Designing the Future: Inside Canva's AI Strategy with John Milinovich, GenAI Product Lead at Canva

At the highest level, there's like automation and augmentation. What people want from automation is to remove the ick from something that's just super annoying to do. As a user, you know what you want the outcome to be, but you just kind of want it done for you. The other dimension here is augmentation, which is I am fundamentally in the driver's seat. I am working towards something that I can't quite see what it is in my head yet. And I want a set of tools or a suite of capabilities that help me Take that like fuzzy feeling and make it into something that's more concrete. One of the real original innovation of Canva was moving design from a world of pixels to a world of objects. When you look at what AI is doing is we believe it's moving to a world from like object level manipulation into a world of like concept level manipulation. I think generally our development flow is just like, make it work, make it good, make it fast, and then make it cheap. That's, I think about that really as the problem orientation versus the solution orientation. Oftentimes the outcome is like so clear that we can see it, but being able to actually deliver on that is extremely, extremely difficult. If you're topping out at 81 and we know we need to get to 98, like it probably means that you need to maintain the problem focus, but switch the solution.

Hello and welcome back to The Cognitive Revolution. Today my guest is John Malinovich, head of generative AI product at Canva. For anyone who's not already familiar, Canva is an online design platform with a mission to empower everyone in the world to design anything, which has scaled to serve now more than 200 million users globally with its highly accessible suite of design products. More recently, Canva has also become a leader in AI-powered design experiences with a mix of point solution features like their excellent image background removal tool, More horizontal features like their Magic Write tool, which attempts to write in your brand's voice across their entire product suite, and AI superpower features like their new DreamLab text-to-image product, which was derived from their acquisition of Leonardo AI, reportedly, although this is not confirmed, for some $320 million. In this episode, John shares Canva's framework for thinking about task automation versus human augmentation. Canva's approach to testing and evaluating AI features, insights on fine-tuning foundation models, and a fascinating discussion on how AI might transform fields like architecture, where John began his career. We also dig into practical tips for AI engineering, with John emphasizing the importance of maintaining problem orientation rather than getting too attached to any particular candidate solution. This conversation was a super fun opportunity for me to trade notes with another generative AI product leader whose expertise has been demonstrated at global scale. I think there's huge value here for anyone who wants to level up their thinking about what sorts of experiences AI can unlock and also how best to go about developing and deploying them. If you agree, we'd ask that you take just a second to share the show online, write a review on Apple Podcasts or Spotify, or just post a comment on YouTube.

Of course, your feedback is always appreciated too.

You can contact us via our website, cognitiverevolution.ai, Or by DMing me on your favorite social network. Now, I hope you enjoy this behind-the-scenes look at AI product development at scale with John Malinovich of Canva.

John Malinovich, head of GenAI product at Canva. Welcome to The Cognitive Revolution.

Thank you so much, Nathan. I'm really excited to be here today. Big fan of the podcast and what you all are doing at Turbotime Network.

Cool. Thank you.

I appreciate that. Well, right back at you too. I mean, Canva obviously has been a leader in the design software space and helping people who are maybe not creative professionals, but still are at least a little bit creative to realize their visions for a number of years. Definitely a company that I've watched closely. I don't know if you know about me, but I started a company called Waymark that is doing a similar thing, but very much for video advertising for small businesses. So a narrower scope, but very focused in on that one use case. And we've obviously looked at Canva quite a bit and always kept an eye on what you guys are doing and the Product leadership sort of speaks for itself. I wanted to start off with a big picture question about creativity and how you think about helping people be creative or how creative they really want to be. I'm wondering how many people really want to be creative versus want to totally outsource that creativity and maybe were limited in the past by budget, but maybe in the age of AI, like just want stuff done. for them. How do you think about how the population breaks down, and what's your kind of framework for figuring out how to balance enabling their creativity versus just getting things done that they need done?

I love this question. I love these types of big philosophical reflections as well. I think first order, it's important to delineate design from creativity. I view design as the process of generating or synthesizing new ideas, whereas design is much more of a goal-directed process that's really trying to produce some kind of an output to communicate some goal or to accomplish some kind of mission that you're setting out for. So I think what we've seen is actually that creativity is something that is like the highest enjoyment for people and that people generally want to spend the most amount of their time doing. When it comes to design, we've actually done a lot of user research on this. And actually what we've seen is actually a perfect split of a third of people want to spend More time designing, a third of people want to spend less time designing, and a third of people want to spend about just the same amount of time doing it. So I think what this really makes it clear for us as Canva is that our job is to really just help break down the barriers for true global creativity and ultimately give people the tools they need to really augment and enrich their workflows no matter where they fall on that spectrum. And I think generally how much automation or how much augmentation People want, which is something I'm excited to dig into and talk more about. That difference really depends on the type of job that they're trying to do and how much of that creative expression they want to put onto the process versus how much they view it as a production-oriented task.

Yeah. Okay.

That's interesting.

So a third, a third, a third.

And are you trying to serve all those people? We have like, obviously Adobe is out there for the people that really want to specialize in the craft of a, you know, a certain kind of Design. Are you trying to support all of these different profiles or how, how do you think about what are the really in-focus user personas for Canva?

Yeah, definitely. So I think, yeah, within Canva's 200 million plus users, we definitely have a mix of all of those types of folks. And I think the thing that I think is so exciting to me about Canva and our mission to empower the world to design is that we're really trying to actually give people creative confidence. where they might not have otherwise had it. There's this really unique kind of gap in the market that enabled Canva to get to the scale that it's at, which actually does help people no matter where they are on that spectrum actually express themselves in a way that makes them feel proud and ultimately it makes them feel good about themselves. So I think that even within that spectrum of those, that 200 million plus that Canva creates, there's a really wide range of what people are looking for there. And I think what we're really trying to do is help support all of them. And I think that is obviously a difficult task from a product experience standpoint, but I think is also something that I think we've been doing a pretty good job at for the last decade.

Maybe you could organize this by personas. How do you think about the kinds of AI-assisted experiences that these different folks will be best served by? I mean, in our case at Waymark, we really started to hear, and this is really what set me off on the AI journey that has now become personal consuming obsession. But we really started to hear from people in the like 2020, 2021 timeframe as we had finished our in-browser rendering and finished all the easy-to-use editing features and whatnot. We were like, okay, what can we do next to make this product better and easier to use for you? And people started to tell us, nothing really comes to mind. They would be like, it is pretty easy to use. That's not really a problem. I just don't have that many ideas, or I don't really know what to say, or I find writing to be kind of a challenge. And we were like, man, that's going to be really Hard for us to UI our way around. So I think for our user type, which canonically is like small business owner, who is the typical story there is they opened the bakery because they love to bake and now they've got all these other responsibilities. I think that's definitely a prime Canva target user too.

Totally.

We found for our people that like, they mostly just wanted this done for them. And that has led us to a very tell us what you want, we'll try to make it for you. But one thing I was struck by as I was looking at Canva over the last few days is there's a lot more local utility tools, some of which are extremely well done and definitely lead the market. Like, the background removal is top notch and hard to match otherwise from what I've seen. But there's less of a super big picture, give us your high-level idea in 10 words and we'll spit it all out at you. So really interested to hear how you've thought about that.

