like a good initial configuration that you want to use. And we’ve just had like an agent just completely one shot that it goes, it gets the compute, it like runs a couple experiments.It’s like [01:06:00] this is the best, this is this, these are part of the ER frontier. Go run this. And then we just like give that to people and it’s like faster than anything that they have.Nader: Agent UX and agent marketing are super important. There’s stuff that we’ve been thinking a lot about. Um, Alec is like redoing the entire Brev CLI, um, so that you can fetch all the different compute types that are available.I don’t know, it’s gonna be really soon, but then you can, you can just browse what GPUs are available and then provision one say to it right there. And you can pipe all the commands. But I think it goes back to like the Alex CLI, like if you, coding agents. It’s kind of funny. I feel like coding agents have been so much more effective than general purpose agents.And I think a large part of that is it just has access to the terminal, like you said, and that means it has access to everything that you’ve installed into your terminal. It can run. So, you know, it would write code and, and it can compile the code and if there are errors, it can fix it, it can run your suite of tests because that’s all just in your terminal.And so that, you know, then for the idea, what come me really excited about the CLI, we’re now just turning through building CLI for the entire, like for the entire business. We Slack, building Slack, also. Workday, C-L-I-S-A Go. I, I’ve also done that for myself first. Really? Yeah. Yeah. Um, we’re gonna, we’re gonna [01:07:00] open source all of this.And like yeah, all the, the I they’re just they’re the C yeah. CLI for the business applications. We would love for someone to run with this and like build like, I don’t know, like open CLI foundation in or something. Yeah. We, I Nvidia would love to support, uh, anyone that’s doing this.Like e every Devrel tool should really have good CLI support at this point.Yeah. Like at one point it was, you want your docs to be. Like accessible by an LM, right? You want LM Good dog. No, every, everything needs some CLI.Nader: Yeah. It’s kind of funny, right? Like we, like computing began with a terminal with a shell, but we said that it’s not empathetic to, uh, humans. So we built these nice user interfaces and then now we have LMS navigating our user interfaces.And ironically, we’re not empathetic to the machine anymore.swyx: Yeah.Nader: Yeah. Just give the, the LLM access to the show.swyx: One thing that slightly makes me uncomfortable is like, why do we have to build cli? Why can’t we just expose APIs? Like,Kyle: I, I have, I have an interesting answer to this. So there are a couple reasons.Like there’s, there’s like, you know, portability is like one issue. Like, you know, like sometimes APIs are not like discoverable or like reachable by, by some, you know, types of [01:08:00] things. There’s some element of locality, right? Like, uh, like the CLI is like literally you interfacing with your like local system, which is a little bit different.You could still do it by API, but like there’s this highlighting of like, what is the difference between like a CLI and an MCP, right? Like they kind of occupy the same purposes and you call them, it does something on the system and, and that’s done. I think that in pre-training there’s just an enormous amount.Oh, okay. Command line data. Yeah.Yeah. Like e even let’s ignore our, let’s let’s ignore our l Like you’re doing no harness, you’re doing no harness push training. Just the amount of like CLI versus API documentation for just like navigating this world of the CLI in your file system through that is just enormous.Nader: Yeah. Yeah.Kyle: Right. INader: think there’s a, there’s a couple of things too. Like if, let’s say we wanna, so one I think your intuition’s, right? The CLI is just wrapping the API,swyx: right? So functionalNader: functionally, right? Yeah. And I think it’s nice because one, you’re, you’re being very, uh, specific and pedantic even, um, of what and that’s really good ‘cause you’re describing the problem space.So you know what the, I don’t [01:09:00] know. I don’t wanna call it like what the, the space for vulnerability. You know what network calls you’re making, it’s not arbitrary and that’s not decided on the fly. That’s like pre-decided, which is important from a security perspective. But then if you were to write a bunch of API requests, you would probably do that.I don’t know. Would the model like use Python to do so? I kind of like that. Everything like a CLI is just dash because it’s ubiquitous. Like it’s just there. And you don’t have to make sure that there’s certain environment variables that are set up. Like if your Python versions, if the My Python version we’re using the same model to go do the same thing, is it gonna write like different code?It probably would. And so it’s kind of like an nice deal work, right? Yeah. Human. Yeah. No, I think just like making those decisions happen ahead of time versus yeah.swyx: One last thing on this sort of agent, I guess maybe co-location or whatever you call it, uh, one pattern on tracking for this year, I always try to think about what’s the theme of this year gonna be last year?Definitely coding agents this year is definitely coding agents, breaking out of containment into broadening third world. I go Definitely has. SoVibhu: you rent a human?swyx: Yeah. Yeah.I’m on here.swyx: Are you really? [01:10:00]I’m like $5,000. I’ll do anything. Really? I think so. I need, uh,swyx: my, uh, my borrow from Costco.Uh, but I think the best part is only the agent can book me, you know?Yeah.swyx: It’s veryKyle: usually like,swyx: it’s just like another labor marketplace at Mechanical Turk was this.So definitely I have a weird story with why I did it. So back to your example of just giving agent access to compute, right? Yeah. You guys are GPU Rich at Nvidia. Yeah, I hooked up.Nader: He’s not shy about it.Local GPUs And Scaling InferenceI have, I have a 24 7 agent running, I hooked up to run pot.It doesn’t shut down instances. And I’m like, I’ve tried prompting you, I’ve given the instruction. Shut down when you’re done. It’s like I to keep it warm, I’ll need it soon. And it’s horrible on time estimates too, ‘cause like they realize it’s like. Yeah, I’ll need it in 45 minutes. 45 minutes, I’ll shut it down.45 minutes of human time is actually three minute of agent time, so it’s like I’m booting it up, I’m waiting, I’ll just leave it on all night. And mo moo’s good at shutting down after something activity. I had it on my local server, like a little dual GPU thing. It just stays on. I have a little space heater at home now, but careful.[01:11:00] So basically, you know, they don’t care about the concept of money just burn it. I need it. It’s useful.Nader: And another DGX spark will be really nice. Like, I, I think I’m looking at it as super useful for agents because Yeah, you buy it once you plug it in and they it can rip. I’m gonna make a, I’m gonna make an Nvidia ad here.Kyle: Okay. The Blackwell, like RTX 6,000 cards. Pro Pro only, like, I think it’s $8,000. Slightly cheaper. Yeah. Well, it’s much, it’s much cheaper than the data center cards.Vibhu: Yeah.Kyle: And it’s got 96 gigabytes of u gram. So if you and your, your crew want to go, like, run a local agent for you, you know, you, you in the home.I feel like, hmm. It’s got a significant amount of vra m I’ve thought about purchasing this and running in my basement, except my neighbors would hate me.It’s just a single, like two, three slot. GPU. It’s mostly,Kyle: yeah, it’s A-V-C-I-E.Yeah, it’sKyle: UCI u. So GPU, you can go by that. I mean, the big difference against like the RTX, like gaming, GPUs, it, I mean, obviously it’s like blackball Pro, like it’s a pro GPU and it has a [01:12:00] lot of E round, which means you can run pretty large models on it.You can stack four of them for the Maxim Q in a system that’s a beast.Kyle: It’s beefy. You can run, uh, what is that, 96 ger or anything? 96, uh, you’re on a loge.Uh, but also they, they are slow. They’re not, I mean, performance of speed will be somewhat slower compared to API like,Kyle: oh yeah, that, that’s true. So again, the big learning economy of scale allows you to do things that allow you to get both speed and throughput.Like you can run. I’ll give you an example. There’s an optimization called Wide ep. I’m not gonna go into it fully, but like it featured heavily in, in inference Maxim for Deep seek. And there’s a, there’s a great set of stories from Nvidia and from semi analysis about like why y EP is important, but for like MOE models, it’s like basically essential and you run it like the A Level app parallelism, the level scale up parallelism used for it is like 32.So it goes beyond that eight barrier. And it like really, really, really is important to have that M mbl, L [01:13:00] 72, GB 200 MD link to serve at scale. And like, it’s like, I don’t remember the, the, you know, cost improvement I think against Hopper, right? Against Hopper. With this MBL L 72 system, you’re getting like 35 times cheaper per token for like a lot of the curve.Yeah. Which is crazy.swyx: Yeah.Kyle: And Normalize per GPU obviously because the part of the GP is cost or the code, the GST part of the cost.swyx: One thing I’m exploring is the sort of, this year is also the year at the subagent, um, where you have the main agent, but then that also kicks off tools, which are in themselves, agents that have limiteds.Yeah. And sort of context locally, whatever, right? Yeah. Different prompts. So for example, one thing that Ian does is before you kick off a search, they do like a fast context model where you kick off April or you just to search, uh, across the code base plus all that. That is better than indexing. A a lot of the times, not, not all the times, and, uh, you should sell index for some picks, but like the idea that agents should be able to command subagent and probably run [01:14:00] them like maybe close to inference as well.I don’t know if that’s like architecturally possible or evenKyle: Yeah, we’re, we’re thinking about that for dmo. That’s like our big theme for the year,swyx: because like you, like if you can design that into your stuff, then a lot of people, a lot more people will use it. Right now it’s like just kind of theoretical because.You do pay a lot of like back and forth, uh, coordination costs. Yes.Vibhu: I think it’ll net speed up though, right? Like even at a basic level, speculative decoding, you’re running a small model, you’re running two instances, but it’s not,swyx: that is one example. Yes.Kyle: Yeah. But this is like a little bit like different with like agents.Agents, yeah. This is not spec. I think, I think there’s like a summarization of that trend that I like to do or I like to say to my team, it’s like, this is the year. So there are two things. This is the year system as model, right? Where like instead of having like a single model be a thing, you have a system of models and components that are working together to like emulate the black box model.So when you, when you make an API call to something that’s like, like a multi-agent in the background, it still looks like an API called a model. You’re still getting back toswyx: grants, but under the hood.Kyle: Yeah, under the hood. It’s like a [01:15:00] billion different models. And that’s a lot of complexity, with Dynamo and with other libraries and media we’re, we’re looking to help manageNader: that complaint.Yeah. It’s funny because we actually, for CES, we just released the model router. Uh, for DGX Spark where you can have a local model that’s running on the spark and then also a foundational model and then the model router decides when to send queries to which one. So it’s no longer this like either or.It’s used the best stuff for everything that’s available to you. You have a good post-training bottle that’s running onswyx: these. There are leads that are also the bread functionality of being able to manage the spark.Kyle: Oh, that’d be cool. Oh yeah,swyx: I did be able feature request. There we go.Long Running Agents And SF ReflectionsKyle: I actually like a question, like I, I like to like extend and flip over.How much longer do you guys think like agents are gonna be running? Because that’s one thing I’ve been throwing around, like, what happens when, Imean always areKyle: iteven affects the, like back to the prefilled d the decode, right? Like, yeah. Codex is, I’d say, compared to cloud code, it’s much longer at tasks like, yeah, that thing, we’ll, like to run 6, 7, 8 hours.I’ll run it overnight.Kyle: Yeah.And I’ll, I’ll go back and I have like a little crappy logging software I use and there’s just times where it wants to, like, I’m gonna go deep on [01:16:00] research and it’ll, I eat up 80,000 tokens go on another go on another, yeah. Just eat through tokens and you know, that’s part of it.Like, at the end it does, it does hit a long task. And I think you only see that, that expense. Yeah.Nader: I, yeah, there’s insatiable demand for tokens and every improvement that comes kind of just makes our demand even higher. It’s kind of funny, right? Like if you have like a teammate and you ask me to do a task and they’re like, should I save some effort and not think too hard about this task?I’m like, f**k no.I mean, my favorite was like, you can, you can have four shots, right? Yeah. Like the original codex before the app. You, why do one call, like, give it four attempts? Just, just use all the token to out, right? Try Moreal try, try again. Try more. It’sKyle: like, it’s like the, the meta index right?Is the thing that tracks like how long models are able to run. I expect that we’ll just see like log linear, if not log super linear growth. We will see before the end of the year an agent that is capable of running for longer than 24 hours with like self consistency the entire time.I, I would also poke at different domains, having different [01:17:00] desires, right?Like at a consumer level. I’m getting slightly frustrated at 20 minutes per basic query. Sure. You can optimize, you know, six, eight hour. I don’t see myself shooting off many one week agents. Right. Someone doing like, okay, GPU kernel research or medical or biological, like, you know, in, in those domains Sure.Shoot off a lot. That take a, so like I think it will be somewhat domain specific ‘cause you also really need to turn that in. Right.Kyle: It’s funny one, those was doing your taxes. Right. Like, that’s tax. Yeah, that’s, yeah. Okay. Yeah.Nader: Get it right. I wonder if like this major school say sort of like, uh, speculative decoding is like your agent figuring out what you might be prompting it the next day at night and like pre fetching.swyx: Yeah, you can dothat.Nader: Yeah. Really? Branch, branch prediction.swyx: Oh, well no, that, well, that’s, that’s too, that’s too low level, but yes. Sorry. Yeah, yeah, yeah. One question I gotta get, so like, uh, we actually did record a part with the, the beat folks. Uh, with Sarah right here, their chart is the human equivalent work, uh, hours of work rather than how long it has themselves are, are being [01:18:00] autonomous.And that, that’s a huge difference, right? Like human work, five hours agent work, 30 minutes, like it’s actually 30 minutes not, uh, yeah. Firearms, right? Like, so like that, that, that chart that you see is them estimating what the human equivalent replacement is. Um, I think the, I think actually Enro release a more recent chart.That showed cloud code autonomy from their production traffic numbers, and that was 20 to 45 minutes. That’s roughly where we are. So yeah. Yeah, that’s the sort of realistic thing. I mean, I, I do think like there’s experimental setups we can just like, Ralph with and like just prompt it to keep going, uh, when it stops.And obviously you can, that can go arbitrarily long,Nader: I feel likefrom myNader: experience. Yeah. I guess 20 to 40 minutes seems right for when I’m using like Codex or cloud code. But then like what, I always try to just, like, if I wanna spin up like a new, there’s a net new project, I’ll, I’ll often start to rep it and like it’ll end for I believe, yeah, yeah.Like spin up like the, their new, like from the V three agent. Like it’ll spin up a web browser and like click around and discover new bugs and just keep churning. Um, so I, I think like my longest was like over an hour that, hey, I’ve been churningI think before [01:19:00] we see super long running. I think there’s gonna be a bit of an efficiency hit.So. Sure you can take an hour and go down paths, but you also want you wanna be more efficient, you wanna be smarter in your reasoning, right? So I think that’ll actually go down before we go back up. Like, you don’t wanna scale non-optimized systems just for the heck of it. As much as I love saying, use all the tokens, um, you know, they are expensive.Like going from dance to reasoning models, that’s an added cost, right? You’re paying for a lot of tokens and it doesn’t make sense to just scale stuff that’s not optimized. So there’s, there’s always that little balance.Nader: Yeah.But you know. I think you’ll see both sides of it.Nader: Yeah. So 2023 was super exciting.I think if you were in SF you were like, okay, uh, I know this is gonna be a huge world changing moment, but it seemed like, you know, no one had known yet. And maybe even before, was it 2022 maybe?swyx: Yeah, yeah. I would say, yeah, like RU had this tweet where like everyone was in SF from like 2021 to 2023. Yeah.Understood what it was like to be late, early.Nader: Totally. Um, yeah, 2021, that’s when I made my first open AI account. Yeah, it went, um, it was crazy. [01:20:00] And I remember it was so funny ‘cause at the time SF had not been doing well. So pretty much what it felt like was the concentration of founders in the city had ro had risen because, um, where my neighbors were used to doing a bunch of stuff, those people had all left.So the only people that were still in the city were people that really wanted to build It was cheap tech. It was, yeah. It was also way cheaper. I feel really bad anyone, uh, who is trying to get rent now, but there was, uh, cell was they had a huge office.swyx: So blockchain in Yeah, like took over the, the old Casper building.Nader: Yeah. They had the showroom and they had the, like the, what would, I think it was like the back warehouse. It was, and it was a huge office. Andswyx: it’s right across an opening Eyes in New Link.Nader: Yeah. It was inthe original arena.swyx: I named the Arena because of it.Nader: Yeah. Yeah. And so it was really exciting because like vo flow I think uh, I forgot the Minify.Yeah. Minify, uh, brev was there. You guys were there. I remember. That was actually, it was there that you bought the AI engineer domain.swyx: Yeah. I didn’t know what I was gonna do in ai. I, I wanna do something,Nader: but it was kind of this, it was a really fun moment where we were kind of all in this solo space and it, um, I don’t know.It was, [01:21:00] it was a really cool community, especially being soswyx: early. Yeah. And so it, then you got me early cruise access. Oh yeah. So there was a going period of time. They both cruises and Waymo’s were just free. Yeah, always.If you had, I mean, they’re, they’re so Back Cell is opened again.swyx: Yeah. So Nature Zoo.Zoo is Nature Zoo. Zoo Robot Taxi. Yeah. So Totally. Yeah.Nader: Oh. But yeah. And so it’s actually really cool that you guys have this studio so close to, uh, cell. Yeah. This rock climbing gin right around the corner. It was like, um, 2000. Oh yeah. Yeah. It’s, it’s an awesome block.swyx: Cool. Yeah. Just, and you bit services partnership.Uh, I do think one, one thing I try to do with the podcast is like bring, like what is, I get to be a San Francisco to the rest of the world and also just like. Maybe give, uh, yeah.Nader: Yeah. My favorite talk was in the city, uh, andswyx: yeah, stick and stream. I know. It’s very good.Nader: Yeah. And I guess what it’s like to be in San Francisco I think is just everyone seems to be super supportive.Uh, sometimes I feel like the city believes in you more than you do. And even, uh, I don’t know if you remember, but I remember [01:22:00] posting my first blog post and I had met you on Twitter and you gave me like an hour of your time super randomly, and you kind of coached me through, uh, writing content for developers.And I was trying really hard not to come off salesy or plug myself. And so I kind of stripped all personality out of the blog post. Yeah. And you, you brought that out. You’re like, people don’t, it’s, it’s okay to talk about what you’re doing. Like you don’t have to be weird about it. And I remember just that, I think that really helped me kind of figure out what our voice is and not shy away from it.And so always really grateful for you. Hey, you inject your voice into like, everything. Now it’s actually a huge advantage to be like veryKyle: genuine about what you care about.swyx: Yeah. Yeah. You imagine like summer, some infra in DMU and like, it’s like, can you gimme feedback on this blog post? And it’s pretty boring and you’re like.Find like, you know, he looks interesting. I’ll just do a zoom call and then you meet this guy. Yeah, right. He’s so energetic, so just be right. There’s, but like, I think people are trained to write a certain way in school and Yeah. They never totally see there’s like a broader well,andNader: lots un unlearnKyle: writing.Writing is thinking and like everyone thinks differently. So [01:23:00] like, might as well as just like,swyx: yeah. Yeah.Kyle: Write your way.swyx: Cool. Well, thank you for, uh, in indulging with us, uh, really broad breaking discussion, but I love, like, you guys are like, sort of like the sort of young faces on video with so much energy and, but like also lot of technic death and I think, uh, people learn about for this session.So thank you.Nader: This was awesome. Thank you guys. So thank you for everything that you’ve done in the talk. Yeah, NG the podcast, all the above. And uh, C-O-T-C-I really forward to it. Yeah. Cool. Thanks. That’s awesome. Thank you. Thank you. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.latent.space/subscribe

All speakers are announced at AIE EU, schedule coming soon. Join us there or in Miami with the renowned organizers of React Miami! Singapore CFP also open!We’ve called this out a few times over in AINews, but the overwhelming consensus in the Valley is that “the IDE is Dead”. In November it was just a gut feeling, but now we actually have data: even at the canonical “VSCode Fork” company, people are officially using more agents than tab autocomplete (the first wave of AI coding):Cursor has launched cloud agents for a few months now, and this specific launch is around Computer Use, which has come a long way since we first talked with Anthropic about it in 2024, and which Jonas productized as Autotab:We also take the opportunity to do a live demo, talk about slash commands and subagents, and the future of continual learning and personalized coding models, something that Sam previously worked on at New Computer. (The fact that both of these folks are top tier CEOs of their own startups that have now joined the insane talent density gathering at Cursor should also not be overlooked).Full Episode on YouTube!please like and subscribe!Timestamps00:00 Agentic Code Experiments00:53 Why Cloud Agents Matter02:08 Testing First Pillar03:36 Video Reviews Second Pillar04:29 Remote Control Third Pillar06:17 Meta Demos and Bug Repro13:36 Slash Commands and MCPs18:19 From Tab to Team Workflow31:41 Minimal Web UI Philosophy32:40 Why No File Editor34:38 Full Stack Cursor Debate36:34 Model Choice and Auto Routing38:34 Parallel Agents and Best Of N41:41 Subagents and Context Management44:48 Grind Mode and Throughput Future01:00:24 Cloud Agent Onboarding and MemoryTranscriptEP 77 - CURSOR - Audio version[00:00:00]Agentic Code ExperimentsSamantha: This is another experiment that we ran last year and didn’t decide to ship at that time, but may come back to LM Judge, but one that was also agentic and could write code. So it wasn’t just picking but also taking the learnings from two models or and models that it was looking at and writing a new diff.And what we found was that there were strengths to using models from different model providers as the base level of this process. Basically you could get almost like a synergistic output that was better than having a very unified like bottom model tier.Jonas: We think that over the coming months, the big unlock is not going to be one person with a model getting more done, like the water flowing faster and we’ll be making the pipe much wider and so paralyzing more, whether that’s swarms of agents or parallel agents, both of those are things that contribute to getting much more done in the same amount of time.Why Cloud Agents Matterswyx: This week, one of the biggest launches that Cursor’s ever done is cloud agents. I think you, you had [00:01:00] cloud agents before, but this was like, you give cursor a computer, right? Yeah. So it’s just basically they bought auto tab and then they repackaged it. Is that what’s going on, or,Jonas: that’s a big part of it.Yeah. Cloud agents already ran in their own computers, but they were sort of site reading code. Yeah. And those computers were not, they were like blank VMs typically that were not set up for the Devrel X for whatever repo the agents working on. One of the things that we talk about is if you put yourself in the model shoes and you were seeing tokens stream by and all you could do was cite read code and spit out tokens and hope that you had done the right thing,swyx: no chanceJonas: I’d be so bad.Like you obviously you need to run the code. And so that I think also is probably not that contrarian of a take, but no one has done that yet. And so giving the model the tools to onboard itself and then use full computer use end-to-end pixels in coordinates out and have the cloud computer with different apps in it is the big unlock that we’ve seen internally in terms of use usage of this going from, oh, we use it for little copy changes [00:02:00] to no.We’re really like driving new features with this kind of new type of entech workflow. Alright, let’s see it. Cool.Live Demo TourJonas: So this is what it looks like in cursor.com/agents. So this is one I kicked off a while ago. So on the left hand side is the chat. Very classic sort of agentic thing. The big new thing here is that the agent will test its changes.So you can see here it worked for half an hour. That is because it not only took time to write the tokens of code, it also took time to test them end to end. So it started Devrel servers iterate when needed. And so that’s one part of it is like model works for longer and doesn’t come back with a, I tried some things pr, but a I tested at pr that’s ready for your review.One of the other intuition pumps we use there is if a human gave you a PR asked you to review it and you hadn’t, they hadn’t tested it, you’d also be annoyed because you’d be like, only ask me for a review once it’s actually ready. So that’s what we’ve done withTesting Defaults and Controlsswyx: simple question I wanted to gather out front.Some prs are way smaller, [00:03:00] like just copy change. Does it always do the video or is it sometimes,Jonas: Sometimes.swyx: Okay. So what’s the judgment?Jonas: The model does it? So we we do some default prompting with sort. What types of changes to test? There’s a slash command that people can do called slash no test, where if you do that, the model will not test,swyx: but the default is test.Jonas: The default is to be calibrated. So we tell it don’t test, very simple copy changes, but test like more complex things. And then users can also write their agents.md and specify like this type of, if you’re editing this subpart of my mono repo, never tested ‘cause that won’t work or whatever.Videos and Remote ControlJonas: So pillar one is the model actually testing Pillar two is the model coming back with a video of what it did.We have found that in this new world where agents can end-to-end, write much more code, reviewing the code is one of these new bottlenecks that crop up. And so reviewing a video is not a substitute for reviewing code, but it is an entry point that is much, much easier to start with than glancing at [00:04:00] some giant diff.And so typically you kick one off you, it’s done you come back and the first thing that you would do is watch this video. So this is a, video of it. In this case I wanted a tool tip over this button. And so it went and showed me what that looks like in, in this video that I think here, it actually used a gallery.So sometimes it will build storybook type galleries where you can see like that component in action. And so that’s pillar two is like these demo videos of what it built. And then pillar number three is I have full remote control access to this vm. So I can go heat in here. I can hover things, I can type, I have full control.And same thing for the terminal. I have full access. And so that is also really useful because sometimes the video is like all you need to see. And oftentimes by the way, the video’s not perfect, the video will show you, is this worth either merging immediately or oftentimes is this worth iterating with to get it to that final stage where I am ready to merge in.So I can go through some other examples where the first video [00:05:00] wasn’t perfect, but it gave me confidence that we were on the right track and two or three follow-ups later, it was good to go. And then I also have full access here where some things you just wanna play around with. You wanna get a feel for what is this and there’s no substitute to a live preview.And the VNC kind of VM remote access gives you that.swyx: Amazing What, sorry? What is VN. AndJonas: just the remote desktop. Remote desktop. Yeah.swyx: Sam, any other details that you always wanna call out?Samantha: Yeah, for me the videos have been super helpful. I would say, especially in cases where a common problem for me with agents and cloud agents beforehand was almost like under specification in my requests where our plan mode and going really back and forth and getting detailed implementation spec is a way to reduce the risk of under specification, but then similar to how human communication breaks down over time, I feel like you have this risk where it’s okay, when I pull down, go to the triple of pulling down and like running this branch locally, I’m gonna see that, like I said, this should be a toggle and you have a checkbox and like, why didn’t you get that detail?And having the video up front just [00:06:00] has that makes that alignment like you’re talking about a shared artifact with the agent. Very clear, which has been just super helpful for me.Jonas: I can quickly run through some other Yes. Examples.Meta Agents and More DemosJonas: So this is a very front end heavy one. So one question I wasswyx: gonna say, is this only for frontJonas: end?Exactly. One question you might have is this only for front end? So this is another example where the thing I wanted it to implement was a better error message for saving secrets. So the cloud agents support adding secrets, that’s part of what it needs to access certain systems. Part of onboarding that is giving access.This is cloud is working onswyx: cloud agents. Yes.Jonas: So this is a fun thing isSamantha: it can get super meta. ItJonas: can get super meta, it can start its own cloud agents, it can talk to its own cloud agents. Sometimes it’s hard to wrap your mind around that. We have disabled, it’s cloud agents starting more cloud agents. So we currently disallow that.Someday you might. Someday we might. Someday we might. So this actually was mostly a backend change in terms of the error handling here, where if the [00:07:00] secret is far too large, it would oh, this is actually really cool. Wow. That’s the Devrel tools. That’s the Devrel tools. So if the secret is far too large, we.Allow secrets above a certain size. We have a size limit on them. And the error message there was really bad. It was just some generic failed to save message. So I was like, Hey, we wanted an error message. So first cool thing it did here, zero prompting on how to test this. Instead of typing out the, like a character 5,000 times to hit the limit, it opens Devrel tools, writes js, or to paste into the input 5,000 characters of the letter A and then hit save, closes the Devrel tools, hit save and gets this new gets the new error message.So that looks like the video actually cut off, but here you can see the, here you can see the screenshot of the of the error message. What, so that is like frontend backend end-to-end feature to, to get that,swyx: yeah.Jonas: Andswyx: And you just need a full vm, full computer run everything.Okay. Yeah.Jonas: Yeah. So we’ve had versions of this. This is one of the auto tab lessons where we started that in 2022. [00:08:00] No, in 2023. And at the time it was like browser use, DOM, like all these different things. And I think we ended up very sort of a GI pilled in the sense that just give the model pixels, give it a box, a brain in a box is what you want and you want to remove limitations around context and capabilities such that the bottleneck should be the intelligence.And given how smart models are today, that’s a very far out bottleneck. And so giving it its full VM and having it be onboarded with Devrel X set up like a human would is just been for us internally a really big step change in capability.swyx: Yeah I would say, let’s call it a year ago the models weren’t even good enough to do any of this stuff.SoSamantha: even six months ago. Yeah.swyx: So yeah what people have told me is like round about Sonder four fire is when this started being good enough to just automate fully by pixel.Jonas: Yeah, I think it’s always a question of when is good enough. I think we found in particular with Opus 4 5, 4, 6, and Codex five three, that those were additional step [00:09:00] changes in the autonomy grade capabilities of the model to just.Go off and figure out the details and come back when it’s done.swyx: I wanna appreciate a couple details. One 10 Stack Router. I see it. Yeah. I’m a big fan. Do you know any, I have to name the 10 Stack.Jonas: No.swyx: This just a random lore. Some buddy Sue Tanner. My and then the other thing if you switch back to the video.Jonas: Yeah.swyx: I wanna shout out this thing. Probably Sam did it. I don’t knowJonas: the chapters.swyx: What is this called? Yeah, this is called Chapters. Yeah. It’s like a Vimeo thing. I don’t know. But it’s so nice the design details, like the, and obviously a company called Cursor has to have a beautiful cursorSamantha: and it isswyx: the cursor.Samantha: Cursor.swyx: You see it branded? It’s the cursor. Cursor, yeah. Okay, cool. And then I was like, I complained to Evan. I was like, okay, but you guys branded everything but the wallpaper. And he was like, no, that’s a cursor wallpaper. I was like, what?Samantha: Yeah. Rio picked the wallpaper, I think. Yeah. The video.That’s probably Alexi and yeah, a few others on the team with the chapters on the video. Matthew Frederico. There’s been a lot of teamwork on this. It’s a huge effort.swyx: I just, I like design details.Samantha: Yeah.swyx: And and then when you download it adds like a little cursor. Kind of TikTok clip. [00:10:00] Yes. Yes.So it’s to make it really obvious is from Cursor,Jonas: we did the TikTok branding at the end. This was actually in our launch video. Alexi demoed the cloud agent that built that feature. Which was funny because that was an instance where one of the things that’s been a consequence of having these videos is we use best of event where you run head to head different models on the same prompt.We use that a lot more because one of the complications with doing that before was you’d run four models and they would come back with some giant diff, like 700 lines of code times four. It’s what are you gonna do? You’re gonna review all that’s horrible. But if you come back with four 22nd videos, yeah, I’ll watch four 22nd videos.And then even if none of them is perfect, you can figure out like, which one of those do you want to iterate with, to get it over the line. Yeah. And so that’s really been really fun.Bug Repro WorkflowJonas: Here’s another example. That’s we found really cool, which is we’ve actually turned since into a slash command as well slash [00:11:00] repro, where for bugs in particular, the model of having full access to the to its own vm, it can first reproduce the bug, make a video of the bug reproducing, fix the bug, make a video of the bug being fixed, like doing the same pattern workflow with obviously the bug not reproducing.And that has been the single category that has gone from like these types of bugs, really hard to reproduce and pick two tons of time locally, even if you try a cloud agent on it. Are you confident it actually fixed it to when this happens? You’ll merge it in 90 seconds or something like that.So this is an example where, let me see if this is the broken one or the, okay, this is the fixed one. Okay. So we had a bug on cursor.com/agents where if you would attach images where remove them. Then still submit your prompt. They would actually still get attached to the prompt. Okay. And so here you can see Cursor is using, its full desktop by the way.This is one of the cases where if you just do, browse [00:12:00] use type stuff, you’ll have a bad time. ‘cause now it needs to upload files. Like it just uses its native file viewer to do that. And so you can see here it’s uploading files. It’s going to submit a prompt and then it will go and open up. So this is the meta, this is cursor agent, prompting cursor agent inside its own environment.And so you can see here bug, there’s five images attached, whereas when it’s submitted, it only had one image.swyx: I see. Yeah. But you gotta enable that if you’re gonna use cur agent inside cur.Jonas: Exactly. And so here, this is then the after video where it went, it does the same thing. It attaches images, removes, some of them hit send.And you can see here, once this agent is up, only one of the images is left in the attachments. Yeah.swyx: Beautiful.Jonas: Okay. So easy merge.swyx: So yeah. When does it choose to do this? Because this is an extra step.Jonas: Yes. I think I’ve not done a great job yet of calibrating the model on when to reproduce these things.Yeah. Sometimes it will do it of its own accord. Yeah. We’ve been conservative where we try to have it only do it when it’s [00:13:00] quite sure because it does add some amount of time to how long it takes it to work on it. But we also have added things like the slash repro command where you can just do, fix this bug slash repro and then it will know that it should first make you a video of it actually finding and making sure it can reproduce the bug.swyx: Yeah. Yeah. One sort of ML topic this ties into is reward hacking, where while you write test that you update only pass. So first write test, it shows me it fails, then make you test pass, which is a classic like red green.Jonas: Yep.swyx: LikeJonas: A-T-D-D-T-D-Dswyx: thing.No, very cool. Was that the last demo? Is thereJonas: Yeah.Anything I missed on the demos or points that you think? I think thatSamantha: covers it well. Yeah.swyx: Cool. Before we stop the screen share, can you gimme like a, just a tour of the slash commands ‘cause I so God ready. Huh, what? What are the good ones?Samantha: Yeah, we wanna increase discoverability around this too.I think that’ll be like a future thing we work on. Yeah. But there’s definitely a lot of good stuff nowJonas: we have a lot of internal ones that I think will not be that interesting. Here’s an internal one that I’ve made. I don’t know if anyone else at Cursor uses this one. Fix bb.Samantha: I’ve never heard of it.Jonas: Yeah.