Podcast

I think we'll see the next 100 million software developers emerge around tools that are agentic, but I still think it will be a profession to use those tools to do stuff, to build stuff for other people. If I look at Google's products, like I now have all these Genesis buttons all over and I never use them. They just haven't managed to productize it in a way that feels super compelling.

This is 20 Product with me, Harry Stebbings. Now today we focus on a core new focus for product teams. How to craft an amazing agent experience. Now, we've had an amazing developer experience for years, but as we move into a world of AI, crafting a beautiful and seamless agent experience will be the difference between winners and losers. Joining me for this discussion is Matt Bilman, co-founder and CEO at Netlify, where under his leadership, Netlify has become one of the fastest growing platforms for modern web development. He's also coined the term agent experience. But before we dive into the show today, are you struggling to beat model benchmarks or implement GenAI in your product? If so, you need Turing. Turing is an AGI infrastructure company backed by incredible investors like Foundation Capital and Westbridge Capital, and they do two things. Number one, they help leading companies and AI labs like Salesforce, Anthropic, and Meta enhance their LLMs with advanced reasoning, coding, multilinguality, multimodality, and more. Number two, they combine human and artificial intelligence expertise to deploy cutting-edge AI systems for awesome companies like Rivian and Reddit. Right now, Turing offers a free 5-minute self-assessment to help you pinpoint your place in the GenAI journey, get tailored next steps to optimize your model strategy, and then finally learn how Turing can refine and implement your models for better performance. Take the guesswork out of GenAI. Visit Turing.com/20VC to start your free assessment today. And talking about scaling seamlessly, let me tell you about WorkOS. So WorkOS is the modern identity platform for B2B SaaS, helping startups move upmarket with ease. Selling to enterprises means honestly really complex security requirements like SAML, like single sign-on, like SCIM, provisioning, audit logs— honestly a ton of stuff that is just a nightmare to do. Features that take months to build and maintain. Well, WorkOS streamlines this with flexible, easy-to-use APIs that make enterprise readiness quick and painless. Its suite of features include AuthKit, a complete user management solution, free up to a million monthly users with built-in MFA, RBAC, bot protection, and user impersonation. Enterprise SSO— my God, these enterprises love their acronyms— supports any identity provider using SAML or OIDC, while directory sync enables seamless user provisioning and deprovisioning— oh no— for SCIM-compliant directories. Fine-grained authorization powers, complex permissioning, and it comes again, the admin portal simplifies SSO and SCIM onboarding for IT teams. Trusted by companies like Cursor. Cursor use this. If Cursor use this, it's gotta be great. Come on. Perplexity, Vercel, Sierra. I mean, these companies are awesome and they've raised $95 million in funding from amazing people like 20VC. Try it today at workos.com/20VC. Now that you've nailed enterprise features, let's talk about creating amazing product experiences. Get your users to do what you want them to do. That's the simple power of Pendo, the only all-in-one product experience platform. Pendo combines analytics, in-app guidance, session replay, feedback management, and road mapping, all purpose-built to work together seamlessly. Trusted by over 10,000 companies, Pendo is transforming how businesses understand and engage their users. Plus, they're the creators of Mind the Product, the world's largest product management It's awesome. See the magic for yourself. Visit pendo.io/20product-podcast to get started today.

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Matt, I'm really excited for this. I really like your writing and I've loved your writing for a while.

So thank you so much for joining me.

Thanks. It's great being here.

I would love to start.

How does building for agents, not humans, change the way that we build?

Yeah. So the first thing I would say is that when I think about building for agents, I still start by thinking about building for humans. In essence, you could say that there's two versions of that 10-year future. There's one where the agents just kind of escape, that they're just off doing their own things and we are sort of left behind, right? Like, I hope that's not what happens. But there's another one where agents are tools that all of us use to do stuff with, right? Like, and where Agents are fundamentally always doing something because some human is trying to accomplish something through an agent. And now we are in the very early days of building a discipline around agent experience and really starting to think about like when a user tries to get an agent to do something through your product, what happens?

Can I be direct? I mean this in a nice way. I don't understand how does building for agents change the way that we build?