Yeah.

those forking paths and which ones you've chosen to go down?

I think there's, at the highest level, again, there's automation and augmentation. So I think generally that we've seen what people want from automation is to remove the ick from something that's just super annoying to do. So this is where things like Background Remover is a great example, or something like Magic Switch, where you're converting a doc into deck format, or things like even Magic Sort within our new Whiteboards product, where you can take all the sticky notes from a brainstorm and put them into a new order. But these are things where Where there's like, as a user, you know what you want the outcome to be, but you just kind of want it done for you. So I think that's automation. The other dimension here is augmentation, which is, hey, I am fundamentally in the driver's seat. I am working towards something that I can't quite see what it is in my head yet. And I want a set of tools or a suite of capabilities that help me take that like fuzzy feeling and make it into something that's more concrete.

Yeah.

Or really turn that idea Into reality. So I think that's really been where I think the, again, it's a much fuzzier balance there because it's less obvious how can you measure the outcome as a user where you know it when you see it in a way. So I think we think a lot about our product portfolio in these 2 different dimensions of augmentation and automation. And I think generally speaking, when it comes to things that are more augmentation focused, what we've seen is that having really natural AI integration points in the existing product. is really the best way to drive this forward. So it's very fundamentally like an embedded AI strategy where we're trying to, again, put AI at the point of need for users so that it can actually help them assist in whether they're, again, looking for that automation task or that augmentation task. I think that when you're asking about having maybe a more separate or kind of AI-native experience, actually, this is something we've been thinking about. And actually, Dream Lab, our first kind of point of view or opinion on what kind of a separate, maybe more AI-centric experience can look like. So DreamLab is a new text-to-image generation product that Canva just launched with our Leonardo team, which has been an incredible addition to the Canva family. And ultimately what DreamLab does is it actually expands the use cases that people have for Canva because our Magic Media product, which lives in the editor for text-to-image generation, Helps a user when they're actually in the process of doing an existing design. So the mindset is, hey, I'm designing a social media post for my daughter's first birthday. I want to find that perfect image or create that perfect image for it. Whereas, and that's one kind of, call it serviceable market. When you, but when you look at what you can do with image generation in general, there's a much wider set of things that maybe isn't tied to a specific design. So I think when we talked about that creativity and design delineation up, up to the top. Something like DreamLab is actually much closer to the creativity of the spectrum that I think is, again, very much about augmenting a human's capabilities. So I think this is something we're getting a lot of positive feedback about, we're excited about, and would be excited to think about other potential opportunities for these more AI-native experiences in the future as well.

I, I did use the new Leonardo DreamLab to create almost exactly what you said. I, I went in and asked for a birthday party invitation for my soon-to-be 6-year-old with astronaut dinosaurs. And it's always worth, for me, reminding myself of just how new all this stuff is, just how recently it's gotten so good. Because even like the original Stable Diffusion, you know, which was obviously kind of a tipping point moment for the field, like couldn't do anything like that. And it even placed the text, but it did a really nice job of laying the font in that said like Ernie's 6th birthday. And then it had a lot of made up stuff that wasn't actually coherent text below that, where it was like.

Yeah.

I, if maybe if I had given it like our address and the time and the date, it would've also set that perfectly accurately, but I didn't. And so it just like did like an abstract form of that, which then I went back and erased and, you know, at some point maybe can fill in. I guess a big question that I have there around the image generation is how you guys are thinking about the right level of abstraction for the AI to be working. Interestingly, at Waymark, we still haven't integrated a straight up text to image generator because we feel like that hasn't been quite controllable enough for our small business users. They want to represent their real business and they might be able to get like astronaut dinosaurs, but when they really want to show their business and set realistic expectations and show themselves off in the way they want to show up, it just doesn't quite hit the mark well enough. And so we tend to be a little bit higher level where we present to the AI like, Here is the structure that we want you to follow, and it's like your job to fill in these different dimensions. So on the one hand, you have every pixel is generated by AI and it's all kind of one layer. And then on the other end, you maybe have like choice of template kind of decisions. What do you find to be the right balance or how do you organize your thinking about that when you have so many different options?

I think that, so one thing that I've heard Mel, Canva's CEO and fearless leader, say many times that it's one of those things that just kind of lives rent-free in my head is that one of the real original innovation of Canva was moving design from a world of pixels to a world of objects, right? So being able to have all of this integrated inventory of all these elements, this whole template library so that every stock photo, every graphic, every video, every font you could ever want was just all in one place and you could just drag and drop it in this really easy to use and intuitive editor. That was really the market opportunity that led Canva to really grow and take off in the first place and make, again, creativity accessible in a way that it wasn't before. When you look at what AI is doing is it's, I think we believe it's moving to a world from like object level manipulation into a world of like concept level manipulation. So instead of having to only work at the level of objects, which there'll always be a place for, You're able to now do these higher-order abstractions or higher-order manipulations. And again, when you think about this in a world of text generation, or when we think about something like Claude's Artifacts product, there, I think it was a deliberate product decision for them to not let you select or manipulate specific pieces of text, but instead ask to do these more conceptual edits across the entire generated Markdown file. I think that similarly within kind of the image generation space and with these new multimodal diffusion transformer models that have really kind of been a huge innovation in, you know, text and image alignment, but also ecosystem of innovations around comfy UI pipelines or ControlNets and things. I think we're seeing a new level of that conceptual control also being available. So things like being able to do depth maps, so you can actually do things like really like high-rendered architectural models, or things like pose estimation models where you can get the exact pose of a person, or content models where you can actually maintain the overall conceptual or semantic meaning of an image or like style control. So I think that what's happening now is that similar to how we went from pixels to objects to concepts, that right concept-level control is like what I think is really starting to win out at the level of image generation. You see a lot of interesting movements in this space as well with things like Krea's real-time generation or Leonardo's real-time generation where you can also just design in high-level abstract rectangles and circles, put that with a text prompt and see what comes out. And I think that this shows a really promising direction for the future.

Hey, we'll continue our interview in a moment after a word from our sponsors. I like the notion of exposing concept-level interfaces to the user. From an implementation standpoint, probably the answer is both. I feel like I can guess where this goes, but I wonder if you have any more nuanced comments than both when it comes to, okay, to the user, we'll expose concept-level controls, but what do we ask the AI to do? Do we ask the AI to do object-level work, or do we ask it to go down to, like, pixel-level work? And maybe it just depends on the use case, but I'd be interested in how you think about those decisions.

Sully does. Of course, the answer is it depends, but I'll try to give a little bit more depth. than that. When you think about even the domain of design that Canva works in, of graphic design, which again, it limits it, but it doesn't limit it that much, right? Graphic design is a massive domain. Today there's over 500 different design categories that are supported on Canva.

Yeah.