[00:14:00]Fix Bug Bot. So this is a thing that we want to integrate more tightly on. So you made it forswyx: yourself.Jonas: I made this for myself. It’s actually available to everyone in the team, but yeah, no one knows about it. But yeah, there will be Bug bot comments and so Bug Bot has a lot of cool things. We actually just launched Bug Bot Auto Fix, where you can click a button and or change a setting and it will automatically fix its own things, and that works great in a bunch of cases.There are some cases where having the context of the original agent that created the PR is really helpful for fixing the bugs, because it might be like, oh, the bug here is that this, is a regression and actually you meant to do something more like that. And so having the original prompt and all of the context of the agent that worked on it, and so here I could just do, fix or we used to be able to do fixed PB and it would do that.No test is another one that we’ve had. Slash repro is in here. We mentioned that one.Samantha: One of my favorites is cloud agent diagnosis. This is one that makes heavy use of the Datadog MCP. Okay. And I [00:15:00] think Nick and David on our team wrote, and basically if there is a problem with a cloud agent we’ll spin up a bunch of subs.Like a singleswyx: instance.Samantha: Yeah. We’ll take the ideas and argument and spin up a bunch of subagents using the Datadog MCP to explore the logs and find like all of the problems that could have happened with that. It takes the debugging time, like from potentially you can do quick stuff quickly with the Datadog ui, but it takes it down to, again, like a single agent call as opposed to trolling through logs yourself.Jonas: You should also talk about the stuff we’ve done with transcripts.Samantha: Yes. Also so basically we’ve also done some things internally. There’ll be some versions of this as we ship publicly soon, where you can spit up an agent and give it access to another agent’s transcript to either basically debug something that happened.So act as an external debugger. I see. Or continue the conversation. Almost like forking it.swyx: A transcript includes all the chain of thought for the 11 minutes here. 45 minutes there.Samantha: Yeah. That way. Exactly. So basically acting as a like secondary agent that debugs the first, so we’ve started to push more andswyx: they’re all the same [00:16:00] code.It is just the different prompts, but the sa the same.Samantha: Yeah. So basically same cloud agent infrastructure and then same harness. And then like when we do things like include, there’s some extra infrastructure that goes into piping in like an external transcript if we include it as an attachment.But for things like the cloud agent diagnosis, that’s mostly just using the Datadog MCP. ‘Cause we also launched CPS along with along with this cloud agent launch, launch support for cloud agent cps.swyx: Oh, that was drawn out.Jonas: We won’t, we’ll be doing a bigger marketing moment for it next week, but, and you can now use CPS andswyx: People will listen to it as well.Yeah,Jonas: they’llSamantha: be ahead of the third. They’ll be ahead. And I would I actually don’t know if the Datadog CP is like publicly available yet. I realize this not sure beta testing it, but it’s been one of my favorites to use. Soswyx: I think that one’s interesting for Datadog. ‘cause Datadog wants to own that site.Interesting with Bits. I don’t know if you’ve tried bits.Samantha: I haven’t tried bits.swyx: Yeah.Jonas: That’s their cloud agentswyx: product. Yeah. Yeah. They want to be like we own your logs and give us our, some part of the, [00:17:00] self-healing software that everyone wants. Yeah. But obviously Cursor has a strong opinion on coding agents and you, you like taking away from the which like obviously you’re going to do, and not every company’s like Cursor, but it’s interesting if you’re a Datadog, like what do you do here?Do you expose your logs to FDP and let other people do it? Or do you try to own that it because it’s extra business for you? Yeah. It’s like an interesting one.Samantha: It’s a good question. All I know is that I love the Datadog MCP,Jonas: And yeah, it is gonna be no, no surprise that people like will demand it, right?Samantha: Yeah.swyx: It’s, it’s like anysystemswyx: of record company like this, it’s like how much do you give away? Cool. I think that’s that for the sort of cloud agents tour. Cool. And we just talk about like cloud agents have been when did Kirsten loves cloud agents? Do you know, in JuneJonas: last year.swyx: June last year. So it’s been slowly develop the thing you did, like a bunch of, like Michael did a post where himself, where he like showed this chart of like ages overtaking tap. And I’m like, wow, this is like the biggest transition in code.Jonas: Yeah.swyx: Like in, in [00:18:00] like the last,Jonas: yeah. I think that kind of got turned out.Yeah. I think it’s a very interest,swyx: not at all. I think it’s been highlighted by our friend Andre Kati today.Jonas: Okay.swyx: Talk more about it. What does it mean? Yeah. Is I just got given like the cursor tab key.Jonas: Yes. Yes.swyx: That’s that’sSamantha: cool.swyx: I know, but it’s gonna be like put in a museum.Jonas: It is.Samantha: I have to say I haven’t used tab a little bit myself.Jonas: Yeah. I think that what it looks like to code with AI code generally creates software, even if you want to go higher level. Is changing very rapidly. No, not a hot take, but I think from our vendor’s point at Cursor, I think one of the things that is probably underappreciated from the outside is that we are extremely self-aware about that fact and Kerscher, got its start in phase one, era one of like tab and auto complete.And that was really useful in its time. But a lot of people start looking at text files and editing code, like we call it hand coding. Now when you like type out the actual letters, it’sswyx: oh that’s cute.Jonas: Yeah.swyx: Oh that’s cute.Jonas: You’re so boomer. So boomer. [00:19:00] And so that I think has been a slowly accelerating and now in the last few months, rapidly accelerating shift.And we think that’s going to happen again with the next thing where the, I think some of the pains around tab of it’s great, but I actually just want to give more to the agent and I don’t want to do one tab at a time. I want to just give it a task and it goes off and does a larger unit of work and I can.Lean back a little bit more and operate at that higher level of abstraction that’s going to happen again, where it goes from agents handing you back diffs and you’re like in the weeds and giving it, 32nd to three minute tasks, to, you’re giving it, three minute to 30 minute to three hour tasks and you’re getting back videos and trying out previews rather than immediately looking at diffs every single time.swyx: Yeah. Anything to add?Samantha: One other shift that I’ve noticed as our cloud agents have really taken off internally has been a shift from primarily individually driven development to almost this collaborative nature of development for us, slack is actually almost like a development on [00:20:00] Id basically.So Iswyx: like maybe don’t even build a custom ui, like maybe that’s like a debugging thing, but actually it’s that.Samantha: I feel like, yeah, there’s still so much to left to explore there, but basically for us, like Slack is where a lot of development happens. Like we will have these issue channels or just like this product discussion channels where people are always at cursing and that kicks off a cloud agent.And for us at least, we have team follow-ups enabled. So if Jonas kicks off at Cursor in a thread, I can follow up with it and add more context. And so it turns into almost like a discussion service where people can like collaborate on ui. Oftentimes I will kick off an investigation and then sometimes I even ask it to get blame and then tag people who should be brought in. ‘cause it can tag people in Slack and then other people will comeswyx: in, can tag other people who are not involved in conversation. Yes. Can just do at Jonas if say, was talking to,Samantha: yeah.swyx: That’s cool. You should, you guys should make a big good deal outta that.Samantha: I know. It’s a lot to, I feel like there’s a lot more to do with our slack surface area to show people externally. But yeah, basically like it [00:21:00] can bring other people in and then other people can also contribute to that thread and you can end up with a PR again, with the artifacts visible and then people can be like, okay, cool, we can merge this.So for us it’s like the ID is almost like moving into Slack in some ways as well.swyx: I have the same experience with, but it’s not developers, it’s me. Designer salespeople.Samantha: Yeah.swyx: So me on like technical marketing, vision, designer on design and then salespeople on here’s the legal source of what we agreed on.And then they all just collaborate and correct. The agents,Jonas: I think that we found when these threads is. The work that is left, that the humans are discussing in these threads is the nugget of what is actually interesting and relevant. It’s not the boring details of where does this if statement go?It’s do we wanna ship this? Is this the right ux? Is this the right form factor? Yeah. How do we make this more obvious to the user? It’s like those really interesting kind of higher order questions that are so easy to collaborate with and leave the implementation to the cloud agent.Samantha: Totally. And no more discussion of am I gonna do this? Are you [00:22:00] gonna do this cursor’s doing it? You just have to decide. You like it.swyx: Sometimes the, I don’t know if there’s a, this probably, you guys probably figured this out already, but since I, you need like a mute button. So like cursor, like we’re going to take this offline, but still online.But like we need to talk among the humans first. Before you like could stop responding to everything.Jonas: Yeah. This is a design decision where currently cursor won’t chime in unless you explicitly add Mention it. Yeah. Yeah.Samantha: So it’s not always listening.Yeah.Jonas: I can see all the intermediate messages.swyx: Have you done the recursive, can cursor add another cursor or spawn another cursor?Samantha: Oh,Jonas: we’ve done some versions of this.swyx: Because, ‘cause it can add humans.Jonas: Yes. One of the other things we’ve been working on that’s like an implication of generating the code is so easy is getting it to production is still harder than it should be.And broadly, you solve one bottleneck and three new ones pop up. Yeah. And so one of the new bottlenecks is getting into production and we have a like joke internally where you’ll be talking about some feature and someone says, I have a PR for that. Which is it’s so easy [00:23:00] to get to, I a PR for that, but it’s hard still relatively to get from I a PR for that to, I’m confident and ready to merge this.And so I think that over the coming weeks and months, that’s a thing that we think a lot about is how do we scale up compute to that pipeline of getting things from a first draft An agent did.swyx: Isn’t that what Merge isn’t know what graphite’s for, likeJonas: graphite is a big part of that. The cloud agent testingswyx: Is it fully integrated or still different companiesJonas: working on I think we’ll have more to share there in the future, but the goal is to have great end-to-end experience where Cursor doesn’t just help you generate code tokens, it helps you create software end-to-end.And so review is a big part of that, that I think especially as models have gotten much better at writing code, generating code, we’ve felt that relatively crop up more,swyx: sorry this is completely unplanned, but like there I have people arguing one to you need ai. To review ai and then there is another approach, thought school of thought where it’s no, [00:24:00] reviews are dead.Like just show me the video. It’s it like,Samantha: yeah. I feel again, for me, the video is often like alignment and then I often still wanna go through a code review process.swyx: Like still look at the files andSamantha: everything. Yeah. There’s a spectrum of course. Like the video, if it’s really well done and it does like fully like test everything, you can feel pretty competent, but it’s still helpful to, to look at the code.I make hep pay a lot of attention to bug bot. I feel like Bug Bot has been a great really highly adopted internally. We often like, won’t we tell people like, don’t leave bug bot comments unaddressed. ‘cause we have such high confidence in it. So people always address their bug bot comments.Jonas: Once you’ve had two cases where you merged something and then you went back later, there was a bug in it, you merged, you went back later and you were like, ah, bug Bot had found that I should have listened to Bug Bot.Once that happens two or three times, you learn to wait for bug bot.Samantha: Yeah. So I think for us there’s like that code level review where like it’s looking at the actual code and then there’s like the like feature level review where you’re looking at the features. There’s like a whole number of different like areas.There’ll probably eventually be things like performance level review, security [00:25:00] review, things like that where it’s like more more different aspects of how this feature might affect your code base that you want to potentially leverage an agent to help with.Jonas: And some of those like bug bot will be synchronous and you’ll typically want to wait on before you merge.But I think another thing that we’re starting to see is. As with cloud agents, you scale up this parallelism and how much code you generate. 10 person startups become, need the Devrel X and pipelines that a 10,000 person company used to need. And that looks like a lot of the things I think that 10,000 person companies invented in order to get that volume of software to production safely.So that’s things like, release frequently or release slowly, have different stages where you release, have checkpoints, automated ways of detecting regressions. And so I think we’re gonna need stacks merg stack diffs merge queues. Exactly. A lot of those things are going to be importantswyx: forward with.I think the majority of people still don’t know what stack stacks are. And I like, I have many friends in Facebook and like I, I’m pretty friendly with graphite. I’ve just, [00:26:00] I’ve never needed it ‘cause I don’t work on that larger team and it’s just like democratization of no, only here’s what we’ve already worked out at very large scale and here’s how you can, it benefits you too.Like I think to me, one of the beautiful things about GitHub is that. It’s actually useful to me as an individual solo developer, even though it’s like actually collaboration software.Jonas: Yep.swyx: And I don’t think a lot of Devrel tools have figured that out yet. That transition from like large down to small.Jonas: Yeah. Kers is probably an inverse story.swyx: This is small down toJonas: Yeah. Where historically Kers share, part of why we grew so quickly was anyone on the team could pick it up and in fact people would pick it up, on the weekend for their side project and then bring it into work. ‘cause they loved using it so much.swyx: Yeah.Jonas: And I think a thing that we’ve started working on a lot more, not us specifically, but as a company and other folks at Cursor, is making it really great for teams and making it the, the 10th person that starts using Cursor in a team. Is immediately set up with things like, we launched Marketplace recently so other people can [00:27:00] configure what CPS and skills like plugins.So skills and cps, other people can configure that. So that my cursor is ready to go and set up. Sam loves the Datadog, MCP and Slack, MCP you’ve also been using a lot butSamantha: also pre-launch, but I feel like it’s so good.Jonas: Yeah, my cursor should be configured if Sam feels strongly that’s just amazing and required.swyx: Is it automatically shared or you have to go and.Jonas: It depends on the MCP. So some are obviously off per user. Yeah. And so Sam can’t off my cursor with my Slack MCP, but some are team off and those can be set up by admins.swyx: Yeah. Yeah. That’s cool. Yeah, I think, we had a man on the pod when cursor was five people, and like everyone was like, okay, what’s the thing?And then it’s usually something teams and org and enterprise, but it’s actually working. But like usually at that stage when you’re five, when you’re just a vs. Code fork it’s like how do you get there? Yeah. Will people pay for this? People do pay for it.Jonas: Yeah. And I think for cloud agents, we expect.[00:28:00]To have similar kind of PLG things where I think off the bat we’ve seen a lot of adoption with kind of smaller teams where the code bases are not quite as complex to set up. Yes. If you need some insane docker layer caching thing for builds not to take two hours, that’s going to take a little bit longer for us to be able to support that kind of infrastructure.Whereas if you have front end backend, like one click agents can install everything that they need themselves.swyx: This is a good chance for me to just ask some technical sort of check the box questions. Can I choose the size of the vm?Jonas: Not yet. We are planning on adding that. Weswyx: have, this is obviously you want like LXXL, whatever, right?Like it’s like the Amazon like sort menu.Jonas: Yes, exactly. We’ll add that.swyx: Yeah. In some ways you have to basically become like a EC2, almost like you rent a box.Jonas: You rent a box. Yes. We talk a lot about brain in a box. Yeah. So cursor, we want to be a brain in a box,swyx: but is the mental model different? Is it more serverless?Is it more persistent? Is. Something else.Samantha: We want it to be a bit persistent. The desktop should be [00:29:00] something you can return to af even after some days. Like maybe you go back, they’re like still thinking about a feature for some period of time. So theswyx: full like sus like suspend the memory and bring it back and then keep going.Samantha: Exactly.swyx: That’s an interesting one because what I actually do want, like from a manna and open crawl, whatever, is like I want to be able to log in with my credentials to the thing, but not actually store it in any like secret store, whatever. ‘cause it’s like this is the, my most sensitive stuff.Yeah. This is like my email, whatever. And just have it like, persist to the image. I don’t know how it was hood, but like to rehydrate and then just keep going from there. But I don’t think a lot of infra works that way. A lot of it’s stateless where like you save it to a docker image and then it’s only whatever you can describe in a Docker file and that’s it.That’s the only thing you can cl multiple times in parallel.Jonas: Yeah. We have a bunch of different ways of setting them up. So there’s a dockerfile based approach. The main default way is actually snapshottingswyx: like a Linux vmJonas: like vm, right? You run a bunch of install commands and then you snapshot more or less the file system.And so that gets you set up for everything [00:30:00] that you would want to bring a new VM up from that template basically.swyx: Yeah.Jonas: And that’s a bit distinct from what Sam was talking about with the hibernating and re rehydrating where that is a full memory snapshot as well. So there, if I had like the browser open to a specific page and we bring that back, that page will still be there.swyx: Was there any discussion internally and just building this stuff about every time you shoot a video it’s actually you show a little bit of the desktop and the browser and it’s not necessary if you just show the browser. If, if you know you’re just demoing a front end application.Why not just show the browser, right? Like it Yeah,Samantha: we do have some panning and zooming. Yeah. Like it can decide that when it’s actually recording and cutting the video to highlight different things. I think we’ve played around with different ways of segmenting it and yeah. There’s been some different revs on it for sure.Jonas: Yeah. I think one of the interesting things is the version that you see now in cursor.com actually is like half of what we had at peak where we decided to unshift or unshipped quite a few things. So two of the interesting things to talk about, one is directly an answer to your [00:31:00] question where we had native browser that you would have locally, it was basically an iframe that via port forwarding could load the URL could talk to local host in the vm.So that gets you basically, so inswyx: your machine’s browser,likeJonas: in your local browser? Yeah. You would go to local host 4,000 and that would get forwarded to local host 4,000 in the VM via port forward. We unshift that like atswyx: Eng Rock.Jonas: Like an Eng Rock. Exactly. We unshift that because we felt that the remote desktop was sufficiently low latency and more general purpose.So we build Cursor web, but we also build Cursor desktop. And so it’s really useful to be able to have the full spectrum of things. And even for Cursor Web, as you saw in one of the examples, the agent was uploading files and like I couldn’t upload files and open the file viewer if I only had access to the browser.And we’ve thought a lot about, this might seem funny coming from Cursor where we started as this, vs. Code Fork and I think inherited a lot of amazing things, but also a lot [00:32:00] of legacy UI from VS Code.Minimal Web UI SurfacesJonas: And so with the web UI we wanted to be very intentional about keeping that very minimal and exposing the right sum of set of primitive sort of app surfaces we call them, that are shared features of that cloud.Environment that you and the agent both use. So agent uses desktop and controls it. I can use desktop and controlled agent runs terminal commands. I can run terminal commands. So that’s how our philosophy around it. The other thing that is maybe interesting to talk about that we unshipped is and we may, both of these things we may reship and decide at some point in the future that we’ve changed our minds on the trade offs or gotten it to a point where, putswyx: it out there.Let users tell you they want it. Exactly. Alright, fine.Why No File EditorJonas: So one of the other things is actually a files app. And so we used to have the ability at one point during the process of testing this internally to see next to, I had GID desktop and terminal on the right hand side of the tab there earlier to also have a files app where you could see and edit files.And we actually felt that in some [00:33:00] ways, by restricting and limiting what you could do there, people would naturally leave more to the agent and fall into this new pattern of delegating, which we thought was really valuable. And there’s currently no way in Cursor web to edit these files.swyx: Yeah. Except you like open up the PR and go into GitHub and do the thing.Jonas: Yeah.swyx: Which is annoying.Jonas: Just tell the agent,swyx: I have criticized open AI for this. Because Open AI is Codex app doesn’t have a file editor, like it has file viewer, but isn’t a file editor.Jonas: Do you use the file viewer a lot?swyx: No. I understand, but like sometimes I want it, the one way to do it is like freaking going to no, they have a open in cursor button or open an antigravity or, opening whatever and people pointed that.So I was, I was part of the early testers group people pointed that and they were like, this is like a design smell. It’s like you actually want a VS. Code fork that has all these things, but also a file editor. And they were like, no, just trust us.Jonas: Yeah. I think we as Cursor will want to, as a product, offer the [00:34:00] whole spectrum and so you want to be able to.Work at really high levels of abstraction and double click and see the lowest level. That’s important. But I also think that like you won’t be doing that in Slack. And so there are surfaces and ways of interacting where in some cases limiting the UX capabilities makes for a cleaner experience that’s more simple and drives people into these new patterns where even locally we kicked off joking about this.People like don’t really edit files, hand code anymore. And so we want to build for where that’s going and not where it’s beenswyx: a lot of cool stuff. And Okay. I have a couple more.Full Stack Hosting Debateswyx: So observations about the design elements about these things. One of the things that I’m always thinking about is cursor and other peers of cursor start from like the Devrel tools and work their way towards cloud agents.Other people, like the lovable and bolts of the world start with here’s like the vibe code. Full cloud thing. They were already cloud edges before anyone else cloud edges and we will give you the full deploy platform. So we own the whole loop. We own all the infrastructure, we own, we, we have the logs, we have the the live site, [00:35:00] whatever.And you can do that cycle cursor doesn’t own that cycle even today. You don’t have the versal, you don’t have the, you whatever deploy infrastructure that, that you’re gonna have, which gives you powers because anyone can use it. And any enterprise who, whatever you infra, I don’t care. But then also gives you limitations as to how much you can actually fully debug end to end.I guess I’m just putting out there that like is there a future where there’s like full stack cursor where like cursor apps.com where like I host my cursor site this, which is basically a verse clone, right? I don’t know.Jonas: I think that’s a interesting question to be asking, and I think like the logic that you laid out for how you would get there is logic that I largely agree with.swyx: Yeah. Yeah.Jonas: I think right now we’re really focused on what we see as the next big bottleneck and because things like the Datadog MCP exist, yeah. I don’t think that the best way we can help our customers ship more software. Is by building a hosting solution right now,swyx: by the way, these are things I’ve actually discussed with some of the companies I just named.Jonas: Yeah, for sure. Right now, just this big bottleneck is getting the code out there and also [00:36:00] unlike a lovable in the bolt, we focus much more on existing software. And the zero to one greenfield is just a very different problem. Imagine going to a Shopify and convincing them to deploy on your deployment solution.That’s very different and I think will take much longer to see how that works. May never happen relative to, oh, it’s like a zero to one app.swyx: I’ll say. It’s tempting because look like 50% of your apps are versal, superb base tailwind react it’s the stack. It’s what everyone does.So I it’s kinda interesting.Jonas: Yeah.Model Choice and Auto Routingswyx: The other thing is the model select dying. Right now in cloud agents, it’s stuck down, bottom left. Sure it’s Codex High today, but do I care if it’s suddenly switched to Opus? Probably not.Samantha: We definitely wanna give people a choice across models because I feel like it, the meta change is very frequently.I was a big like Opus 4.5 Maximalist, and when codex 5.3 came out, I hard, hard switch. So that’s all I use now.swyx: Yeah. Agreed. I don’t know if, but basically like when I use it in Slack, [00:37:00] right? Cursor does a very good job of exposing yeah. Cursors. If people go use it, here’s the model we’re using.Yeah. Here’s how you switch if you want. But otherwise it’s like extracted away, which is like beautiful because then you actually, you should decide.Jonas: Yeah, I think we want to be doing more with defaults.swyx: Yeah.Jonas: Where we can suggest things to people. A thing that we have in the editor, the desktop app is auto, which will route your request and do things there.So I think we will want to do something like that for cloud agents as well. We haven’t done it yet. And so I think. We have both people like Sam, who are very savvy and want know exactly what model they want, and we also have people that want us to pick the best model for them because we have amazing people like Sam and we, we are the experts.Yeah. We have both the traffic and the internal taste and experience to know what we think is best.swyx: Yeah. I have this ongoing pieces of agent lab versus model lab. And to me, cursor and other companies are example of an agent lab that is, building a new playbook that is different from a model lab where it’s like very GP heavy Olo.So obviously has a research [00:38:00] team. And my thesis is like you just, every agent lab is going to have a router because you’re going to be asked like, what’s what. I don’t keep up to every day. I’m not a Sam, I don’t keep up every day for using you as sample the arm arbitrator of taste. Put me on CRI Auto.Is it free? It’s not free.Jonas: Auto’s not free, but there’s different pricing tiers. Yeah.swyx: Put me on Chris. You decide from me based on all the other people you know better than me. And I think every agent lab should basically end up doing this because that actually gives you extra power because you like people stop carrying or having loyalty with one lab.Jonas: Yeah.Best Of N and Model CouncilsJonas: Two other maybe interesting things that I don’t know how much they’re on your radar are one the best event thing we mentioned where running different models head to head is actually quite interesting becauseswyx: which exists in cursor.Jonas: That exists in cur ID and web. So the problem is where do you run them?swyx: Okay.Jonas: And so I, I can share my screen if that’s interesting. Yeahinteresting.swyx: Yeah. Yeah. Obviously parallel agents, very popal.Jonas: Yes, exactly. Parallel agentsswyx: in you mind. Are they the same thing? Best event and parallel agents? I don’t want to [00:39:00] put words in your mouth.Jonas: Best event is a subset of parallel agents where they’re running on the same prompt.That would be my answer. So this is what that looks like. And so here in this dropdown picker, I can just select multiple models.swyx: Yeah.Jonas: And now if I do a prompt, I’m going to do something silly. I am running these five models.swyx: Okay. This is this fake clone, of course. The 2.0 yeah.Jonas: Yes, exactly. But they’re running so the cursor 2.0, you can do desktop or cloud.So this is cloud specifically where the benefit over work trees is that they have their own VMs and can run commands and won’t try to kill ports that the other one is running. Which are some of the pains. These are allswyx: called work trees?Jonas: No, these are all cloud agents with their own VMs.swyx: Okay. ButJonas: When you do it locally, sometimes people do work trees and that’s been the main way that people have set out parallel so far.I’ve gotta say.swyx: That’s so confusing for folks.Jonas: Yeah.swyx: No one knows what work trees are.Jonas: Exactly. I think we’re phasing out work trees.swyx: Really.Jonas: Yeah.swyx: Okay.Samantha: But yeah. And one other thing I would say though on the multimodel choice, [00:40:00] so this is another experiment that we ran last year and the decide to ship at that time but may come back to, and there was an interesting learning that’s relevant for, these different model providers. It was something that would run a bunch of best of ends but then synthesize and basically run like a synthesizer layer of models. And that was other agents that would take LM Judge, but one that was also agentic and could write code. So it wasn’t just picking but also taking the learnings from two models or, and models that it was looking at and writing a new diff.And what we found was that at the time at least, there were strengths to using models from different model providers as the base level of this process. Like basically you could get almost like a synergistic output that was better than having a very unified, like bottom model tier. So it was really interesting ‘cause it’s like potentially, even though even in the future when you have like maybe one model as ahead of the other for a little bit, there could be some benefit from having like multiple top tier models involved in like a [00:41:00] model swarm or whatever agent Swarm that you’re doing, that they each have strengths and weaknesses.Yeah.Jonas: Andre called this the council, right?Samantha: Yeah, exactly. We actually, oh, that’s another internal command we have that Ian wrote slash council. Oh, and they some, yeah.swyx: Yes. This idea is in various forms everywhere. And I think for me, like for me, the productization of it, you guys have done yeah, like this is very flexible, but.If I were to add another Yeah, what your thing is on here it would be too much. I what, let’s say,Samantha: Ideally it’s all, it’s something that the user can just choose and it all happens under the hood in a way where like you just get the benefit of that process at the end and better output basically, but don’t have to get too lost in the complexity of judging along the way.Jonas: Okay.Subagents for ContextJonas: Another thing on the many agents, on different parallel agents that’s interesting is an idea that’s been around for a while as well that has started working recently is subagents. And so this is one other way to get agents of the different prompts and different goals and different models, [00:42:00] different vintages to work together.Collaborate and delegate.swyx: Yeah. I’m very like I like one of my, I always looking for this is the year of the blah, right? Yeah. I think one of the things on the blahs is subs. I think this is of but I haven’t used them in cursor. Are they fully formed or how do I honestly like an intro because do I form them from new every time?Do I have fixed subagents? How are they different for slash commands? There’s all these like really basic questions that no one stops to answer for people because everyone’s just like too busy launching. We have toSamantha: honestly, you could, you can see them in cursor now if you just say spin up like 50 subagents to, so cursor definesswyx: what Subagents.Yeah.Samantha: Yeah. So basically I think I shouldn’t speak for the whole subagents team. This is like a different team that’s been working on this, but our thesis or thing that we saw internally is that like they’re great for context management for kind of long running threads, or if you’re trying to just throw more compute at something.We have strongly used, almost like a generic task interface where then the main agent can define [00:43:00] like what goes into the subagent. So if I say explore my code base, it might decide to spin up an explore subagent and or might decide to spin up five explore subagent.swyx: But I don’t get to set what those subagent are, right?It’s all defined by a model.Samantha: I think. I actually would have to refresh myself on the sub agent interface.Jonas: There are some built-in ones like the explore subagent is free pre-built. But you can also instruct the model to use other subagents and then it will. And one other example of a built-in subagent is I actually just kicked one off in cursor and I can show you what that looks like.swyx: Yes. Because I tried to do this in pure prompt space.Jonas: So this is the desktop app? Yeah. Yeah. And that’sswyx: all you need to do, right? Yeah.Jonas: That’s all you need to do. So I said use a sub agent to explore and I think, yeah, so I can even click in and see what the subagent is working on here. It ran some fine command and this is a composer under the hood.Even though my main model is Opus, it does smart routing to take, like in this instance the explorer sort of requires reading a ton of things. And so a faster model is really useful to get an [00:44:00] answer quickly, but that this is what subagent look like. And I think we wanted to do a lot more to expose hooks and ways for people to configure these.Another example of a cus sort of builtin subagent is the computer use subagent in the cloud agents, where we found that those trajectories can be long and involve a lot of images obviously, and execution of some testing verification task. We wanted to use that models that are particularly good at that.So that’s one reason to use subagents. And then the other reason to use subagents is we want contexts to be summarized reduced down at a subagent level. That’s a really neat boundary at which to compress that rollout and testing into a final message that agent writes that then gets passed into the parent rather than having to do some global compaction or something like that.swyx: Awesome. Cool. While we’re in the subagents conversation, I can’t do a cursor conversation and not talk about listen stuff. What is that? What is what? He built a browser. He built an os. Yes. And he [00:45:00] experimented with a lot of different architectures and basically ended up reinventing the software engineer org chart.This is all cool, but what’s your take? What’s, is there any hole behind the side? The scenes stories about that kind of, that whole adventure.Samantha: Some of those experiments have found their way into a feature that’s available in cloud agents now, the long running agent mode internally, we call it grind mode.And I think there’s like some hint of grind mode accessible in the picker today. ‘cause you can do choose grind until done. And so that was really the result of experiments that Wilson started in this vein where he I think the Ralph Wigga loop was like floating around at the time, but it was something he also independently found and he was experimenting with.And that was what led to this product surface.swyx: And it is just simple idea of have criteria for completion and do not. Until you complete,Samantha: there’s a bit more complexity as well in, in our implementation. Like there’s a specific, you have to start out by aligning and there’s like a planning stage where it will work with you and it will not get like start grind execution mode until it’s decided that the [00:46:00] plan is amenable to both of you.Basically,swyx: I refuse to work until you make me happy.Jonas: We found that it’s really important where people would give like very underspecified prompt and then expect it to come back with magic. And if it’s gonna go off and work for three minutes, that’s one thing. When it’s gonna go off and work for three days, probably should spend like a few hours upfront making sure that you have communicated what you actually want.swyx: Yeah. And just to like really drive from the point. We really mean three days that No, noJonas: human. Oh yeah. We’ve had three day months innovation whatsoever.Samantha: I don’t know what the record is, but there’s been a long time with the grantsJonas: and so the thing that is available in cursor. The long running agent is if you wanna think about it, very abstractly that is like one worker node.Whereas what built the browser is a society of workers and planners and different agents collaborating. Because we started building the browser with one worker node at the time, that was just the agent. And it became one worker node when we realized that the throughput of the system was not where it needed to be [00:47:00] to get something as large of a scale as the browser done.swyx: Yeah.Jonas: And so this has also become a really big mental model for us with cloud, cloud agents is there’s the classic engineering latency throughput trade-offs. And so you know, the code is water flowing through a pipe. The, we think that over the coming months, the big unlock is not going to be one person with a model getting more done, like the water flowing faster and we’ll be making the pipe much wider and so ing more, whether that’s swarms of agents or parallel agents, both of those are things that contribute to getting.Much more done in the same amount of time, but any one of those tasks doesn’t necessarily need to get done that quickly. And throughput is this really big thing where if you see the system of a hundred concurrent agents outputting thousands of tokens a second, you can’t go back like that.Just you see a glimpse of the future where obviously there are many caveats. Like no one is using this browser. IRL. There’s like a bunch of things not quite right yet, but we are going to get to systems that produce real production [00:48:00] code at the scale much sooner than people think. And it forces you to think what even happens to production systems. Like we’ve broken our GitHub actions recently because we have so many agents like producing and pushing code that like CICD is just overloaded. ‘cause suddenly it’s like effectively weg grew, cursor’s growing very quickly anyway, but you grow head count, 10 x when people run 10 x as many agents.And so a lot of these systems, exactly, a lot of these systems will need to adapt.swyx: It also reminds me, we, we all, the three of us live in the app layer, but if you talk to the researchers who are doing RL infrastructure, it’s the same thing. It’s like all these parallel rollouts and scheduling them and making sure as much throughput as possible goes through them.Yeah, it’s the same thing.Jonas: We were talking briefly before we started recording. You were mentioning memory chips and some of the shortages there. The other thing that I think is just like hard to wrap your head around the scale of the system that was building the browser, the concurrency there.If Sam and I both have a system like that running for us, [00:49:00] shipping our software. The amount of inference that we’re going to need per developer is just really mind-boggling. And that makes, sometimes when I think about that, I think that even with, the most optimistic projections for what we’re going to need in terms of buildout, our underestimating, the extent to which