Let me take some examples for stuff we've done that's been successful with agents, right? Like, so one thing that we built specifically to improve our agent experience was building an API flow that would allow an agent to create a site and deploy a site without any users signing up for Netlify first and then hand over that site to a user later with a claim flow. And again, simply from the realization that when we have a normal developer, the first creation of the site will always be triggered by that developer doing something with Netlify, right? Like they'll pick a template and start, or they'll link to a new GitHub repository, or they'll deploy from their command line. But once you have a CodeGen agent, they might just ask that agent, build me a web app with a Sudoku game, whatever. And now it's shared with people on a URL. So we gave those agents the ability to just deploy to Netlify, no signup from the user. Show the user the URL and say like, here's what is built for you. And then later the user can go claim it and say, okay, I actually want a Netlify account or I have a Netlify account added here. I'll want this to stick around. I'll put a custom domain on it and so on, right? We've seen a lot of companies now start adopting similar flows, right? Like in the authentication space, in the database space and so on to make their tools available to agents without an explicit user signup and setup step first. And delaying that step to after, right? So that's one very specific example, but one that's been really impactful.

Does designing for agents in this way reduce the importance of UX, of design, of taste when building?

I don't actually think so. And in the end, we are designing for humans. I just don't think anyone can have a great developer experience 5 years from now if they don't have a great agent experience. So that also means that a lot of the traditional UX disciplines and so on and understanding not just the UI design but the UX design, right? Like the holistic experience of a user trying to do something with your product, that's still really important. But obviously a lot of the details are gonna change. A lot of things we do today are going to require very different interaction flows and very different ways of displaying that UI to people.

If I'm a founder today, How do I tell my product team where they should focus, what they should build, what they should do? If I'm setting strategy for them, what the fuck do I tell them?

You embrace agent experience as a discipline in the same way that you would do it for developer experience or for user experience, right? Like, I think we'll see that being the approach, right? Like rather than going from like some theory of like, we need this spec now, start understanding in your space. What are the agents that humans are actually going to be using with your product? In our space, it's on the one hand, tools like Cursor, Copilot, Windsurf. On the other hand, tools like Bold, Lovable, Create X, Y, Z, Refine, like all of these tools, like one level up. But in other spaces, that might be a different set of agents.

When I interview people today, Matt, the common public company short is Salesforce for a number of different reasons. But do agents merely turn Salesforce into a data repository?

That's definitely the big threat to Salesforce, right? Like to just be reduced to some kind of system of record. I'm sort of mixed on whether long-term that's a really, really bad thing for Salesforce or if it could also be a good thing for them, right? Like if you really start becoming like the main system of record that all of these tools rely on, that's like, I don't think you should underestimate just how valuable a position that is because all those flows and apps and everything will run on top of it. And sure, it might change a lot of what Salesforce looks like today into what they look like in the future. But they definitely feel it very strongly as like the biggest threat to them to be reduced to that system of record and not the actual like workflow platform. And I think that's pretty likely what would happen, right? Like I think what we are seeing now is definitely the cost of building custom workflows, custom UIs, custom applications is going to dive down dramatically. And typically, that will mean that demand for doing that will go up radically. And people will start building much more custom applications for everything, right? And then the question is like, where does all that data live that those applications need to interact with? And where do the rules that govern that data live to make sure that it's also safe for these agents to do stuff to it? Where does the authentication and permission and auditing layer live? And so on.

I don't think it's as binary as that. I think you can retain Salesforce as your system of record, but then also build applications around it, use other SaaS providers around it. You said before generic, and I'm quoting you here, generic SaaS tools will increasingly be replaced by custom developed internal apps. I'd love to debate this one with you because if so, I'm going to be out of a job. Why do you think that?

I think it's a balance that will really start tipping, right? Like where today, if you're a company and you have a specific business need, hiring a development team to build, deploy, operate an internal application just for you to solve that business need, the math of that very rarely makes sense, right? Like in the build versus buy equation, the buy equation almost always makes sense, right? And that balance is gonna start really shifting towards like building is gonna be much more of a viable option. And that often—

But that's not a generic SaaS tool. That's a specific tool that a specific company needs for a specific workflow that they have. I agree with you that dev shops that build specialized custom solutions will be replaced by your Lovables of the world. But you said generic SaaS tools, and we have companies like Klarna who are saying, oh, we're replacing all of our SaaS with AI. They're not. No, they're absolutely not.

And they won't. Why do you think they will?

Again, I think it will be more and more common to start doing that, right? Like, because if you think of generic SaaS tools, right? Like they are also solutions to a specific business problem that businesses have. They'll just say, okay, this problem looks very similar across tens of thousands of businesses. So we'll build like the generic version that works across all of those businesses, right? Like, so they don't each have to build their own. And that comes with a set of trade-offs, right? Like you get some benefits from getting a generic tool that encodes some best practices and so on, right? But you typically also have to adapt how you work as a business to the tool you just bought, right? Like you typically sort of have to, with a lot of the SaaS tools that I've bought over time of building up Netlify, it's been like, oh, we are kind of doing things this way now, but this tool kind of says we should do things this way. So we are gonna like start adopting to the tool because we can't afford to just build our own stuff And that's where I mean that more and more things that are right now in the balance where you would buy a generic tool that works for lots of companies, for more and more of those problems, it'll start being a viable solution to say, let's just build our own, like let's just solve our specific problem instead of leaning into a generic solution for tens of thousands of companies.