And if you look at each of those and you can, you can map them generally into kind of a spectrum of how much it's about the form versus the function. Of the thing, right? So form—it's much more purely about the aesthetics or the visual nature of it. On a functional level, it's much more about the text or the content that's being explained. So on one extreme of form, you have something like maybe a logo or social media posts. On the other extreme of function, maybe you have something like a doc or a whiteboard. And I think when you look across that spectrum, the level of expectation of both what the user wants to be able to do, but also what you need to ask the AI to do. Is very different. And I think what we're starting to see is that the world of large language models and diffusion models is really starting to converge. And this is true both at a model architecture level, like, again, generally a lot of what's happening in, like, the multimodal space and being able to have these new types of cross-attention mechanisms at the encoder level, but also then at a user experience level, being able to actually let users work at a concept level to start with and then pop into things at the object level. where it makes sense. So, for things that are generally more, like, functionally oriented, you can probably get really far to start with at a concept level. Again, think of Claude artifacts for Markdown files to start with, but then you still need to be able to let a user at the end of the day tweak the wording, right? So, that's, you can imagine, starting from concept, jumping into object. And similarly, when you get to, on the other side of the extreme, form, you actually wanna start again at the concept level, Explaining a thing or being able to explain like what is the vibe you're going for of your logo, but you still need to actually have like some lower level control to change the kerning, for example. So I think there's just a wide range of use cases within the domain of design that the combination of large language models and diffusion models offers an interesting perspective at both of what the model capabilities can be in the future. The hard part for Canva and for the industry is figuring out the right native interfaces on top of all of this to make it. Not overly confusing to users.

Yeah. So what do you think the future of that is? Because I feel like everything is trending toward, not everything's an extreme statement, but a lot of things are trending toward an open, just tell us what you want starting point. And so I would imagine like a future of Canva, me being like confronted with probably some suggestions or whatever, not that this would be the only way to interact, but like, A natural first way to interact would be just tell us what you want to create. Next step would be, here's a version of it for you. And then drop down into those object level or pixel level refinements as needed. Is that kind of the vision that you have for the product or do you want to zag where everybody else is going that direction?

Yeah, I think that one of the things that we've seen in general is that people want more or less the same amount of design. We really appreciate it, especially when you take a very global view here. People have different modes or different means of being able to communicate the most effectively. And especially it's true in design. Even if you ask 3 professional designers to describe a design, they actually might all do it in very different ways. Or if you ask 5 different designers to explain what modernism is and what it means for modern logo design, you'd probably get 5 different answers. So I think that there's a huge opportunity for just building a more natural interface. For users to be able to interact with all AI systems, certainly design-oriented ones as well. But I don't think that should be just limited to text. I think that especially for things that are inherently multimodal, like you need to be able to convey ideas through imagery, through touch, through gesture, through voice, through text. I think design is by definition one of the most absolutely multimodal disciplines that you can imagine. So I think that while these open-ended text-based interfaces have done a great job at getting humans familiar with this new underlying technology. I think the reason we've started there is because it's maybe not necessarily the best UI for, like, for AI in general, but it's just maybe the best one for large language models or this token-in token-out based input. Like, definitely more natural conversational is going to be a way that the industry continues to move, but at the same time, it's not going to be limited to just text. And I think that what you're going to see is things where there's Just the right amount of interface that's put at the right moments in a user's journey to help capture more context, help ask for questions. But as an example, if you're saying, hey, like, here's 4 options, which of them do you like? It doesn't make sense to have a user type or say, oh, I like the third one. Maybe you should just be able to click it. So I think that we need to like really challenge the assumption that text is the best ubiquitous interface for AI. And I think that's something that I'm very excited about to see happening in the industry, but also to figure out what that means for Canva.

Yeah. I also really like the idea of multi-generation. I feel like the future of a lot of this software is it works in the background for us every single day, even if we don't visit. And what I want to do is start to send people like, hey, here's your new video that we made today, or maybe even a couple and have them be seasonally appropriate and all that kind of good stuff. So that maybe people don't even publish 10% of them, but the option is always there and it becomes more— somebody once told me, clients don't want software, clients want service. And I always remember that because again, we couldn't really do that at the time, but it is starting, everything is starting to look more service-like. So it sounds like you also been down Canva being more of a designer that's always on in the background more proactively as we go forward in time, bringing new ideas.

Yeah.

What's interesting, almost actually like independent of Canva, which I'll touch on it for sure. My last startup was actually, was called Aesthetic, which was actually like a more, it was like design as a service company. So we actually like were a tech-enabled design agency. And a lot of the core idea was that the world is going to need more design over time, but there's still not like enough design co-founders. So what if you could actually give every company in the world designer co-founder? What would that look like? And I think again, this was back in 2018. We were very inspired by the recent advances in GAN models and things like that, like Ian Goodfellow and Labs were doing. We thought that this, there was a promise to actually not just automate a lot of the back office work of managing a design agency, but also to start eating into the actual core design work itself. And ultimately from a business model standpoint, many design agencies are, they charge on a project basis. They're selling the actual work. They're not selling the time. Sometimes they do, but generally they're selling the work. So I think that I very much believe in this kind of AI eating into the services industry. And I think that there's going to be a huge opportunity for that across the industry. When it comes to Canva, I think, again, we fundamentally believe that creativity is going to remain deeply central to our product and kind of like what we continue to offer to the world. I think there's a lot of opportunities for these agentic workflows to help support more production-oriented tasks. And again, in my mind, there's, like, production design is the stuff that you can almost imagine it in your head the moment you think of it, and you just need it to get done. And I think, again, we see this as a way to really help remove friction from the process versus, like, removing humans from it, while still really maintaining the right human intervention points. And I think that's the big difference is that I think fundamentally, in this current or pre-AI era of tooling, a human had to learn every new tool that they wanted to use and ultimately would have to use many of them in order to get a job done. I think in this new era, the AI actually adapts to the human and the job that they're trying to do, and it supports them across that entire work stream. So I think again, for design in particular, there'll be a lot of work that just does happen for you in the background, or that just understands your content calendar and understands the holidays and can proactively make suggestions for you. I think that's going to be a really, really promising or exciting future. But I don't think any of that's going to come at the cost or the expense of having humans not be core and central to the work as well.

We certainly see very few videos ultimately downloaded out of our product that don't have some element of human edit. And edit could be for any number of reasons. There is a certain irreducible taste factor. I don't know if— it's funny to say this because I feel like I'm young, but I'm dating myself with a Simpsons reference. But I don't know if you ever Remember the one where there's like a gallery unveiling? I always cite this, but Mr. Burns is confronted with a piece of art and he says, I'm no art critic, but I know what I hate. And I feel like that is exactly the mindset that we are kind of tapping into with our users, where a lot of times they're like, that ain't it, give me another one. And then they're like, that's close to it, but there is part of it that I hate and that's the part I'm going to drill in and fix. And then they may even end up doing more than that, but it often starts with a feeling of, oh, that's close, but I, there's something there that's bugging me.

Yeah.

me, and that takes them down into these like object or lower level, uh, changes.