these swarm systems can like churn at scale to produce code that is valuable to the economy.And,swyx: yeah, you can cut this if it’s sensitive, but I was just Do you have estimates of how much your token consumption is?Jonas: Like per developer?swyx: Yeah. Or yourself. I don’t need like comfy average. I just curious. ISamantha: feel like I, for a while I wasn’t an admin on the usage dashboard, so I like wasn’t able to actually see, but it was a,swyx: mine has gone up.Samantha: Oh yeah.swyx: But I thinkSamantha: it’s in terms of how much work I’m doing, it’s more like I have no worries about developers losing their jobs, at least in the near term. ‘cause I feel like that’s a more broad discussion.swyx: Yeah. Yeah. You went there. I didn’t go, I wasn’t going there.I was just like how much more are you using?Samantha: There’s so much stuff to be built. And so I feel like I’m basically just [00:50:00] trying to constantly I have more ambitions than I did before. Yes. Personally. Yes. So can’t speak to the broader thing. But for me it’s like I’m busier than ever before.I’m using more tokens and I am also doing more things.Jonas: Yeah. Yeah. I don’t have the stats for myself, but I think broadly a thing that we’ve seen, that we expect to continue is J’S paradox. Whereswyx: you can’t do it in our podcast without seeingJonas: it. Exactly. We’ve done it. Now we can wrap. We’ve done, we said the words.Phase one tab auto complete people paid like 20 bucks a month. And that was great. Phase two where you were iterating with these local models. Today people pay like hundreds of dollars a month. I think as we think about these highly parallel kind of agents running off for a long times in their own VM system, we are already at that point where people will be spending thousands of dollars a month per human, and I think potentially tens of thousands and beyond, where it’s not like we are greedy for like capturing more money, but what happens is just individuals get that much more leverage.And if one person can do as much as 10 people, yeah. That tool that allows ‘em to do that is going to be tremendously valuable [00:51:00] and worth investing in and taking the best thing that exists.swyx: One more question on just the cursor in general and then open-ended for you guys to plug whatever you wanna put.How is Cursor hiring these days?Samantha: What do you mean by how?swyx: So obviously lead code is dead. Oh,Samantha: okay.swyx: Everyone says work trial. Different people have different levels of adoption of agents. Some people can really adopt can be much more productive. But other people, you just need to give them a little bit of time.And sometimes they’ve never lived in a token rich place like cursor.And once you live in a token rich place, you’re you just work differently. But you need to have done that. And a lot of people anyway, it was just open-ended. Like how has agentic engineering, agentic coding changed your opinions on hiring?Is there any like broad like insights? Yeah.Jonas: Basically I’m asking this for other people, right? Yeah, totally. Totally. To hear Sam’s opinion, we haven’t talked about this the two of us. I think that we don’t see necessarily being great at the latest thing with AI coding as a prerequisite.I do think that’s a sign that people are keeping up and [00:52:00] curious and willing to upscale themselves in what’s happening because. As we were talking about the last three months, the game has completely changed. It’s like what I do all day is very different.swyx: Like it’s my job and I can’t,Jonas: Yeah, totally.I do think that still as Sam was saying, the fundamentals remain important in the current age and being able to go and double click down. And models today do still have weaknesses where if you let them run for too long without cleaning up and refactoring, the coke will get sloppy and there’ll be bad abstractions.And so you still do need humans that like have built systems before, no good patterns when they see them and know where to steer things.Samantha: I would agree with that. I would say again, cursor also operates very quickly and leveraging ag agentic engineering is probably one reason why that’s possible in this current moment.I think in the past it was just like people coding quickly and now there’s like people who use agents to move faster as well. So it’s part of our process will always look for we’ll select for kind of that ability to make good decisions quickly and move well in this environment.And so I think being able to [00:53:00] figure out how to use agents to help you do that is an important part of it too.swyx: Yeah. Okay. The fork in the road, either predictions for the end of the year, if you have any, or PUDs.Jonas: Evictions are not going to go well.Samantha: I know it’s hard.swyx: They’re so hard. Get it wrong.It’s okay. Just, yeah.Jonas: One other plug that may be interesting that I feel like we touched on but haven’t talked a ton about is a thing that the kind of these new interfaces and this parallelism enables is the ability to hop back and forth between threads really quickly. And so a thing that we have,swyx: you wanna show something or,Jonas: yeah, I can show something.A thing that we have felt with local agents is this pain around contact switching. And you have one agent that went off and did some work and another agent that, that did something else. And so here by having, I just have three tabs open, let’s say, but I can very quickly, hop in here.This is an example I showed earlier, but the actual workflow here I think is really different in a way that may not be obvious, where, I start the morning, I kick off 10 agents or something, the first one of them [00:54:00] finishes, come in, watch the video either as close. And so I might send a follow up.I might say, Hey, make it red, or I might hop into the desktop and try it out. And within, 90, 120 seconds, I’ve kicked this one back off. And either started the merge process like CI is running now and I’ll come back to it later or it’s off with some additional follow up information. And then I can hop into the next one.And then the next one I hop in and I’m like, okay, this looks interesting. Actually try it out for real in the app. I want to see it in action, not just in the gallery. So I can kick that off and the agent will go and work on that because maybe I wanted to try it out, like what the button looks like in the actual thing.And then here I might hop in as well and, check the video here or do something. And so you’re really parallelizing much more and follow up here, check in there. It’s much more this higher level of abstraction and having the different desktops where you can hop back and forth and you’re [00:55:00] not like, oh, I checked out this branch.Oh, where was that work tree again? Yeah. It’s really like solving for that which we’ve ourselves have struggled with in cursor and these local agents to be like, where was that diff again? It’s lost in some work tree. Never gonna find it. Oh, my local thing is rebuilding. Oh, just make another one.That, that’s what you end up with and then you wait for five more minutes for it to run. And so this is really like a new way of just paralleling that we found to be really fun, honestly. Yeah. Where you’re just hopping in and injecting taste and you’re like that doesn’t quite feel right.Oh, actually this is not architected quite right, but you’re just focusing on those like taste interesting questions.Samantha: For me, the cloud ecosystem too also enabled this to be like, something that is like adding productivity to my dead time, like commuting or like overnight or something like that.The fact that I don’t have to leave my computer open,swyx: there’s no cursor, there is a cursor mobile app.Samantha: If there is, I’m not sure. It’s like the current thing. We, I use it on my phone all the time, just on the web. So pretty good experience there for checking [00:56:00] in. Yeah. And un unlocking. I think, yeah. You can see the videos and stuff in the web app, which is awesome.Yeah.Jonas: Yeah.swyx: I think this is one that the a DD one inherited the earth, like the, if you’re like, your attention span is cooked, but you still can manage, like actually this is good for you. Yeah. But also I think this is where the coding tools start coming into conflict with the productivity tools where like the linear the canman boards, because what you have there is cool, but you know what, you actually need a cabin board. Which people have vibe, vibe, cam, van is out there. Open source. I’m sure you guys have talked about it, but we’ll start to conflict because actually the code doesn’t matter anymore.It’s the process of the human interacting and checking in. And seeing, like getting the world of warcrafts sound package to go like work or whatever. It’s like job done or, I don’t know. It’s like an interesting like future productivity thing.Samantha: Yeah.swyx: I also think like another big theme like last year li is called like the, your coding agents.This year another like coding agents spill over to the real world into cloud cowork and all the other stuff. Yeah. I’m sure cursor’s gonna focus on software, but let’s call it like open claw is like extremely [00:57:00] mind expanding in terms of I did not know that could happen.Jonas: Yeah.swyx: And it’s all based on a coding agent based totally.Jonas: And I think one of the things that like talking to, friends and family that are not in the software world that’s interesting is I do. Speeding up predictions. I do think that we are going to start seeing other industries go through what software development has started going through.I think by virtue of how good models are at writing software and how early adopter the people building the new technology are and trying it out and applying it to themselves, that’s certain kinds of shifts will happen too to other industries. And there’s a lot to be learned from how that’s gone down and is continuing to go down in software.In terms of, all the interesting questions about to what point do people get more leverage, when do you start changing the role to become much more generalist? Like, all of these questions that we’ve seen some data on, but we’ll see a lot more in the coming months. That will happen everywhere.swyx: Sammy party thoughts? Any flus of your own?Samantha: Not really. [00:58:00] It’s fine. I feel we covered so much good draft. We covered it. We covered a lot. Coming up with a prediction. I just think agents are gonna keep getting better. Gonna stop doing as much manual coding, probably zero lines of code written in the whole month of December this year by myself.A hundred percent agents as a personal prediction, butswyx: oh, you’re not as zero today.What in what cases?Samantha: I think honestly, it’s 1% if I like, just am like, get frustrated and I’m like, I don’t wanna go have it tell an agent to change this one thing. ButJonas: prompting sometimes I feel like working on prompts sometimes.Yeah. I still go in and manually edit because it’s so like bare intent transfer that like telling the agent what I want. It’s like writing an essay where I don’t use agents to write essays yet because the process of writing it is the thinking.Samantha: I still can’t stand AI generated writing. So yeah, I can also can’t have the agent write prompts.swyx: So no D Spy, no jpa, nothing like that here.Jonas: We have some internal tooling around some of the prompt optimization things, but there’s a fair amount of just what concepts do I need to communicate to the agent or the model.swyx: I also noticed another thing I’m also [00:59:00] looking for is voice.I noticed that you didn’t use your voice to code even open ai. When we do podcasts with them, they don’t use their voice. Yeah. And I’m like at some point this gets good. You can stop typing.Samantha: We have some people who like that a lot internally, and I think we’ll be experimenting in that space too, for sure.Jonas: Do you use voice log?swyx: Not a lot. Sometimes that’s bound to my caps log, so I can press it. I just,Jonas: and when you use it, do you want it to talk back or you just wantswyx: Yeah,Jonas: just dump in. Yeah. Yeah.swyx: But like the brain dump is good. Yeah. Because you can interrupt yourself. You can go on a tangent, whatever.It just captures everything. Yeah. And lop it into all m, it’s fine.Jonas: Yeah. The way that we did this with Auto Tab was people would record full screen recordings with audio to teach the model, like how to do a task. And one of the funny things that we learned was people would use their Siri voice, where they would start talking in like short, stilted sentences and enunciate really clearly because they were used to, they last used AI two years ago where you had toswyx: apple has damaged like an entire generation of people’s expectations.Jonas: Exactly. And we had to be like, no you’re very native, so [01:00:00] you do this, but just dump everything in. You can say you can repeat yourself. You can contradict yourself. The models are smart enough to figure it out,swyx: but it’s still very bad. So voice coding was always, I considered like the hardest part because you have to say like technical things that pel like spelling matters, capitalization matters and like it’s all not in voice.So we’ll see. So far it’s been more sort of emotional companionship, that kind of stuff, but at some point it’s gonna hit voice coding.Jonas: Yeah. I have a prediction for you. I predict that by the end of the year, the volume on, I think it will take longer than people think and longer than we think for cloud and agents working in their own boxes to surpass local agents.But I think that crossover will happen before the end of the year and probably by the end of the year, agents running in the cloud will be a multi, like more than two x the volume of local agents.swyx: Okay. You’re leaving me an opening. What’s not good today?Jonas: Yeah, there’s a bunch of hard things. So one of them is just getting those [01:01:00] sandboxes to be really good and a thing that was part of this launch that we spend in inordinate amount of time on is cursor.com/onboard where you pick a repo, add secrets, give it access to things, and the agent just goes off and installs things.swyx: Yes, I think all the whole thing. That was my favorite.Jonas: Yeah, we worked a lot on that. Sam and I in particular spent a lot of late nights making that good, but there’s still a lot to do there, right? Set up 1, 2, 2 things. Maybe it’s too slow. It’s too slow. Working on it set up is not like a unitary thing where everything is set up or not, right?Like things will break over time. You have new dependencies, you need access to new systems, like you change where your database lives. So that’s one part of it. And then the other part of it is, having these agents run in the cloud and be more autonomous. We’ve really started to see the lack of memory.And Sam, as someone who’s thought a lot about this once you start getting the model kind of doing, operating the code base, there’s more particularities that are not it’s not just a read file tool. It needs to know how do I start up the backend, how do I check the status [01:02:00] of the backend?That’s very particular to your code base. And even if it’s great at NPM Run watch or whatever the default things are, there’s always quirks. Everyone has quirks. And getting the model good at those things will require more work. And we’re working on that. But we think that will be one of the big unlocks, is having them be onboarded not only in terms of their environment, but also in terms of their understanding of design trade-offs, how the code base works, how to be a good developer in any one code base.swyx: It’s lot crier rules. It’s gonna be something else. Is it gonna be a file? Is it. We just call in either markdown file a different name, andSamantha: I don’t know. One thing that we learned at, could we be in cursor of the company this year? There, there’s a really great blog post that the Judi and the other people in the agent quality team put out about dynamic file context.swyx: Is that your team is the different team?Samantha: Different team, yeah. And they were working on basically doing a lot everything, file system, everything is file system. And so a lot of my thinking personally on memory this past year has changed to be more aligned with that, where it’s like giving the agent pointers to things, annotations [01:03:00] to things.The second thing I think that I’ve started to think differently about memory is a subset of agent self-audit ability and self-awareness. Basically like the agent might wanna propose annotations or links or memory like files to itself when it finds that there’s like some gap in its functionality in its own harness that might need to be filled by like some piece of information on a semi-permanent basis.But there’s a whole bunch of other things that are a side effect of self auditability that are really interesting, like potentially finding like conflicting instructions or like skills and rules that like might be like, eh, these are bugging each other. And also things like fixing like Devrel X problems that it runs into.I think that basically the dynamic file system stuff is probably very promising from memory. And there’s also this notion of needing to have the agent be a little bit more self-aware in terms of being able to identify gaps in its own functionality and decide how to fill them.Jonas: That’s such a good point.Like self-awareness broadly has been a really big thing that I think Sam has pushed us to [01:04:00] do more and more of where the agent should understand how its environment works, it should understand how secrets work. Like it needs to be self-aware about its own harness and its environment. And then, and youswyx: think this is not inherent in the model you have to do.Jonas: It’s specifics, right? If it’s running in cursor versus some other sandbox that’s a bit different. And then the other part of it that starts to get really interesting is when the model starts editing its own system. Prompt.swyx: Yeah.Jonas: What does that even mean? How do you do that safely and then way overswyx: do that?This is just research, right? This isn’t, this isJonas: I think it will do that. Yeah. It will manage its own context. And so system prompt is part of the context, and you can argue aboutSamantha: Yeah, like other things that it might decide to turn off or on depending, and all those, self-awareness to us in this context is not like the model itself, having a notion of consciousness, but more like knowing like what system it’s operating in and the constraints of that system and potentially being able to have agency in optimizing itself to operate best in the, in that system.This was like one of the [01:05:00] first things I learned at DOT when we launched was that I we had made the model or made the agent or. Whatever we would call it. At that time, it was far less, agentic made the product work very well at a certain number of things, but didn’t have complete self-awareness of like its own boundaries.So people would be like, Hey, can you do this thing? And the thing was there and could be done and the and the product would be like, oh no. And I’d be like, but you can. And so like basically like that was one of the earliest things I found isswyx: believe in yourself.Samantha: I know as a product developer, like it needs to both be able to do the thing and it needs to have complete knowledge of its ability to do the thing.Those are not always obviously the same like part of the prompt at all.Yeah.swyx: Yeah.Samantha: It’s something that I think has continued to be a theme in the ecosystem that users will often attribute increased intelligence to a system that is more highly self-aware and is more able to like, manipulate itself to do well in a system.If that makes sense.swyx: Yeah. This is more abstract than I ever thought would get at Thisor discussion. Cool. That isn’t the kind of [01:06:00] conversation that you haveSamantha: in, we talk about this stuff all the time toswyx: improvingSamantha: Yeah.swyx: Agents in general.Jonas: Yeah. I think to your point right about the agent layer and thinking a lot about models and the harness and the product and the affordances like that.Yeah. Falls from theswyx: No, I mean you guys are like my sort of needing example what an agent lab looks like and can be successful and I think people always hungry for insights into how you guys operate, so thank you for taking the time to share.Samantha: Yeah. Thanks for coming.Yeah. Thank you. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.latent.space/subscribe

The reception to our recent post on Code Reviews has been strong. Catch up!Amid a maelstrom of discussion on whether or not AI is killing SaaS, one of the top publicly listed SaaS companies in the world has just reported record revenues, clearing well over $1.1B in ARR for the first time with a 28% margin. As we comment on the pod, Aaron Levie is the rare public company CEO equally at home in both worlds of Silicon Valley and Wall Street/Main Street, by day helping 70% of the Fortune 500 with their Enterprise Advanced Suite, and yet by night is often found in the basements of early startups and tweeting viral insights about the future of agents.Now that both Cursor, Cloudflare, Perplexity, Anthropic and more have made Filesystems and Sandboxes and various forms of “Just Give the Agent a Box” cool (not just cool; it is now one of the single hottest areas in AI infrastructure growing 100% MoM), we find it a delightfully appropriate time to do the episode with the OG CEO who has been giving humans and computers Boxes since he was a college dropout pitching VCs at a Michael Arrington house party.Enjoy our special pod, with fan favorite returning guest/guest cohost Jeff Huber!Note: We didn’t directly discuss the AI vs SaaS debate - Aaron has done many, many, many other podcasts on that, and you should read his definitive essay on it. Most commentators do not understand SaaS businesses because they have never scaled one themselves, and deeply reflected on what the true value proposition of SaaS is.We also discuss Your Company is a Filesystem:We also shoutout CTO Ben Kus’ and the AI team, who talked about the technical architecture and will return for AIE WF 2026.Full Video EpisodeTimestamps* 00:00 Adapting Work for Agents* 01:29 Why Every Agent Needs a Box* 04:38 Agent Governance and Identity* 11:28 Why Coding Agents Took Off First* 21:42 Context Engineering and Search Limits* 31:29 Inside Agent Evals* 33:23 Industries and Datasets* 35:22 Building the Agent Team* 38:50 Read Write Agent Workflows* 41:54 Docs Graphs and Founder Mode* 55:38 Token FOMO Culture* 56:31 Production Function Secrets* 01:01:08 Film Roots to Box* 01:03:38 AI Future of Movies* 01:06:47 Media DevRel and EngineeringTranscriptAdapting Work for AgentsAaron Levie: Like you don’t write code, you talk to an agent and it goes and does it for you, and you may be at best review it. That’s even probably like, like largely not even what you’re doing. What’s happening is we are changing our work to make the agents effective. In that model, the agent didn’t really adapt to how we work.We basically adapted to how the agent works. All of the economy has to go through that exact same evolution. Right now, it’s a huge asset and an advantage for the teams that do it early and that are kinda wired into doing this ‘cause you’ll see compounding returns. But that’s just gonna take a while for most companies to actually go and get this deployed.swyx: Welcome to the Lane Space Pod. We’re back in the chroma studio with uh, chroma, CEO, Jeff Hoover. Welcome returning guest now guest host.Aaron Levie: It’s a pleasure. Wow. How’d you get upgraded to, uh, to that?swyx: Because he’s like the perfect guy to be guest those for you.Aaron Levie: That makes sense actually, for We love context. We, we both really love context le we really do.We really do.swyx: Uh, and we’re here with, uh, Aaron Levy. Welcome.Aaron Levie: Thank you. Good to, uh, good to be [00:01:00] here.swyx: Uh, yeah. So we’ve all met offline and like chatted a little bit, but like, it’s always nice to get these things in person and conversation. Yeah. You just started off with so much energy. You’re, you’re super excited about agents.I loveAaron Levie: agents.swyx: Yeah. Open claw. Just got by, got bought by OpenAI. No, not bought, but you know, you know what I mean?Aaron Levie: Some, some, you know, acquihire. Executiveswyx: hire.Aaron Levie: Executive hire. Okay. Executive hire. Say,swyx: hey, that’s my term. Okay. Um, what are you pounding the table on on agents? You have so many insightful tweets.Why Every Agent Needs a BoxAaron Levie: Well, the thing that, that we get super excited by that I think is probably, you know, should be relatively obvious is we’ve, we’ve built a platform to help enterprises manage their files and their, their corporate files and the permissions of who has access to those files and the sharing collaboration of those files.All of those files contain really, really important information for the enterprise. It might have your contracts, it might have your research materials, it might have marketing information, it might have your memos. All that data obviously has, you know, predominantly been used by humans. [00:02:00] But there’s been one really interesting problem, which is that, you know, humans only really work with their files during an active engagement with them, and they kind of go away and you don’t really see them for a long time.And all of a sudden, uh, with the power of AI and AI agents, all of that data becomes extremely relevant as this ongoing source of, of answers to new questions of data that will transform into, into something else that, that produces value in your organization. It, it contains the answer to the new employee that’s onboarding, that needs to ramp up on a project.Um, it contains the answer to the right thing to sell a customer when you’re having a conversation to them, with them contains the roadmap information that’s gonna produce the next feature. So all that data. That previously we’ve been just sort of storing and, and you know, occasionally forgetting about, ‘cause we’re only working on the new active stuff.All of that information becomes valuable to the enterprise and it’s gonna become extremely valuable to end users because now they can have agents go find what they’re looking for and produce new, new [00:03:00] value and new data on that information. And it’s gonna become incredibly valuable to agents because agents can roam around and do a bunch of work and they’re gonna need access to that data as well.And um, and you know, sometimes that will be an agent that is sort of working on behalf of, of, of you and, and effectively as you as and, and they are kind of accessing all of the same information that you have access to and, and operating as you in the system. And then sometimes there’s gonna be agents that are just.Effectively autonomous and kind of run on their own and, and you’re gonna collaborate and work with them kind of like you did another person. Open Claw being the most recent and maybe first real sort of, you know, kind of, you know, up updating everybody’s, you know, views of this landscape version of, of what that could look like, which is, okay, I have an agent.It’s on its own system, it’s on its own computer, it has access to its own tools. I probably don’t give it access to my entire life. I probably communicate with it like I would an assistant or a colleague and then it, it sort of has this sandbox environment. So all of that has massive implications for a platform that manage that [00:04:00] enterprise data.We think it’s gonna just transform how we work with all of the enterprise content that we work with, and we just have to make sure we’re building the right platform to support that.swyx: The sort of shorthand I put it is as people build agents, everybody’s just realizing that every agent needs a box. Yes.And it’s nice to be called box and just give everyone a box.Aaron Levie: Hey, I if I, you know, if we can make that go viral, uh, like I, I think that that terminology, I, that’s theswyx: tagline. Every agentAaron Levie: needs a box. Every agent needs a box. If we can make that the headline of this, I’m fine with this. And that’s the billboard I wanna like Yeah, exactly.Every agent needs a box. Um, I like it. Can we ship this? Like,swyx: okay, let’s do it. Yeah.Aaron Levie: Uh, my work here is done and I got the value I needed outta this podcast Drinks.swyx: Yeah.Agent Governance and IdentityAaron Levie: But, but, um, but, but, you know, so the thing that we, we kind of think about is, um, is, you know, whether you think the number 10 x or a hundred x or whatever the number is, we’re gonna have some order of magnitude more agents than people.That’s inevitable. It has to happen. So then the question is, what is the infrastructure that’s needed to make all those agents effective in the enterprise? Make sure that they are well governed. Make sure they’re only doing [00:05:00] safe things on your information. Make sure that they’re not getting exposed. The data that they shouldn’t have access to.There’s gonna be just incredibly spectacularly crazy security incidents that will happen with agents because you’ll prompt, inject an agent and sort of find your way through the CRM system and pull out data that you shouldn’t have access to. Oh, weJeff Huber: have God,Aaron Levie: right? I mean, that’s just gonna happen all over the place, right?So, so then the thing is, is how do you make sure you have the right security, the permissions, the access controls, the data governance. Um, we actually don’t yet exactly know in many cases how we’re gonna regulate some of these agents, right? If you think about an agent in financial services, does it have the exact same financial sort of, uh, requirements that a human did?Or is it, is the risk fully on the human that was interacting or created the agent? All open questions, but no matter what, there’s gonna need to be a layer that manages the, the data they have access to, the workflows that they’re involved in, pulling up data from multiple systems. This is the new infrastructure opportunity in the era of agents.swyx: You have a piece on agent identities, [00:06:00] which I think was today, um, which I think a lot of breaking news, the security, security people are talking about, right? Like you basically, I, I always think of this as like, well you need the human you and then there you need the agent. YouAaron Levie: Yes.swyx: And uh, well, I don’t know if it’s that simple, but is box going to have an opinion on that or you’re just gonna be like, well we’re just the sort of the, the source layer.Yeah. Let’s Okta of zero handle that.Aaron Levie: I think we’re gonna have an opinion and we will work with generally wherever the contours of the market end up. Um, and the reason that we’re gonna have an opinion more than other topics probably is because one of the biggest use cases for why your agent might need it, an identity is for file system access.So thus we have to kind of think about this pretty deeply. And I think, uh, unless you’re like in our world thinking about this particular problem all day long, it might be, you know, like, why is this such a big deal? And the reason why it’s a really big deal is because sometimes sort of say, well just give the agent an, an account on the system and it just treats, treat it like every other type of user on the system.The [00:07:00] problem is, is that I as Aaron don’t really have any responsibility over anybody else’s box account in our organization. I can’t see the box account of any other employee that I work with. I am not liable for anything that they do. And they have, I have, I have, you know, strict privacy requirements on everything that they’re able to, you know, that, that, that they work on.Agents don’t have that, you know, don’t have those properties. The person who creates the agent probably is gonna, for the foreseeable future, take on a lot of the liability of what that agent does. That agent doesn’t deserve any privacy because, because it’s, you know, it can’t fully be autonomously operated and it doesn’t have any legal, you know, kind of, you know, responsibility.So thus you can’t just be like, oh, well I’ll just create a bunch of accounts and then I’ll, I’ll kind of work with that agent and I’ll talk to it occasionally. Like you need oversight of that. And so then the question is, how do you have a world where the agent, sometimes you have oversight of, but what if that agent goes and works with other people?That person over there is collaborating with the agent on something you shouldn’t have [00:08:00] access to what they’re doing. So we have all of these new boundaries that we’re gonna have to figure out of, of, you know, it’s really, really easy. So far we’ve been in, in easy mode. We’ve hit the easy button with ai, which is the agent just is you.And when you’re in quad code and you’re in cursor, and you’re in Codex, you’re just, the agent is you. You’re offing into your services. It can do everything you can do. That’s the easy mode. The hard mode is agents are kind of running on their own. People check in with them occasionally, they’re doing things autonomously.How do you give them access to resources in the enterprise and not dramatically increased the security risk and the risk that you might expose the wrong thing to somebody. These are all the new problems that we have to get solved. I like the identity layer and, and identity vendors as being a solution to that, but we’ll, we’ll need some opinions as well because so many of the use cases are these collaborative file system use cases, which is how do I give it an agent, a subset of my data?Give it its own workspace as well. ‘cause it’s gonna need to store off its own information that would be relevant for it. And how do I have the right oversight into that? [00:09:00]Jeff Huber: One thing, which, um, I think is kind interesting, think about is that you know, how humans work, right? Like I may not also just like give you access to the whole file.I might like sit next to you and like scroll to this like one part of the file and just show you that like one part and like, you know,swyx: partial file access.Jeff Huber: I’m just saying I think like our, like RA does seem to be dead, right? Like you wanna say something is dead uhhuh probably RA is dead. And uh, like the auth story to me seems like incredibly unsolved and unaddressed by like the existing state of like AI vendors.ButAaron Levie: yeah, I think, um, we’re, I mean you’re taking obviously really to level limit that we probably need to solve for. Yeah. And we built an access control system that was, was kind of like, you know, its own little world for, for a long time. And um, and the idea was this, it’s a many to many collaboration system where I can give you any part of the file system.And it’s a waterfall model. So if I give you higher up in the, in the, in the system, you get everything below. And that, that kind of created immense flexibility because I can kind of point you to any layer in the, in the tree, but then you’re gonna get access to everything kind of below it. And that [00:10:00] mostly is, is working in this, in this world.But you do have to manage this issue, which is how do I create an agent that has access to some of my stuff and somebody else’s stuff as well. Mm-hmm. And which parts do I get to look at as the creator of the agent? And, and these are just brand new problems? Yeah. Crazy. And humans, when there was a human there that was really easy to do.Like, like if the three of us were all sharing, there’d be a Venn diagram where we’d have an overlapping set of things we’ve shared, but then we’d have our own ways that we shared with each other. In an agent world, somebody needs to take responsibility for what that agent has access to and what they’re working on.These are like the, some of the most probably, you know, boring problems for 98% of people on, on the internet, but they will be the problems that are the difference between can you actually have autonomous agents in an enterprise contextswyx: Yeah.Aaron Levie: That are not leaking your data constantly.swyx: No. Like, I mean, you know, I run a very, very small company for my conference and like we already have data sensitivity issues.Yes. And some of my team members cannot see Yes. Uh, the others and like, I can’t imagine what it’s like to run a Fortune 500 and like, you have to [00:11:00] worry about this. I’m just kinda curious, like you, you talked to a lot like, like 70, 80% of your cus uh, of the Fortune 500, your customers.Aaron Levie: Yep. 67%. Just so we’re being verySEswyx: precise.So Yeah. I’m notAaron Levie: Okay. Okay.swyx: Something I’m rounding up. Yes. Round up. I’m projecting to, forAaron Levie: the government.swyx: I’m projecting to the end of the year.Aaron Levie: Okay.swyx: There you go.Aaron Levie: You do make it sound like, like we, we, well we’ve gotta be on this. Like we’re, we’re taking way too long to get to 80%. Well,swyx: no, I mean, so like. How are they approaching it?Right? Because you’re, you don’t have a, you don’t have a final answer yet.Why Coding Agents Took Off FirstAaron Levie: Well, okay, so, so this is actually, this is the stark reality that like, unfortunately is the kinda like pouring the water on the party a little bit.swyx: Yes.Aaron Levie: We all in Silicon Valley are like, have the absolute best conditions possible for AI ever.And I think we all saw the dke, you know, kind of Dario podcast and this idea of AI coding. Why is that taken off? And, and we’re not yet fully seeing it everywhere else. Well, look, if you just like enumerated the list of properties that AI coding has and then compared it to other [00:12:00] knowledge work, let’s just, let’s just go through a few of them.Generally speaking, you bring on a new engineer, they have access to a large swath of the code base. Like, there’s like very, like you, just, like new engineer comes on, they can just go and find the, the, the stuff that they, they need to work with. It’s a fully text in text out. Medium. It’s only, it’s just gonna be text at the end of the day.So it’s like really great from a, from just a, uh, you know, kinda what the agent can work with. Obviously the models are super trained on that dataset. The labs themselves have a really strong, kind of self-reinforcing positive flywheel of why they need to do, you know, agent coding deeply. So then you get just better tooling, better services.The actual developers of the AI are daily users of the, of the thing that they’re we’re working on versus like the, you know, probably there’s only like seven Claude Cowork legal plugin users at Anthropic any given day, but there’s like a couple thousand Claude code and you know, users every single day.So just like, think about which one are they getting more feedback on. All day long. So you just go through this list. You have a, you know, everybody who’s a [00:13:00] developer by definition is technical so they can go install the latest thing. We’re all generally online, or at least, you know, kinda the weird ones are, and we’re all talking to each other, sharing best practices, like that’s like already eight differences.Versus the rest of the economy. Every other part of the economy has like, like six to seven headwinds relative to that list. You go into a company, you’re a banker in financial services, you have access to like a, a tiny little subset of the total data that’s gonna be relevant to do your job. And you’re have to start to go and talk to a bunch of people to get the right data to do your job because Sally didn’t add you to that deal room, you know, folder.And that that, you know, the information is actually in a completely different organization that you now have to go in and, and sort of run into. And it’s like you have this endless list of access controls and security. As, as you talked about, you have a medium, which is not, it’s not just text, right? You have, you have a zoom call that, that you’re getting all of the requirements from the customer.You have a lot of in-person conversations and you’re doing in-person sales and like how do you ever [00:14:00] digitize all of that information? Um, you know, I think a lot of people got upset with this idea that the code base has all the context, um, that I don’t know if you follow, you know, did you follow some of that conversation that that went viral?Is like, you know, it’s not that simple that, that the code base doesn’t have all the knowledge, but like it’s a lot, you’re a lot better off than you are with other areas of knowledge work. Like you, we like, we like have documentation practices, you write specifications. Those things don’t exist for like 80% of work that happens in the enterprise.That’s the divide that we have, which is, which is AI coding has, has just fully, you know, where we’ve reached escape velocity of how powerful this stuff is, and then we’re gonna have to find a way to bring that same energy and momentum, but to all these other areas of knowledge work. Where the tools aren’t there, the data’s not set up to be there.The access controls don’t make it that easy. The context engineering is an incredibly hard problem because again, you have access control challenges, you have different data formats. You have end users that are gonna need to kind of be kind of trained through this as opposed to their adopting [00:15:00] these tools in their free time.That’s where the Fortune 500 is. And so we, I think, you know, have to be prepared as an industry where we are gonna be on a multi-year march to, to be able to bring agents to the enterprise for these workflows. And I think probably the, the thing that we’ve learned most in coding that, that the rest of the world is not yet, I think ready for, I mean, we’re, they’ll, they’ll have to be ready for it because it’s just gonna inevitably happen is I think in coding.What, what’s interesting is if you think about the practice of coding today versus two years ago. It’s probably the most changed workflow in maybe the history of time from the amount of time it’s changed, right? Yeah. Like, like has any, has any workflow in the entire economy changed that quickly in terms of the amount of change?I just, you know, at least in any knowledge worker workflow, there’s like very rarely been an event where one piece of technology and work practice has so fundamentally, you know, changed, changed what you do. Like you don’t write code, you talk to an agent and it goes and [00:16:00] does it for you, and you may be at best review it.And even that’s even probably like, like largely not even what you’re doing. What’s happening is we are changing our work to make the agents effective. In that model, the agent didn’t really adapt to how we work. We basically adapted to how the agent works. Mm-hmm. All of the economy has to go through that exact same evolution.The rest of the economy is gonna have to update its workflows to make agents effective. And to give agents the context that they need and to actually figure out what kind of prompting works and to figure out how do you ensure that the agent has the right access to information to be able to execute on its work.I, you know, this is not the panacea that people were hoping for, of the agent drops in, just automates your life. Like you have to basically re-engineer your workflow to get the most out of agents and, uh, and that, that’s just gonna take, you know, multiple years across the economy. Right now it’s a huge asset and an advantage for the teams that do it early and that are kinda wired into doing this.