You've sold to large enterprises before. They move slowly. They're not always hugely educated. Respectfully, I think it is a very small customer segment that will be doing that in the next 15 years.

No, I honestly, I probably agreed with that like a year ago. And then I started seeing like just how fast tools like Bold and Lovable and so on are starting to change things at sort of the other end of like indie startups, everything like that. And now my timeline is more like 5 years than 15 years. Before it's going to be really relevant. It'll start by tapping into areas like everywhere where you have no-code tools right now, like Retool and stuff like that. Starting to have agents that use code together with people to build there will start just giving lots more flexibility. You'll be able to build much more, right? And as that evolves, we'll start seeing that spread into more and more, I think, like in internal tooling teams that solves where some budget will gradually start shifting from the SaaS spend budget into that either internal tooling team budget or to kind of like external providers that custom build for you kind of budget.

How do you think about maintenance? The joys of having independent providers is they're maintained, updated continuously by great teams. When you have 200 tools across a large organization, you're not going to do maintenance, security updates on all of them. How do you think about that?

Yeah, that's something I think a lot about because the interesting thing is that that's kind of like this whole sort of Jamstack architecture I proposed back in the beginning of Netlify's journey starts becoming really important for this as well, right? Because if you start going from buying 200 test tools to running 200 internal specialized or maybe 400 internal specialized applications, you have to do that on a platform that's zero operations. First of all, right? And that means that you start having this new stack where people like you can make a lot of money by investing in the right places. It's all of the components that go into that kind of like zero operations and serverless stack of building blocks, right? Like you definitely don't want a codegen agent that you're using to solve one of these problems to give you like a massive Kubernetes cluster and be like, Good luck. You'll want it to deploy to platforms that are zero operations and serverless and with security built in and so on. You'll want them to use serverless API services, databases that are all sort of managed with their own security team and operations teams and so on as the Legos it kind of builds on top with and composes together. Because otherwise you're right, right? Otherwise if it's just, fully custom-built Kubernetes cluster stuff, all of it, the viability of that whole approach goes away, right? Like the maintenance cost just overtakes everything. And then you could speculate, can the agents maintain it? But I think that then we are definitely in a 15, 20-year horizon before they could be relied on for anything like that. But if the agents build on top of a stack where your deployment layer is fully zero-operation, serverless, and so on, where you're using systems for headless content or you're using like Salesforce as your system of records for a bunch of stuff, right? Like you're using managed databases, whether it becomes like a Supabase or a NeonDB or some of the big cloud providers that wins out in that layer, right? But the agent use these building blocks that are in itself maintained by someone, right? Like then you start being able to take on that level of building without exploding in terms of like maintenance costs.

When you look at the different stages, we mentioned that lovable and, you know, being able to create very easily. Prototyping is now like step one, have an idea. Do design tools like Figma die in the next wave of build?

They're definitely going to have to really think a lot about this, this, this full stream of how prototyping, again, is often going to shift from the design tool into building something. I still think for a certain level, again, we talked earlier about like, does brand matter? Does anything like that matter, right? Like, as long as that still matters, it will also matter having teams, I think, that work with tooling that operates at the visual level and the interface design level. But if Figma doesn't manage to connect that to the full end-to-end chain of prototyping and building and so on, then this could be a pretty existential threat to companies like that over time, or at least like a threat to their current revenue model. Because there's no doubt that the way people start projects in general are really already starting to shift a lot, both from traditional templates and bootstraps and front-end frameworks on the one end. On the other end from like design prototypes and visual design on the other end, right? Like to prompting is one of the key ways to just start a new project.

Do you think, you mentioned prompting that, do you think chat is the right interface for this next wave of AI? I've had many guests on the show before that say the worst thing with ChatGPT is it made chat and prompting the default interface. Do you agree?