Exactly. And that's again, just back to that, the object level. That's, I think, why maintaining and preserving that ability to actually give users have high steerability and control over the output is, you know, super, super critical to this work output. Also, that Simpsons quote, which I, I do remember that episode and I'm a big Simpsons fan myself. Remember like some work that we did at Pinterest where there's, you know, a corpus of 4 billion pins. And one of the biggest challenges was when there would be new content coming into the system, understanding by any measure whether it was something that was good enough to even start showing to users. Because historically, the only way to know whether something is good is whether people like it, right? People engage with it. So I think what we, we found after spending a lot of time doing research into this problem, it's actually quite easy to have machine learning systems that can predict whether something is bad or low quality. It is extremely difficult to have it predict whether something is very, very high quality. And it's been interesting to actually try similar approaches or points of view now and call it a post-foundation model, multimodal foundation model era and see how things are similar or different. But I think what remains true is that you can only have an AI system predict quality to a certain level that you're always going to need human intervention, which is why I think that this world of having a Call it, you know, fully automated brand presence for a company posting across every channel. I think it's, it's a cool art concept, but I think it's very far from reality just because I think, again, humans are always going to want to have control and always going to want to imbue their own opinion and make sure their own taste is applied to the core outputs, especially when it's something that their name is going to be attached to.

Yeah. And especially as we imagine a potentially more abundant future in many respects, this is one of the areas where it is work in some cases, but it's also just expression. And at some point, what else are we going to have to do except find new ways to express ourselves?

100%.

Yeah, I definitely agree with the importance of just retaining that control. It is interesting to imagine how that evolves too. I mean, The Claude computer use, which is obviously the latest and greatest new hotness, does sort of suggest a new era of my AI talking to your AI. Are you starting to wrap your heads around that at all? First thing I did was went and just had the Claude computer use Waymark and just see, could it do it? It's actually pretty good at prompting other AIs, I found quickly. Some issues still in the fine points of the UI, But do you think that if you were advising smaller companies that maybe can't serve every profile, would you be steering them towards saying, keep designing the UI and building the UI for the human to drill down into the UI and exert their control? Or would you think, geez, the AIs themselves are getting much better at understanding the instructions and much better at implementing the point-by-point changes, so maybe It could still be a sort of verbal or whatever sort of interaction that still allows you to have the same level of control and feeling of ownership in the end.

Yeah, definitely. My intuition here is that, similar to actually what you mentioned before, AI is actually very good at learning how to write prompts for other AI or interacting with other AI. One of my favourite things to do is to ask an LLM to generate a prompt to use in a diffusion model, or asking Claude to help me write a prompt for Perplexity. I love that kind of stuff. works far better than I could have done myself. I think that's, that trend is going to continue. And ultimately, practically what it means is that not every company is going to have to have like API integrations with each other in order to enable connectivity between software. So I think that's like the mental model that I have for this is it's really just a— it's almost like instead of it being something that goes over the top of the software, that's like quite literally using it, which obviously is like user experience of it. It's much more similar to like the operating system level experience that It's just able to manipulate and connect things together in a way that it wasn't able to before. It's like the pipe command in Linux where you can take the output of one thing and put it into the input of another. And I think as you're building software, I think you have to basically build for that future. And I think really practically what that means, if you're building an AI-native experience where there's a large language model under the hood that's powering a lot of the experience, you do want to make sure that you have some means of exposing that functionality. To users. And I think being able to actually let a user always directly interact with the AI is like kind of the escape hatch, independent of whatever UI you might be building otherwise, while also then building the most ergonomic experience for the masses, right? So I think that even when you're building this more opinionated user experience on top of this large language model capability, you still always want to have an escape hatch, if you will. And I think that's true for the human user, and that's especially true for the AI user. I think generally speaking, the things that are most interpretable or easy to use for AI is also going to be the stuff that's the easiest to interpret for humans.

Yeah, this stuff gets pretty Hall of Mirrors pretty quick in some cases.

Yeah, big time.

Hey, we'll continue our interview in a moment after a word from our sponsors. Going back to some of the, like, moment of need AI experiences that you have today. We mentioned the background removal and the Magic Eraser are 2 that, like, I sometimes come to Canva for that just because it's really good at that. And even if I don't need, like, any other surrounding stuff, I just, I need to do this operation. Really good models for that. Do I recall correctly that there was a company that maybe was acquired also to do that background removal at one point in time? Yes.

Kaleido, which is an incredible team based out of Vienna, Austria, and is like a big part of our, our gen AI research division today. And yeah, continue to build incredible products through the Canva experience as well as separate properties as remove.bg.

So what other narrow, very purpose-specific AI experiences would you wanna highlight? Yeah. And maybe you could take that in multiple directions. It could be like, there's great utility here that people should know about. I'd also be interested in any interesting anecdotes or favorite open source models. that you think people are sleeping on that definitely round out this whole toolset?

Yeah. So I think first order, one thing I'm really excited about is that Canva's AI features have been used over 10 billion times across our platform. So I think that's just one of the things that I think gets me really excited about the breadth of applications that we're able to find through this embedded approach. I think some of the ones that I think are really exciting, again, are Magic Switch. So being able to Transform doc types from one to another, which is also similar to our magic resize feature. Especially Expedia has gotten a ton of use out of this and have been able to take some of their workflows that would have taken 8 hours before and turn them into something that took 20 minutes. Another example is our magic edit, which I think you referred to, like the actual image editing side of things and being able to use a brush, kind of find highlight part of an image, describe what you'd want to have different. Something that a real estate investment trust like FNRE has seen like crazy time leverage from. I think that. Personally, I mentioned Magic Sort, which I use a lot. Our Magic Write personalized tone of voice is like a lifesaver for me. So being able to actually give Magic Write one of my own writing samples and then being able to basically just do something stream of consciousness and have it then transformed into like my style or into our brand style has been huge. When I'm actually then also putting presentations and slide decks together, our Magic Layouts feature. Has been epic. Being able to actually just throw stuff onto a page, not worrying about like how it's set up and then being able to visualize dozens of different layouts that actually, again, get that, go from a purely functional item to something that has a bit more of the form thought out as well. I think those are some of the ones that I've gotten a lot of personal value out of and like my, some of my daily drivers, as well as ones that I think we've seen a lot of benefit from, especially some of our larger enterprise customers.

To drill in a little bit on the writing use case, this has been one of my own personal white whale projects for some time. I guess I have found on a specific task, like for example, I always write an intro essay for the podcast. My workflow now is I have a standard PDF doc that has 30 intro essays from past episodes. I'll put that into Claude and transcript of the current episode and say a pretty standard prompt. using the style, tone, voice, and perspective of the essays, write a new one. And then I can also give it a little bit of incremental runtime instructions if there's something I want to emphasise in a particular case, which often enough there is. And then it does a pretty remarkable job coming out. One thing that is notable about that, though, is I'm usually giving it like 50,000 tokens of context, and it really does seem to need, at least to satisfy me, it does seem to need a lot of those.

Yeah.

prior essay examples. If I just say in adjectives, here's how I want to sound, or if I just give it one, it doesn't seem to nail it as much. So do you guys do something similar with that feature? Like, are you guiding users toward assembling tens of thousands of tokens of context to customize the writing somehow?