‘cause [00:17:00] you’ll see compounding returns, but that’s just gonna take a while for most companies to actually go and get this deployed.swyx: I love, I love pushing back. I think that. That is what a lot of technology consultants love to hear this sort of thing, right? Yeah, yeah, yeah. First to, to embrace the ai. Yes. To get to the promised land, you must pay me so much money to a hundred percent to adopt the prescribed way of, uh, conforming to the agents.Yes. And I worry that you will be eclipsed by someone else who says, no, come as you are.Aaron Levie: Yeah.swyx: And we’ll meet you where you are.Aaron Levie: And, and, and and what was the thing that went viral a week ago? OpenAI probably, uh, is hiring F Dees. Yeah. Uh, to go into the enterprise. Yeah. Yeah. And then philanthropic is embedded at Goldman Sachs.Yeah. So if the labs are having to do this, if, if the labs have decided that they need to hire FDE and professional services, then I think that’s a pretty clear indication that this, there’s no easy mode of workflow transformation. Yeah. Yeah. So, so to your point, I think actually this is a market opportunity for, you know, new professional services and consulting [00:18:00] firms that are like Agent Build and they, and they kind of, you know, go into organizations and they figure out how to re-engineer your workflows to make them more agent ready and get your data into the right format and, you know, reconstruct your business process.So you’re, you’re not doing most of the work. You’re telling agents how to do the work and then you’re reviewing it. But I haven’t seen the thing that can just drop in and, and kinda let you not go through those changes.swyx: I don’t know how that kind of sales pitch goes over. Yeah. You know, you’re, you’re saying things like, well, in my sort of nice beautiful walled garden, here’s, there’s, uh, because here’s this, here’s this beautiful box account that has everything.Yes. And I’m like, well, most, most real life is extremely messy. Sure. And like, poorly named and there duplicate this outdated s**tAaron Levie: a hundred percent. And so No, no, a hundred percent. And so this is actually No. So, so this is, I mean, we agree that, that getting to the beautiful garden is gonna be tough.swyx: Yeah.Aaron Levie: There’s also the other end of the spectrum where I, I just like, it’s a technical impossibility to solve. The agent is, is truly cannot get enough context to make the right decision in, in the, in the incredibly messy land. Like there’s [00:19:00] no a GI that will solve that. So, so we’re gonna have to kind of land in somewhere in between, which is like we all collectively get better at.Documentation practices and, and having authoritative relatively up-to-date information and putting it in the right place like agents will, will certainly cause us to be much better organized around how we work with our information, simply because the severity of the agent pulling the wrong data will be too high and the productivity gain of that you’ll miss out on by not doing this will be too high as well, that you, that your competition will just do it and they’ll just have higher velocity.So, uh, and, and we, we see this a lot firsthand. So we, we build a series of agents internally that they can kind of have access to your full box account and go off and you give it a task and it can go find whatever information you’re looking for and work with. And, you know, thank God for the model progress, but like, if, if you gave that task to an agent.Nine months ago, you’re just gonna get lots of bogus answers because it’s gonna, it’s gonna say, Hey, here’s, here are fi [00:20:00] five, you know, documents that all kind of smell like the right thing. And I’m gonna, but I, but you’re, you’re putting me on the clock. ‘cause my assistant prompt says like, you know, be pretty smart, but also try and respond to the user and it’s gonna respond.And it’s like, ah, it got the wrong document. And then you do that once or twice as a knowledge worker and you’re just neverswyx: again,Aaron Levie: never again. You’re just like done with the system.swyx: Yeah. It doesn’t work.Aaron Levie: It doesn’t work. And so, you know, Opus four six and Gemini three one Pro and you know, whatever the latest five 3G BT will be, like, those things are getting better and better and it’s using better judgment.And this sort of like the, all of these updates to the agentic tool and search systems are, are, we’re seeing, we’re seeing very real progress where the agent. Kind of can, can almost smell some things a little bit fishy when it’s getting, you know, we, we have this process where we, we have it go fan out, do a bunch of searches, pull up a bunch of data, and then it has to sort of do its own ranking of, you know, what are the right documents that, that it should be working with.And again, like, you know, the intelligence level of a model six months ago, [00:21:00] it’d be just throwing a dart at like, I’m just, I’m gonna grab these seven files and I, I pray, I hope that that’s the right answer. And something like an opus first four five, and now four six is like, oh, it’s like, no, that one doesn’t seem right relative to this question because I’m seeing some signal that is making that, you know, that’s contradicting the document where it would normally be in the tree and who should have access.Like it’s doing all of that kind of work for you. But like, it still doesn’t work if you just have a total wasteland of data. Like, it’s just not, it’s just not possible. Partly ‘cause a human wouldn’t even be able to do it. So basically if a, if a really, really smart human. Could not do that task in five or 10 minutes for a search retrieval type task.Look, you know, your agent’s not gonna be able to do it any better. You see this all day long. SoContext Engineering and Search Limitsswyx: this touches on a thing that just passionate about it was just context engineering. I, I’m just gonna let you ramble or riff on, on context engineering. If, if, if there’s anything like he, he did really good work on context fraud, which has really taken over as like the term that people use and the referenceAaron Levie: a hundred percent.We, we all we think about is, is the context rob problem. [00:22:00]Jeff Huber: Yeah, there’s certainly a lot of like ranking considerations. Gentech surgery think is incredibly promising. Um, yeah, I was trying to generate a question though. I think I have a question right now. Swyx.Aaron Levie: Yeah, no, but like, like I think there was this moment, um, you know, like, I don’t know, two years ago before, before we knew like where the, the gotchas were gonna be in ai and I think someone was like, was like, well, infinite context windows will just solve all of these problems and ‘cause you’ll just, you’ll just give the context window like all the data and.It’s just like, okay, I mean, maybe in 2035, like this is a viable solution. First of all, it, it would just, it would just simply cost too much. Like we just can’t give the model like the 5,000 documents that might be relevant and it’s gonna read them all. And I’ve seen enough to, to start believing in crazy stuff.So like, I’m willing to just say, sure. Like in, in 10 years from now,swyx: never say, never, never.Aaron Levie: In, in 10 years from now, we’ll have infinite context windows at, at a thousandth of the price of today. Like, let’s just like believe that that’s possible, but Right. We’re in reality today. So today we have a context engineering [00:23:00] problem, which is, I got, I got, you know, 200,000 tokens that I can work with, or prob, I don’t even know what the latest graph is before, like massive degradation.16. Okay. I have 60,000 tokens that I get to work with where I’m gonna get accurate information. That’s not a lot of tokens for a corpus of 10 million documents that a knowledge worker might have across all of the teams and all the projects and all the people they work with. I have, I have 10 million documents.Which, you know, maybe is times five pages per document or something like that. I’m at 50 million pages of information and I have 60,000 tokens. Like, holy s**t. Yeah. This is like, how do I bridge the 50 million pages of information with, you know, the couple hundred that I get to work with in that, in that token window.Yeah. This is like, this is like such an interesting problem and that’s why actually so much work is actually like, just like search systems and the databases and that layer has to just get so locked in, but models getting better and importantly [00:24:00] knowing when they’ve done a search, they found the wrong thing, they go back, they check their work, they, they find a way to balance sort of appeasing the user versus double checking.We have this one, we have this one test case where we ask the agent to go find. 10 pieces of information.swyx: Is this the complex work eval?Aaron Levie: Uh, this is actually not in the eval. This is, this is sort of just like we have a bunch of different, we have a bunch of internal benchmark kind of scenarios. Every time we, we update our agent, we have one, which is, I ask it to find all of our office addresses, and I give it the list of 10 offices that we have.And there’s not one document that has this, maybe there should be, that would be a great example of the kind of thing that like maybe over time companies start to, you know, have these sort of like, what are the canonical, you know, kind of key areas of knowledge that we need to have. We don’t seem to have this one document that says, here are all of our offices.We have a bunch of documents that have like, here’s the New York office and whatever. So you task this agent and you, you get, you say, I need the addresses for these 10 offices. Okay. And by the way, if you do this on any, you know, [00:25:00] public chat model, the same outcome is gonna happen. But for a different kind of query, you give it, you say, I need these 10 addresses.How many times should the agent go and do its search before it decides whether or not, there’s just no answer to this question. Often, and especially the, the, let’s say lower tier models, it’ll come back and it’ll give you six of the 10 addresses. And it’ll, and I’ll just say I couldn’t find the otherswyx: four.It, it doesn’t know what It doesn’t know. ItAaron Levie: doesn’t know what It doesn’t know. Yeah. So the model is just like, like when should it stop? When should it stop doing? Like should it, should it do that task for literally an hour and just keep cranking through? Maybe I actually made up an office location and it doesn’t know that I made it up and I didn’t even know that I made it up.Like, should it just keep, re should it read every single file in your entire box account until it, until it should exhaust every single piece of information.swyx: Expensive.Aaron Levie: These are the new problems that we have. So, you know, something like, let’s say a new opus model is sort of like, okay, I’m gonna try these types of queries.I didn’t get exactly what I wanted. I’m gonna try again. I’m gonna, at [00:26:00] some point I’m gonna stop searching. ‘cause I’ve determined that that no amount of searching is gonna solve this problem. I’m just not able to do it. And that judgment is like a really new thing that the model needs to be able to have.It’s like, when should it give up on a task? ‘cause, ‘cause you just don’t, it’s a can’t find the thing. That’s the real world of knowledge, work problems. And this is the stuff that the coding agents don’t have to deal with. Because they, it just doesn’t like, like you’re not usually asking it about, you’re, you’re always creating net new information coming right outta the model for the most part.Obviously it has to know about your code base and your specs and your documentation, but, but when you deploy an agent on all of your data that now you have all of these new problems that you’re dealing withJeff Huber: our, uh, follow follow-up research to context ride is actually on a genetic search. Ah. Um, and we’ve like right, sort of stress tested like frontier models and their ability to search.Um, and they’re not actually that good at searching. Right. Uh, so you’re sort of highlighting this like explore, exploit.swyx: You’re just say, Debbie, Donna say everything doesn’t work. Like,Aaron Levie: well,Jeff Huber: somebody has to be,Aaron Levie: um, can I just throw out one more thing? Yeah. That is different from coding and, and the rest [00:27:00] of the knowledge work that I, I failed to mention.So one other kind of key point is, is that, you know, at the end of the day. Whether you believe we’re in a slop apocalypse or, or whatever. At the end of the day, if you, if you build a working product at the end of, if you, if you’ve built a working solution that is ultimately what the customer is paying for, like whether I have a lot of slop, a little slop or whatever, I’m sure there’s lots of code bases we could go into in enterprise software companies where it’s like just crazy slop that humans did over a 20 year period, but the end customer just gets this little interface.They can, they can type into it, it does its thing. Knowledge work, uh, doesn’t have that property. If I have an AI model, go generate a contract and I generate a contract 20 times and, you know, all 20 times it’s just 3% different and like that I, that, that kind of lop introduces all new kinds of risk for my organization that the code version of that LOP didn’t, didn’t introduce.These are, and so like, so how do you constrain these models to just the part that you want [00:28:00] them to work on and just do the thing that you want them to do? And, and, you know, in engineering, we don’t, you can’t be disbarred as an engineer, but you could be disbarred as a lawyer. Like you can do the wrong medical thing In healthcare, you, there’s no, there’s no equivalent to that of engineering.Like, doswyx: you want there to be, because I’ve considered softwareJeff Huber: engineer. What’s that? Civil engineering there is, right? NotAaron Levie: software civil engineer. Sure. Oh yeah, for sure. But like in any of our companies, you like, you know, you’ll be forgiven if you took down the site and, and we, we will do a rollback and you’ll, you’ll be in a meeting, but you have not been disbarred as an engineer.We don’t, we don’t change your, you know, your computer science, uh, blameJeff Huber: degree, this postmortem.Aaron Levie: Yeah, exactly. Exactly. So, so, uh, now maybe we collectively as an industry need to figure out like, what are you liable for? Not legally, but like in a, in a management sense, uh, of these agents. All sorts of interesting problems that, that, that, uh, that have to come out.But in knowledge work, that’s the real hostile environments that we’re operating in. Hmm.swyx: I do think like, uh, a lot of the last year’s, 2025 story was the rise of coding agents and I think [00:29:00] 2026 story is definitely knowledge work agents. Yes. A hundredAaron Levie: percent.swyx: Right. Like that would, and I think open claw core work are just the beginning.Yes. Like it’s, the next one’s gonna just gonna be absolute craziness.Aaron Levie: It it is. And, and, uh, and it’s gonna be, I mean, again, like this is gonna be this, this wave where we, we are gonna try and bring as many of the practices from coding because that, that will clearly be the forefront, which is tell an agent to go do something and has an access to a set of resources.You need to be responsible for reviewing it at the end of the process. That to me is the, is the kind of template that I just think goes across knowledge, work and odd. Cowork is a great example. Open Closet’s a great example. You can kind of, sort of see what Codex could become over time. These are some, some really interesting kind of platforms that are emerging.swyx: Okay. Um, I wanted to, we touched on evals a little bit. You had, you had the report that you’re gonna go bring up and then I was gonna go into like, uh, boxes, evals, but uh, go ahead. Talk about your genetic search thing.Jeff Huber: Yeah. Mostly I think kinda a few of the insights. It’s like number one frontier model is not good at search.Humans have this [00:30:00] natural explore, exploit trade off where we kinda understand like when to stop doing something. Also, humans are pretty good at like forgetting actually, and like pruning their own context, whereas agents are not, and actually an agent in their kind of context history, if they knew something was bad and they even, you could see in the trace the reason you trace, Hey, that probably wasn’t a good idea.If it’s still in the trace, still in the context, they’ll still do it again. Uhhuh. Uh, and so like, I think pruning is also gonna be like, really, it’s already becoming a thing, right? But like, letting self prune the con windowsswyx: be a big deal. Yeah. So, so don’t leave the mistake. Don’t leave the mistake in there.Cut out the mistake but tell it that you made a mistake in the past and so it doesn’t repeat it.Jeff Huber: Yeah. But like cut it out so it doesn’t get like distracted by it again. ‘cause really, you know, what is so, so it will repeat its mistake just because it’s been, it’s inswyx: theJeff Huber: context. It’sAaron Levie: in the context so much.That’s a few shot example. Even if it, yeah.Jeff Huber: It’s like oh thisAaron Levie: is a great thing to go try even ifJeff Huber: it didn’t work.Aaron Levie: Yeah,Jeff Huber: exactly.Aaron Levie: SoJeff Huber: there’s like a bunch of stuff there. JustAaron Levie: Groundhogs Day inside these models. Yeah. I’m gonna go keep doing the same wrongJeff Huber: thing. Covering sense. I feel like, you know, some creator analogy you’re trying like fit a manifold in latent space, which kind is doing break program synthesis, which is kinda one we think about we’re doing right.Like, you know, certain [00:31:00] facts might be like sort of overly pitting it. There are certain, you know, sec sectors of latent space and so like plug clean space. Yeah. And, uh, andswyx: so we have a bell, our editor as a bell every time you say that. SoJeff Huber: you have, you have to like remove those, likeswyx: you shoulda a gong like TPN or something.IfJeff Huber: we gong, you either remove those links to like kinda give it the freedom, kind of do what you need to do. So, but yeah. We’ll, we’ll release more soon. That’sAaron Levie: awesome.Jeff Huber: That’ll, that’ll be cool.swyx: We’re a cerebral podcast that people listen to us and, and sort of think really deep. So yeah, we try to keep it subtle.Okay. We try to keep it.Aaron Levie: Okay, fine.Inside Agent Evalsswyx: Um, you, you guys do, you guys do have EVs, you talked about your, your office thing, but, uh, you’ve been also promoting APEX agents and complex work. Uh, yeah, whatever you, wherever you wanna take this just Yeah. How youAaron Levie: Apex is, is obviously me, core’s, uh, uh, kind of, um, agent eval.We, we supported that by sort of. Opening up some data for them around how we kind of see these, um, data workspaces in, in the, you know, kind of regular economy. So how do lawyers have a workspace? How do investment bankers have a workspace? What kind of data goes into those? And so we, [00:32:00] we partner with them on their, their apex eval.Our own, um, eval is, it’s actually relatively straightforward. We have a, a set of, of documents in a, in a range of industries. We give the agent previously did this as a one shot test of just purely the model. And then we just realized we, we need to, based on where everything’s going, it’s just gotta be more agentic.So now it’s a bit more of a test of both our harness and the model. And we have a rubric of a set of things that has to get right and we score it. Um, and you’re just seeing, you know, these incredible jumps in almost every single model in its own family of, you know, opus four, um, you know, sonnet four six versus sonnet four five.swyx: Yeah. We have this up on screen.Aaron Levie: Okay, cool. So some, you’re seeing it somewhere like. I, I forget the to, it was like 15 point jump, I think on the main, on the overall,swyx: yes.Aaron Levie: And it’s just like, you know, these incredible leaps that, that are starting to happen. Um,swyx: and OP doesn’t know any, like any, it’s completely held out from op.Aaron Levie: This is not in any, there’s no public data which has, you know, Ben benefits and this is just a private eval that we [00:33:00] do, and then we just happen to show it to, to the world. Hmm. So you can’t, you can’t train against it. And I think it’s just as representative of. It’s obviously reasoning capabilities, what it’s doing at, at, you know, kind of test time, compute capabilities, thinking levels, all like the context rot issues.So many interesting, you know, kind of, uh, uh, capabilities that are, that are now improvingswyx: one sector that you have. That’s interesting.Industries and Datasetsswyx: Uh, people are roughly familiar with healthcare and legal, but you have public sector in there.Aaron Levie: Yeah.swyx: Uh, what’s that? Like, what, what, what is that?Aaron Levie: Yeah, and, and we actually test against, I dunno, maybe 10 industries.We, we end up usually just cutting a few that we think have interesting gains. All extras, won a lot of like government type documents. Um,swyx: what is that? What is it? Government type documents?Aaron Levie: Government filings. Like a taxswyx: return, likeAaron Levie: a probably not tax returns. It would be more of what would go the government be using, uh, as data.So, okay. Um, so think about research that, that type of, of, of data sets. And then we have financial services for things like data rooms and what would be in an investment prospectus. Uhhuh,swyx: that one you can dog food.Aaron Levie: Yeah, exactly. Exactly. Yes. Yes. [00:34:00] So, uh, so we, we run the models, um, in now, you know, more of an agent mode, but, but still with, with kinda limited capacity and just try and see like on a, like, for like basis, what are the improvements?And, and again, we just continue to be blown away by. How, how good these models are getting.swyx: Yeah, I mean, I think every serious AI company needs something like that where like, well, this is the work we do. Here’s our company eval. Yeah. And if you don’t have it, well, you’re not a serious AI company.Aaron Levie: There’s two dimensions, right?So there’s, there’s like, how are the models improving? And so which models should you either recommend a customer use, which one should you adopt? But then every single day, we’re making changes to our agents. And you need to knowswyx: if you regressed,Aaron Levie: if you know. Yeah. You know, I’ve been fully convinced that the whole agent observability and eval space is gonna be a massive space.Um, super excited for what Braintrust is doing, excited for, you know, Lang Smith, all the things. And I think what you’re going to, I mean, this is like every enter like literally every enterprise right now. It’s like the AI companies are the customers of these tools. Every enterprise will have this. Yeah, you’ll just [00:35:00] have to have an eval.Of all of your work and like, we’ll, you’ll have an eval of your RFP generation, you’ll have an eval of your sales material creation. You’ll have an eval of your, uh, invoice processing. And, and as you, you know, buy or use new agentic systems, you are gonna need to know like, what’s the quality of your, of your pipeline.swyx: Yeah.Aaron Levie: Um, so huge, huge market with agent evals.swyx: Yeah.Building the Agent Teamswyx: And, and you know, I’m gonna shout out your, your team a bit, uh, your CTO, Ben, uh, did a great talk with us last year. Awesome. And he’s gonna come back again. Oh, cool. For World’s Fair.Aaron Levie: Yep.swyx: Just talk about your team, like brag a little bit. I think I, I think people take these eval numbers in pretty charts for granted, but No, there, I mean, there’s, there’s lots of really smart people at work during all this.Aaron Levie: Biggest shout out, uh, is we have a, we have a couple folks at Dya, uh, Sidarth, uh, that, that kind of run this. They’re like a, you know, kind of tag tag team duo on our evals, Ben, our CTO, heavily involved Yasha, head of ai, uh, you know, a bunch of folks. And, um, evals is one part of the story. And then just like the full, you know, kind of AI.An agent team [00:36:00] is, uh, is a, is a pretty, you know, is core to this whole effort. So there’s probably, I don’t know, like maybe a few dozen people that are like the epicenter. And then you just have like layers and layers of, of kind of concentric circles of okay, then there’s a search team that supports them and an infrastructure team that supports them.And it’s starting to ripple through the entire company. But there’s that kind of core agent team, um, that’s a pretty, pretty close, uh, close knit group.swyx: The search team is separate from the infra team.Aaron Levie: I mean, we have like every, every layer of the stack we have to kind of do, except for just pure public cloud.Um, but um, you know, we, we store, I don’t even know what our public numbers are in, you know, but like, you can just think about it as like a lot of data is, is stored in box. And so we have, and you have every layer of the, of the stack of, you know, how do you manage the data, the file system, the metadata system, the search system, just all of those components.And then they all are having to understand that now you’ve got this new customer. Which is the agent, and they’ve been building for two types of customers in the past. They’ve been building for users and they’ve been building for like applications. [00:37:00] And now you’ve got this new agent user, and it comes in with a difference of it, of property sometimes, like, hey, maybe sometimes we should do embeddings, an embedding based, you know, kind of search versus, you know, your, your typical semantic search.Like, it’s just like you have to build the, the capabilities to support all of this. And we’re testing stuff, throwing things away, something doesn’t work and, and not relevant. It’s like just, you know, total chaos. But all of those teams are supporting the agent team that is kind of coming up with its requirements of what, what do we need?swyx: Yeah. No, uh, we just came from, uh, fireside chat where you did, and you, you talked about how you’re doing this. It’s, it’s kind of like an internal startup. Yeah. Within the broader company. The broader company’s like 3000 people. Yeah. But you know, there’s, there’s a, this is a core team of like, well, here’s the innovation center.Aaron Levie: Yeah.swyx: And like that every company kind of is run this way.Aaron Levie: Yeah. I wanna be sensitive. I don’t call it the innovation center. Yeah. Only because I think everybody has to do innovation. Um, there, there’s a part of the, the, the company that is, is sort of do or die for the agent wave.swyx: Yeah.Aaron Levie: And it only happens to be more of my focus simply because it’s existential that [00:38:00] we get it right.swyx: Yeah.Aaron Levie: All of the supporting systems are necessary. All of the surrounding adjacent capabilities are necessary. Like the only reason we get to be a platform where you’d run an agent is because we have a security feature or a compliance feature, or a governance feature that, that some team is working on.But that’s not gonna be the make or break of, of whether we get agents right. Like that already exists and we need to keep innovating there. I don’t know what the right, exact precise number is, but it’s not a thousand people and it’s not 10 people. There’s a number of people that are like the, the kind of like, you know, startup within the company that are the make or break on everything related to AI agents, you know, leveraging our platform and letting you work with your data.And that’s where I spend a lot of my time, and Ben and Yosh and Diego and Teri, you know, these are just, you know, people that, that, you know, kind of across the team. Are working.swyx: Yeah. Amazing.Read Write Agent WorkflowsJeff Huber: How do you, how do you think about, I mean, you talked a lot about like kinda read workflows over your box data. Yep.Right. You know, gen search questions, queries, et cetera. But like, what about like, write or like authoring workflows?Aaron Levie: Yes. I’ve [00:39:00] already probably revealed too much actually now that I think about it. So, um, I’ve talked about whatever,Jeff Huber: whatever you can.Aaron Levie: Okay. It’s just us. It’s just us. Yeah. Okay. Of course, of course.So I, I guess I would just, uh, I’ll make it a little bit conceptual, uh, because again, I’ve already, I’ve already said things that are not even ga but, but we’ve, we’ve kinda like danced around it publicly, so I, yeah, yeah. Okay. Just like, hopefully nobody watches this, um, episode. No.swyx: It’s tidbits for the Heidi engaged to go figure out like what exactly, um, you know, is, is your sort of line of thinking.Sure. They can connect the dots.Aaron Levie: Yeah. So, so I would say that, that, uh, we, you know, as a, as a place where you have your enterprise content, there’s a use case where I want to, you know, have an agent read that data and answer questions for me. And then there’s a use case where I want the agent to create something.And use the file system to create something or store off data that it’s working on, or be able to have, you know, various files that it’s writing to about the work it’s doing. So we do see it as a total read write. The harder problem has so far been the read only because, because again, you have that kind of like 10 [00:40:00] million to one ratio problem, whereas rights are a lot of, that’s just gonna come from the model and, and we just like, we’ll just put it in the file system and kinda use it.So it’s a little bit of a technically easier problem, but the only part that’s like, not necessarily technically hard, it is just like it’s not yet perfected in the state of the ecosystem is, you know, building a beautiful PowerPoint presentation. It’s still a hard problem for these models. Like, like we still, you know, like, like these formats are just, we’re not built for.They’reswyx: working on it.Aaron Levie: They’re, they’re working on it. Everybody’s working on it.swyx: Every launch is like, well, we do PowerPoint now.Aaron Levie: We’re getting, yeah, getting a lot, getting a lot of better each time. But then you’ll do this thing where you’ll ask the update one slide and all of a sudden, like the fonts will be just like a little bit different, you know, on two of the slides, or it moved, you know, some shape over to the left a little bit.And again, these are the kind of things that, like in code, obviously you could really care about if you really care about, you know, how beautiful is the code, but at the end, user doesn’t notice all those problems and file creation, the end user instantly sees it. You’re [00:41:00] like, ah, like paragraph three, like, you literally just changed the font on me.Like it’s a totally different font and like midway through the document. Mm-hmm. Those are the kind of things that you run into a lot of in the, in the content creation side. So, mm-hmm. We are gonna have native agents. That do all of those things, they’ll be powered by the leading kind of models and labs.But the thing that I think is, is probably gonna be a much bigger idea over time is any agent on any system, again, using Box as a file system for its work, and in that kind of scenario, we don’t necessarily care what it’s putting in the file system. It could put its memory files, it could put its, you know, specification, you know, documents.It could put, you know, whatever its markdown files are, or it could, you know, generate PDFs. It’s just like, it’s a workspace that is, is sort of sandboxed off for its work. People can collaborate into it, it can share with other people. And, and so we, we were thinking a lot about what’s the right, you know, kind of way to, to deliver that at scale.Docs Graphs and Founder Modeswyx: I wanted to come into sort of the sort of AI transformation or AI sort of, uh, operations things. [00:42:00] Um, one of the tweets that you, that you wanted to talk about, this is just me going through your tweets, by the way. Oh, okay. I mean, like, this is, you readAaron Levie: one by one,swyx: you’re the, you’re the easiest guest to prep for because you, you already have like, this is the, this is what I’m interested in.I’m like, okay, well, areAaron Levie: we gonna get to like, like February, January or something? Where are we in the, in the timelines? How far back are we going?swyx: Can you, can you describe boxes? A set of skills? Right? Like that, that’s like, that’s like one of the extremes of like, well if you, you just turn everything into a markdown file.Yeah. Then your agent can run your company. Uh, like you just have to write, find the right sequence of words toAaron Levie: Yes.swyx: To do it.Aaron Levie: Sorry, isthatswyx: the question? So I think the question is like, what if we documented everything? Yes. The way that you exactly said like,Aaron Levie: yes.swyx: Um, let’s get all the Fortune five hundreds, uh, prepared for agents.Yes. And like, you know, everything’s in golden and, and nicely filed away and everything. Yes. What’s missing? Like, what’s left, right? LikeAaron Levie: Yeah.swyx: You’ve, you’ve run your company for a decade. LikeAaron Levie: Yeah. I think the challenge is that, that that information changes a week later. And because something happened in the market for that [00:43:00] customer, or us as a company that now has to go get updated, and so these systems are living and breathing and they have to experience reality and updates to reality, which right now is probably gonna be humans, you know, kinda giving those, giving them the updates.And, you know, there is this piece about context graphs as as, uh, that kinda went very viral. Yeah. And I, I, I was like a, i, I, I thought it was super provocative. I agreed with many parts of it. I disagree with a few parts around. You know, it’s not gonna be as easy as as just if we just had the agent traces, then we can finally do that work because there’s just like, there’s so much more other stuff that that’s happening that, that we haven’t been able to capture and digitize.And I think they actually represented that in the piece to be clear. But like there’s just a lot of work, you know, that that has to, you just can’t have only skills files, you know, for your company because it’s just gonna be like, there’s gonna be a lot of other stuff that happens. Yeah. Change over time.Yeah. Most companies are practically apprenticeships.swyx: Most companies are practically apprenticeships. LikeJeff Huber: every new employee who joins the team, [00:44:00] like you span one to three months. Like ramping them up.Aaron Levie: Yes. AllJeff Huber: that tat knowledgeAaron Levie: isJeff Huber: not written down.Aaron Levie: Yes.Jeff Huber: But like, it would have to be if you wanted to like give it to an Asian.Right. And so like that seems to me like to beAaron Levie: one is I think you’re gonna see again a premium on companies that can document this. Mm-hmm. Much. There’ll be a huge premium on that because, because you know, can you shorten that three month ramp cycle to a two week ramp cycle? That’s an instant productivity gain.Can you re dramatically reduce rework in the organization because you’ve documented where all the stuff is and where the answers are. Can you make your average employee as good as your 90th percentile employee because you’ve captured the knowledge that’s sort of in the heads of, of those top employees and make that available.So like you can see some very clear productivity benefits. Mm-hmm. If you had a company culture of making sure you know your information was captured, digitized, put in a format that was agent ready and then made available to agents to work with, and then you just, again, have this reality of like add a 10,000 person [00:45:00] company.Mapping that to the, you know, access structure of the company is just a hard problem. Is like, is like, yeah, well, you just, not every piece of information that’s digitized can be shared to everybody. And so now you have to organize that in a way that actually works. There was a pretty good piece, um, this, this, uh, this piece called your company as a file is a file system.I, did you see that one?swyx: Nope.Aaron Levie: Uh, yes. You saw it. Yeah. And, and, uh, I actually be curious your thoughts on it. Um, like, like an interesting kind of like, we, we agree with it because, because that’s how we see the world and, uh,swyx: okay. We, we have it up on screen. Oh,Aaron Levie: okay. Yeah. But, but it’s all about basically like, you know, we’ve already, we, we, we already organized in this kind of like, you know, permission structure way.Uh, and, and these are the kind of, you know, natural ways that, that agents can now work with data. So it’s kind of like this, this, you know, kind of interesting metaphor, but I do think companies will have to start to think about how they start to digitize more, more of that data. What was your take?Jeff Huber: Yeah, I mean, like the company’s probably like an acid compliant file system.Aaron Levie: Uh,Jeff Huber: yeah. Which I’m guessing boxes, right? So, yeah. Yes.swyx: Yeah. [00:46:00]Jeff Huber: Which you have a great piece on, but,swyx: uh, yeah. Well, uh, I, I, my, my, my direction is a little bit like, I wanna rewind a little bit to the graph word you said that there, that’s a magic trigger word for us. I always ask what’s your take on knowledge graphs?Yeah. Uh, ‘cause every, especially at every data database person, I just wanna see what they think. There’s been knowledge graphs, hype cycles, and you’ve seen it all. So.Aaron Levie: Hmm. I actually am not the expert in knowledge graphs, so, so that you might need toswyx: research, you don’t need to be an expert. Yeah. I think it’s just