Yes, I don't think chat is like the be-all and end-all of interfaces. It's a very sort of simple transactional flow that that's easy to work with. And I think chat or conversational interfaces will be a thing, right? It's also a thing between humans, right? We all use Slack and Messenger and WhatsApp and all of these chat tools for good reasons. It's not like that will go away. But I think there's a whole other set of user experiences and user interactions that we have in sort of the non-AI-powered world that we haven't really yet figured out how to do in the AI powered world. So one of the things I've been talking a lot about is this path where right now when we look at all this custom development and all of these apps like Bold and Lovable and so on, right? Right now they're generally making it a lot faster to build exactly the same things on the web that we built the last 10 years, right? Like the same kind of applications, the same kind of marketing sites, the same kind of user experiences that we've built through the last 10 years, right? And we're just driving down the price of building that. But the next frontier for me is sort of figuring out what is it we can build in terms of actual user experiences when we have LLMs and AI available that we couldn't build 2 to 3 years ago. Because I think there's a lot of interactive user experiences that we can now build that are definitely not just at a chat prompt saying, like, type what you want to see or do, or, like, talk to me, right? Like, that could not be done if we didn't have the ability to, one, create all kinds of assets, right? Like, from 3D modeling to sound and music and visuals and so on automatically. And that couldn't be done at a time when the core constraint of all user interfaces is that computers are transactional deterministic machines, right? Like you click a button, the UI does something that you know that button will do every time. You type a command, the computer does something predictable, right? Like GenAI kind of removed that underlying constraint. And we haven't really started building new kind of UIs that takes advantage of that. And I really agree that like chat is not it there, right? Like chat is part of it. But like if I follow a link and I land on a ecommerce from like a large brand that's trying to really differentiate themselves and be something different, right? Like, I definitely just, I wouldn't want just to have some box saying like, you come up with what you want me to do, right? Like type something, right? Like I want those online experiences to guide me and to have some experience for me, right? Like, and to take me somewhere. And that's never going to happen through chat style prompt.

Why? Do you not go into a shop and ask for what you want?

Yeah, but you also have, like, you think about how much a fancy brand spends on that shop, right? Like, and on the display windows and on people that don't ask first, right? Like, on everything that's supposed to draw you into the point where you're ready to ask, like, hey, can I have a look at this thing, right? Like, that's a very expensive industry, right? Like, to make all of that happen. And I think The more the world goes digital, right? Like if you want to build any kind of that kind of brand affinity and like storytelling, you also gotta find ways to do that. Today, honestly, like most e-commerces, for example, have like the last 3 years have kind of been very stagnating in terms of like development in that field, right? Like, and everything looks pretty similar with some changes, right? Like, but I think when the cost of building an e-commerce that looks like any of the current brands today goes down to like just ask Bolt to do it for you, ask Lovable to do it for you, and you have that. Those brands are going to have to come up with something much more engaging if they want to keep stand out and if they keep wanting to build relations to people as more than just like a one-click shopping experience amongst any other.

You've mentioned Bolt and Lovable. And when we think about these GenAI services that are scaling revenues, Matt, like we've never seen revenue scaling before.

It's wild.

Are wild. Everyone says these GenAI tools, they're sugar-high revenues. You can't rely on them. How do you distinguish between sugar-high revenues that lack sustainability and meaningful, durable revenues that can be relied upon?

When I look at tools like, like Bold and Lovable, the category itself has something where it seems obvious that there will be a lot of money spent there. Just because like when you see some of the examples of what people can do with those tools that they just couldn't do before, it seems obvious that that's worth something. When you see how fast someone can build a typical website or typical app or dashboard, right? Like—

It's so funny. This is the promise of Webflow and Squarespace for years. Anyone can build it. The truth is Shopify, Webflow, Squarespace, me and you both know, My mother can't build on them. It's still too tough. She can use Lovable.

Yeah. But even then, I don't know, I've liked this example of this UX designer from Niantic that are building these things on Bolt that just seems, I don't know, it's just mind-blowing, right? Like he built this whole 3D object editor, like this actual like tool where you can build like 3D objects in the browser with AI-based prompting and everything like running in the browser and you build that. Entirely with Bolt just by prompting. And that's so mind-blowing, but it's also an example, like I'm sure like your mom probably couldn't do that with Bolt, right? Like, because I don't think I could do that. I'm pretty sure I couldn't do that with Bolt, right? Like that takes like real skill having built that skill set to work with these tools. So I'm sure we'll see the same that not everybody is going to use these tools to make their self stuff. In the end, even if you can potentially as a small restaurant owner or whatever, go to Squarespace today and build yourself the website for your restaurant, you're probably busy enough that what Squarespace will do for you is making sure that the cost of getting some freelancer to build your website is much lower than it would be if you had to get that freelancer to program the whole site from scratch, right? Like, and I think we'll see the same with tools like Bold and Lovable. I think we'll see the next 100 million software developers emerge around tools that are agentic. But I still think it will be a profession to use those tools to do stuff, to build stuff for other people, because there'll still be a skill set involved in knowing what the agents should actually build for someone and what works and how to get there fastest and how to push the limits of these tools. But it will lower the cost of each project built with those tools dramatically from, from, from what it would cost today.