So it's interesting to figure out where that efficient frontier is of like the number of token priors to help get the right tone of voice. We've done some, like, evaluation across that curve. I think what's really interesting is it's very brand, very person-specific. I think it's harder— we haven't quite nailed being able to give very prescriptive guidance on how much to get Nathan's voice right versus maybe how much to get John's voice, as an example. But I think more is generally better. So I think that what we have seen is we can let users put You know, quite a bit of text. I'm not sure whether we would support the 50,000 tokens at this point, but like definitely thousands of tokens, you know, it's like what I personally would do when I'm using this within Canva. Similar to you, I've also compared it to the Claude project approach of having prior posts and giving a stream of consciousness. And my own like qualitative evaluation is that it does actually like work extremely well. I think that's just part of a testament to, I think a lot of the fine-tuning and the kind of tweaking at the prompt level to really get this right, as well as a lot of like user experience that we're building on top to help guide users in the right direction. And I think that's the key thing here too, is again, when this is a perfect example of a concept-level editing where we're basically helping a user edit at a concept of their, their tone while then giving them full control of the object, which is actually the, the words or the tokens themselves. So I think this is an active area where we're going to continue to invest more and continue to push more. But I think that what we've seen through our own use and through feedback from customers is the current approach is actually getting pretty exciting results.

I don't know if you can share what models underlie those writing features today. For me, Claude has been the best. Obviously, that's something that you would have to use as a customer, as opposed to be able to run your own version on your own infrastructure. Which at Canvas scale, I imagine has some appeal. I normally advise developers not to rush into that, um, unless they're really at, you know, serious scale, which you are. So, um, how do you think about using the latest and greatest frontier model versus fine-tuning a LLaMA model or whatever you can actually bring in and make truly your own?

Yeah, so we've kind of maintained like a 3-pronged approach here between kind of building a lot of our own models, which again, we've been doing since 2017 across a wide variety. Of domain problems. So I think we actually have like over 100 models that are being used in production today, kind of partnering with the best of breed of what's out there and partnering with all of the research labs and getting access to everything that they're working on and figuring out the different ways of integrating that to leverage within our product, as well as working through an ecosystem of app development partners to bring their capabilities and apps natively into Canva for our end users to experience. So again, we kind of work across those 3 of building, partnering, and our ecosystem. I think it's what we've seen, especially in the large language model realm. There's so much innovation and so much advancement here that being able to just try lots of different approaches and try lots of different things has yielded a lot of really positive results. And I think something that we're going to continue to try various versions of what's out there and to, like, end-weight them against each other.

Have you, this might be something you can't disclose even if you have, but I am waiting for the GPT-4o image editing capability with a lot of anticipation. I feel like that has sort of almost been memory holed at this point, but they did show us a bit a number of months ago about how it seemed like it was like instruct Pix2Pix, but like, you know, 2 generations forward, it seemed.

Right. Yeah.

So I guess if there's anything you can tell us about any exposure you've had to that, I'd be fascinated to know about it. And then more generally, again, it's like, how do you think about in a particular situation like that where it's, I see that there's something out there that's got to be coming before too long, but I'm not sure when I would really be able to deploy it. How do I invest in that knowing that probably no matter what I invested, I'm going to have a hard time matching That capability.

Yeah, totally. And I think that's part of what makes it so fun to be building in this space. I think that speaking like more generally here, again, like the big advancement, call it the like GPT, you know, moment for a lot of these diffusion models, in my opinion, was the release of these multimodal diffusion transformers, which again really helps basically maintain like a single transformer model that can use a text encoder. Which could be a GPT-level equivalent or could literally be, you know, one of the OpenAI class models or LLaMA or whatever it needs to be, as well as these encoder models with this, like, cross-attention to be able to actually, like, understand the adherence and the alignment between the text and the specific semantics of the image in a way that was just not really possible before. And I think that's what's really enabling all this new generation of image infills, image expansions, image generation, and all the like. So I think this has been an area where there's been like tremendous amount of progress. I'd say as much progress as we've seen in the text generation era, we're seeing that very much in the image generation era as well. This is an area where we're continuing to tinker, continue to explore, but also really excited to have the incredible Leonardo team who's like really just going absolutely super, super deep into this space as well and being able to actually like train and launch their own state-of-the-art models in this space as well. So I think we're kind of, we benefit as Canva of both seeing and understanding what's happening across the industry, but also being very deeply invested into being our own model developers in this space as well.

Yeah. All of the above definitely makes sense, I suppose, at the Canva scale. How do you think about evaluation and deciding what is good enough to launch? We talked a little bit about the challenge of taste. I won't bore you with my full history of trying to use aesthetic evaluation models, but suffice it to say, it's way harder, it seems, to get to any sort of ground truth or any sort of agreement on matters of taste than it is on classification tasks or whatever.

Big time.

Are you guys— I assume you have to be running on more than vibes with 200 million users. What sits between vibes and objective ground truth when there is no objective ground truth?

Yeah, no, I, this is, yeah, it's the heart of the question. I'd say for any people building in the AI space, like starting with the evaluation is like so critical. I know we've, in, you know, traditional software engineering, we've talked about test-driven development. I think that in the world of AI, a lot of folks start with like vibe-driven development, but you've really got to get to this kind of like eval. Based approach as fast as you possibly can. This is something that basically for the last 2 years we've gone extremely deep into. I think especially because there are a lot of these LMSIS-type arenas for chatbots that exist for like the large language model space. It just doesn't exist for the domain of designs. So I think we've had to go to the end of the earth here to become really the best in the world. So I think in particular what this comes down to is being able to have very rigorous custom evaluation guidelines that ultimately describe the human taste aspect of what is good, combined with a trained set of professional designers and evaluators. We're able to actually imbue that judgment onto a larger scale, large enough to actually have statistical significance. You can also imagine we're not working across like a single document or design type, but working across many different types. So you have to have a lot of category-specific examples or references. What makes a good slide deck versus social media post, website versus whiteboard? And ultimately then you have to be able to have a way to actually have multiple different generators or multiple versions of generators ultimately compete with each other and be able to actually be evaluated against each other in a highly comparative way. And then come up with scores across all the different dimensions that you might care about. So certainly things like visual quality or prompt adherence. You can imagine there's 5 or 10 different dimensions that you might care about that some are similar, but some are different across the wide range of designs as well. So I think that being able to actually have this kind of golden set of prompts that we can then evaluate for each different category of design we care about, for every different potential generator that we want to evaluate, be able to then actually have this comparative scoring across these different dimensions. There's a lot of like investment and like math that has to go into getting that to be really good. All that is in service of actually helping avoid homogeneity in the design process and helping give end users what feels like a very high amount of control or steerability over the models that they're actually using. So again, eval is like something very near and dear to my heart and something that we think a lot about within Canva for sure.

If I was gonna imagine A sort of graduated approach to ultimately launching a feature and having the benefit of Canvas scale. I might think, okay, let's take background removal, for example. We've got the current background removal model and we've got a new background removal model. And, you know, developers say it's better. I could imagine using other models to do evaluation.

Yeah.

And maybe that could be a simple As send 100 of them to GPT-4o and Claude and have it compare. I personally don't trust that stuff that much yet for most things, but it could be like an initial smoke test, or at least has to not look a lot worse according to those standards to then move on. Then I guess it sounds like there's sort of a group of trusted people who you're like, bounce it off of them and get a score and see if it is better. And then I would maybe even imagine doing some, hey user, live in the product, like here's 2 background removals, you pick the one that you want and really kind of doing like post-launch monitoring that way. Is that kind of the structure and would I have right or wrong about that? And where do you get the most value?

Yeah, it's a great mental model for it. I think what I described was like a lot of the, call it like offline evaluation side of the house in particular for design generation.

tasks?