like, well, how, how seriously do people take it?Yeah. Like, is is, is there a lot of potential in the, in the HOVI?Aaron Levie: Uh, well, can I, can I, uh, understand first if it’s, um, is this a loaded question in the sense of are you super pro, super con, super anti medium? Iswyx: see pro, I see pros and cons. Okay. Uh, but I, I think your opinion should be independent of mine.Aaron Levie: Yeah. No, no, totally. Yeah. I just want to see what I’m stepping into.swyx: No, I know. It’s a, and it’s a huge trigger word for a lot of people out Yeah. In our audience. And they’re, they’re trying to figure out why is that? Because whyAaron Levie: is this such aswyx: hot item for them? Because a lot of people get graph religion.And they’re like, everything’s a graph. Of course you have to represent it as a graph. Well, [00:47:00] how do you solve your knowledge? Um, changing over time? Well, it’s a graph.Aaron Levie: Yeah.swyx: And, and I think there, there’s that line of work and then there’s, there’s a lot of people who are like, well, you don’t need it. And both are right.Aaron Levie: Yeah. And what do the people who say you don’t need it, what are theyswyx: arguing for Mark down files. Oh, sure, sure. Simplicity.Aaron Levie: Yeah.swyx: Versus it’s, it’s structure versus less structure. Right. That’s, that’s all what it is. I do.Aaron Levie: I think the tricky thing is, um, is, is again, when this gets met with real humans, they’re just going to their computer.They’re just working with some people on Slack or teams. They’re just sharing some data through a collaborative file system and Google Docs or Box or whatever. I certainly like the vision of most, most knowledge graph, you know, kind of futuristic kind of ways of thinking about it. Uh, it’s just like, you know, it’s 2026.We haven’t seen it yet. Kind of play out as as, I mean, I remember. Do you remember the, um, in like, actually I don’t, I don’t even know how old you guys are, but I’ll for, for to show my age. I remember 17 years ago, everybody thought enterprises would just run on [00:48:00] Wikis. Yeah. And, uh, confluence and, and not even, I mean, confluence actually took off for engineering for sure.Like unquestionably. But like, this was like everything would be in the w. And I think based on our, uh, our, uh, general style of, of, of what we were building, like we were just like, I don’t know, people just like wanna workspace. They’re gonna collaborate with other people.swyx: Exactly. Yeah. So you were, you were anti-knowledge graph.Aaron Levie: Not anti, not anti. Soswyx: not nonAaron Levie: I’m not, I’m not anti. ‘cause I think, I think your search system, I just think these are two systems that probably, but like, I’m, I’m not in any religious war. I don’t want to be in anybody’s YouTube comments on this. There’s not a fight for me.swyx: We, we love YouTube comments. We’re, we’re, we’re get into comments.Aaron Levie: Okay. Uh, but like, but I, I, it’s mostly just a virtue of what we built. Yeah. And we just continued down that path. Yeah.swyx: Yeah.Aaron Levie: And, um, and that, that was what we pursued. But I’m not, this is not a, you know, kind of, this is not a, uh, it’sswyx: not existential for you. Great.Aaron Levie: We’re happy to plug into somebody else’s graph.We’re happy to feed data into it. We’re happy for [00:49:00] agents to, to talk to multiple systems. Not, not our fight.swyx: Yeah.Aaron Levie: But I need your answer. Yeah. Graphs or nerd Snipes is very effective nerd.swyx: See this is, this is one, one opinion and then I’ve,Jeff Huber: and I think that the actual graph structure is emergent in the mind of the agent.Ah, in the same way it is in the mind of the human. And that’s a more powerful graph ‘cause it actually involved over time.swyx: So don’t tell me how to graph. I’ll, I’ll figure it out myself. Exactly. Okay. All right. AndJeff Huber: what’s yours?swyx: I like the, the Wiki approach. Uh, my, I’m actually like, uh, you know, obviously I spent some my time at cognition, which, uh, you, you know very well.Yep. And they’ve had a lot of success with Deep Wiki. Yeah. It powers a lot of Devrel and brainAaron Levie: super powerful.swyx: And it’s super, it’s useful for humans, but it’s, oh my God, it’s useful for agents.Aaron Levie: Yes. Tell me if you think I’m, I’m wrong on this, but, but not much of an access control structure issue?swyx: No.Aaron Levie: There’s like the whole, you get the whole code base and everybody gets to,swyx: well, before, before I speak too much, there may be some enterprise controls on Sure.The enterprise Deb offering that I’m not familiar with. Yeah. But yeah, I don’t, I don’t have any, anything on the public side. But, you know, I, I think like, almost like every agent should have its [00:50:00] own wiki that it’s updating and that’s. Persistent memory and yeah, that is a very weak knowledge graph.Jeff Huber: Yeah.swyx: And you, you could strengthen it if you want more structure, but you may not need it.Jeff Huber: Markdown files, having links and wiki style. Right. Yep. Very effective. Right, Lindy?Aaron Levie: Yep.swyx: I like that. As a, as a just general pattern. Um, okay. So, uh, last couple questions. Sure. But feel free to jump on in or, or if you want any rants.Um, I see you as a very interesting and, and unusual founder where, like, you’ve been in a business and you are, you’re both like, you’re off like of two worlds, like you’re of Silicon Valley, but you’re also of the Fortune five hundreds. And like, I feel like your kind of founder mode is very different from the Brian Chesky founder mode.And I’m just kinda curious if you have like ref reflections on like how you operate as a founder,Aaron Levie: what would his founder mode be?swyx: Don’t delegate.Aaron Levie: Ah, right. And what, how would you put me,swyx: you do delegate. Ah,Aaron Levie: okay. I, I, I, I see the, um, I think that I, I don’t know that Brian and I would be that far removed from each other when you get to the specifics.swyx: Okay.Aaron Levie: So there’s a whole bunch that I delegate, [00:51:00] 90%. Of the work that happens at Box is fully, you know, fully delegated. We’ve got great leaders running, running, all that stuff. It’s just too much for my brain to handle. And probably 70% of the work, I’m gonna make up all the numbers here, probably 70% of the work at Box or 70, 80% of the work at Box.I only need to really look at about 5% of that for like, some high leverage decisions to be involved in, you know, what’s the marketing message that we think is gonna resonate with, with customers. So that’s a little bit of high leverage thing that, that, that we do in marketing. But most of marketing activities I don’t get involved in.What’s our sales pitch? Maybe I’ll be involved in that a little bit. Or like what’s roughly the investments or push we’re gonna do in certain verticals. You know, that’s about 5% of like the total bandwidth of, you know, this, the, the key areas of sales or go to market. Okay. So like. 70, 80% of the company, I can just do about 5%.[00:52:00]And then, and then just like operationally, we’ve got great leaders and they’re gonna execute on that, and we collaborate on the 5% anyway. It’s not like I’m just like making up a decision and, and saying to go and do it. Then there’s this part that is like the existential part of the business, which is if we don’t do this right, we’re out of business.And, uh, by virtue of just being a founder, you get kind of sucked into that part of the work because you can feel it. Like, this is like, like you can just see how the AI tsunami could wipe you out if you make just 2, 3, 4, 5 wrong decisions in this space. Like couple wrong architecture decisions, couple wrong AI feature decisions, couple wrong API platform decisions, and, and you might be out of the game in a year from now and like, you just feel it in your bones.You, you know, this, uh, like, it’s just like, like, like we feel this all day long in this space given what’s happening. Hmm. And so that, in that area. It’s, you can’t kind of delegate in a classic sense. You still need to make sure you’ve got great leaders and strong hires and people that, that are have high agency.‘cause [00:53:00] they wanna be able to the own part of the, the strategy and the roadmap or else you can’t hire good people. But, but you know, there’s gonna be a lot of little micro forks in the road that they will compound to determine whether you’ve succeed or fail. And so your kind of founder energy just like automatically draws you into, into those because, because they are the determining decisions of, of your company’s future.And that’s kind of where I spend my time and I, and you have to kind of, you know, do it in a collaborative way again, because if you are only dictatorial and just, you know, you just won’t, won’t eventually be able to hire the best people. ‘cause they won’t wanna work on that environment. But you also just can’t like.Abdicate all the responsibility because the risks are, are just simply too high. Like, and so you have to somehow, obviously, add some value. And so the value I add is I’ve seen 20 years of this business, so I, I think I can kind of piece together what I expect the value propositions are gonna be and how customers will react to certain things.So that’s what I can bring to the table. And then you have this kind of existential fear of, if I get it wrong, it’s all on me anyway. [00:54:00] I don’t get to blame, you know, you know, the engineer that was working on that project, like, it’s all, it’s, it’s, it’s my fault, right? Like at the end of the day, it’ll be my fault if it doesn’t work.So by virtue of of that liability, uh, responsibility, you just get pulled into needing to make sure like it’s all going a according to, to kind of how you think it needs to end up. I don’t, I don’t know how Brian would answer that, I guess, but like I, I, yeah,swyx: it’s a long essay. It’s an interesting essay.People should go and compare and contrast your answer versus his, uh, I do think that, um, systems have a way of letting entropy get to them. Yep. And you, you, if you step away for too long, you need to have a way to like check in and go like, well, do I need to come back in? Or are we good? And people are gonna tell you things are good, but they’re not good.Yes,Aaron Levie: yes. A hundred percent.swyx: Yeah.Aaron Levie: And that’s actually, I’m, um, I’m a fan of actually process for the, that 70 to 80%.swyx: Yeah.Aaron Levie: So that 70 to 80% the process is you’re gonna do a, you know, a quarterly business review and you’re gonna have a brand check-in, and you’re gonna do [00:55:00] those, like, you’re gonna make sure that, that you’re seeing all the, the right episodes of, of what’s changing and, and how, and how it’s kind of, you know, evolving and, and make sure it’s kind of going the right direction.And then there’s some areas which is like, no, it’s 24 7. Like, like I guarantee after this podcast at 11:00 PM I’ll be doing a Zoom with Ben, uh, and probably some other people. ‘cause we’re gonna be talking about agents and, and new platform features and like, that’s amazing. That’s your just in the cauldron, you know, kind of grinding on, on, on that side.swyx: Yeah. Yeah. That’s, uh, that’s extremely, um, realistic. Yeah. What is, what it’s like, and I just want to have people hear your perspective on what,Token FOMO CultureAaron Levie: and this is what you like, and this is the, this is this like, um, you read the post about, you know, everybody having agents running on the weekend and, um, and it’s like, uh, you know, you, you just.I mean, first of all, anybody crazy enough to come to Silicon Valley? Like we don’t bring good news about the sort of like healthiness of our environment right now. Like, like, like you have to,swyx: andAaron Levie: [00:56:00] you have to know what you’re signing up for. But like, like, you know, there, there’s a real issue, which is like, shoot, do I have enough agents running?And, andswyx: oh yeah, I made a meme that was like semi viral for me about this. Exactly, yes. That was incredible. That’s,Aaron Levie: and, and, and that, thatswyx: was, you can’t even enjoy a party these days. Becausecause, you’re working with your tokens.Aaron Levie: No. You just compute out there that you’re not utilizing,swyx: what the hell? Like,soAaron Levie: like there’sswyx: ad I paid for the $200, I’m gonna spend the $200.Aaron Levie: Yeah.swyx: Uh, I’m gonna spend $6,000 out of 200 bucks. Yeah, exactly.Jeff Huber: Exactly.Aaron Levie: WeJeff Huber: need to make anthropic very unprofitable. So,swyx: yeah. Yeah. We’re not doing a good enough job. Cool.Production Function Secretsswyx: I have a closing question. If you, unless you,Jeff Huber: I have a question. I’ve asked this question in private before, but I ask it again, which is, uh, it’s a question that Tyler Cowen asks his guests on his podcast, which is, uh, what is the Aaron Levy production function?And, uh, uhswyx: Oh, I loveJeff Huber: that. I love this question because there’s so a few people that I think are good at both executing. Also like distilling and like, just putting good ideas into the ether. Mm-hmm. You put a lot of good ideas into the ether. And so like what is the air levee production function that allows you you to do that versus others?[00:57:00]Aaron Levie: How do I get that information? Orswyx: I, I can give you a, a, a variant. Yeah. Which is what goes into air and levee.Aaron Levie: Yeah.swyx: And what goes out and how does it turn inside? Yeah.Aaron Levie: I’m just trying to think of, ‘cause I mean, you know, there’s some very, I, I just read a lot of Twitter, uh, as well. And so like, I just, and you’ve, youswyx: spent a lot of effortAaron Levie: too.Jeff Huber: Contrast, you don’t see like, great. Many essays from Brian Chesky every day.Aaron Levie: Uh,Jeff Huber: but youAaron Levie: doJeff Huber: from you.Aaron Levie: Oh, yeah. And you’reJeff Huber: kind of weird in that way, soAaron Levie: why? Maybe he’s, he, maybe he’s healthier than me. Actually. We should just like, we should just text him to see if, you know, he’s got a more I think he doesswyx: work out.Aaron Levie: Yeah. He got biggerswyx: muscles.Aaron Levie: That’s the thing. I, I work out less than him and I tweet more than him. So, so that’s the, that’s how we’re balancing things out. I am, um, I mostly, the way I just think about it is, uh, is just, um, you know, there’s, there’s lots of work that’s happening in the business. I am getting to see the, all the problems that we are running into constantly.And I am trying to, uh, be a little bit of a, create a flywheel between what we’re doing [00:58:00] internally, what, what, what. Then we talk about, uh, getting a feedback loop on that and seeing other people’s, you know, experiences of what they’re doing. Bring that back into the business. And, and so I just see, uh, like my job is as, you know, hopefully being able to kind of connect the dots.Of, of what’s going on in the world with what’s going on in box. And then I just happened to tweet about that along the way.swyx: Yeah.Aaron Levie: Um, becauseswyx: it’s all you, there’s no like,Aaron Levie: yeah.swyx: Editor,Aaron Levie: there’s no,swyx: yeah.Aaron Levie: Yeah.swyx: Wow.Aaron Levie: The, uh, I got, um, there was a funny, uh, uh, my, I, I tried to get an internship in, um, between freshman and sophomore year of this company, and it was a, it was a film, uh, kind of production company in New York.And, uh, I got the internship and then I emailed my liaison kind of guy who sponsored me for the internship and I said, Hey, I’d like to do a blog of my summer internship. Hmm. Where I blog about, you know, the, the being an intern at a production company in New York and. About like a, I dunno, half a day, a day later, [00:59:00] uh, they emailed me back saying they’ve rescinded the internship.swyx: No.Aaron Levie: Um, uh, yeah, because, because I showed a lack of judgment on, you know, professionalism, you know, or whatever. Like, like just even the, the idea that I would ask that question, red flags went up of like, who the f**k is this guy? So anyway, I, I only say that to say that like, like to me, just like, you know, building in public is just like a natural, is a natural thing.And so I, so I just, you know, go through the day. We, we deal with interesting problems. I tweet about them. I get information back in the process. I, I see your work. I see your work. You know, I see a bunch of folks and, and try and, you know, kind of incorporate that back in the box. My job is to try and connect all these things together and, uh, and make, make it useful.swyx: And you’re, I mean, you’re the number one spokesperson, right? So you do have to be out there.Aaron Levie: Yeah, I, but I, I kind of would be doing it whether or not, like it’s, I don’t really think of it as a job requirement as much as like, I just like, I like social media.Jeff Huber: You’re so good at it.Aaron Levie: Yeah.Jeff Huber: It’s so hard to believe.So like,Aaron Levie: okay, sorry.Jeff Huber: Do you get up at 5:00 AM [01:00:00] with coffee? Is that your secret? It’s like, how do you work or do you actually just like, in the back of Waymo’s, like, is, do you do it that way? Like how do you do this?Aaron Levie: It’s, it’s, no, it’s, it’s, it’s mostly that though. It’s mostly, uh, there’s a, you know, I, I, I have a commute home each night.I try and see, you know, my kids’ most, most weekdays before I have to hop back online. So there’s like a 20 minute window there.Jeff Huber: Okay.Aaron Levie: Where I can kinda like distill the information that’s happened and nice. And be like, ah, is there anything I learned today that would be interesting to throw out there? Or anything that I saw.And then probably somewhere between like seven 30 and 9:00 PM I finally get a chance to like look through the feed. Mm. And see like, did anything crazy happen in ai? And, um, uh, and then that’s, that will also kind of catalyze, you know, something Yep. As like, that’s the best I can kind of,swyx: youAaron Levie: know, respect.Yeah. Okay. Thanks.swyx: Uh, and now I know you, you cut off his 8:00 PM I will try to get AI news out before 8:00 PM so I can help him.Aaron Levie: Yeah.swyx: Do, do his thing.Aaron Levie: Ba basically, if, if I [01:01:00] don’t see it before eight to eight 30, I’m not gonnaswyx: Yeah. It’s, I’m gonnaAaron Levie: be able to like court tweet or something.swyx: Yeah,yeah.Aaron Levie: Uh, because, uh, because then I’m back on Zoom after that,Film Roots to Boxswyx: so I wasn’t gonna plan on asking this, but you’ve mentioned, uh, you mentioned the film stuff.Aaron Levie: Yeah.swyx: And I know from one of my favorite parts of doing your research on you was that, uh, you got the idea for Box from like, the, the Paramount lot. Yeah. Uh, pushing paper. Uh, are you film guy? You, you’re a big,Aaron Levie: uh, I, I I, I, I would say I used to be more of a film guy.swyx: Yeah. What, what’s your, what what, what are your favorites?If you have, you wanna list off anyAaron Levie: kind of the classic, uh, wannabe film student classics are, are youswyx: talking Scorsese?Aaron Levie: Yeah. Panino, pop Fiction, Magnolia. Requiem for a dream, basically. Like if there was an art house film in the nineties, uh, to early two thousands, that was my genre. Yeah. That got me into like, wow, wouldn’t it be cool to do, you know, you know, film.And then I, I thought maybe I could connect digital into it. Like, could you, could you do film online? That just seemed too [01:02:00] hard from a licensing standpoint. And then obviously Netflix, you know, kind of existed. Um, so I, I never quite was able to fully connect the dots on these things. But the internship at Paramount, um, was one kind of catalyst for starting box because we were using just traditional enterprise software.And I was like, wow. It’s like really hard to share data, you know, just like files going back and forth. Um, but the same thing was happening in school as well, and so that all led to, led the box basically.swyx: Um, well, a 24 is, uh, you know, kind of giving back the sort of resurgence of the independent film, I guess aAaron Levie: hundred percent.swyx: Um, uh, in, in, in, in the face of all the Marvel slop.Aaron Levie: Uh, you know, I was thinking about this the other day, and a 24 is, you know, uh, certainly the best, uh, EE example I’m sure of, of this today. But, um, you know, they just don’t, you know, you, it’s hard to make a film, uh, like, you know, no country for old men or, um, there will be blood like, like what is that movie today?swyx: Yeah.Aaron Levie: Like what is a brand new movie that is just like original? [01:03:00] You just watch it and you’re like, what, what did I just watch? Soswyx: my, my, you know, sixes movie bench is, uh, Forrest Gump.Aaron Levie: Okay.swyx: Which iconic in its time.Aaron Levie: Yep. A hundred percent.swyx: Never again.Aaron Levie: Yeah. Yeah. We, we did not make, we don’t know how to make Fors Gump anymore.Um, they will try it with the sequelJeff Huber: though, at some point.Aaron Levie: For sure. I, I honestly forsswyx: Gump two in 30Aaron Levie: years. I’ll be fine with it. No, that Fors Gump has a kid. Like he’s still right. Yeah, he’s still right. Exactly. Um, I think for Gump has a grandkid would be like a good movie. Like what is the grandkid of Forres Gump doing in, uh, in 2026swyx: goes tropical.Aaron Levie: Yeah. But, um, yeah, I definitely, let’s, I wanna see good, I wanna see more movies out there.AI Future of MoviesAaron Levie: You know, I’m a little bit conflicted on AI and film because,swyx: oh, that, let’s see that.Aaron Levie: Well, because I, uh, the world does not need more slop on, on AI entertainment, but I’m kind of like in a mode where I think that AI is, is, is gonna be, you know, generally a pure positive.Because if I’m a, [01:04:00] if I was me 25 years ago in high school, for sure, I would be making a full production film. That had explosions and car chases and, but then there’d be like people that would show up there. So like I think that ability to, to just, you get to be Spielberg, you know, is, is, you know, completely amazing and, and democratizing.That is incredible. And I, you know, I’m, I’m concerned about like, how do you make sure that we still get PT Anderson. Along the way and, and can we make sure that those, those guys exist? And then interestingly, I never, and I never saw it, but Darren Aronofsky, I, I believe, has either put out or gonna put out a, an AI film, you know, even some of the best artists are, are, you know, starting to adopt this.But, um, uh, but yeah, I, I definitely don’t want to, what I don’t wanna do is just be like in this like TikTok feed of just films and it’s just like, oh, this film about the car chase that does this thing. And it says like, we don’t need that. Like, like, [01:05:00] like this should be a form of entertainment and art and let’s use AI to accelerate the production process.Do the really hard CG work that, that you just, you had to spend way too much money on previously to do the, you know, kind of like, let’s, let’s use it to test out all new kind of plot ideas. Uh, yeah. Previs.Jeff Huber: Yeah, exactly. LikeAaron Levie: backgrounds and that’s incredible. Like whatever. Yeah. And all those things are super incredible.I still like the, it’s very nostalgic, but I still like the idea of like. This is a camera and a person and a person that says, you know, action. Uh, and then, and let’s hopefully like surround AI around that. Yeah. We’ll, but we’ll, we’ll see how that plays out.swyx: Yeah. I think, you know, so one of the things that stability ai, uh, made an impression on me was like, well, you know, and at least now we can remake Game of Throne Season eight, and I can, you know, uh, like, like it was meant to be not, uh, not rushed.Yeah.Aaron Levie: And then you watch, um, well I have a six and a half year old and I, you know, you see a lot of these kid movies and you’re like, yeah, that probably will be ai. I don’t totally know the job math ‘cause I don’t know how many animators there are today. [01:06:00] But I actually think, weirdly, I think we could be producing more high quality, maybe even slightly educational kids entertainment.And so it’s maybe that’s a positive is like we could just have like more, like you could just have a Pixar for like, you know, things where kids learn stuff. And it used to be these like very, you know, lo-fi uh, you know, kinda lesson things.swyx: I mean, we had tellies, you know, that so slow.Aaron Levie: So, so we, we could have way more of that.And, and maybe every animator that today is making a Pixar film is now, you know, we’re like, we fragment that out and uh, but now they’re responsible for more content and they’ve got AI agents running. So like, so, so I think there’s some optimistic scenarios on the entertainment side is like, there’s a lot of great use cases for being able to do, you know, generative media.swyx: Yeah. Yeah. Edu edutainment as well.Media DevRel and Engineeringswyx: I guess one question I is, it’s kind of like a self-serving one and almost like an advice, uh, side of the, the, the, the question, one of the things I just, uh, really enjoyed, uh, researching you was that, uh, Michael Arrington had some influence in the [01:07:00] box journey because he went to his house party.Aaron Levie: Yes.swyx: And, and that’s how you got funding.Aaron Levie: Yes.swyx: One of latent spaces. That’s a deep cut, right?Aaron Levie: Yeah. Very deep cut. That’s a oh six deep cut.swyx: Yeah. Uh, do, I mean, do you want to tell that story? I don’t know if you’ve told it veryAaron Levie: much. It’s not very much of the story. Yeah. Uh, because I probably just,swyx: it’s like a random intro, right?Like,Aaron Levie: um, well, it was just he used to have house parties. Yeah. Uh, TechCrunch had had these house parties and, and it was, um, probably no different than somebody’s doing a house party in sf Uh, you know, just go, yeah. And you just go and you meet the VCs and founders and like, I’m gonna make up examples, so I don’t want to like, you know, there’d be like Chad Hurley over there pitching his, you know, YouTube to people.And like, like that’s just like how it worked. And it was just like, wow. Like that was this era where all these new companies were, were emerging. And I met, uh, our first investor, uh, in Silicon Valley at one of these house parties, Emily Melton, who then brought us into D-D-D-F-J-D, that, that became our Series A.So that was all because of Arrington’s, uh, backyard Party.swyx: One of my inspirations for late space is to be as helpful, influential, whatever as TechCrunch was. That’s [01:08:00] awesome. In the day.Aaron Levie: That’s Yeah.swyx: What would a new TechCrunch today look like? You know, what, what, what, what should I, what should I do? I think there used to be TechCrunch Disrupt.Yeah. You know, I could do that with my conference, but I haven’t done it yet.Aaron Levie: Well, I mean, I think,swyx: um, useful. I don’t know.Aaron Levie: Uh, well, you know, actually interestingly, I would, I would argue Disrupt came after the period that was the, was that Deep cut period. Okay. So, so I think Di Disrupt, you know, ended up being, you know, you know, catalyzing.I don’t even, I think Cloud Flare launched It disrupted, yes. Is that the story? Right.swyx: They were runners up.Aaron Levie: Okay. Okay. So like, so like, I think anytime. Anytime you can be in a, a launchpad is, is just great because it draws in people that are, that’s what I’m trying to do in that creative moment. And whether it needs to be a contest or, or just like everybody gets like five minutes and you’re fundraising.I mean, who knows? But, but I mean, for what it’s worth, like, I don’t know, have that much advice. ‘cause I think you, you’re, you’re already doing it effectively. Like I, I just like watched the YouTube videos late at night. Um, uh, from the events. I haven’t [01:09:00] been to one of your events, but like from the, from the camera angles, it looks like everybody’s there trying,Jeff Huber: trying.SoAaron Levie: what’s great is that people are gonna be in the audience as like two random people and they’ll be like, you know, the next, the next big AI company will come from, you know, people coming to a meetup. ‘cause they were like, ah, I came in from Chicago and I’m ah, from, you know. Poland and let’s go do a startup.Like that’sswyx: theAaron Levie: magicswyx: ofAaron Levie: the valley.swyx: Dix Hy found his co-founder at a IE Oh, and I know of at least one marriage. That’s, that’s, wow,Aaron Levie: you have marriagesswyx: already. Yeah. Yeah.Aaron Levie: IJeff Huber: don’t,Aaron Levie: I never heard that about,swyx: that’s my go, that’s my favorite. KPI.Aaron Levie: Wow. We have AI marriages at the, at the AI engineer conferences.These are bothJeff Huber: humans. To be clear,swyx: that’s a very good clarification. I like that. You have to check.Jeff Huber: Yes. That’s aswyx: very goodAaron Levie: clarification.swyx: No, but I, I think you have, you’re, you’re insightful business leader with like, a lot of thoughts on media, so I just figured I would,Aaron Levie: I mean, media is such an interesting space right now because, because I, you know, with the go direct model, every company is gonna have to be a media company.Youswyx: are going, you are the og. Go direct.Aaron Levie: Yeah. But, but, but you know, we [01:10:00] we’re, we’re still like. Like, I think, I think what, what you guys are doing, and I don’t even know all the overlapping relationships, but like I watch your guys’ videos of your events, watch your event videos, but like, it’s clearly like this is the new format, right?Companies have to become channels to communicate with audiences. Yeah. I think the resurgence, resurgence maybe is a bad word ‘cause it implies it decline, but like, Devrel is hot. Yeah. Like the hottest thing of all time right now. I like if you could produce a fricking factory of Devrel people, like there’s just like unlimited jobs right now on the other end of that.Yeah.Jeff Huber: Yeah.Aaron Levie: Um, ‘cause we’re gonna, everybody needs their services and APIs to be used by agents. And so we have to all find a way to like, like, Hey, look at me. Like, like agent over, oh please come over here agent. And that’s gonna, that’s a content game. Like how do you get the agents to see your stuffswyx: Yeah.Aaron Levie: And know your APIs and like, this is like a new world that, that we are in. And uh, it’s gonna be a. It’s, it’s gonna completely be a [01:11:00] digital marketing, you know, kind of world that we’re in.swyx: Yeah. Uh, for what it’s worth, I’m trying to help by doing little writing bootcamps and basically turn into a Devrel bootcamp.Um, where, you know, well, it’s a demand and supply problem. There’s, there’s huge demand. Yeah. There’s no supply. Wow. All this increaseAaron Levie: supply. Why is your no supply?swyx: The one, the really good ones were for themselves.Aaron Levie: Uh huh.swyx: Creator economy screwed, screwed you over.Aaron Levie: So, so I see so, so Substack and Yes. YouTube payouts.And that’s, is thatswyx: really making Patreon? Yeah. Like the, the most talented guys are making, you know, millions and just working for themselves while for you,Aaron Levie: that’s not, we don’t want them to make that much money. Okay.swyx: We need to be able to hireAaron Levie: people.swyx: I mean, I think, I think like, you know, do do what some companies are doing, you know, I’m not saying it’s my situation exactly, but like give them equity and like Uhhuh it should probably would be worth more, uh, just like sort of helping them out.Aaron Levie: Well, they are getting Oh, sorry. As full-time employees or not?swyx: I’m part-time.Aaron Levie: You need full-time.swyx: I’m part-time.Aaron Levie: Yeah. But, but you’re, you’re you n of one, like, we like also people that are full-time.swyx: Yeah. Yeah. My classic joke or, or like, observation [01:12:00] was like, this was when HubSpot bought, like their, they bought like a newsletter business.Uh, and then they bought the, my first million, like the, the sort of podcast. Oh, okay. Dharmesh, you must know Dharmesh. Um, so he’s like obsessed with this guy. Okay. So, so my conclusion was like every company must either build or buy a media company. Yes. Right. And until you, unless you realize that. You have to take it that seriously that you are running a media business in your company.Yes. You will never be good at it.Aaron Levie: Yes, a hundred percent.swyx: Yeah.Aaron Levie: Yeah. No, we’re, we’re very much taking that seriously. But, but still, and yet Devrel, I mean, I gotta do one plug. I don’t all is out. Please, please. We’re hiring a Devrel.swyx: Yeah.Like,Jeff Huber: like pleaseswyx: no, all engineers here. Like, yeah. Like you’ve made it, like, and I just said every, every agent needs a box.Like, let’s go, let’s go.Aaron Levie: Thank you. No, that, that’s the headline. And we are hiring Devrel to make that happen. Uh, but yeah, I think Devrel is like the future job. So we’re all just gonna be doing Devrel in some form.swyx: Okay. Yeah.Aaron Levie: I mean, what is FDswyx: developers are ruling the earth. Yeah.Jeff Huber: What is FDI don’t know. Um,Aaron Levie: no, it’s, it’s Devrel.swyx: Yeah. Okay.Aaron Levie: No, you just, you’re going toswyx: a company, isn’t it just like glorify consulting? That’s, that’s the downside.Aaron Levie: Sure. I mean, I guess nobody can like actually [01:13:00] d you know, fully define this, but, um, uh, but I think it’s, it’s, it’s micro Devrel, like you’re in the company, you’re helping them with the services.Yeah. You’re doing a little bit extra implementation. Yeah.swyx: Yeah.Aaron Levie: Um, but, uh, but yeah, so it’s, uh, I, I think we’re all, you know, the thing that’s gonna happen on the ledger of software is we’re gonna produce far more output of code and thus features per dollar. But on the other end of this, we’re gonna actually end up spending probably just as much on how do you get all of that stuff to the customer, and it’s gonna create a new set of roles that we are all doing, partly because I, either, because there’s so much choice and now you have to kind of fight for attention there, or because this stuff is, is just changing so quickly that you have to technically help your customers.Along the journey. Yeah, so, so I just think like, I, this is why I, I, I always laugh when, you know, people say you don’t need to be an engineer, don’t do computer science. I actually think like that is like still one of the most protected job categories because [01:14:00] things are only getting more technical. Things are only gonna get harder and anybody in a technical position is in the best position.Yeah. To get agents deployed, get them built, get them adopted, build the, the, the custom code software to the, for the IT system, all of that.swyx: So, yeah. Yeah. My, my classic founding story of like why I picked AI engineer as a title and as, as a, as a theme for this podcast as theme for my conference was, um, back in like early 2023, someone al came to me and said like, I’m all in on ai.What should I do? And I was like, I just looked at her. I was like,Jeff Huber: God dammit, there’s nothing you can do.swyx: Like engineers are about to get so much more powerful than you Uhhuh. You don’t even understand.Aaron Levie: Tell me there’s a good, did she go and then learn?swyx: No, I didn’t, I didn’t say any of that to her.Aaron Levie: Oh, oh, I see, I see, I see.swyx: Okay. Yeah, I’m not, I’m not that honest. Well,Aaron Levie: I hope, I hope somewhere out there. She, she did, went to some online academy.swyx: Exactly. Learn to code.Aaron Levie: Yeah.swyx: But there, there’s a lot of people, like, there’s a lot of people who believe AI too much, and then they’re like, well, you don’t need to learn to code, so I won’t learn to code.Yeah. And then there’s, there’s like, there’s a bunch of us who are like, just in that [01:15:00] sweet spot of like, we can code and we can wield AI a thousand times more effectively than you can. Yeah. And like, well, who’s gonna win here? LikeJeff Huber: I, I think I, this was another, uh, a tweet, but it was like the observation that like, really software engineering for the past 30 years was the primary career track for like technical, high agency people that wanted to have a large outsize impact on the world.swyx: Yeah.Jeff Huber: And like, software was a means to, you know, do that Right. Effectively. Um, and so yeah, with ai, is it like that, uh, and, and for AI could eat software engineering or software engineering could eat all their kind of domains of discipline.Aaron Levie: You, those pr same principles then get applied to every other and then function,Jeff Huber: right?Aaron Levie: Yeah, exactly. Yeah. IJeff Huber: mean, g team engineering, is that a hundred percent Anything else? Yeah.Aaron Levie: Well, this is the, you know, uh, anybody who believes that an enterprise, and I’m, I’m, I’m mixed on the, I’m mixed on this is, but if you believe that an enterprise is going to build its own software for all of its problems, then you must be the most long on computer science, you know, as a discipline of all time, because guess what, most of the economy does not have enough engineers to then [01:16:00] maintain all those systems, to update to all those systems, to figure out the, the relationship between the business problem and what the code needs to do to go and actually manage that.And so, so like that’s, that’s a very pro. Engineering job argument of what the future’s gonna look like. I’m still, again, I go back and forth on like, are you gonna really build all these things versus no prepackaged software, but no matter what, there’s gonna be 10 to a hundred times more code. So I think you can be very long engineering right now as just a, you know, purely on the dimension of, of software’s gonna become increasingly more important once agents are, are, you know, turning everything into software.swyx: Yeah. All right. Three software guys say software in room. Okay.Aaron Levie: Not biased at all. Okay.swyx: But, uh, Aaron, your inspiration. All right. Take you. It’s such a pleasure.Aaron Levie: All right. Good to be here. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.latent.space/subscribe

This is a free preview of a paid episode. To hear more, visit www.latent.spaceAIE Europe CFP and AIE World’s Fair paper submissions for CAIS peer review are due TODAY - do not delay! Last call ever.We’re excited to welcome METR for their first LS Pod, hopefully the first of many:METR are keepers of currently the single most infamous chart in AI:But every Latent Space reader should be sophisticated enough to know that the details matter and that hype and hyperbole go hand in hand in AI social media, because the millions of impressions that got, by people who don’t understand or care about the nuances, disclaimers, and error bars, far outreaches the 69k views on the corrections by the people who actually made the chart:There’s a lot of nuance both in making benchmarks (as we discovered with OpenAI on our SWE-Bench Verified podcast) and in extrapolating results from them, especially where exponentials and sigmoids are concerned. METR’s Long Horizons work itself has known biases that the authors have responsibly disclosed, but go far too underappreciated in the pursuit of doomer chart porn.If you’re interested in a short, sharable TED talk version of this pod, over at AIE CODE we were blessed to feature Joel twice, as a stage talk and with a longer form small workshop with Q&A:We also make sure cover some of METR’s lesser known work on Threat Evaluation but also Developer Productivity, where 2x friend of the pod and now Zyphra founder Quentin Anthony was the ONLY productive participant!Finally, if you’re the sort to read these show notes to the end, then you definitely deserve some pictures of Joel shredding the guitar at Love Band Karaoke which we mention at the end: Full Video PodTimestamps00:00 What METR Means00:39 Podcast Intro With Joel01:39 ME vs TR03:33 Time Horizon Origin Story04:56 Picking Tasks And Biases09:13 Time Horizon Misconceptions11:37 Opus 4.5 And Trendlines14:27 Productivity Studies And Explosions29:50 Compute Slows Progress30:47 Algorithms Need Compute32:45 Industry Spend and Data34:57 Clusters and Shipping Timelines36:44 Prediction Markets for Models38:10 Manifold Alpha Story43:04 Beyond Benchmarks Evals51:39 METR Roadmap and FarewellTranscript

Swyx joined SAIL! Thank you SAIL Media, Prof. Tom Yeh, 8Lee, Hamid Bagheri, c9n, and many others for tuning into SAIL Live #6 with Nathan Lambert and Sebastian Raschka, PhD. Sharing here for the LS paid subscribers.We covered: This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.latent.space/subscribe