So there are devs using Cursor, there are devs using Lovable and Bolt, and then there are non-devs using your Lovables and your Bolts. When you look across that stack, how many do you think remain in the devs using Cursor and your alternatives?

Because I've been in this space of building tools for web developers, like, for, for way too long, I guess, right? Like, I've kind seen the same discussion forever, right? Like, because early on when I was CTO of a company in Spain, we were like mass-producing websites for small to medium businesses in Europe and so on, right? Like, and I was a CTO building the whole platform that our freelance designers would use to do that work on and everything, right? Like, and tools like Squarespace, Weebly, and so on started coming on and everybody was saying, oh, but like, that's going to be the end of all web development. People are just going to use those tools, right? That didn't happen, right? Like it just lowered the barrier to entry. It meant that every little corner store could have a website, but it also just pushed up like what you needed to show up with if you're somewhat more professional. And then I started this whole Jamstack movement around decoupling the actual web front end from the back end and starting to build it at that level, right? Like, and we saw probably in the years since like 2016, '17, '18, we started seeing all these bootcamps just like starting to spit out React developers. And there was like this sentiment that they're not real developers and they don't know the whole stack and so on, right? But it turned out that they were really valuable and that working at that layer of the stack was important. And now we might have like an additional like 14 million developers in the world from that layer. But the interesting thing is that the layer below of like Ruby on Rails developers and Java developers and.NET developers, It's probably still at least as large as it was before that. The new layer just got added on top. And my prediction is that something pretty similar will happen, right? Like we'll probably add a new, in this case, I think more like 100 million new software developers that mainly operate at this like very agentic stack. And some of them will go a couple of layers just like now, right? Like you'll have some that are more full stack than others that'll go a few layers below that level of the stack. We'll have that happen. And then you'll probably have more or less the same amount of developers that actually fully understand the layers below and are working on that and are doing work on that. And those are probably the ones that are going to be thinking a lot about the agent experience of what they're building, but they're probably still going to be really, really necessary.

I totally get you. When you look forward to that future, open versus closed is a very big question. How do you think about which approach dominates in an agent-first world and why?

Yeah, I mean, I think every time there is a platform change, we see this battle between open versus closed. This is another kind of platform change. I think open will win again, in part because I think the ones that were best positioned initially to become fully vertical lockdown platforms was really like the large language model makers. And I think there was a moment where it really looked like we would just have very few of those that would be incredibly important and would be able to sort of build a whole stack around them. And that was it. And then suddenly model training costs kind of went down and these open models came around and DeepSeq came around and so on. Right? And now it seems a bit the opposite, that there'll be a lot more to do to build agents that can then swap out whatever model is best and combine the models together and so on. And it'll actually be an advantage for the agent builders to not be tied to a specific model and be able to just jump around between whichever model is best. And I think once that start is happening, we're going to have— that's going to mean a much broader competing ecosystem of agents. And that's going to make the benefits of an open model where people can bring their own agent win out over a closed model where everything is like fully verticalized?

I'm not sure, because I think like the most underestimated is Google because of the endpoints they have with consumers being so broad and having so many consumer touch points. And then they also own the chip layer, they also own their own compute, and it's a very strong walled garden if they keep it within all of their G Suite products. And so I'm not sure. And then you look at Microsoft and you look at Suite and Copilot and everything that they can build within enterprises and the security provisions within enterprises being non-trivial, to say the least. I'm not so sure. I think closed has so much value. Again, am I wrong?

I don't think you're wrong in the sense that today I said like the web really managed to fight back and it's fully relevant today. And there are still a lot of closed walled-off gardens, right? Like I think we'll see the same, but I will say that when I just look at where we are right now, if I look at like Google's products, like I now have all these Genesis buttons all over and I never use them. They just haven't managed to productize it in a way that feels super compelling compared to just going—

Is that not just a Google product strategy? So I would say that Facebook is the same, like Llama and the productization around Llama has been bluntly very, very poor at the moment. It's just an integration into WhatsApp.

And I think most of the— and that's what I mean. I think most of the tools I use that are agentic sits outside of any of those walled gardens, right? And we're starting to see things like— you'll see that there's, for example, a Chrome extension to use ChatGPT within Google Docs instead of Gemini, just because people want it, right? Because like, hey, I use ChatGPT all the time. It has my history. It knows me now and so on, right? I want to bring it there, right? Like you start seeing those things emerge as like pressures to do stuff with these products, with other agents, because the vertical strategy, at least right now, is producing, I think, more bland and worse results than the myriad of companies just like in building agentic experiences, right? Like, so right now my signal is that like the open world will probably create more compelling innovation. That people will want to bring into the product they otherwise use. And if they really can't, they might start using other products.