I think there's definitely a lot of like online eval, which is ultimately more of like looking at user engagement, you know, X versus like thing A or thing B and understanding it there. I think that generally when launching any type of new machine learning product, whether it's an incremental version of a new model or a new model in general, a lot of like we need to do this again first by defining what success looks like. So in the case of background generation, the nuance has to do with like how much of the, how tightly is the Foreground image cropped. So you can imagine if we were coming up with an evaluation rubric, we're talking about, you know, like, is the right item picked out? Yes or no. And for that right item, was the cropping good? Yes or no. And if it was good, was it overcropped or undercropped? Just as an example, you can imagine those 3 criteria. And then being able to actually then pre-generate the examples. So you have— show those to enough evaluators who are trained on that rubric to get a ground truth to come up with a point of view. Is this— Yeah. Good or is this bad? That's generally the way that these things kind of roll out or would work. I think that what I think is exciting though is as you do these types of evaluations at enough of a scale, you can actually start to build some kind of like custom machine learning models that are actually kind of focused on actually being aligned to the human judgment. The hard part here is that if you show the same example to 3 different human evaluators for this background generation task, you might get 3 different answers, or not— they might not fully agree with each other from an inter-rater alignment standpoint. So I think generally that causes a lot of challenge for training these models. But generally speaking, it's possible to get something that has 70, 80, maybe even 85 or 90% prediction quality when you're comparing what a model can do compared to what a human evaluator can do. But again, that's only really possible when you have a more narrowly scoped domain task. It's much more difficult for something very open-ended, or that's like very Style dependent.

Yeah.

So I'd say like for us at Canva, we focus a lot on getting really great offline evaluation in place. And we also then do a lot of like offline evaluation where, you know, we'll have a new version of a design generation model. We'll push it into production with like, we'll interleave the results and compare those to other versions of the model. Ultimately just see what the uplift is from one model versus another. Again, very similar to what you would do for, you know, like recommendation engines or for search engines. Figuring out how to actually do that for generation models has been a pretty exciting task as well.

Have you experimented with fine-tuning the GPT-4o models that now support image in the fine-tuning? I wonder to what degree you may have a stable of highly bespoke evaluation models that might soon give way to GPT-4o fine-tuned evaluation models.

Yeah, definitely. So we have definitely tried a lot of fine-tuning of this multimodal class of models, and there's a huge amount of potential benefit. In fact, a lot of those training tasks that I talked about, some of them you still would have to like maybe train your own model for, but a lot of them you actually are just doing like a fine-tune on an existing foundation model. And that's one of those things that still blows my mind compared to like how much more leverage we have now as an industry compared to Back when I was at Pinterest and we had to do all this stuff from scratch. But I think that definitely fine-tuning models is a more promising place to start than having to go train your own model from scratch, especially for things that are in the domain of text or image generation, or more generally where the semantic understanding is really important, or where understanding a broader context for what's being evaluated is important. So again, 1,000, 5,000 examples of background generation or of social media posts to get some kind of output or evaluation out. The fact that these models have seen millions, tens of millions, billions of examples of these things adds a lot of priors that really dramatically improve the results compared to what you would get otherwise.

Do you have rules of thumb for fine-tuning foundation models in terms of how much data? Because I find this This always surprises people, especially if they've been schooled in thinking about big data. Now it's like, I typically advise people to start with 10 examples just because that's achievable and doesn't feel too intimidating. How do you think about how many examples is worth starting with and how do you kind of escalate through orders of magnitude of examples?

Definitely. It depends a lot on the type of model you're working with. So, especially in diffusion models, if you're trying to, you know, do like a LoRA on a diffusion model to consistently create a specific style, you can often do that with tens of examples, right? I think that if you're doing something for writing or for kind of understanding brand tone, it then, it does take, I think, more examples than that. I don't know the exact frontier, but I think the general intuition or the risk that I've seen in fine-tuning of large language models is that it's very easy to overfit them if you don't give enough examples. So I'd say that for like diffusion models, I think it's very clearly you can do it for a lot less examples. I think that shows a lot of promise for what you can do in the general media generation space. For the text generation world, I do think it takes quite a bit longer, but also I would generally challenge a lot of the reasoning behind why fine-tuning these larger models is required, especially when you have such long context windows. Most of the time, what I would advise is that before even trying to do anything on fine-tuning a language model, just try giving a ton of context, right? If you have like a million token window, or you can add, you know, 30,000 or 50,000 tokens of your prior writing examples in your workflow, that's 9 out of 10 times going to be a better— yield a better result than having to Trying to do a broader fine-tuning task.

Yeah, I think that's an apt point that overfitting can work for or against you. If you have a very specific task that you wanna dial in performance on, then it's like really—

Yeah, exactly.

If you wanna maintain the generality that you're used to with a chatbot, but give it a different vibe somehow, then I think semantic stuffing definitely is the way to go.

It works really well for things like if you are trying to do like a classification task, like that's a great, fine, that's a great use of fine-tuning. But if you're trying to capture the vibe of something, again, like style, I think that's generally not a very good use case for it.

Interesting. Okay. How do you guys think about cost and latency in your designs? Obviously, especially if you're working with an API and paying by token, especially with 200 million users, you could run up a real bill. At the same time, I often think people are Especially when they're getting started, I think they think about the cost way too soon. So, do you have like a framework or guidelines for your team?

Yeah. So, I think generally, like, our development flow is just like, make it work, make it good, make it fast, and then make it cheap. And then generally, we'll talk about launch milestones around after we make it good, maybe sometimes after we start making it fast, depending on what the use case is. So for us, we're definitely like quite cost aware, but it's certainly not the primary driver. I think if you just zoom out and look at what's happening with just like Moore's Law in terms of like compute availability, but also just like the cost curves of both inference time compute for all these models, I think in the last year we've seen a 95% cost reduction or something in that order of magnitude. So I don't think we need to over-rotate on cost when you're getting started especially. So that's kind of what I would advise. For folks as well, just focus on really nailing the user experience.

Yeah, I'm with that for sure. I'm— that might be a t-shirt in the— can I design a t-shirt on Canva?

Say, yeah, let's get— yeah, we'll do that in Canva and we can get it printed and delivered.

Make it work, make it good, make it fast, make it cheap. Could be a mantra. So let me see, what else did I have here? It sounds like fine-tuning is not like per-account fine-tuning. That was a question I wanted to ask. It sounds like that's not going to be a huge focus, maybe on the image generation side for styling, but not in the big picture thing of these high-order functions of creating stuff so much.

Yeah, I think that's the mental model that we have today. I think that, again, these things are also changing so quickly, so I think we're staying close to this. But I think the use cases that probably make the most sense are like capturing aesthetic style. So that's like ones that, you know, I've tested and are looking into, but generally speaking, per-account fine-tuning isn't a big part of our strategy today.

Okay, cool. How about in hiring AI engineers? That's probably our most common listener profile type, although data is kind of muddy, but I think Elicit has had a really good explication of their philosophy, but they're doing a very different thing, obviously, where I don't know if you know Elicit's product, but it's like essentially AI-assisted literature review for biomedical context and things like that. So it's a very different corner of the economy. I wonder how your most important traits, best practices for AI engineering might compare to theirs.