Editor’s note: CuspAI raised a $100m Series A in September and is rumored to have reached a unicorn valuation. They have all-star advisors from Geoff Hinton to Yann Lecun and team of deep domain experts to tackle this next frontier in AI applications.In this episode, Max Welling traces the thread connecting quantum gravity, equivariant neural networks, diffusion models, and climate-focused materials discovery (yes, there is one!!!).We begin with a provocative framing: experiments as computation. Welling describes the idea of a “physics processing unit”—a world in which digital models and physical experiments work together, with nature itself acting as a kind of processor. It’s a grounded but ambitious vision of AI for science: not replacing chemists, but accelerating them.Along the way, we discuss:* Why symmetry and equivariance matter in deep learning* The tradeoff between scale and inductive bias* The deep mathematical links between diffusion models and stochastic thermodynamics* Why materials—not software—may be the real bottleneck for AI and the energy transition* What it actually takes to build an AI-driven materials platformMax reflects on moving from curiosity-driven theoretical physics (including work with Gerard ‘t Hooft) toward impact-driven research in climate and energy. The result is a conversation about convergence: physics and machine learning, digital models and laboratory experiments, long-term ambition and incremental progress.Full Video EpisodeTimestamps* 00:00:00 – The Physics Processing Unit (PPU): Nature as the Ultimate Computer* Max introduces the idea of a Physics Processing Unit — using real-world experiments as computation.* 00:00:44 – From Quantum Gravity to AI for Materials* Brandon frames Max’s career arc: VAE pioneer → equivariant GNNs → materials startup founder.* 00:01:34 – Curiosity vs Impact: How His Motivation Evolved* Max explains the shift from pure theoretical curiosity to climate-driven impact.* 00:02:43 – Why CaspAI Exists: Technology as Climate Strategy* Politics struggles; technology scales. Why materials innovation became the focus.* 00:03:39 – The Thread: Physics → Symmetry → Machine Learning* How gauge symmetry, group theory, and relativity informed equivariant neural networks.* 00:06:52 – AI for Science Is Exploding (Not Emerging)* The funding surge and why AI-for-Science feels like a new industrial era.* 00:07:53 – Why Now? The Two Catalysts Behind AI for Science* Protein folding, ML force fields, and the tipping point moment.* 00:10:12 – How Engineers Can Enter AI for Science* Practical pathways: curriculum, workshops, cross-disciplinary training.* 00:11:28 – Why Materials Matter More Than Software* The argument that everything—LLMs included—rests on materials innovation.* 00:13:02 – Materials as a Search Engine* The vision: automated exploration of chemical space like querying Google.* 01:14:48 – Inside CuspAI: The Platform Architecture* Generative models + multi-scale digital twin + experiment loop.* 00:21:17 – Automating Chemistry: Human-in-the-Loop First* Start manual → modular tools → agents → increasing autonomy.* 00:25:04 – Moonshots vs Incremental Wins* Balancing lighthouse materials with paid partnerships.* 00:26:22 – Why Breakthroughs Will Still Require Humans* Automation is vertical-specific and iterative.* 00:29:01 – What Is Equivariance (In Plain English)?* Symmetry in neural networks explained with the bottle example.* 00:30:01 – Why Not Just Use Data Augmentation?* The optimization trade-off between inductive bias and data scale.* 00:31:55 – Generative AI Meets Stochastic Thermodynamics* His upcoming book and the unification of diffusion models and physics.* 00:33:44 – When the Book Drops (ICLR?)TranscriptMax: I want to think of it as what I would call a physics processing unit, like a PPU, right? Which is you have digital processing units and then you have physics processing units. So it’s basically nature doing computations for you. It’s the fastest computer known, as possible even. It’s a bit hard to program because you have to do all these experiments. Those are quite bulky, it’s like a very large thing you have to do. But in a way it is a computation and that’s the way I want to see it. You can do computations in a data center and then you can ask nature to do some computations. Your interface with nature is a bit more complicated. But then these things will have to seamlessly work together to get to a new material that you’re interested in.[01:00:44:14 - 01:01:34:08]Brandon: Yeah, it’s a pleasure to have Max Woehling as a guest today. Max has done so much over his career that I’ve been so excited about. If you’re in the deep learning community, you probably know Max for his work on variational autocoders, which has literally stood the test of prime or officially stood the test of prime. If you are a scientist, you probably know him for his like, binary work on graph neural networks on equivariance. And if you’re a material science, you probably know him about his new startup, CASPAI. Max has a long history doing lots of cool problems. You started in quantum gravity, which is I think very different than all of these other things you worked on. The first question for AI engineers and for scientists, what is the thread in how you think about problems? What is the thread in the type of things which excite you? And how do you decide what is the next big thing you want to work on?[01:01:34:08 - 01:02:41:13]Max: So it has actually evolved a lot. In my young days, let’s breathe, I would just follow what I would find super interesting. I have kind of this sensor. I think many people have, but maybe not really sort of use very much, which is like, you get this feeling about getting very excited about some problem. Like it could be, what’s inside of a black hole or what’s at the boundary of the universe or what are quantum mechanics actually all about. And so I follow that basically throughout my career. But I have to say that as you get older, this changes a little bit in the sense that there’s a new dimension coming to it and there’s this impact. Going in two-dimensional quantum gravity, you pretty much guaranteed there’s going to be no impact on what you do relative, maybe a few papers, but not in this world, this energy scale. As I get closer to retirement, which is fortunately still 10 years away or so, I do want to kind of make a positive impact in the world. And I got pretty worried about climate change.[01:02:43:15 - 01:03:19:11]Max: I think politics seems to have a hard time solving it, especially these days. And so I thought better work on it from the technology side. And that’s why we started CaspAI. But there’s also a lot of really interesting science problems in material science. And so it’s kind of combining both the impact you can make with it as well as the interesting science. So it’s sort of these two dimensions, like working on things which you feel there’s like, well, there’s something very deep going on here. And on the other hand, trying to build tools that can actually make a real impact in the world.[01:03:19:11 - 01:03:39:23]RJ: So the thread that when I look back, look at the different things that you worked out, some of them seem pretty connected, like the physics to equivariance and, yeah, and, uh, gravitational networks, maybe. And that seems to be somewhat related to Casp. Do you have a thread through there?[01:03:39:23 - 01:06:52:16]Max: Yeah. So physics is the thread. So having done, you know, spent a lot of time in theoretical physics, I think there is first very fundamental and exciting questions, like things that haven’t actually been figured out in quantum gravity. So that is really the frontier. There’s also a lot of mathematical tools that you can use, right? In, for instance, in particle physics, but also in general relativity, sort of symmetry space to play an enormously important role. And this goes all the way to gauge symmetries as well. And so applying these kinds of symmetries to, uh, machine learning was actually, you know, I thought of it as a very deep and interesting mathematical problem. I did this with Taco Cohen and Taco was the main driver behind this, went all the way from just simple, like rotational symmetries all the way to gauge symmetries on spheres and stuff like that. So, and, uh, Maurice Weiler, who’s also here, um, when he was a PhD student, he was a very good student with me, you know, he wrote an entire book, which I can really recommend about the role of symmetries in AI and machine learning. So I find this a very deep and interesting problem. So more recently, so I’ve taken a sort of different path, which is the relationship between diffusion models and that field called stochastic thermodynamics. This is basically the thermodynamics, which is a theory of equilibrium. So but then formulated for out of equilibrium systems. And it turns out that the mathematics that we use for diffusion models, but even for reinforcement learning for Schrodinger bridges for MCMC sampling has the same mathematics as this theoretical, this physical theory of non-equilibrium systems. And that got me very excited. And actually, uh, when I taught a course in, um, Mauschenberg, uh, it is South Africa, close to Cape Town at the African Institute for Mathematical Sciences Ames. And I turned that into a book site. Two years later, the book was finished. I’ve sent it to the publisher. And this is about the deep relationship between free energy, diffusion models, basically generative AI and stochastic thermodynamics. So it’s always some kind of, I don’t know, I find physics very deep. I also think a lot about quantum mechanics and it’s, it’s, it’s a completely weird theory that actually nobody really understands. And there’s a very interesting story, which is maybe good to tell to connect sort of my PZ back to where I’m now. So I did my PZ with a Nobel Laureate, Gerard the toft. He says the most brilliant man I’ve ever met. He was never wrong about anything as long as I’ve seen him. And now he says quantum mechanics is wrong and he has a new theory of quantum mechanics. Nobody understands what he’s saying, even though what he’s writing down is not mathematically very complex, but he’s trying to address this understandability, let’s say of quantum mechanics head on. And I find it very courageous and I’m completely fascinated by it. So I’m also trying to think about, okay, can I actually understand quantum mechanics in a more mundane way? So that, you know, without all the weird multiverses and collapses and stuff like that. So the physics is always been the threat and I’m trying to apply the physics to the machine learning to build better algorithms.[01:06:52:16 - 01:07:05:15]Brandon: You are still very involved in understanding and understanding physics and the worlds. Yeah. And just like applications to machine learning or introducing no formalisms. That’s really cool.[01:07:05:15 - 01:07:18:02]Max: Yes, I would say I’m not contributing much to physics, but I’m contributing to the interface between physics and science. And that’s called AI for science or science or AI is kind of a super, it’s actually a new discipline that’s emerging.[01:07:18:02 - 01:07:18:19]Speaker 5: Yeah.[01:07:18:19 - 01:07:45:14]Max: And it’s not just emerging, it’s exploding, I would say. That’s the better term because I know you go from investments into like in the hundreds of millions now in the billions. So there’s now actually a startup by Jeff Bezos that is at 6.2 billion sheep round. Right. Insane. I guess it’s the largest startup ever, I think. And that’s in this field, AI for science. It tells you something that we are creating a new bubble here.[01:07:46:15 - 01:07:53:28]Brandon: So why do you think it is? What has changed that has motivated people to start working on AI for science type problems?[01:07:53:28 - 01:08:49:17]Max: So there’s two reasons actually. One is that people have been applying sort of the new tools from AI to the sciences, which is quite natural. And there’s of course, I think there’s two big examples, protein folding is a big one. And the other one is machine learning forest fields or something called machine learning inter-atomic potentials. Both of them have been actually very successful. Both also had something to do with symmetries, which is a little cool. And sort of people in the AI sciences saw an opportunity to apply the tools that they had developed beyond advertised placement, right, or multimedia applications into something that could actually make a very positive impact in society like health, drug development, materials for the energy transition, carbon capture. These are all really cool, impactful applications.[01:08:50:19 - 01:09:42:14]Max: Despite that, the science and the kind of the is also very interesting. I would say the fact that these sort of these two fields are coming together and that we’re now at the point that we can actually model these things effectively and move the needle on some of these sort of science sort of methodologies is also a very unique moment, I would say. People recognize that, okay, now we’re at the cusp of something new, where it results whether the company is called after. We’re at the cusp of something new. And of course that always creates a lot of energy. It’s like, okay, there’s something, it’s like sort of virgin field. It’s like nobody’s green field. Nobody’s been there. I can rush in and I can sort of start harvesting there, right? And I think that’s also what’s causing a lot of sort of enthusiasm in the fields.[01:09:42:14 - 01:10:12:18]RJ: If you’re an AI engineer, basically if the people that listen to this podcast will be in the field, then you maybe don’t have a strong science background. How does, but are excited. Most I would say most AI practitioners, BM engineers or scientists would consider themselves scientists and they have some background, a little bit of physics, a little bit of industry college, maybe even graduate school that have been working or are starting out. How does somebody who is not a scientist on a day-to-day basis, how do they get involved?[01:10:12:18 - 01:10:14:28]Max: Well, they can read my book once it’s out.[01:10:16:07 - 01:11:05:24]Max: This is basically saying that there is more, we should create curricula that are on this interface. So I’m not sure there is, also we already have some universities actual courses you can take, maybe online courses you can take. These workshops where we are now are actually very good as well. And we should probably have more tutorials before the workshop starts. Actually we’ve, I’ve kind of proposed this at some point. It’s like maybe first have an hour of a tutorial so that people can get new into the field. There’s a lot out there. Most of it is of course inaccessible, but I would say we will create much more books and other contents that is more accessible, including this podcast I would say. So I think it will come. And these days you can watch videos and things. There’s a huge amount of content you can go and see.[01:11:05:24 - 01:11:28:28]Brandon: So maybe a follow-up to that. How do people learn and get involved? But why should they get involved? I mean, we have a lot of people who are of our audience will be interested in AI engineering, but they may be looking for bigger impacts in the world. What opportunities does AI for science provide them to make an impact to change the world? That working in this the world of pure bits would not.[01:11:28:28 - 01:11:40:06]Max: So my view is that underlying almost everything is immaterial. So we are focusing a lot on LLMs now, which is kind of the software layer.[01:11:41:06 - 01:11:56:05]Max: I would say if you think very hard, underlying everything is immaterial. So underlying an LLM is a GPU, and underlying a GPU is a wafer on which we will have to deposit materials. Do we want to wait a little bit?[01:12:02:25 - 01:12:11:06]Max: Underlying everything is immaterial. So I was saying, you know, there’s the LLM underlying the LLM is a GPU on which it runs. In order to make that GPU,[01:12:12:08 - 01:12:43:20]Max: you have to put materials down on a wafer and sort of shine on it with sort of EUV light in order to etch kind of the structures in. But that’s now an actual material problem, because more or less we’ve reached the limits of scaling things down. And now we are trying to improve further by new materials. So that’s a fundamental materials problem. We need to get through the energy transition fast if we don’t want to kind of mess up this world. And so there is, for instance, batteries. That’s a complete materials problem. There’s fuel cells.[01:12:44:23 - 01:13:01:16]Max: There is solar panels. So that they can now make solar panels with new perovskite layers on top of the silicon layers that can capture, you know, theoretically up to 50% of the light, where now we’re at, I don’t know, maybe 22 or something. So these are huge changes all by material innovation.[01:13:02:21 - 01:13:47:15]Max: And yeah, I think wherever you go, you know, I can probably dig deep enough and then tell you, well, actually, the very foundation of what you’re doing is a material problem. And so I think it’s just very nice to work on this very, very foundation. And also because I think this is maybe also something that’s happening now is we can start to search through this material space. This has never been the case, right? It’s like scientists, the normal way of working is you read papers and then you come up with no hypothesis. You do an experiment and you learn, et cetera. So that’s a very slow process. Now we can treat this as a search engine. Like we search the internet, we now search the space of all possible molecules, not just the ones that people have made or that they’re in the universe, but all of them.[01:13:48:21 - 01:14:42:01]Max: And we can make this kind of fully automated. That’s the hope, right? We can just type, it becomes a tool where you type what you want and something starts spinning and some experiments get going. And then, you know, outcome list of materials and then you look at it and say, maybe not. And then you refine your query a little bit. And you kind of do research with this search engine where a huge amount of computation and experimentation is happening, you know, somewhere far away in some lab or some data center or something like this. I find this a very, very promising view of how we can sort of build a much better sort of materials layer underneath almost everything. And also more sustainable materials. Our plastics are polluting the planet. If you come up with a plastic that kind of destroys itself, you know, after, I don’t a few weeks, right? And actually becomes a fertilizer. These are things that are not impossible at all. These things can be done, right? And we should do it.[01:14:42:01 - 01:14:47:23]RJ: Can you tell us a little bit just generally about CUSBI and then I have a ton of questions.[01:14:47:23 - 01:14:48:15]Speaker 5: Yeah.[01:14:48:15 - 01:17:49:10]Max: So CUSBI started about 20 months ago and it was because I was worried about I’m still worried about climate change. And so I realized that in order to get, you know, to stay within two degrees, let’s say, we would not only have to reduce our emissions to zero by 2050, but then, you know, another half century or even a century of removing carbon dioxide from the atmosphere, not by reducing your emissions, but actually removing it at a rate that’s about half the rate that we now emit it. And that is a unsolved problem. But if we don’t solve it, two degrees is not going to happen, right? It’s going to be much more. And I don’t think people quite understand how bad that can be, like four degrees, like very bad. So this technology needs to be developed. And so this was my and my co-founder, Chet Edwards, motivation to start this startup. And also because, you know, we saw the technology was ready, which is also very good. So if you’re, you know, the time is right to do it. And yeah, so we now in the meanwhile, we’ve grown to about 40 people. We’ve kind of collected 130 million investment into the company, which is for a European company is quite a lot. I would say it’s interesting that right after that, you know, other startups got even more. So that’s kind of tells you how fast this is growing. But yeah, we are we are now at the we’ve built the platform, of course, but it’s for a series of material classes and it needs to be constantly expanded to new material classes. And it can be more automated because, you know, we know putting LLMs in as the whole thing gets more and more automated. And now we’re moving to sort of high throughput experimentation. So connecting the actual platform, which is computational, to the experiments so that you can get also get fast feedback from experiments. And I kind of think of experiments as something you do at the end, although that’s what we’ve been doing so far. I want to think of it as what I would call a sort of a physics processing unit, like a PPU, right, which is you have digital processing units and then you have physics processing units. So it’s basically nature doing computations for you. It’s the fastest computer known as possible, even. It’s a bit hard to program because you have to do all these experiments. Those are quite, quite bulky. It’s like a very large thing you have to do. But in a way, it is a computation. And that’s the way I want to see it. So I want to you can do computations in a data center and then you can ask nature to do some computations. Your interface with nature is a bit more complicated. But then these things will have to seamlessly work together to get to a new material that you’re interested in. And that’s the vision we have. We don’t say super intelligence because I don’t quite know what it means and I don’t want to oversell it. But I do want to automate this process and give a very powerful tool in the hands of the chemists and the material scientists.[01:17:49:10 - 01:18:01:02]Brandon: That actually brings up a question I wanted to ask you. First of all, can you talk about your platform to like whatever degree, like explain kind of how it works and like what you your thought processes was in developing it?[01:18:01:02 - 01:20:47:22]Max: Yeah, I think it’s been surprisingly, it’s not rocket science, I would say. It’s not rocket science in the sense of the design and basically the design that, you know, I wrote down at the very beginning. It’s still more or less the design, although you add things like I wasn’t thinking very much about multi-scale models and as the common are rated that actually multi-scale is very important. And the beginning, I wasn’t thinking very much about self-driving labs. But now I think, you know, we are now at the stage we should be adding that. And so there is sort of bits and details that we’re adding. But more or less, it’s what you see in the slide decks here as well, which is there is a generative component that you have to train to generate candidates. And then there is a digital twin, multi-scale, multi-fidelity digital twin, which you walk through the steps of the ladder, you know, they do the cheap things first, you weed out everything that’s obviously unuseful, and then you go to more and more expensive things later. And so you narrow things down to a small number. Those go into an experiment, you know, do the experiment, get feedback, etc. Now, things that also have been more recently added is sort of more agentic sort of parts. You know, we have agents that search the literature and come up with, you know, actually the chemical literature and come up with, you know, chemical suggestions for doing experiments. We have agents which sort of autonomously orchestrate all of the computations and the experiments that need to be done. You know, they’re in various stages of maturity and they can be continuously improved, I would say. And so that’s basically I don’t think that part. There’s rocket science, but, you know, the design of that thing is not like surprising. What is it’s surprising hard to actually build it. Right. So that’s that’s the thing that is where the moat is in the data that you can get your hands on and the and actually building the platform. And I would say there’s two people in particular I want to call out, which is Felix Hunker, who is actually, you know, building the scientific part of the platform and Sandra de Maria, who is building the sort of the skate that is kind of this the MLOps part of the platform. Yeah. And so and recently we also added sort of Aaron Walsh to our team, who is a very accomplished scientist from Imperial College. We’re very happy about that. He’s going to be a chief science officer. And we also have a partnerships team that sort of seeks out all the customers because I think this is one thing I find very important. In print, it’s so complex to do to actually bring a material to the real world that you must do this, you know, in collaboration with sort of the domain experts, which are the companies typically. So we always we only start to invest in the direction if we find a good industrial partner to go on that journey with us.[01:20:47:22 - 01:20:55:12]Brandon: Makes a lot of sense. Over the evolution of the platform, did you find that you that human intervention, human,[01:20:56:18 - 01:21:17:01]Brandon: I guess you could start out with a pure, you could imagine two directions when you start up making everything purely automatic, automated, agentic, so on. And then later on, you like find that you need to have more human input and feedback different steps. Or maybe did you start out with having human feedback? You have lots of steps and then like kind of, yeah, figure out ways to remove, you know,[01:21:17:01 - 01:22:39:18]Max: that is the second one. So you build tools for you. So it’s much more modular than you think. But it’s like, we need these tools for this application. We need these tools. So you build all these tools, and then you go through a workflow actually in the beginning just manually. So you put them in a first this tool, then run this to them or this with sithery. So you put them in a workflow and then you figure out, oh, actually, you know, this this porous material that we are trying to make actually collapses if you shake it a bit. Okay, then you add a new tool that says test for stability. Right. Yeah. And so there’s more and more tools. And then you build the agent, which could be a Bayesian optimizer, or it could be an actual other them, you know, maybe trained to be a good chemist that will then start to use all these tools in the right way in the right order. Yeah. Right. But in the beginning, it’s like you as a chemist are putting the workflow together. And then you think about, okay, how am I going to automate this? Right. For one very easy question you can ask yourself is, you know, every time somebody who is not a super expert in DFT, yeah, and he wants to do a calculation has to go to somebody who knows DFT. And so could you start to automate that away, which is like, okay, make it so user friendly, so that you actually do the right DFT for the right problem and for the right length of time, and you can actually assess whether it’s a good outcome, etc. So you start to automate smaller small pieces and bigger pieces, etc. And in the end, the whole thing is automated.[01:22:39:18 - 01:22:53:25]Brandon: So your philosophy is you want to provide a set of specific tools that make it so that the scientists making decisions are better informed and less so trying to create an automated process.[01:22:53:25 - 01:23:22:01]Max: I think it’s this is sort of the same where you’re saying because, yes, we want to automate, yeah, but we don’t see something very soon where the chemists and the domain expert is out of the loop. Yeah, but it but it’s a retreat, right? It’s like, okay, so first, you need an expert to tell you precisely how to set the parameters of the DFT calculation. Okay, maybe we can take that out. We can maybe automate that, right? And so increasingly, more of these things are going to be removed.[01:23:22:01 - 01:23:22:19]Speaker 5: Yeah.[01:23:22:19 - 01:24:33:25]Max: In the end, the vision is it will be a search engine where you where somebody, a chemist will type things and we’ll get candidates, but the chemist will still decide what is a good material and what is not a good material out of that list, right? And so the vision of a completely dark lab, where you can close the door and you just say, just, you know, find something interesting and then it will it will just figure out what’s interesting and we’ll figure out, you know, it’s like, oh, I found this new material to blah, blah, blah, blah, right? That’s not the vision I have. He’s not for, you know, a long time. So for me, it’s really empowering the domain experts that are sitting in the companies and in universities to be much faster in developing their materials. And I should say, it’s also good to be a little humble at times, because it is very complicated, you know, to bring it to make it and to bring it into the real world. And there are people that are doing this for the entire lives. Yeah. Right. And it’s like, I wonder if they scratch their head and say, well, you know, how are you going to completely automate that away, like in the next five years? I don’t think that’s going to happen at all.[01:24:35:01 - 01:24:39:24]Max: Yeah. So to me, it’s an increasingly powerful tool in the hands of the chemists.[01:24:39:24 - 01:25:04:02]RJ: I have a question. You’ve talked before about getting people interested based on having, you know, sort of a big breakthrough in materials, incremental change. I’m curious what you think about the platform you have now in are sort of stepping towards and how are you chasing the big change or is this like incremental or is there they’re not mutually exclusive, obviously, but what do you think about that?[01:25:04:02 - 01:26:04:27]Max: We follow a mixed strategy. So we are definitely going after a big material. Again, we do this with a partner. I’m not going to disclose precisely what it is, but we have our own kind of long term goal. You could call it lighthouse or, you know, sort of moonshot or whatever, but it is going to be a really impactful material that we want to develop as a proof point that it can be done and that it will make it into the into the real world and that AI was essential in actually making it happen. At the same time, we also are quite happy to work with companies that have more modest goals. Like I would say one is a very deep partnership where you go on a journey with a company and that’s a long term commitment together. And the other one is like somebody says, I knew I need a force field. Can you help me train this force field and then maybe analyze this particular problem for me? And I’ll pay you a bunch of money for that. And then maybe after that we’ll see. And that’s fine too. Right. But we prefer, you know, the deep partnerships where we can really change something for the good.[01:26:04:27 - 01:26:22:02]RJ: Yeah. And do you feel like from a platform standpoint you’re ready for that or what are the things that and again, not asking you to disclose proprietary secret sauce, but what are the things generally speaking that need to happen from where we are to where to get those big breakthroughs?[01:26:22:02 - 01:28:40:01]Max: What I find interesting about this field is that every time you build something, it’s actually immediately useful. Right. And so unlike quantum computing, which or nuclear fusion, so you work for 20, 30, 40 years and nothing, nothing, nothing, nothing. And then it has to happen. Right. And when it happens, it’s huge. So it’s quite different here because every time you introduce, so you go to a customer and you say, so what do you need? Right. So we work, let’s say, on a problem like a water filtration. We want to remove PFAS from water. Right. So we do this with a company, Camira. So they are a deep partner for us. Right. So we on a journey together. I think that the breakthrough will happen with a lot of human in the loop because there is the chemists who have a whole lot more knowledge of their field and it’s us who will help them with training, having a new message. And in that kind of interface, these interactions, something beautiful will happen and that will have to happen first before this field will really take off, I think. And so in the sense that it’s not a bubble, let’s put it that way. So that’s people see that as actual real what’s happening. So in the beginning, it will be very, you know, with a lot of humans in the loop, I would say, and I would I would hope we will have this new sort of breakthrough material before, you know, everything is completely automated because that will take a while. And also it is very vertical specific. So it’s like completely automating something for problem A, you know, you can probably achieve it, but then you’ll sort of have to start over again for problem B because, you know, your experimental setup looks very different in the machines that you characterize your materials look very different. Even the models in your platform will have to be retrained and fine tuned to the new class. So every time, you know, you have a lot of learnings to transfer, but also, you know, the problems are actually different. And so, yes, I would want that breakthrough material before it’s completely automated, which I think is kind of a long term vision. And I would say every time you move to something new, you’ll have to start retraining and humans will have to come in again and say, okay, so what does this problem look like? And now sort of, you know, point the the machine again, you know, in the new direction and then and then use it again.[01:28:40:01 - 01:28:47:17]RJ: For the non-scientists among us, me included a bit of a scientist. There’s a lot of terminology. You mentioned DFT,[01:28:49:00 - 01:29:01:11]RJ: you equivariance we’ve talked about. Can you sort of explain in engineering terms or the level of sophistication and engineering? Well, how what is equivariance?[01:29:01:11 - 01:29:55:01]Max: So equivariance is the infusion of symmetry in neural networks. So if I build a neural network, let’s say that needs to recognize this bottle, right, and then I rotate the bottle, it will then actually have to completely start again because it has no idea that the rotated bottle. Well, actually, the input that represents a rotated bottle is actually rotated bottle. It just doesn’t understand that. Right. If you build equivariance in basically once you’ve trained it in one orientation, it will understand it in any other orientation. So that means you need a lot less data to train these models. And these are constraints on the weights of the model. So so basically you have to constrain the way such data to understand it. And you can build it in, you can hard code it in. And yeah, this the symmetry groups can be, you know, translations, rotations, but also permutations. I can graph neural network, their permutations and then physics, of course, as many more of these groups.[01:29:55:01 - 01:30:01:08]RJ: To pray devil’s advocate, why not just use data augmentation by your bottle is in all the different orientations?[01:30:01:08 - 01:30:58:23]Max: As an option, it’s just not exact. It’s like, why would you go through the work of doing all that? Where you would really need an infinite number of augmentations to get it completely right. Where you can also hard code it in. Now, I have to say sometimes actually data augmentation works even better than hard coding the equivariance in. And this is something to do with the fact that if you constrain the optimization, the weights before the optimization starts, the optimization surface or objective becomes more complicated. And so it’s harder to find good minima. So there is also a complicated interplay, I think, between the optimization process and these constraints you put in your network. And so, yeah, you’ll hear kind of contradicting claims in this field. Like some people and for certain applications, it works just better than not doing it. And sometimes you hear other people, if you have a lot of data and you can do data augmentation, then actually it’s easier to optimize them and it actually works better than putting the equivariance in.[01:30:58:23 - 01:31:07:16]Brandon: Do you think there’s kind of a bitter lesson for mathematically founded models and strategies for doing deep learning?[01:31:07:16 - 01:31:46:06]Max: Yeah, ultimately it’s a trade-off between data and inductive bias. So if your inductive bias is not perfectly correct, you have to be careful because you put a ceiling to what you can do. But if you know the symmetry is there, it’s hard to imagine there isn’t a way to actually leverage it. But yeah, so there is a bitter lesson. And one of the bitter lessons is you should always make sure your architecture is scale, unless you have a tiny data set, in which case it doesn’t matter. But if you, you know, the same bitter lessons or lessons that you can draw in LLM space are eventually going to be true in this space as well, I think.[01:31:47:10 - 01:31:55:01]RJ: Can you talk a little bit about your upcoming book and tell the listeners, like, what’s exciting about it? Yeah, I should read it.[01:31:55:01 - 01:33:42:20]Max: So this book is about, it’s called Generative AI and Stochastic Thermodynamics. It basically lays bare the fact that the mathematics that goes into both generative AI, which is the technology to generate images and videos, and this field of non-equilibrium statistical mechanics, which are systems of molecules that are just moving around and relaxing to the ground state, or that you can control to have certain, you know, be in a certain state, the mathematics of these two is actually identical. And so that’s fascinating. And in fact, what’s interesting is that Jeff Hinton and Radford Neal already wrote down the variational free energy for machine learning a long time ago. And there’s also Carl Friston’s work on free energy principle and active entrance. But now we’ve related it to this very new field in physics, which is called stochastic thermodynamics or non-equilibrium thermodynamics, which has its own very interesting theorems, like fluctuation theorems, which we don’t typically talk about, but we can learn a lot from. And I think it’s just it can sort of now start to cross fertilize. When we see that these things are actually the same, we can, like we did for symmetries, we can now look at this new theory that’s out there, developed by these very smart physicists, and say, okay, what can we take from here that will make our algorithms better? At the same time, we can use our models to now help the scientists do better science. And so it becomes a beautiful cross-fertilization between these two fields. The book is rather technical, I would say. And it takes all sorts of things that have been done as stochastic thermodynamics, and all sorts of models that have been done in the machine learning literature, and it basically equates them to each other. And I think hopefully that sense of unification will be revealing to people.[01:33:42:20 - 01:33:44:05]RJ: Wait, and when is it out?[01:33:44:05 - 01:33:56:09]Max: Well, it depends on the publisher now. But I hope in April, I’m going to give a keynote at ICLR. And it would be very nice if they have this book in my hand. But you know, it’s hard to control these kind of timelines.[01:33:56:09 - 01:33:58:19]RJ: Yeah, I’m looking forward to it. Great.[01:33:58:19 - 01:33:59:25]Max: Thank you very much. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.latent.space/subscribe