Do you think we'll see a specialization of LLM? You see Anthropic really excel on developer tooling in particular and code, but then honestly OpenAI has just wiped the floor with them on consumer touchpoints, consumer brand.

Yeah, I mean, I think you just answered it in a way, right? Like I said, I think we're already starting to see models get a brand as being good at different things, right? Like, and you start building affinity to, okay, if I'm doing this thing, I'm probably going to go to this type of model and this company seems to like really, really serve me there, right? Like, and it thinks, again, it's so early that who knows, right? Like, but the sign right now is that yes, we will start seeing large language models sort of have different strengths and weaknesses and you will go to some of them for specific use cases. And Tropic definitely has really stood out in their ability to solve programming and coding style tasks in a way that I think is like, I'm very bullish on Anthropic for that reason because I think that's such a groundbreaking part of what makes LLMs multiply what they can do by a lot, right? Like the better they are at programming other computers to do stuff, the further the reach of what they can actually do.

You can invest in Anthropic at $60, OpenAI at $300, or Groq at $50. Which would you buy and which would you sell and why?

I would probably go for Anthropic. It's a really interesting thing from the outside where a lot of their motivation started around these safety concerns and how do we allow the models to not take over the world and so on. And I think after an initial panic that now that seems pretty okay, LLMs right now are probably not going to escape and take over the world. I think it turned out that a lot of the mechanisms you needed to build to make sure that the model's output was safe applies also to making sure that the model's output is usable for a practical purpose. And I think that's where Anthropic have really built strength, right? Like in terms of actually being able to guide their models to do things that work in production or to write the right code or to like not break the syntax and stuff like that. And I think if they can keep on that, it makes their models really real-world applicable.

So would you sell OpenAI or Groq then?

I would probably sell Groq. I still think like it sits a little more in a middle space where, as you said, OpenAI on the other thing has just like really captured. I think it is just when you as a consumer think about going and asking an AI for something, it is still just the brand you go to, right? Like it is the first one you think of. And I think that carries very, very real value and it's very hard to build with the scale of users they have and with like just like the ingrainedness of ChatGPT into the language as like what you would call like what a normal person would talk about if they talked about going and talking to an AI, right?

Speaking of like carrying value and going full circle, we spoke a lot about the agent experience. How does value accrue in an agent economy? If like an agent builder has to pay you and Bolt or Lovable and OpenAI, how much margin is left?

Every layer will shift spend from somewhere else in a way, right? Like that whole layer of Bolt, Unlovable, and also Cursor and Windsurf and all of these toolings, right? Like they will shift budget that would normally go into more hours of developer time to build anything. And there's a lot of that budget that can shift into building more things instead, right? Tools like ours will shift budget from maintenance, operations, DevOps, like the actual cost of running a thing after you build it. There's a lot of budget there to shift into paying a platform that works. And then if that's true, you'll kind of still have the same amount of budget available for anyone buying your thing or getting value out of your thing, right? But the pieces of budget that will move is like the hours you would have to pay developers before to build something.

Do you think we'll see companies be willing to shift labor spend to agent spend? And what I mean by that is that you're seeing like, uh, trucker calling, you know, calling up brokers for truckers, Happy Trucker or whatever it's called, the Andreessen one. Are we willing to move labor costs to agent spend cost?

I think so. I think companies will be willing to, to do that, and I think it will be disruptive in some, some areas. Like, I think The first area we've started to see it on is probably something like call center workers, where obviously you don't see companies saying we have to keep our call centers as staffed as they are today, right? Like they do say if we can shift call center hours onto just LLMs, that's gonna be more predictable and more—

And we don't see a per-seat pricing on those usage cases. We see a resolution pricing, which I think is probably much more reasonable.

Precisely. We start seeing real changes in those kind of pricings, right? Like, and I think that just is a very concrete example of a willingness to shift around labor. And part of what my theory is, is that that will mean that a lot of the labor again will shift into building agentic digital workflows, products, applications, and so on. Back to my thesis of like another 100 million new developers at least.

I think Stripe will be massively more valuable in a world that we now enter because I think there will be so many people who are enabled to create stores, entrepreneurial endeavors. And will inevitably use the default of Stripe as their payments mechanism that would never have been entrepreneurs making money on the internet. And the GDP of the internet will increase seismically as a result of that.