Yeah, absolutely. So I think for At Canva, I'd say our number 1, number 2, and number 3 priority when it comes to GenAI in general is being the best in the world at design AI. We are extremely motivated and dedicated to being the world leaders in design AI technology. So I think first and foremost, people who are deeply passionate about that mission is, I'd say, the number 1 thing that we look at for folks who are coming in the door. It doesn't necessarily mean that you have to be a designer by background, but you have to actually be excited about the interplay between humans and AI in the domain of creative work. I think generally speaking, people who are like extremely curious, have a very strong growth mindset, and are just willing to be, you know, in touch with this world that is changing and evolving every single day, but also are excited to actually live in and use the Canva product every day, which is a huge part of our culture and something that is one of my favorite things we get to do is literally use the thing that we're building. Every single day. I think that generally folks who are also very practical with their problem-solving abilities and are actually excited to wear multiple hats and actually thinking about and solving problems at a huge scale. I think that generally this is a non-purist approach where it's people who are excited to actually ship a new model to test and try within the product and actually understand what the jagged edges of it are before they think that it might not be perfect by some offline evaluation metric. I think it's generally this like multidisciplinary approach that I've seen work extremely well. And I think that it's really differentiated the AI engineering culture that we've been able to build at Canva.

Are there any like best practices in terms of engineering approaches or pattern of problem solving or just habits of mind that you would impart on people?

I think there's like a certain grit and determination that I've seen, which, and I think really how that plays out is like an unwillingness to be blocked or an unwillingness to like not persevere through the problem. And I've seen this play out in a few different ways. It's being able to proactively ask for support or help when you need it. Maybe there's, you need some support from a different team or from somebody on the business development side. Being able to, like, proactively raise your hand when you need support and not just waiting or expecting somebody else to come to you. I think that's extremely important, as well as just, again, that grit to be willing to just grind through these really complicated problems. And in many cases, there literally is no industry precedent for what we're trying to build. So being able to actually be, like, deeply first principled in how you go about that and actually come at a problem From a deeply user and domain-centric point of view. I think that those are things that are extremely important for all people who are entering this field and certainly those who would be excited to work at Canva.

Cool. I like that. Let me try a couple of mine out on you and you can either riff on them or reject them or whatever you think. One that I use is do the hard part first, or sometimes I rephrase that as work from the AI out, meaning, like, I think to contrast this kind of product development with traditional software development, we don't really always know what's going to work, right? So it's like we can't design everything end to end and say, okay, we've got all this planned out, this is the plan, now we execute the plan. There's got to be a more dynamic interplay between the sort of planning and the actual making the key part of it, which is typically an AI model, confirming that works. So, I always try to say, start with a prototype, or sometimes I've done collab notebooks these days. A lot of times it's in a Replit REPL, but get that core thing to work first. We'll figure out the plumbing later. Can we get down to inputs and outputs actually working? So, your thoughts?

I vehemently agree. I think that you can either think about this as either the walking skeleton of the system. So, it's just like, what's the bare-bones version of the thing going from end to end. And oftentimes, yeah, that critical thing is the, like, taking that jagged edge of the software and smoothing it out, right? So, being able to actually figure out, like, yeah, what is that core, most unknown piece of the puzzle? And just being relentless about focusing on that first. I think that's a really, really good callout.

Another one for your thoughts Sometimes I call this situational awareness, although that's becoming such an overloaded term in AI discourse. But the sort of mistake that I sometimes see people making is rabbit holing on a particular solution and being like, just not changing the frame or zooming out and being like, this doesn't seem to be working. Could I just try a totally different approach? And trying to kind of incrementally grind. This is kind of like the flip side to the tenacity thing, because I think tenacity is important. But then I also think sometimes you need to have that awareness to say, okay, I've been able to grind from like 79 to 82% here or whatever. And that may not even be a real measurement, but I feel like I'm topping out below where I want to be. Can I reconceive this problem or try a totally different strategy?

Oh, yeah.

It's intangible for me, but I don't know if you can make that any more tangible, guidelines in place or whatever.

I think it's, to me, it, that's, I think about that really as the problem orientation versus the solution orientation. Because I think oftentimes, like this guy, Dave Herndon, who was the former CTO, now distinguished engineer at Canva, he had this saying that I love, which is, we've had the idea for hoverboards for 50 years, right? But no one's like ridden a hoverboard yet. So I think oftentimes the outcome is so obvious, like so clear that we can see it. You can often prototype it or you can. Golden path, the solution, but being able to actually deliver on that is extremely, extremely difficult. And I think this is oriented to the problem orientation, which your goal is to build a hoverboard. You know, there might be one promising solution in order to get there that gets you from 72 to 81% or whatever it may be. But if you're topping out at 81 and we know we need to get to 98, like it probably means that you need to maintain the problem focus, but switch the solution. So, I think that, like, orienting around the problem is really key and also is difficult, right? Because it might mean that you have to, like, just fundamentally change your approach or pivot on a dime. And that's hard to do. It's hard to be both deeply passionate about what you're doing, but also be willing to kind of take a sidestep sometimes.

Yeah. I like your framing better than mine, actually. I think it's quite a bit clearer. So, watch out for that to come in a few— Sounds like your true presentation.

A lot of t-shirts here. Yeah.

Less maintain problem orientation, be willing to let go of solution orientation. I like that a lot. What other products do you look at in the space for inspiration? Who is on the edge of, in your minds, that you just like want to see what they're doing on a regular basis?

Yeah, totally. So I, that's like one of the coolest things about building in this space is just Seeing how much incredible innovation and how many extremely smart and motivated teams there are working across all angles. I think within the creativity space, some of the ones I love using and I just am very inspired by, so I think like Krea AI is doing a really awesome job and I think building some really interesting things in terms of blending the concept and object-level manipulation. I've also studied architecture in college, so actually I'm very Keen to a lot of what's happening in the 3D world. So a lot of things with Meshy and Spline, and I think what they're doing is just super fascinating and kind of the, call it text-to-3D model world. I think on that architecture path, so SpaceMaker and ArchiDesign are 2 really, really interesting ones that when I play with them or I dust off my old skills from using Rhino and AutoCAD way too much, and I see what this new generation of tools is capable of doing, it just like completely blows my mind and really inspires me to think about continuing to distill down and refine these extremely deep and complicated workflows using AI to actually both, again, automate and augment. And also just my personal daily drivers, I would say, is I use Perplexity Cloud, ChatGPT, Otter every single day. So I'm always very inspired by a lot of the work that's being pushed there and really thinking about the general large language model approaches and how you build these kind of paved roads and most generic possible functionality on top of these models, as well as then how you integrate those into either the world's knowledge or into your own personal knowledge repositories.

The 3D callout is really interesting. How good are those things getting these days? I haven't used any like architecture generator.