This is a free preview of a paid episode. To hear more, visit www.latent.spaceFirst speakers for AIE Europe and AIEi Miami have been announced. If you’re in Asia/Aus, come by Singapore and Melbourne. AI Engineering is going global!One year ago today, Anthropic launched Claude Code, to not much fanfare:The word of mouth was incredibly strong however, and so we were glad to be one of the first podcasts to invite Boris and Cat on in early May:As we discussed on the pod, all CC usage was API-based and therefore it was ridiculously expensive to do anything. This was then fixed by the team including Claude Code in the Claude Pro plan in early June, and then the virality caused us to make a rare trend call in late June:Now, 6 months on, Doug has just calculated that around 4% of GitHub is written by Claude Code:We talk about how Doug uses Claude Code to do SemiAnalysis work.Memory ManiaIn the second part of this episode, we also check in on Memory Mania, which is going to affect you (yes, you) at home if it hasn’t already:Full Episode on YouTubeTimestamps00:00 AI as Junior Analyst00:59 Meet Swyx and Doug03:30 From Value Mule to Semis06:28 Moore’s Law Ends Thesis12:02 Claude Code Awakening32:02 Agent Swarms Reality Check32:53 Kimi Swarm Benchmarks37:31 Bots vs Zapier Automation39:44 Claude Code Workflow Setup57:54 AGI Metrics and GDP01:04:48 Railroad CapEx Analogy01:06:00 Funding Bubbles and Demand01:08:11 Agents Replace Work Tools01:13:56 Codex vs Claude Race01:21:15 Microsoft and TPU Strategy01:34:13 TPU Window vs Nvidia01:36:30 HBM Supply Chain Squeeze01:39:41 Memory Shock and CXL01:45:20 Context Rationing Future01:54:37 Writing and Trail LessonsTranscript[00:00:00] AI as Junior Analyst[00:00:00] Doug: This crap makes mistakes all the time. All the time. It is still just like a, like I think of it once again as like a junior analyst, right? The analyst goes and does all this like really pain in the ass information and you bring it all together to make a good decision at the top. Historically what happens is that junior analyst, who I once was, went and gathered all that information, and after doing this enough times, there’s a meta level thinking that’s happening where it’s like, okay, here’s what I really understand and how this type of analysis, I’m an expert in, actually I’m very good at, I consistently have a hit rate.[00:00:28] Now I’m the expert, right? I don’t think that meta level learning is there yet. We’ll see if l ones do it, right? Everyone who’s spending one quadrillion dollars in the world thinks it will, it better, it better happen by if you’re spending, you know, a trillion dollars and there’s not meta level learning.[00:00:44] But for me, in our firm, that massively amplifies everyone who is an expert. ‘cause like you have to still do something that you can just like lop it up. It’s very obvious to me. What It’s slop.[00:00:59] Meet Swyx and Doug

Olivia Watkins (Frontier Evals team) and Mia Glaese (VP of Research at OpenAI, leading the Codex, human data, and alignment teams) discuss a new blog post (https://openai.com/index/why-we-no-longer-evaluate-swe-bench-verified/) arguing that SWE-Bench Verified—long treated as a key “North Star” coding benchmark—has become saturated and highly contaminated, making it less useful for measuring real coding progress. SWE-Bench Verified originated as a major OpenAI-led cleanup of the original Princeton SWE-Bench benchmark, including a large human review effort with nearly 100 software engineers and multiple independent reviews to curate ~500 higher-quality tasks. But recent findings show that many remaining failures can reflect unfair or overly narrow tests (e.g., requiring specific naming or unspecified implementation details) rather than true model inability, and cite examples suggesting contamination such as models recalling repository-specific implementation details or task identifiers. From now on, OpenAI plans to stop reporting SWE-Bench Verified and instead focus on SWE-Bench Pro (from Scale), which is harder, more diverse (more repos and languages), includes longer tasks (1–4 hours and 4+ hours), and shows substantially less evidence of contamination under their “contamination auditor agent” analysis. We also discuss what future coding/agent benchmarks should measure beyond pass/fail tests—longer-horizon tasks, open-ended design decisions, code quality/maintainability, and real-world product-building—along with the tradeoffs between fast automated grading and human-intensive evaluation. 00:00 Meet the Frontier Evals Team00:56 Why SWE Bench Stalled01:47 How Verified Was Built04:32 Contamination In The Wild06:16 Unfair Tests And Narrow Specs08:40 When Benchmarks Saturate10:28 Switching To SWE Bench Pro12:31 What Great Coding Evals Measure18:17 Beyond Tests Dollars And Autonomy21:49 Preparedness And Future Directions This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.latent.space/subscribe

Tickets for AIEi Miami and AIE Europe are live, with first wave speakers announced!From pioneering software-defined networking to backing many of the most aggressive AI model companies of this cycle, Martin Casado and Sarah Wang sit at the center of the capital, compute, and talent arms race reshaping the tech industry. As partners at a16z investing across infrastructure and growth, they’ve watched venture and growth blur, model labs turn dollars into capability at unprecedented speed, and startups raise nine-figure rounds before monetization.Martin and Sarah join us to unpack the new financing playbook for AI: why today’s rounds are really compute contracts in disguise, how the “raise → train → ship → raise bigger” flywheel works, and whether foundation model companies can outspend the entire app ecosystem built on top of them. They also share what’s underhyped (boring enterprise software), what’s overheated (talent wars and compensation spirals), and the two radically different futures they see for AI’s market structure.We discuss:* Martin’s “two futures” fork: infinite fragmentation and new software categories vs. a small oligopoly of general models that consume everything above them* The capital flywheel: how model labs translate funding directly into capability gains, then into revenue growth measured in weeks, not years* Why venture and growth have merged: $100M–$1B hybrid rounds, strategic investors, compute negotiations, and complex deal structures* The AGI vs. product tension: allocating scarce GPUs between long-term research and near-term revenue flywheels* Whether frontier labs can out-raise and outspend the entire app ecosystem built on top of their APIs* Why today’s talent wars ($10M+ comp packages, $B acqui-hires) are breaking early-stage founder math* Cursor as a case study: building up from the app layer while training down into your own models* Why “boring” enterprise software may be the most underinvested opportunity in the AI mania* Hardware and robotics: why the ChatGPT moment hasn’t yet arrived for robots and what would need to change* World Labs and generative 3D: bringing the marginal cost of 3D scene creation down by orders of magnitude* Why public AI discourse is often wildly disconnected from boardroom reality and how founders should navigate the noiseShow Notes:* “Where Value Will Accrue in AI: Martin Casado & Sarah Wang” - a16z show* “Jack Altman & Martin Casado on the Future of Venture Capital”* World Labs—Martin Casado• LinkedIn: https://www.linkedin.com/in/martincasado/• X: https://x.com/martin_casadoSarah Wang• LinkedIn: https://www.linkedin.com/in/sarah-wang-59b96a7• X: https://x.com/sarahdingwanga16z• https://a16z.com/Timestamps00:00:00 – Intro: Live from a16z00:01:20 – The New AI Funding Model: Venture + Growth Collide00:03:19 – Circular Funding, Demand & “No Dark GPUs”00:05:24 – Infrastructure vs Apps: The Lines Blur00:06:24 – The Capital Flywheel: Raise → Train → Ship → Raise Bigger00:09:39 – Can Frontier Labs Outspend the Entire App Ecosystem?00:11:24 – Character AI & The AGI vs Product Dilemma00:14:39 – Talent Wars, $10M Engineers & Founder Anxiety00:17:33 – What’s Underinvested? The Case for “Boring” Software00:19:29 – Robotics, Hardware & Why It’s Hard to Win00:22:42 – Custom ASICs & The $1B Training Run Economics00:24:23 – American Dynamism, Geography & AI Power Centers00:26:48 – How AI Is Changing the Investor Workflow (Claude Cowork)00:29:12 – Two Futures of AI: Infinite Expansion or Oligopoly?00:32:48 – If You Can Raise More Than Your Ecosystem, You Win00:34:27 – Are All Tasks AGI-Complete? Coding as the Test Case00:38:55 – Cursor & The Power of the App Layer00:44:05 – World Labs, Spatial Intelligence & 3D Foundation Models00:47:20 – Thinking Machines, Founder Drama & Media Narratives00:52:30 – Where Long-Term Power Accrues in the AI StackTranscriptLatent.Space - Inside AI’s $10B+ Capital Flywheel — Martin Casado & Sarah Wang of a16z[00:00:00] Welcome to Latent Space (Live from a16z) + Meet the Guests[00:00:00] Alessio: Hey everyone. Welcome to the Latent Space podcast, live from a 16 z. Uh, this is Alessio founder Kernel Lance, and I’m joined by Twix, editor of Latent Space.[00:00:08] swyx: Hey, hey, hey. Uh, and we’re so glad to be on with you guys. Also a top AI podcast, uh, Martin Cado and Sarah Wang. Welcome, very[00:00:16] Martin Casado: happy to be here and welcome.[00:00:17] swyx: Yes, uh, we love this office. We love what you’ve done with the place. Uh, the new logo is everywhere now. It’s, it’s still getting, takes a while to get used to, but it reminds me of like sort of a callback to a more ambitious age, which I think is kind of[00:00:31] Martin Casado: definitely makes a statement.[00:00:33] swyx: Yeah.[00:00:34] Martin Casado: Not quite sure what that statement is, but it makes a statement.[00:00:37] swyx: Uh, Martin, I go back with you to Netlify.[00:00:40] Martin Casado: Yep.[00:00:40] swyx: Uh, and, uh, you know, you create a software defined networking and all, all that stuff people can read up on your background. Yep. Sarah, I’m newer to you. Uh, you, you sort of started working together on AI infrastructure stuff.[00:00:51] Sarah Wang: That’s right. Yeah. Seven, seven years ago now.[00:00:53] Martin Casado: Best growth investor in the entire industry.[00:00:55] swyx: Oh, say[00:00:56] Martin Casado: more hands down there is, there is. [00:01:00] I mean, when it comes to AI companies, Sarah, I think has done the most kind of aggressive, um, investment thesis around AI models, right? So, worked for Nom Ja, Mira Ia, FEI Fey, and so just these frontier, kind of like large AI models.[00:01:15] I think, you know, Sarah’s been the, the broadest investor. Is that fair?[00:01:20] Venture vs. Growth in the Frontier Model Era[00:01:20] Sarah Wang: No, I, well, I was gonna say, I think it’s been a really interesting tag, tag team actually just ‘cause the, a lot of these big C deals, not only are they raising a lot of money, um, it’s still a tech founder bet, which obviously is inherently early stage.[00:01:33] But the resources,[00:01:36] Martin Casado: so many, I[00:01:36] Sarah Wang: was gonna say the resources one, they just grow really quickly. But then two, the resources that they need day one are kind of growth scale. So I, the hybrid tag team that we have is. Quite effective, I think,[00:01:46] Martin Casado: what is growth these days? You know, you don’t wake up if it’s less than a billion or like, it’s, it’s actually, it’s actually very like, like no, it’s a very interesting time in investing because like, you know, take like the character around, right?[00:01:59] These tend to [00:02:00] be like pre monetization, but the dollars are large enough that you need to have a larger fund and the analysis. You know, because you’ve got lots of users. ‘cause this stuff has such high demand requires, you know, more of a number sophistication. And so most of these deals, whether it’s US or other firms on these large model companies, are like this hybrid between venture growth.[00:02:18] Sarah Wang: Yeah. Total. And I think, you know, stuff like BD for example, you wouldn’t usually need BD when you were seed stage trying to get market biz Devrel. Biz Devrel, exactly. Okay. But like now, sorry, I’m,[00:02:27] swyx: I’m not familiar. What, what, what does biz Devrel mean for a venture fund? Because I know what biz Devrel means for a company.[00:02:31] Sarah Wang: Yeah.[00:02:32] Compute Deals, Strategics, and the ‘Circular Funding’ Question[00:02:32] Sarah Wang: You know, so a, a good example is, I mean, we talk about buying compute, but there’s a huge negotiation involved there in terms of, okay, do you get equity for the compute? What, what sort of partner are you looking at? Is there a go-to market arm to that? Um, and these are just things on this scale, hundreds of millions, you know, maybe.[00:02:50] Six months into the inception of a company, you just wouldn’t have to negotiate these deals before.[00:02:54] Martin Casado: Yeah. These large rounds are very complex now. Like in the past, if you did a series A [00:03:00] or a series B, like whatever, you’re writing a 20 to a $60 million check and you call it a day. Now you normally have financial investors and strategic investors, and then the strategic portion always still goes with like these kind of large compute contracts, which can take months to do.[00:03:13] And so it’s, it’s very different ties. I’ve been doing this for 10 years. It’s the, I’ve never seen anything like this.[00:03:19] swyx: Yeah. Do you have worries about the circular funding from so disease strategics?[00:03:24] Martin Casado: I mean, listen, as long as the demand is there, like the demand is there. Like the problem with the internet is the demand wasn’t there.[00:03:29] swyx: Exactly. All right. This, this is like the, the whole pyramid scheme bubble thing, where like, as long as you mark to market on like the notional value of like, these deals, fine, but like once it starts to chip away, it really Well[00:03:41] Martin Casado: no, like as, as, as, as long as there’s demand. I mean, you know, this, this is like a lot of these sound bites have already become kind of cliches, but they’re worth saying it.[00:03:47] Right? Like during the internet days, like we were. Um, raising money to put fiber in the ground that wasn’t used. And that’s a problem, right? Because now you actually have a supply overhang.[00:03:58] swyx: Mm-hmm.[00:03:59] Martin Casado: And even in the, [00:04:00] the time of the, the internet, like the supply and, and bandwidth overhang, even as massive as it was in, as massive as the crash was only lasted about four years.[00:04:09] But we don’t have a supply overhang. Like there’s no dark GPUs, right? I mean, and so, you know, circular or not, I mean, you know, if, if someone invests in a company that, um. You know, they’ll actually use the GPUs. And on the other side of it is the, is the ask for customer. So I I, I think it’s a different time.[00:04:25] Sarah Wang: I think the other piece, maybe just to add onto this, and I’m gonna quote Martine in front of him, but this is probably also a unique time in that. For the first time, you can actually trace dollars to outcomes. Yeah, right. Provided that scaling laws are, are holding, um, and capabilities are actually moving forward.[00:04:40] Because if you can put translate dollars into capabilities, uh, a capability improvement, there’s demand there to martine’s point. But if that somehow breaks, you know, obviously that’s an important assumption in this whole thing to make it work. But you know, instead of investing dollars into sales and marketing, you’re, you’re investing into r and d to get to the capability, um, you know, increase.[00:04:59] And [00:05:00] that’s sort of been the demand driver because. Once there’s an unlock there, people are willing to pay for it.[00:05:05] Alessio: Yeah.[00:05:06] Blurring Lines: Models as Infra + Apps, and the New Fundraising Flywheel[00:05:06] Alessio: Is there any difference in how you built the portfolio now that some of your growth companies are, like the infrastructure of the early stage companies, like, you know, OpenAI is now the same size as some of the cloud providers were early on.[00:05:16] Like what does that look like? Like how much information can you feed off each other between the, the two?[00:05:24] Martin Casado: There’s so many lines that are being crossed right now, or blurred. Right. So we already talked about venture and growth. Another one that’s being blurred is between infrastructure and apps, right? So like what is a model company?[00:05:35] Mm-hmm. Like, it’s clearly infrastructure, right? Because it’s like, you know, it’s doing kind of core r and d. It’s a horizontal platform, but it’s also an app because it’s um, uh, touches the users directly. And then of course. You know, the, the, the growth of these is just so high. And so I actually think you’re just starting to see a, a, a new financing strategy emerge and, you know, we’ve had to adapt as a result of that.[00:05:59] And [00:06:00] so there’s been a lot of changes. Um, you’re right that these companies become platform companies very quickly. You’ve got ecosystem build out. So none of this is necessarily new, but the timescales of which it’s happened is pretty phenomenal. And the way we’d normally cut lines before is blurred a little bit, but.[00:06:16] But that, that, that said, I mean, a lot of it also just does feel like things that we’ve seen in the past, like cloud build out the internet build out as well.[00:06:24] Sarah Wang: Yeah. Um, yeah, I think it’s interesting, uh, I don’t know if you guys would agree with this, but it feels like the emerging strategy is, and this builds off of your other question, um.[00:06:33] You raise money for compute, you pour that or you, you pour the money into compute, you get some sort of breakthrough. You funnel the breakthrough into your vertically integrated application. That could be chat GBT, that could be cloud code, you know, whatever it is. You massively gain share and get users.[00:06:49] Maybe you’re even subsidizing at that point. Um, depending on your strategy. You raise money at the peak momentum and then you repeat, rinse and repeat. Um, and so. And that wasn’t [00:07:00] true even two years ago, I think. Mm-hmm. And so it’s sort of to your, just tying it to fundraising strategy, right? There’s a, and hiring strategy.[00:07:07] All of these are tied, I think the lines are blurring even more today where everyone is, and they, but of course these companies all have API businesses and so they’re these, these frenemy lines that are getting blurred in that a lot of, I mean, they have billions of dollars of API revenue, right? And so there are customers there.[00:07:23] But they’re competing on the app layer.[00:07:24] Martin Casado: Yeah. So this is a really, really important point. So I, I would say for sure, venture and growth, that line is blurry app and infrastructure. That line is blurry. Um, but I don’t think that that changes our practice so much. But like where the very open questions are like, does this layer in the same way.[00:07:43] Compute traditionally has like during the cloud is like, you know, like whatever, somebody wins one layer, but then another whole set of companies wins another layer. But that might not, might not be the case here. It may be the case that you actually can’t verticalize on the token string. Like you can’t build an app like it, it necessarily goes down just because there are no [00:08:00] abstractions.[00:08:00] So those are kinda the bigger existential questions we ask. Another thing that is very different this time than in the history of computer sciences is. In the past, if you raised money, then you basically had to wait for engineering to catch up. Which famously doesn’t scale like the mythical mammoth. It take a very long time.[00:08:18] But like that’s not the case here. Like a model company can raise money and drop a model in a, in a year, and it’s better, right? And, and it does it with a team of 20 people or 10 people. So this type of like money entering a company and then producing something that has demand and growth right away and using that to raise more money is a very different capital flywheel than we’ve ever seen before.[00:08:39] And I think everybody’s trying to understand what the consequences are. So I think it’s less about like. Big companies and growth and this, and more about these more systemic questions that we actually don’t have answers to.[00:08:49] Alessio: Yeah, like at Kernel Labs, one of our ideas is like if you had unlimited money to spend productively to turn tokens into products, like the whole early stage [00:09:00] market is very different because today you’re investing X amount of capital to win a deal because of price structure and whatnot, and you’re kind of pot committing.[00:09:07] Yeah. To a certain strategy for a certain amount of time. Yeah. But if you could like iteratively spin out companies and products and just throw, I, I wanna spend a million dollar of inference today and get a product out tomorrow.[00:09:18] swyx: Yeah.[00:09:19] Alessio: Like, we should get to the point where like the friction of like token to product is so low that you can do this and then you can change the Right, the early stage venture model to be much more iterative.[00:09:30] And then every round is like either 100 k of inference or like a hundred million from a 16 Z. There’s no, there’s no like $8 million C round anymore. Right.[00:09:38] When Frontier Labs Outspend the Entire App Ecosystem[00:09:38] Martin Casado: But, but, but, but there’s a, there’s a, the, an industry structural question that we don’t know the answer to, which involves the frontier models, which is, let’s take.[00:09:48] Anthropic it. Let’s say Anthropic has a state-of-the-art model that has some large percentage of market share. And let’s say that, uh, uh, uh, you know, uh, a company’s building smaller models [00:10:00] that, you know, use the bigger model in the background, open 4.5, but they add value on top of that. Now, if Anthropic can raise three times more.[00:10:10] Every subsequent round, they probably can raise more money than the entire app ecosystem that’s built on top of it. And if that’s the case, they can expand beyond everything built on top of it. It’s like imagine like a star that’s just kind of expanding, so there could be a systemic. There could be a, a systemic situation where the soda models can raise so much money that they can out pay anybody that bills on top of ‘em, which would be something I don’t think we’ve ever seen before just because we were so bottlenecked in engineering, and this is a very open question.[00:10:41] swyx: Yeah. It’s, it is almost like bitter lesson applied to the startup industry.[00:10:45] Martin Casado: Yeah, a hundred percent. It literally becomes an issue of like raise capital, turn that directly into growth. Use that to raise three times more. Exactly. And if you can keep doing that, you literally can outspend any company that’s built the, not any company.[00:10:57] You can outspend the aggregate of companies on top of [00:11:00] you and therefore you’ll necessarily take their share, which is crazy.[00:11:02] swyx: Would you say that kind of happens in character? Is that the, the sort of postmortem on. What happened?[00:11:10] Sarah Wang: Um,[00:11:10] Martin Casado: no.[00:11:12] Sarah Wang: Yeah, because I think so,[00:11:13] swyx: I mean the actual postmortem is, he wanted to go back to Google.[00:11:15] Exactly. But like[00:11:18] Martin Casado: that’s another difference that[00:11:19] Sarah Wang: you said[00:11:21] Martin Casado: it. We should talk, we should actually talk about that.[00:11:22] swyx: Yeah,[00:11:22] Sarah Wang: that’s[00:11:23] swyx: Go for it. Take it. Take,[00:11:23] Sarah Wang: yeah.[00:11:24] Character.AI, Founder Goals (AGI vs Product), and GPU Allocation Tradeoffs[00:11:24] Sarah Wang: I was gonna say, I think, um. The, the, the character thing raises actually a different issue, which actually the Frontier Labs will face as well. So we’ll see how they handle it.[00:11:34] But, um, so we invest in character in January, 2023, which feels like eons ago, I mean, three years ago. Feels like lifetimes ago. But, um, and then they, uh, did the IP licensing deal with Google in August, 2020. Uh, four. And so, um, you know, at the time, no, you know, he’s talked publicly about this, right? He wanted to Google wouldn’t let him put out products in the world.[00:11:56] That’s obviously changed drastically. But, um, he went to go do [00:12:00] that. Um, but he had a product attached. The goal was, I mean, it’s Nome Shair, he wanted to get to a GI. That was always his personal goal. But, you know, I think through collecting data, right, and this sort of very human use case, that the character product.[00:12:13] Originally was and still is, um, was one of the vehicles to do that. Um, I think the real reason that, you know. I if you think about the, the stress that any company feels before, um, you ultimately going one way or the other is sort of this a GI versus product. Um, and I think a lot of the big, I think, you know, opening eyes, feeling that, um, anthropic if they haven’t started, you know, felt it, certainly given the success of their products, they may start to feel that soon.[00:12:39] And the real. I think there’s real trade-offs, right? It’s like how many, when you think about GPUs, that’s a limited resource. Where do you allocate the GPUs? Is it toward the product? Is it toward new re research? Right? Is it, or long-term research, is it toward, um, n you know, near to midterm research? And so, um, in a case where you’re resource constrained, um, [00:13:00] of course there’s this fundraising game you can play, right?[00:13:01] But the fund, the market was very different back in 2023 too. Um. I think the best researchers in the world have this dilemma of, okay, I wanna go all in on a GI, but it’s the product usage revenue flywheel that keeps the revenue in the house to power all the GPUs to get to a GI. And so it does make, um, you know, I think it sets up an interesting dilemma for any startup that has trouble raising up until that level, right?[00:13:27] And certainly if you don’t have that progress, you can’t continue this fly, you know, fundraising flywheel.[00:13:32] Martin Casado: I would say that because, ‘cause we’re keeping track of all of the things that are different, right? Like, you know, venture growth and uh, app infra and one of the ones is definitely the personalities of the founders.[00:13:45] It’s just very different this time I’ve been. Been doing this for a decade and I’ve been doing startups for 20 years. And so, um, I mean a lot of people start this to do a GI and we’ve never had like a unified North star that I recall in the same [00:14:00] way. Like people built companies to start companies in the past.[00:14:02] Like that was what it was. Like I would create an internet company, I would create infrastructure company, like it’s kind of more engineering builders and this is kind of a different. You know, mentality. And some companies have harnessed that incredibly well because their direction is so obviously on the path to what somebody would consider a GI, but others have not.[00:14:20] And so like there is always this tension with personnel. And so I think we’re seeing more kind of founder movement.[00:14:27] Sarah Wang: Yeah.[00:14:27] Martin Casado: You know, as a fraction of founders than we’ve ever seen. I mean, maybe since like, I don’t know the time of like Shockly and the trade DUR aid or something like that. Way back in the beginning of the industry, I, it’s a very, very.[00:14:38] Unusual time of personnel.[00:14:39] Sarah Wang: Totally.[00:14:40] Talent Wars, Mega-Comp, and the Rise of Acquihire M&A[00:14:40] Sarah Wang: And it, I think it’s exacerbated by the fact that talent wars, I mean, every industry has talent wars, but not at this magnitude, right? No. Yeah. Very rarely can you see someone get poached for $5 billion. That’s hard to compete with. And then secondly, if you’re a founder in ai, you could fart and it would be on the front page of, you know, the information these days.[00:14:59] And so there’s [00:15:00] sort of this fishbowl effect that I think adds to the deep anxiety that, that these AI founders are feeling.[00:15:06] Martin Casado: Hmm.[00:15:06] swyx: Uh, yes. I mean, just on, uh, briefly comment on the founder, uh, the sort of. Talent wars thing. I feel like 2025 was just like a blip. Like I, I don’t know if we’ll see that again.[00:15:17] ‘cause meta built the team. Like, I don’t know if, I think, I think they’re kind of done and like, who’s gonna pay more than meta? I, I don’t know.[00:15:23] Martin Casado: I, I agree. So it feels so, it feel, it feels this way to me too. It’s like, it is like, basically Zuckerberg kind of came out swinging and then now he’s kind of back to building.[00:15:30] Yeah,[00:15:31] swyx: yeah. You know, you gotta like pay up to like assemble team to rush the job, whatever. But then now, now you like you, you made your choices and now they got a ship.[00:15:38] Martin Casado: I mean, the, the o other side of that is like, you know, like we’re, we’re actually in the job hiring market. We’ve got 600 people here. I hire all the time.[00:15:44] I’ve got three open recs if anybody’s interested, that’s listening to this for investor. Yeah, on, on the team, like on the investing side of the team, like, and, um, a lot of the people we talk to have acting, you know, active, um, offers for 10 million a year or something like that. And like, you know, and we pay really, [00:16:00] really well.[00:16:00] And just to see what’s out on the market is really, is really remarkable. And so I would just say it’s actually, so you’re right, like the really flashy one, like I will get someone for, you know, a billion dollars, but like the inflated, um, uh, trickles down. Yeah, it is still very active today. I mean,[00:16:18] Sarah Wang: yeah, you could be an L five and get an offer in the tens of millions.[00:16:22] Okay. Yeah. Easily. Yeah. It’s so I think you’re right that it felt like a blip. I hope you’re right. Um, but I think it’s been, the steady state is now, I think got pulled up. Yeah. Yeah. I’ll pull up for[00:16:31] Martin Casado: sure. Yeah.[00:16:32] Alessio: Yeah. And I think that’s breaking the early stage founder math too. I think before a lot of people would be like, well, maybe I should just go be a founder instead of like getting paid.[00:16:39] Yeah. 800 KA million at Google. But if I’m getting paid. Five, 6 million. That’s different but[00:16:45] Martin Casado: on. But on the other hand, there’s more strategic money than we’ve ever seen historically, right? Mm-hmm. And so, yep. The economics, the, the, the, the calculus on the economics is very different in a number of ways. And, uh, it’s crazy.[00:16:58] It’s cra it’s causing like a, [00:17:00] a, a, a ton of change in confusion in the market. Some very positive, sub negative, like, so for example, the other side of the, um. The co-founder, like, um, acquisition, you know, mark Zuckerberg poaching someone for a lot of money is like, we were actually seeing historic amount of m and a for basically acquihires, right?[00:17:20] That you like, you know, really good outcomes from a venture perspective that are effective acquihires, right? So I would say it’s probably net positive from the investment standpoint, even though it seems from the headlines to be very disruptive in a negative way.[00:17:33] Alessio: Yeah.[00:17:33] What’s Underfunded: Boring Software, Robotics Skepticism, and Custom Silicon Economics[00:17:33] Alessio: Um, let’s talk maybe about what’s not being invested in, like maybe some interesting ideas that you would see more people build or it, it seems in a way, you know, as ycs getting more popular, it’s like access getting more popular.[00:17:47] There’s a startup school path that a lot of founders take and they know what’s hot in the VC circles and they know what gets funded. Uh, and there’s maybe not as much risk appetite for. Things outside of that. Um, I’m curious if you feel [00:18:00] like that’s true and what are maybe, uh, some of the areas, uh, that you think are under discussed?[00:18:06] Martin Casado: I mean, I actually think that we’ve taken our eye off the ball in a lot of like, just traditional, you know, software companies. Um, so like, I mean. You know, I think right now there’s almost a barbell, like you’re like the hot thing on X, you’re deep tech.[00:18:21] swyx: Mm-hmm.[00:18:22] Martin Casado: Right. But I, you know, I feel like there’s just kind of a long, you know, list of like good.[00:18:28] Good companies that will be around for a long time in very large markets. Say you’re building a database, you know, say you’re building, um, you know, kind of monitoring or logging or tooling or whatever. There’s some good companies out there right now, but like, they have a really hard time getting, um, the attention of investors.[00:18:43] And it’s almost become a meme, right? Which is like, if you’re not basically growing from zero to a hundred in a year, you’re not interesting, which is just, is the silliest thing to say. I mean, think of yourself as like an introvert person, like, like your personal money, right? Mm-hmm. So. Your personal money, will you put it in the stock market at 7% or you put it in this company growing five x in a very large [00:19:00] market?[00:19:00] Of course you can put it in the company five x. So it’s just like we say these stupid things, like if you’re not going from zero to a hundred, but like those, like who knows what the margins of those are mean. Clearly these are good investments. True for anybody, right? True. Like our LPs want whatever.[00:19:12] Three x net over, you know, the life cycle of a fund, right? So a, a company in a big market growing five X is a great investment. We’d, everybody would be happy with these returns, but we’ve got this kind of mania on these, these strong growths. And so I would say that that’s probably the most underinvested sector.[00:19:28] Right now.[00:19:29] swyx: Boring software, boring enterprise software.[00:19:31] Martin Casado: Traditional. Really good company.[00:19:33] swyx: No, no AI here.[00:19:34] Martin Casado: No. Like boring. Well, well, the AI of course is pulling them into use cases. Yeah, but that’s not what they’re, they’re not on the token path, right? Yeah. Let’s just say that like they’re software, but they’re not on the token path.[00:19:41] Like these are like they’re great investments from any definition except for like random VC on Twitter saying VC on x, saying like, it’s not growing fast enough. What do you[00:19:52] Sarah Wang: think? Yeah, maybe I’ll answer a slightly different. Question, but adjacent to what you asked, um, which is maybe an area that we’re not, uh, investing [00:20:00] right now that I think is a question and we’re spending a lot of time in regardless of whether we pull the trigger or not.[00:20:05] Um, and it would probably be on the hardware side, actually. Robotics, right? And the robotics side. Robotics. Right. Which is, it’s, I don’t wanna say that it’s not getting funding ‘cause it’s clearly, uh, it’s, it’s sort of non-consensus to almost not invest in robotics at this point. But, um, we spent a lot of time in that space and I think for us, we just haven’t seen the chat GPT moment.[00:20:22] Happen on the hardware side. Um, and the funding going into it feels like it’s already. Taking that for granted.[00:20:30] Martin Casado: Yeah. Yeah. But we also went through the drone, you know, um, there’s a zip line right, right out there. What’s that? Oh yeah, there’s a zip line. Yeah. What the drone, what the av And like one of the takeaways is when it comes to hardware, um, most companies will end up verticalizing.[00:20:46] Like if you’re. If you’re investing in a robot company for an A for agriculture, you’re investing in an ag company. ‘cause that’s the competition and that’s surprising. And that’s supply chain. And if you’re doing it for mining, that’s mining. And so the ad team does a lot of that type of stuff ‘cause they actually set up to [00:21:00] diligence that type of work.[00:21:01] But for like horizontal technology investing, there’s very little when it comes to robots just because it’s so fit for, for purpose. And so we kinda like to look at software. Solutions or horizontal solutions like applied intuition. Clearly from the AV wave deep map, clearly from the AV wave, I would say scale AI was actually a horizontal one for That’s fair, you know, for robotics early on.[00:21:23] And so that sort of thing we’re very, very interested. But the actual like robot interacting with the world is probably better for different team. Agree.[00:21:30] Alessio: Yeah, I’m curious who these teams are supposed to be that invest in them. I feel like everybody’s like, yeah, robotics, it’s important and like people should invest in it.[00:21:38] But then when you look at like the numbers, like the capital requirements early on versus like the moment of, okay, this is actually gonna work. Let’s keep investing. That seems really hard to predict in a way that is not,[00:21:49] Martin Casado: I think co, CO two, kla, gc, I mean these are all invested in in Harvard companies. He just, you know, and [00:22:00] listen, I mean, it could work this time for sure.[00:22:01] Right? I mean if Elon’s doing it, he’s like, right. Just, just the fact that Elon’s doing it means that there’s gonna be a lot of capital and a lot of attempts for a long period of time. So that alone maybe suggests that we should just be investing in robotics just ‘cause you have this North star who’s Elon with a humanoid and that’s gonna like basically willing into being an industry.[00:22:17] Um, but we’ve just historically found like. We’re a huge believer that this is gonna happen. We just don’t feel like we’re in a good position to diligence these things. ‘cause again, robotics companies tend to be vertical. You really have to understand the market they’re being sold into. Like that’s like that competitive equilibrium with a human being is what’s important.[00:22:34] It’s not like the core tech and like we’re kind of more horizontal core tech type investors. And this is Sarah and I. Yeah, the ad team is different. They can actually do these types of things.[00:22:42] swyx: Uh, just to clarify, AD stands for[00:22:44] Martin Casado: American Dynamism.[00:22:45] swyx: Alright. Okay. Yeah, yeah, yeah. Uh, I actually, I do have a related question that, first of all, I wanna acknowledge also just on the, on the chip side.[00:22:51] Yeah. I, I recall a podcast that where you were on, i, I, I think it was the a CC podcast, uh, about two or three years ago where you, where you suddenly said [00:23:00] something, which really stuck in my head about how at some point, at some point kind of scale it makes sense to. Build a custom aic Yes. For per run.[00:23:07] Martin Casado: Yes.[00:23:07] It’s crazy. Yeah.[00:23:09] swyx: We’re here and I think you, you estimated 500 billion, uh, something.[00:23:12] Martin Casado: No, no, no. A billion, a billion dollar training run of $1 billion training run. It makes sense to actually do a custom meic if you can do it in time. The question now is timelines. Yeah, but not money because just, just, just rough math.[00:23:22] If it’s a billion dollar training. Then the inference for that model has to be over a billion, otherwise it won’t be solvent. So let’s assume it’s, if you could save 20%, which you could save much more than that with an ASIC 20%, that’s $200 million. You can tape out a chip for $200 million. Right? So now you can literally like justify economically, not timeline wise.[00:23:41] That’s a different issue. An ASIC per model, which[00:23:44] swyx: is because that, that’s how much we leave on the table every single time. We, we, we do like generic Nvidia.[00:23:48] Martin Casado: Exactly. Exactly. No, it, it is actually much more than that. You could probably get, you know, a factor of two, which would be 500 million.[00:23:54] swyx: Typical MFU would be like 50.[00:23:55] Yeah, yeah. And that’s good.[00:23:57] Martin Casado: Exactly. Yeah. Hundred[00:23:57] swyx: percent. Um, so, so, yeah, and I mean, and I [00:24:00] just wanna acknowledge like, here we are in, in, in 2025 and opening eyes confirming like Broadcom and all the other like custom silicon deals, which is incredible. I, I think that, uh, you know, speaking about ad there’s, there’s a really like interesting tie in that obviously you guys are hit on, which is like these sort, this sort of like America first movement or like sort of re industrialized here.[00:24:17] Yeah. Uh, move TSMC here, if that’s possible. Um, how much overlap is there from ad[00:24:23] Martin Casado: Yeah.[00:24:23] swyx: To, I guess, growth and, uh, investing in particularly like, you know, US AI companies that are strongly bounded by their compute.[00:24:32] Martin Casado: Yeah. Yeah. So I mean, I, I would view, I would view AD as more as a market segmentation than like a mission, right?[00:24:37] So the market segmentation is, it has kind of regulatory compliance issues or government, you know, sale or it deals with like hardware. I mean, they’re just set up to, to, to, to, to. To diligence those types of companies. So it’s a more of a market segmentation thing. I would say the entire firm. You know, which has been since it is been intercepted, you know, has geographical biases, right?[00:24:58] I mean, for the longest time we’re like, you [00:25:00] know, bay Area is gonna be like, great, where the majority of the dollars go. Yeah. And, and listen, there, there’s actually a lot of compounding effects for having a geographic bias. Right. You know, everybody’s in the same place. You’ve got an ecosystem, you’re there, you’ve got presence, you’ve got a network.[00:25:12] Um, and, uh, I mean, I would say the Bay area’s very much back. You know, like I, I remember during pre COVID, like it was like almost Crypto had kind of. Pulled startups away. Miami from the Bay Area. Miami, yeah. Yeah. New York was, you know, because it’s so close to finance, came up like Los Angeles had a moment ‘cause it was so close to consumer, but now it’s kind of come back here.