I think there's a ton of opportunities in that space. Stripe, as you mentioned, right? Like it's one of these, has all of those characteristics I mentioned, right? Like it's zero operations. It can be a building block in any custom-built system. It's not like, it's a little more abstract than any of like the end-to-end e-commerce shops that you buy ready out of the box. It's just a building block for all the underlying transactions, and it's zero operations, right? Like you really don't have to operate it or secure it if an agent builds some of it, right? So all of those sets of tools have huge opportunity for being really valuable as we start custom building more and more solutions, right? And then anything that sits in the space where you have predictable business processes that's just still pretty manual, So that's just an area where we'll accelerate the level of how much of those can be just programmed that way.

Final one, and then we'll do a quickfire. What behavior or action in the wave of AI that we've seen has been most what to you?

I mean, I think it was like probably the panic over AI safety when ChatGPT came around, right? Like, it was like, oh, they're immediately going to kill us all and take control of nuclear missiles and like outcompete humans and so on, where it was like, Wait, when you actually go and look at these LLMs, they're very, very far from any kind of internal agency outside of still give me a text that says this and I'll try to predict it, right? That was probably the most surprising to me, that extreme panic around that for a moment with all kinds of attempts of really, really strict regulation way too early.

I'm like, it doesn't even do a Twitter thread. It's not exactly going to do global invasion.

Exactly.

I feel safe for the time being. Listen, Matt, I want to do a quickfire round. So I say a short statement, you give me your immediate thoughts. What do you believe that most around you disbelieve?

One thing is probably this sense that we'll still actually be building UIs and applications and websites and so on, where I think there's a lot of people that think that once we have agents, everything will be disintermediated, then the agents will just do stuff with each other and so on. But I believe that as humans, as long as those agents are actually doing things because humans are trying to do things, humans need these shared experiences that we can pass around, link to, and that we can understand like, hey, I'm seeing the same as you're seeing and so on. Right? So that's probably one thing where sometimes see a lot of people thinking that all of that is going to go completely away. And I don't think so at all.

You can buy and hold one public stock for the next 10 years. Which do you buy and hold?

It's a hard one, but I would probably say Microsoft. I think, again, if you can only buy one, you probably want it to be a pretty safe one. You want it to be one that benefits from all of the disruption AI is going to bring to the field rather than like falls from it. And then I think of all of those, I think right now Satya is the strongest CEO in that space. And I think we'll make great decisions.

What happens to WordPress?

Yeah, I mean, I think WordPress is in a challenging position where they're kind of like in the end of their innovation cycle and I don't think they're in a great position to respond to all of this disruption. So I think like it'll be seen more and more as a bit of legacy software.

What happens in that situation? Like PE buy it and eke it out for cash?

Potentially, yeah. It depends. Like maybe there's enough community and pressure and like that it just keeps sticking around for a long time, right? Like, but I have a hard time seeing seeing the venture scale acceleration of it ever happening. So either it kind of ossifies or it's got to have some kind of PE exit.

What have you changed your mind on over the last 12 months?

One big piece has just been the timeline for when companies would start writing real software entirely through agents, right? Like I think when for me the combo of Bold and Lovable coming out was really the, like I thought it was going to be 10, 15 years, and now it's more like the next 5 years are going to be really interesting, right? Like, because they, they, they, they push the frontier so fast.

What was the hardest fundraise for Netlify? Why that one?

It was the first one. It was our, our seed round was, was, was like lots of rejections.

And how many, how many meetings did you have?

I don't know, like 100 or something. I don't know, like maybe, maybe, maybe I don't really know, right? Like, because it was all the angels and individuals that then led to funds and so on, right? Like, and then it was all the funds and like different meetings with like several meetings with each fund and so on, right? Like it was a long process.

And how much was your first fundraiser and what was the price?

It was just over $2 million, $2.135 million at an $8 million post.

What's the latest price for Netlify?

I mean, the last round was a $2 billion valuation, right? Like, so come a long way. And back then, one of the key questions was actually why the web, right? Like, why are you building this whole thing for the web when everything is obviously like mobile and social media?

When did you raise it $2 billion?

End of '21.

Was that a really toppy round?

Yeah, that time the climate was also very different than it is both now and in 2016, right?

Do you regret raising at such a high price or actually was it a joy because you've got a lot on the balance sheet and you're in a really comfortable position?

I will say a mixture of the two. I think everything was priced too high there and it wasn't probably entirely healthy. On the other hand, it's also as a founder pretty good to take advantage of that and get cash into the business before hard times comes, right? So I mean, as a founder, you should always raise at the best price you can, right? And capitalize the company as much as you can because you want to be able to weather harder periods.