[00:25:29] And so I would say, you know, we tend to be very Bay area focused historically, even though of course we’ve asked all over the world. And then I would say like, if you take the ring out, you know, one more, it’s gonna be the US of course, because we know it very well. And then one more is gonna be getting us and its allies and Yeah.[00:25:44] And it goes from there.[00:25:45] Sarah Wang: Yeah,[00:25:45] Martin Casado: sorry.[00:25:46] Sarah Wang: No, no. I agree. I think from a, but I think from the intern that that’s sort of like where the companies are headquartered. Maybe your questions on supply chain and customer base. Uh, I, I would say our customers are, are, our companies are fairly international from that perspective.[00:25:59] Like they’re selling [00:26:00] globally, right? They have global supply chains in some cases.[00:26:03] Martin Casado: I would say also the stickiness is very different.[00:26:05] Sarah Wang: Yeah.[00:26:05] Martin Casado: Historically between venture and growth, like there’s so much company building in venture, so much so like hiring the next PM. Introducing the customer, like all of that stuff.[00:26:15] Like of course we’re just gonna be stronger where we have our network and we’ve been doing business for 20 years. I’ve been in the Bay Area for 25 years, so clearly I’m just more effective here than I would be somewhere else. Um, where I think, I think for some of the later stage rounds, the companies don’t need that much help.[00:26:30] They’re already kind of pretty mature historically, so like they can kind of be everywhere. So there’s kind of less of that stickiness. This is different in the AI time. I mean, Sarah is now the, uh, chief of staff of like half the AI companies in, uh, in the Bay Area right now. She’s like, ops Ninja Biz, Devrel, BizOps.[00:26:48] swyx: Are, are you, are you finding much AI automation in your work? Like what, what is your stack.[00:26:53] Sarah Wang: Oh my, in my personal stack.[00:26:54] swyx: I mean, because like, uh, by the way, it’s the, the, the reason for this is it is triggering, uh, yeah. We, like, I’m hiring [00:27:00] ops, ops people. Um, a lot of ponders I know are also hiring ops people and I’m just, you know, it’s opportunity Since you’re, you’re also like basically helping out with ops with a lot of companies.[00:27:09] What are people doing these days? Because it’s still very manual as far as I can tell.[00:27:13] Sarah Wang: Hmm. Yeah. I think the things that we help with are pretty network based, um, in that. It’s sort of like, Hey, how do do I shortcut this process? Well, let’s connect you to the right person. So there’s not quite an AI workflow for that.[00:27:26] I will say as a growth investor, Claude Cowork is pretty interesting. Yeah. Like for the first time, you can actually get one shot data analysis. Right. Which, you know, if you’re gonna do a customer database, analyze a cohort retention, right? That’s just stuff that you had to do by hand before. And our team, the other, it was like midnight and the three of us were playing with Claude Cowork.[00:27:47] We gave it a raw file. Boom. Perfectly accurate. We checked the numbers. It was amazing. That was my like, aha moment. That sounds so boring. But you know, that’s, that’s the kind of thing that a growth investor is like, [00:28:00] you know, slaving away on late at night. Um, done in a few seconds.[00:28:03] swyx: Yeah. You gotta wonder what the whole, like, philanthropic labs, which is like their new sort of products studio.[00:28:10] Yeah. What would that be worth as an independent, uh, startup? You know, like a[00:28:14] Martin Casado: lot.[00:28:14] Sarah Wang: Yeah, true.[00:28:16] swyx: Yeah. You[00:28:16] Martin Casado: gotta hand it to them. They’ve been executing incredibly well.[00:28:19] swyx: Yeah. I, I mean, to me, like, you know, philanthropic, like building on cloud code, I think, uh, it makes sense to me the, the real. Um, pedal to the metal, whatever the, the, the phrase is, is when they start coming after consumer with, uh, against OpenAI and like that is like red alert at Open ai.[00:28:35] Oh, I[00:28:35] Martin Casado: think they’ve been pretty clear. They’re enterprise focused.[00:28:37] swyx: They have been, but like they’ve been free. Here’s[00:28:40] Martin Casado: care publicly,[00:28:40] swyx: it’s enterprise focused. It’s coding. Right. Yeah.[00:28:43] AI Labs vs Startups: Disruption, Undercutting & the Innovator’s Dilemma[00:28:43] swyx: And then, and, but here’s cloud, cloud, cowork, and, and here’s like, well, we, uh, they, apparently they’re running Instagram ads for Claudia.[00:28:50] I, on, you know, for, for people on, I get them all the time. Right. And so, like,[00:28:54] Martin Casado: uh,[00:28:54] swyx: it, it’s kind of like this, the disruption thing of, uh, you know. Mo Open has been doing, [00:29:00] consumer been doing the, just pursuing general intelligence in every mo modality, and here’s a topic that only focus on this thing, but now they’re sort of undercutting and doing the whole innovator’s dilemma thing on like everything else.[00:29:11] Martin Casado: It’s very[00:29:11] swyx: interesting.[00:29:12] Martin Casado: Yeah, I mean there’s, there’s a very open que so for me there’s like, do you know that meme where there’s like the guy in the path and there’s like a path this way? There’s a path this way. Like one which way Western man. Yeah. Yeah.[00:29:23] Two Futures for AI: Infinite Market vs AGI Oligopoly[00:29:23] Martin Casado: And for me, like, like all the entire industry kind of like hinges on like two potential futures.[00:29:29] So in, in one potential future, um, the market is infinitely large. There’s perverse economies of scale. ‘cause as soon as you put a model out there, like it kind of sublimates and all the other models catch up and like, it’s just like software’s being rewritten and fractured all over the place and there’s tons of upside and it just grows.[00:29:48] And then there’s another path which is like, well. Maybe these models actually generalize really well, and all you have to do is train them with three times more money. That’s all you have to [00:30:00] do, and it’ll just consume everything beyond it. And if that’s the case, like you end up with basically an oligopoly for everything, like, you know mm-hmm.[00:30:06] Because they’re perfectly general and like, so this would be like the, the a GI path would be like, these are perfectly general. They can do everything. And this one is like, this is actually normal software. The universe is complicated. You’ve got, and nobody knows the answer.[00:30:18] The Economics Reality Check: Gross Margins, Training Costs & Borrowing Against the Future[00:30:18] Martin Casado: My belief is if you actually look at the numbers of these companies, so generally if you look at the numbers of these companies, if you look at like the amount they’re making and how much they, they spent training the last model, they’re gross margin positive.[00:30:30] You’re like, oh, that’s really working. But if you look at like. The current training that they’re doing for the next model, their gross margin negative. So part of me thinks that a lot of ‘em are kind of borrowing against the future and that’s gonna have to slow down. It’s gonna catch up to them at some point in time, but we don’t really know.[00:30:47] Sarah Wang: Yeah.[00:30:47] Martin Casado: Does that make sense? Like, I mean, it could be, it could be the case that the only reason this is working is ‘cause they can raise that next round and they can train that next model. ‘cause these models have such a short. Life. And so at some point in time, like, you know, they won’t be able to [00:31:00] raise that next round for the next model and then things will kind of converge and fragment again.[00:31:03] But right now it’s not.[00:31:04] Sarah Wang: Totally. I think the other, by the way, just, um, a meta point. I think the other lesson from the last three years is, and we talk about this all the time ‘cause we’re on this. Twitter X bubble. Um, cool. But, you know, if you go back to, let’s say March, 2024, that period, it felt like a, I think an open source model with an, like a, you know, benchmark leading capability was sort of launching on a daily basis at that point.[00:31:27] And, um, and so that, you know, that’s one period. Suddenly it’s sort of like open source takes over the world. There’s gonna be a plethora. It’s not an oligopoly, you know, if you fast, you know, if you, if you rewind time even before that GPT-4 was number one for. Nine months, 10 months. It’s a long time. Right.[00:31:44] Um, and of course now we’re in this era where it feels like an oligopoly, um, maybe some very steady state shifts and, and you know, it could look like this in the future too, but it just, it’s so hard to call. And I think the thing that keeps, you know, us up at [00:32:00] night in, in a good way and bad way, is that the capability progress is actually not slowing down.[00:32:06] And so until that happens, right, like you don’t know what’s gonna look like.[00:32:09] Martin Casado: But I, I would, I would say for sure it’s not converged, like for sure, like the systemic capital flows have not converged, meaning right now it’s still borrowing against the future to subsidize growth currently, which you can do that for a period of time.[00:32:23] But, but you know, at the end, at some point the market will rationalize that and just nobody knows what that will look like.[00:32:29] Alessio: Yeah.[00:32:29] Martin Casado: Or, or like the drop in price of compute will, will, will save them. Who knows?[00:32:34] Alessio: Yeah. Yeah. I think the models need to ask them to, to specific tasks. You know? It’s like, okay, now Opus 4.5 might be a GI at some specific task, and now you can like depreciate the model over a longer time.[00:32:45] I think now, now, right now there’s like no old model.[00:32:47] Martin Casado: No, but let, but lemme just change that mental, that’s, that used to be my mental model. Lemme just change it a little bit.[00:32:53] Capital as a Weapon vs Task Saturation: Where Real Enterprise Value Gets Built[00:32:53] Martin Casado: If you can raise three times, if you can raise more than the aggregate of anybody that uses your models, that doesn’t even matter.[00:32:59] It doesn’t [00:33:00] even matter. See what I’m saying? Like, yeah. Yeah. So, so I have an API Business. My API business is 60% margin, or 70% margin, or 80% margin is a high margin business. So I know what everybody is using. If I can raise more money than the aggregate of everybody that’s using it, I will consume them whether I’m a GI or not.[00:33:14] And I will know if they’re using it ‘cause they’re using it. And like, unlike in the past where engineering stops me from doing that.[00:33:21] Alessio: Mm-hmm.[00:33:21] Martin Casado: It is very straightforward. You just train. So I also thought it was kind of like, you must ask the code a GI, general, general, general. But I think there’s also just a possibility that the, that the capital markets will just give them the, the, the ammunition to just go after everybody on top of ‘em.[00:33:36] Sarah Wang: I, I do wonder though, to your point, um, if there’s a certain task that. Getting marginally better isn’t actually that much better. Like we’ve asked them to it, to, you know, we can call it a GI or whatever, you know, actually, Ali Goi talks about this, like we’re already at a GI for a lot of functions in the enterprise.[00:33:50] Um. That’s probably those for those tasks, you probably could build very specific companies that focus on just getting as much value out of that task that isn’t [00:34:00] coming from the model itself. There’s probably a rich enterprise business to be built there. I mean, could be wrong on that, but there’s a lot of interesting examples.[00:34:08] So, right, if you’re looking the legal profession or, or whatnot, and maybe that’s not a great one ‘cause the models are getting better on that front too, but just something where it’s a bit saturated, then the value comes from. Services. It comes from implementation, right? It comes from all these things that actually make it useful to the end customer.[00:34:24] Martin Casado: Sorry, what am I, one more thing I think is, is underused in all of this is like, to what extent every task is a GI complete.[00:34:31] Sarah Wang: Mm-hmm.[00:34:32] Martin Casado: Yeah. I code every day. It’s so fun.[00:34:35] Sarah Wang: That’s a core question. Yeah.[00:34:36] Martin Casado: And like. When I’m talking to these models, it’s not just code. I mean, it’s everything, right? Like I, you know, like it’s,[00:34:43] swyx: it’s healthcare.[00:34:44] It’s,[00:34:44] Martin Casado: I mean, it’s[00:34:44] swyx: Mele,[00:34:45] Martin Casado: but it’s every, it is exactly that. Like, yeah, that’s[00:34:47] Sarah Wang: great support. Yeah.[00:34:48] Martin Casado: It’s everything. Like I’m asking these models to, yeah, to understand compliance. I’m asking these models to go search the web. I’m asking these models to talk about things I know in the history, like it’s having a full conversation with me while I, I engineer, and so it could be [00:35:00] the case that like, mm-hmm.[00:35:01] The most a, you know, a GI complete, like I’m not an a GI guy. Like I think that’s, you know, but like the most a GI complete model will is win independent of the task. And we don’t know the answer to that one either.[00:35:11] swyx: Yeah.[00:35:12] Martin Casado: But it seems to me that like, listen, codex in my experience is for sure better than Opus 4.5 for coding.[00:35:18] Like it finds the hardest bugs that I work in with. Like, it is, you know. The smartest developers. I don’t work on it. It’s great. Um, but I think Opus 4.5 is actually very, it’s got a great bedside manner and it really, and it, it really matters if you’re building something very complex because like, it really, you know, like you’re, you’re, you’re a partner and a brainstorming partner for somebody.[00:35:38] And I think we don’t discuss enough how every task kind of has that quality.[00:35:42] swyx: Mm-hmm.[00:35:43] Martin Casado: And what does that mean to like capital investment and like frontier models and Submodels? Yeah.[00:35:47] Why “Coding Models” Keep Collapsing into Generalists (Reasoning vs Taste)[00:35:47] Martin Casado: Like what happened to all the special coding models? Like, none of ‘em worked right. So[00:35:51] Alessio: some of them, they didn’t even get released.[00:35:53] Magical[00:35:54] Martin Casado: Devrel. There’s a whole, there’s a whole host. We saw a bunch of them and like there’s this whole theory that like, there could be, and [00:36:00] I think one of the conclusions is, is like there’s no such thing as a coding model,[00:36:04] Alessio: you know?[00:36:04] Martin Casado: Like, that’s not a thing. Like you’re talking to another human being and it’s, it’s good at coding, but like it’s gotta be good at everything.[00:36:10] swyx: Uh, minor disagree only because I, I’m pretty like, have pretty high confidence that basically open eye will always release a GPT five and a GT five codex. Like that’s the code’s. Yeah. The way I call it is one for raisin, one for Tiz. Um, and, and then like someone internal open, it was like, yeah, that’s a good way to frame it.[00:36:32] Martin Casado: That’s so funny.[00:36:33] swyx: Uh, but maybe it, maybe it collapses down to reason and that’s it. It’s not like a hundred dimensions doesn’t life. Yeah. It’s two dimensions. Yeah, yeah, yeah, yeah. Like and exactly. Beside manner versus coding. Yeah.[00:36:43] Martin Casado: Yeah.[00:36:44] swyx: It’s, yeah.[00:36:46] Martin Casado: I, I think for, for any, it’s hilarious. For any, for anybody listening to this for, for, for, I mean, for you, like when, when you’re like coding or using these models for something like that.[00:36:52] Like actually just like be aware of how much of the interaction has nothing to do with coding and it just turns out to be a large portion of it. And so like, you’re, I [00:37:00] think like, like the best Soto ish model. You know, it is going to remain very important no matter what the task is.[00:37:06] swyx: Yeah.[00:37:07] What He’s Actually Coding: Gaussian Splats, Spark.js & 3D Scene Rendering Demos[00:37:07] swyx: Uh, speaking of coding, uh, I, I’m gonna be cheeky and ask like, what actually are you coding?[00:37:11] Because obviously you, you could code anything and you are obviously a busy investor and a manager of the good. Giant team. Um, what are you calling?[00:37:18] Martin Casado: I help, um, uh, FEFA at World Labs. Uh, it’s one of the investments and um, and they’re building a foundation model that creates 3D scenes.[00:37:27] swyx: Yeah, we had it on the pod.[00:37:28] Yeah. Yeah,[00:37:28] Martin Casado: yeah. And so these 3D scenes are Gaussian splats, just by the way that kind of AI works. And so like, you can reconstruct a scene better with, with, with radiance feels than with meshes. ‘cause like they don’t really have topology. So, so they, they, they produce each. Beautiful, you know, 3D rendered scenes that are Gaussian splats, but the actual industry support for Gaussian splats isn’t great.[00:37:50] It’s just never, you know, it’s always been meshes and like, things like unreal use meshes. And so I work on a open source library called Spark js, which is a. Uh, [00:38:00] a JavaScript rendering layer ready for Gaussian splats. And it’s just because, you know, um, you, you, you need that support and, and right now there’s kind of a three js moment that’s all meshes and so like, it’s become kind of the default in three Js ecosystem.[00:38:13] As part of that to kind of exercise the library, I just build a whole bunch of cool demos. So if you see me on X, you see like all my demos and all the world building, but all of that is just to exercise this, this library that I work on. ‘cause it’s actually a very tough algorithmics problem to actually scale a library that much.[00:38:29] And just so you know, this is ancient history now, but 30 years ago I paid for undergrad, you know, working on game engines in college in the late nineties. So I’ve got actually a back and it’s very old background, but I actually have a background in this and so a lot of it’s fun. You know, but, but the, the, the, the whole goal is just for this rendering library to, to,[00:38:47] Sarah Wang: are you one of the most active contributors?[00:38:49] The, their GitHub[00:38:50] Martin Casado: spark? Yes.[00:38:51] Sarah Wang: Yeah, yeah.[00:38:51] Martin Casado: There’s only two of us there, so, yes. No, so by the way, so the, the pri The pri, yeah. Yeah. So the primary developer is a [00:39:00] guy named Andres Quist, who’s an absolute genius. He and I did our, our PhDs together. And so like, um, we studied for constant Quas together. It was almost like hanging out with an old friend, you know?[00:39:09] And so like. So he, he’s the core, core guy. I did mostly kind of, you know, the side I run venture fund.[00:39:14] swyx: It’s amazing. Like five years ago you would not have done any of this. And it brought you back[00:39:19] Martin Casado: the act, the Activ energy, you’re still back. Energy was so high because you had to learn all the framework b******t.[00:39:23] Man, I f*****g used to hate that. And so like, now I don’t have to deal with that. I can like focus on the algorithmics so I can focus on the scaling and I,[00:39:29] swyx: yeah. Yeah.[00:39:29] LLMs vs Spatial Intelligence + How to Value World Labs’ 3D Foundation Model[00:39:29] swyx: And then, uh, I’ll observe one irony and then I’ll ask a serious investor question, uh, which is like, the irony is FFE actually doesn’t believe that LMS can lead us to spatial intelligence.[00:39:37] And here you are using LMS to like help like achieve spatial intelligence. I just see, I see some like disconnect in there.[00:39:45] Martin Casado: Yeah. Yeah. So I think, I think, you know, I think, I think what she would say is LLMs are great to help with coding.[00:39:51] swyx: Yes.[00:39:51] Martin Casado: But like, that’s very different than a model that actually like provides, they, they’ll never have the[00:39:56] swyx: spatial inte[00:39:56] Martin Casado: issues.[00:39:56] And listen, our brains clearly listen, our brains, brains clearly have [00:40:00] both our, our brains clearly have a language reasoning section and they clearly have a spatial reasoning section. I mean, it’s just, you know, these are two pretty independent problems.[00:40:07] swyx: Okay. And you, you, like, I, I would say that the, the one data point I recently had, uh, against it is the DeepMind, uh, IMO Gold, where, so, uh, typically the, the typical answer is that this is where you start going down the neuros symbolic path, right?[00:40:21] Like one, uh, sort of very sort of abstract reasoning thing and one form, formal thing. Um, and that’s what. DeepMind had in 2024 with alpha proof, alpha geometry, and now they just use deep think and just extended thinking tokens. And it’s one model and it’s, and it’s in LM.[00:40:36] Martin Casado: Yeah, yeah, yeah, yeah, yeah.[00:40:37] swyx: And so that, that was my indication of like, maybe you don’t need a separate system.[00:40:42] Martin Casado: Yeah. So, so let me step back. I mean, at the end of the day, at the end of the day, these things are like nodes in a graph with weights on them. Right. You know, like it can be modeled like if you, if you distill it down. But let me just talk about the two different substrates. Let’s, let me put you in a dark room.[00:40:56] Like totally black room. And then let me just [00:41:00] describe how you exit it. Like to your left, there’s a table like duck below this thing, right? I mean like the chances that you’re gonna like not run into something are very low. Now let me like turn on the light and you actually see, and you can do distance and you know how far something away is and like where it is or whatever.[00:41:17] Then you can do it, right? Like language is not the right primitives to describe. The universe because it’s not exact enough. So that’s all Faye, Faye is talking about. When it comes to like spatial reasoning, it’s like you actually have to know that this is three feet far, like that far away. It is curved.[00:41:37] You have to understand, you know, the, like the actual movement through space.[00:41:40] swyx: Yeah.[00:41:40] Martin Casado: So I do, I listen, I do think at the end of these models are definitely converging as far as models, but there’s, there’s, there’s different representations of problems you’re solving. One is language. Which, you know, that would be like describing to somebody like what to do.[00:41:51] And the other one is actually just showing them and the space reasoning is just showing them.[00:41:55] swyx: Yeah, yeah, yeah. Right. Got it, got it. Uh, the, in the investor question was on, on, well labs [00:42:00] is, well, like, how do I value something like this? What, what, what work does the, do you do? I’m just like, Fefe is awesome.[00:42:07] Justin’s awesome. And you know, the other two co-founder, co-founders, but like the, the, the tech, everyone’s building cool tech. But like, what’s the value of the tech? And this is the fundamental question[00:42:16] Martin Casado: of, well, let, let, just like these, let me just maybe give you a rough sketch on the diffusion models. I actually love to hear Sarah because I’m a venture for, you know, so like, ventures always, always like kind of wild west type[00:42:24] swyx: stuff.[00:42:24] You, you, you, you paid a dream and she has to like, actually[00:42:28] Martin Casado: I’m gonna say I’m gonna mar to reality, so I’m gonna say the venture for you. And she can be like, okay, you a little kid. Yeah. So like, so, so these diffusion models literally. Create something for, for almost nothing. And something that the, the world has found to be very valuable in the past, in our real markets, right?[00:42:45] Like, like a 2D image. I mean, that’s been an entire market. People value them. It takes a human being a long time to create it, right? I mean, to create a, you know, a, to turn me into a whatever, like an image would cost a hundred bucks in an hour. The inference cost [00:43:00] us a hundredth of a penny, right? So we’ve seen this with speech in very successful companies.[00:43:03] We’ve seen this with 2D image. We’ve seen this with movies. Right? Now, think about 3D scene. I mean, I mean, when’s Grand Theft Auto coming out? It’s been six, what? It’s been 10 years. I mean, how, how like, but hasn’t been 10 years.[00:43:14] Alessio: Yeah.[00:43:15] Martin Casado: How much would it cost to like, to reproduce this room in 3D? Right. If you, if you, if you hired somebody on fiber, like in, in any sort of quality, probably 4,000 to $10,000.[00:43:24] And then if you had a professional, probably $30,000. So if you could generate the exact same thing from a 2D image, and we know that these are used and they’re using Unreal and they’re using Blend, or they’re using movies and they’re using video games and they’re using all. So if you could do that for.[00:43:36] You know, less than a dollar, that’s four or five orders of magnitude cheaper. So you’re bringing the marginal cost of something that’s useful down by three orders of magnitude, which historically have created very large companies. So that would be like the venture kind of strategic dreaming map.[00:43:49] swyx: Yeah.[00:43:50] And, and for listeners, uh, you can do this yourself on your, on your own phone with like. Uh, the marble.[00:43:55] Martin Casado: Yeah. Marble.[00:43:55] swyx: Uh, or but also there’s many Nerf apps where you just go on your iPhone and, and do this.[00:43:59] Martin Casado: Yeah. Yeah. [00:44:00] Yeah. And, and in the case of marble though, it would, what you do is you literally give it in.[00:44:03] So most Nerf apps you like kind of run around and take a whole bunch of pictures and then you kind of reconstruct it.[00:44:08] swyx: Yeah.[00:44:08] Martin Casado: Um, things like marble, just that the whole generative 3D space will just take a 2D image and it’ll reconstruct all the like, like[00:44:16] swyx: meaning it has to fill in. Uh,[00:44:18] Martin Casado: stuff at the back of the table, under the table, the back, like, like the images, it doesn’t see.[00:44:22] So the generator stuff is very different than reconstruction that it fills in the things that you can’t see.[00:44:26] swyx: Yeah. Okay.[00:44:26] Sarah Wang: So,[00:44:27] Martin Casado: all right. So now the,[00:44:28] Sarah Wang: no, no. I mean I love that[00:44:29] Martin Casado: the adult[00:44:29] Sarah Wang: perspective. Um, well, no, I was gonna say these are very much a tag team. So we, we started this pod with that, um, premise. And I think this is a perfect question to even build on that further.[00:44:36] ‘cause it truly is, I mean, we’re tag teaming all of these together.[00:44:39] Investing in Model Labs, Media Rumors, and the Cursor Playbook (Margins & Going Down-Stack)[00:44:39] Sarah Wang: Um, but I think every investment fundamentally starts with the same. Maybe the same two premises. One is, at this point in time, we actually believe that there are. And of one founders for their particular craft, and they have to be demonstrated in their prior careers, right?[00:44:56] So, uh, we’re not investing in every, you know, now the term is NEO [00:45:00] lab, but every foundation model, uh, any, any company, any founder trying to build a foundation model, we’re not, um, contrary to popular opinion, we’re not invested in all of them. Right. We have a very specific thesis. I don’t think people[00:45:09] swyx: say that about you.[00:45:10] No, they don’t. They don’t,[00:45:12] Sarah Wang: they say that we’re big, we’re in everything. But, um, you know, if you think about ia, right? He’s at SSI, he’s sort of. Been behind almost every foundational breakthrough for the last 15 years. 15 years. Um, if you think about, you know, the Thinking machines team, right? Mira and John, right?[00:45:27] John is the godfather of reinforcement learning. And so, um, I go through this because, you know, if you think about for each of the bets that we’ve made, it goes back to one of, to a very specific thesis about that person, the team they’ve assembled and what they’ve done in a prior life. Um, and you know, I, I think, you know, obviously we talked about talent wars.[00:45:46] Um, we do think. At this particular moment in time, there are particular people that can move needles. Um, clearly, uh, other companies believe that too, otherwise they wouldn’t be willing to pay such crazy prices for single individuals. So that’s, that’s one. And then two, [00:46:00] we don’t think it’s a zero sum game, right?[00:46:02] Like if that were true open AI or, or actually just deep mind would be number one and everything, right? There’s clear value. To specialization. It’s like 11 labs. There have been so, oh my God. Yeah. Many audio models that have hit the market, they’re still fricking number one, right? And so if you think about, and they’ve created a ton of value, um, for their customers, for their investors, you know, for their team.[00:46:23] Um, and so if you think about those two put together, right? That’s sort of the foundation of our thesis when we back, uh, these foundation model, uh, companies. Um, of course. The valuations, you know, they sound astronomical when you think about current revenue, the numbers, um, you know, there’s, there’s sort of that I would, one, I would say that’s the market out there because they are raising larger dollars.[00:46:47] They have compute needs, right? That’s 80% of around that they typically raise or typically of, of around that they raise. Um, but I think the thing that gets us excited about backing them is that the revenue growth has [00:47:00] typically followed the capability breakthrough. So you sort of ties back to that question of.[00:47:04] The cyclical nature, like are you just funding it and then you raise more funding? Um, when there’s a real capability breakthrough, the demand is there. And so the revenue growth is much faster than we’ve ever seen. Once it’s turned on, there’s a company, I can’t share the name, um, but their product went GA in a few weeks.[00:47:21] Tens of millions of revenue. Right. We have[00:47:23] swyx: SaaS[00:47:23] I’ve[00:47:24] swyx: seen as myself. Yes,[00:47:24] Sarah Wang: absolutely. We have SaaS. Absolutely. Companies that, you know, have been in business for seven years and they get to the same level seven years later. And the growth is, you know, eking to whatever it is. Um, and, and by the way, great companies not, not at all, um, diminishing what they’ve accomplished, but the fact is to get to that revenue growth that quickly.[00:47:43] It’s not just the two companies that people talk about. It’s, it’s really a lot of these, you know, sort of. Every domain has a specialist, and we think if you can win that, you become very large, very quickly, and that’s actually played out in the numbers.[00:47:56] swyx: Yeah. Uh, our, our viewers are going to, uh, so [00:48:00] first of all, thank you for that overall take.[00:48:01] I think like it’s important to hear you guys’ perspective because the rest of us are just kind of looking at headlines and not knowing how to make sense of any of this. Um, we can mention like my, our listeners will roast us if we, if we mention thinky and not. Discuss what happened. Uh, I mean, obviously founder split happens, um, but like, I guess is the thesis unchanged is is like, um, you know, like what’s, what’s going on in thinking?[00:48:25] Sarah Wang: Yeah. Um, we’re more excited than ever about them. Um, they have some things that. We’re not gonna do breaking news on a, a pod. Uh, you know, obviously they should share it themselves, but, um, they’ve, you know, I think when you bring a team of that caliber together, there’s special things that happen. And, um, I think 2026 is gonna be a big year for them.[00:48:44] Um, obviously, you know, some of the themes that we talked about before, even with just the media news storm, like the whole, something happens and then it’s everywhere instantly. Um, you know, I think, uh. [00:49:00] That’s a, i, that’s a tough situation for any company to be in. Um, but to come out of that stronger than ever, I think that, you know, we’re, we’re more bullish about thinking than, um, you know, even before.[00:49:12] And, um, obviously,[00:49:13] swyx: and, and, and the story is tin, uh, is tinker. It’s our custom models are all. Um, yeah. Is that, is that what, is that what we’re aiming for?[00:49:22] Sarah Wang: Yeah. And a bunch of stuff we, we can’t talk about here. Okay. Yeah. All right. Cool. Yeah, absolutely. But no, that team is cooking and, um, you know, I think, um, they’ll, they’ll be just fine from, uh, they’ll, they’ll recover from the events in January.[00:49:34] swyx: Yeah.[00:49:34] Martin Casado: I will say this is the furthest, so we have a very privileged position on the boards of these companies, and like I’ll say, I’ve never seen. The perception of the truth be further from the truth.[00:49:48] swyx: Oh,[00:49:48] Martin Casado: industry wide ever. Like I, I guarantee you, for any of these gossipy things, I guarantee you it’s way off.[00:49:55] swyx: Okay.[00:49:55] Martin Casado: Way, way off. Like, like the general sentiment and like, and what happens is like we’ve got this [00:50:00] crazy game of telephone right now where there’s always. Seeds of truth, but it gets so warped by the time, like we hear all the time rumors about stuff that we’re directly involved in. Like we’re literally on the board, you know, like we’re, we’re the one that did the thing.[00:50:12] And by the time it gets so it’s gotten so warped and so twisted. I think this is like everybody’s excited. I. There’s a lot of focus. The shot on fried is so high that people just kind of will into being things that didn’t exist. Um, so I’m not, you know, I, you know, I don’t wanna comment specifically on the thinking machines, but like,[00:50:31] swyx: it’s an important message to the general[00:50:33] Martin Casado: audience.[00:50:33] I, I’ll tell you, if you hear something IX like the chances that it’s. You know, it is accurate representing, but it’s saying to is very, very low.[00:50:42] swyx: Yeah.[00:50:43] Sarah Wang: I have never lost so much faith in the an, an non counts on Twitter that just seemed very confident in what they’re saying. Yeah,[00:50:50] Martin Casado: no. Yeah.[00:50:50] Sarah Wang: And couldn’t be further from the truth.[00:50:52] I, I had a couple days stretch where I was like, oh my God, Twitter is mind poisoned and I. Love X. Yeah,[00:50:56] Martin Casado: but we talk to each other all the time. ‘cause we actually know, ‘cause we’re there like, we’re [00:51:00] there singing these things and like, you know, Sarah will like text me, you know, like whatever. Like, it’s like ridiculous.[00:51:06] So for us it’s like, it’s like this ridiculous. But the problem is, is we realize that things like things start taking on a life of their own and then people assume that they’re real and, and everything. And so I think it’s very tough for founders because, you know, it’s tough enough fighting the real battle.[00:51:20] You know now. Absolutely. Now they’re fighting phantoms too. And so, you know, you know, more and more we’re just like, and I got this from the cursory guys, which I, I really appreciate Michael Troll. He’s like, listen, head’s down, focus on the business. Yeah. And, and he absolutely crushed[00:51:35] swyx: it.[00:51:35] Martin Casado: Yeah. Yeah. And I, I think that’s right.[00:51:37] I all[00:51:37] found[00:51:37] Martin Casado: absolutely right now, ‘cause the noise is so hot.[00:51:40] Sarah Wang: No, that team’s been back to business for, for weeks, the thinky team. So, yeah.[00:51:43] swyx: Yeah. Well, thank you for acknowledging in that, uh, it, it is just, uh, the hot topic at the moment. Oh, we gotta, gotta address the elephant in the room. Um, uh, cursor, right?[00:51:51] You obviously, you guys are big investors. Uh, 2025. I would say it’s cursor year. I mean. Maybe decade, but, uh, [00:52:00] uh, just like I, I think, you know, I, I just going back to the discussion about how a GI would just kind of consume everything. Yeah. S just like the one, like the kind of the shining example of like, here’s how you build application layer.[00:52:10] That’s a wrapper.[00:52:11] Martin Casado: Yeah.[00:52:12] swyx: But extremely damn good one.[00:52:14] Martin Casado: Yeah.[00:52:14] swyx: Uh, and, uh, I guess just like the, the general. Analysis, I guess, of, of cursors development and what it means for everyone? Like is there a cursor in every industry to be built?[00:52:24] Martin Casado: Yeah, so the, the interesting about cursors, they actually for, you know, a small fraction of the cost, a hundred of the costs or less.[00:52:32] Developed an almost soda model, which for a period of time was the most popular coding model in the world. Right? Which is really crazy to think about. So I think they’re just kind of doing it in reverse, right? So there, there, there’s two approaches. You start with a foundation model and then you verticalize up, or you start with the app and all of the product data and you go down and they’re the ones that are doing that.[00:52:55] I think any company that’s doing an app has to ask the margin question. Mm-hmm. Which is like, how, how [00:53:00] do I extract margin on, on, on the tokens that are going through? Like, everybody has to be on the token path and everybody has to ask that question. And I’ve just thought they’ve been incredibly thoughtful about it.[00:53:09] And one reason is, is if you ask. You know, Michael, what type of company are they are a developer company for professional developers. That’s what they’re, they’re a Devrel tools company. They’re just focused on coding. And that’s a hu I mean, even if you didn’t do ai, that’s a ma. You know, they, they, they, um, they acquired graphite.[00:53:25] I mean, like, you know, listen, we were investors in GitHub, like we know how big this market is. So that’s a massive market, even without becoming a model company. But they’ve also been quite successful in doing their own models. And so I think it just shows you that if you. Are focused, you have a large use case.[00:53:40] There’s a huge opportunity not only to get the application, but to start building your own models. Are these gonna be the only models we use? Of course not. Um, but you know, they are in a great position to serve great models and they’ve demonstrated that.[00:53:51] swyx: Yeah. My, my, uh, sort of, uh, thesis, which we’re not gonna have to go into here is actually I think a, um, what I’ve been calling Agent Labs, which are [00:54:00] people who build on top of, uh, all the other models.[00:54:02] Martin Casado: Yeah.[00:54:02] swyx: Um, will probably have a better time with the margins because they, they price against the end user hours spent, or like human labor, whereas models get commodity price per token.[00:54:15] Sarah Wang: Yeah.[00:54:15] swyx: And so margin wise. We know inference economics for, uh, uh, model labs, but agent labs, uh, the difference is the delta between token intelligence, which keeps going down, and human costs, which keep going up.[00:54:28] Martin Casado: Yeah, yeah, yeah.[00:54:28] swyx: And so margin should be higher.[00:54:31] Martin Casado: They, they, they, they, they, they should be. The, the, the, the caveat to that is if the models go first party, right. Yeah. Yeah. What they can do is they can, they can, which is[00:54:40] swyx: the, the composer dream.[00:54:41] Martin Casado: Yes. Yeah. They can subsidize the, no, the models, they can subsidize themselves.[00:54:46] Oh, cloud code, code, they can subsidize themselves and then they can charge the third party more, and it’s a very delicate. Yeah, it’s because you’re kind of competing with your own customers. And so, you know, we’ve seen this historically. We saw this with the cloud with EC2, like, so this is not unusual. We [00:55:00] saw this with the operating system.[00:55:00] It’s not unusual, but it’s playing out very, very quickly.[00:55:04] Alessio: Yeah. Thank you for joining us. That’s all the time we have today. This is such a pleasure. You’re welcome back anytime.[00:55:09] swyx: And thank you for being so open and also like just leading the industry in so many areas. Uh, it’s uh, really inspiring to see. So[00:55:16] Sarah Wang: thank you so much.[00:55:17] Thank you much. Thank you for having us.[00:55:17] swyx: Great. Thank you. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.latent.space/subscribe