What's your biggest short in the public markets? You mentioned Salesforce earlier as a common one with a lot of people. If you were taking them aside, who would be yours?

I'm so bad at thinking in that sense of betting against things rather than betting on what's going to be really big. If I had to pick one, maybe I would just pick something like ExxonMobil because if they go down, it's probably a good thing.

Final one for you. When you look forward 10 years at the most exciting things that happen, what excites you most in the next 10 years of AI?

The capabilities it can give for human creativity and for building like amazing shared experiences, right? Like what it can do for builders seems really amazing, right? Like I've always collected examples of people that are starting to build things like as one person or something like that, that are just like, Wow, right? Like this illustrator that's making these like TikTok sci-fi epos with like AI-generated video that's just like, wow, one person can just sit and come up with something like that, right? Like, oh, as I mentioned, this UX designer from Niantic that can build like a full 3D editor in the browser just by—

Now, if you'd like to watch that episode, you can of course find it on Spotify by searching for 20VC. That's 20VC on Spotify.

Prompting, right? Like, and I keep thinking like, if we do things right and we make sure that open platforms keep being really accessible and readily available, we really invest in tooling for people to build stuff and own it themselves and be creative. AI just has so many exciting abilities to let humans be more creative and do more interesting things. That's what excites me the most, right? Like, that's why I built tools for builders in the first place.

Matt, listen, I so appreciate you joining me today. I so appreciate the directness. Uh, I, I apologize for my debating at times. I hope SaaS continues in a meaningful way, but I so appreciate your time today, and thank you for joining me.

Thank you so much. This is a lot of fun.

Now, if you'd like to see that episode, you can watch it on Spotify by searching for 20VC. That's 20VC on Spotify. Don't forget to leave a rating or a review. It makes such a difference, and I really do so appreciate that. But before we leave you today, are you struggling to beat model benchmarks or implement GenAI in your product? If so, you need Turing. Turing is an AGI infrastructure company backed by incredible investors like Foundation Capital and Westbridge Capital, and they do two things. Number one, they help leading companies and AI labs like Salesforce, Anthropic, and Meta in enhance their LLMs with advanced reasoning, coding, multilinguality, multimodality, and more. Number 2, they combine human and artificial intelligence expertise to deploy cutting-edge AI systems for awesome companies like Rivian and Reddit. Right now, Turing offers a free 5-minute self-assessment to help you pinpoint your place in the GenAI journey, get tailored next steps to optimize your model strategy, and then finally learn how Turing can refine and implement your models for better performance. Take the guesswork out of GenAI. Visit turing.com/20vc to start your free assessment today. And talking about scaling seamlessly, let me tell you about WorkOS. So WorkOS is the modern identity platform for B2B SaaS, helping startups move upmarket with ease. Selling to enterprises means, honestly, really complex security requirements like SAML, like single sign-on, like SCIM, provisioning, audit logs. Honestly, a ton of stuff that is just a nightmare to do. Features that take months to build and maintain. Well, WorkOS streamlines this with flexible, easy-to-use APIs that make enterprise readiness quick and painless. Its suite of features include AuthKit, a complete user management solution, free up to a million monthly users with built-in MFA, RBAC, bot protection, and user impersonation. Enterprise SSO— my God, these enterprises love their acronyms— supports any identity provider using SAML or OIDC, while directory sync enables seamless user provisioning and deprovisioning— oh no— for SCIM-compliant directories. Fine-grained authorization powers complex permissioning, and it comes again, the admin portal simplifies SSO and SCIM onboarding for IT teams. Trusted by companies like Cursor. Cursor use this. If Cursor use this, it's got to be great. Come on. Perplexity, Vercel, Sierra. I mean, these companies are awesome and they've raised $95 million in funding from amazing people like 20VC. Try it today at workos.com. 20vc. Now that you've nailed enterprise features, let's talk about creating amazing product experiences. Get your users to do what you want them to do. That's the simple power of Pendo, the only all-in-one product experience platform. Pendo combines analytics, in-app guidance, session replay, feedback management, and road mapping, all purpose-built to work together seamlessly. Trusted by over 10,000 companies, Pendo is transforming how businesses understand and engage their users. Plus, they're the creators of Mind the Product, the world's largest product management community. It's awesome. See the magic for yourself. Visit pendo.io/20product-podcast to get started today. As always, I so appreciate your support, and stay tuned for an incredible episode coming on Monday with Elias Torres, former founder of Drift and now founder of Agency.