It's getting there. I think that what's really fascinating, so like it, I think I actually first fell in love with generative design back in 2008. So, like, when I was in architecture school, like, Tom Reiss, the, you know, creator of D3.js or Processing.js, excuse me, like, kind of gave a lecture that was showing how you could write an algorithm to generate some, like, output image. And this is the key thing. It was the main thing was they were introducing randomness into the process. So, I think that one of the And that, that kind of led to this whole world of like parametric design. So there's been actually a lot of parametric design tools, which is not using AI, but it's just more or less like putting knobs and dials around how many rooms are in the house, how many square feet is each of the room, and then like change the knob and you can look at different variations. That stuff's been around for quite a while, but seeing now how that is integrating with AI is wild because ultimately there's new levels of abstraction on the interface. Again, now concept-level interactions, you can say, Create a room of 3 houses that's 2,000 square feet and on this site plan and actually come up with some pretty interesting renderings of it, or even the actual 3D model or the BIM, the building information model on top of it. That's very, very exciting to see. I think there's also new capabilities of being able to actually simulate the lived experience in these different houses. So being able to, or buildings in general, being able to take an office building, and, you know, simulate the weather or the temperature inside based on where the sun is relative to the GPS coordinates, and then using that to then optimize the location of windows, or being able to, you know, take the number of the seating plan on the office floor and based on the predicted paths to like the bathrooms or the cafeterias, understand where you might need to put other kind of programming around it. I think that ultimately what I see most here is this true augmentation realm where you're really helping the architect have a 10x, 100x leverage on their work product, as well as then some of the automation around the rote tasks that would be required to go from a concept or an idea of a building into having that thing that you can actually physically step into in the real world. So again, super exciting stuff. Again, I think this world is Very early on, which is part of why I'm very keen to keep my eyes on it. I think, again, you know, there's no map of every building in the world on the internet, which means it's not inside of these frontier models today. So, kind of seeing how companies are going about developing that is really, really inspiring.

That is fascinating. Architecture is a really interesting one too, because it does strike me as one of the verticals where, or like say one of the professions where the sort of, well, we'll always just want more and more and more might not actually be true. Whereas with graphic design, it's quite ephemeral. We could always produce more. The streams are flowing fast and they can continue to flow faster and probably will. When we think about designing homes or designing buildings, it's like The bottleneck is still going to be building them in the real world, and the bulk of the cost is going to be there. And it's probably not the case that if architects get 10x more efficient or 100x more efficient, that we're going to build 10 or 100x more buildings. So one does start to wonder then, like, what does the future of architecture look like? And especially if some of these software platforms get easy enough to use that prospective homeowner can do a decent chunk of that at the concept level.

Yeah.

Should architects be worried about the future of their profession?

I don't think so, especially because in order to actually have something be built in the real world, it has to be signed off by, like, an accredited architect, right? So, somebody who's legally liable for the quality of what was put into the world. But actually, one of the things I think is the most interesting about the architecture profession, so much of the time, especially for these, like, massive projects, So much of the time that is being spent is actually on the work to win the bid in the first place. You're actually spending, you're pretty much like doing a lot of the work before the client actually chooses to work with you. And that's true for like these large commercial projects. It's often even true for a lot of these like residential projects. So I think that, I think the opportunity is to actually help, first order, to help actually visualize the permutation space or actually take the client's idea of what they want want and help visualize permutations with the architect's lens on it before to actually help them win the deal. So, I think that's actually where this will first kind of eat into the creative work itself, which again is fundamentally an augmentation task. I think independent of that, there's going to be a lot of automation that takes place in turning the fully produced CAD and building information model And then using that to create all of the permit paperwork, all of the specialized construction plans for the electrical or the plumbing, all that kind of stuff. So, all the discrete programming based on the building information model, I think there's a lot of automation opportunity there. But no, I think the role of the creative director, the architect, to some degree just gets heightened or gets even more elevated with all these kind of new tools at their disposal.

Yeah, several fascinating things to ponder there. The role of the, of like insurance and liability as potentially determinative is interesting. I do still wonder if like somebody couldn't, like a software company couldn't take that on at some point, like get confident enough in the models and say, hey, we'll insure this or self-insure it even perhaps.

One of the places where this is happening first is for I call it semi-prefab housing where you either have— you basically have a design system for a house. You have, call it, the frames or the flooring or all the individual— the roofing, these core pieces of the design system prebuilt. And then, ultimately, the design process is figuring out the right combination of those things. to put together. So this is kind of where you're vertically integrating across the architecture and the construction, which keep in mind today are generally 2 completely separate industries. But when you actually can vertically integrate across the architecture and the construction, that's where I think there's going to be like the opportunity for these more AI-enabled products. Actually, this was— this idea was actually the place where my last company, Aesthetic, originally the concept started as like an architecture like vertically integrated architecture firm, but then moved into the graphic design space when we kind of saw where a lot of the technology was. So I'm very passionate about this space. And there's actually been some interesting case studies. There was a company called Katerra, which kind of tried to do this and ultimately didn't end up working. But there's a lot to learn from that. The lesson to learn, I don't think, is that it's a bad idea. I think it's more about execution and AI enablement. But I do hope to see Some of these kind of more vertically integrated players here as well. I think just in general, the application layer of GenAI, I think is like really, really, really exciting. I think it's going to be where the lion's share of economic returns come from in the next 5, 10 years.

Anything we can do to bring down the cost of housing, that would certainly be most welcome. Last section, and I really appreciate how generous you've been with your time and insights. You recently wrote a blog post called The GenAI Application Layer, which is about kind of why you're bullish on the application layer. application layer and a little bit about what you're looking for as an investor in the application layer. I won't spoil it. Want to give us just kind of your case for and your priorities when you're thinking about application layer investments?

Yeah, absolutely. So I think what we've seen is this like platform shift, this pattern for any of the major platform shifts that have happened from like on-prem to cloud, desktop to mobile, now call it pre to post AI. Where kind of things always tend to start and aggregating value at the infrastructure level, moving into then the platform level, then moving into the application level. That I think has played out and there's pretty clear data on this, especially looking at the on-prem to cloud level where again, the first big companies happened at like the infrastructure level. So a lot of the chips and the data centers and things like this moved into a lot of the platforms. So again, this hyperscalers and then enabled all the The application layer. So literally pretty much any internet-enabled company. I believe that we're currently in the infrastructure era for AI. If you really think about it, I think how this plays out— today, like, the global GDP is something around $110-ish trillion. I think they expected to grow to like $130 trillion by like 2030, give or take. And then today, the tech sector is, call it, about $5 trillion of that. And if you can imagine being able to even just grow that percentage of how much tech can, can eat into the rest of that TAM, which generally is like services industries and things like this, which even if that grows by like 3%, right? Like that's a, you know, multi-trillion dollar opportunity that I think happens at the application layer eating into a lot of these things that used to be maybe more traditionally thought of as services. So I think this, you know, I think it was the blog post from Sequoia about the $600 billion gap or problem for AI. When I think about the shift in labor and how it's going to be augmented and automated in some cases with AI, I think it just makes it very clear that the application level is extremely underserved compared to this opportunity today.

So you have 3 apps called out by name in the blog post. There's GitHub Copilot, Jasper, and Harvey. I think listeners will probably know each of those by name. It strikes me that like those are not necessarily, I wouldn't be equally confident in their eventual Or long-term success. Jasper in some ways has become the poster child for being the thin wrapper that was very good on identifying a customer need, very good at being quick to market. But I don't know exactly what the latest news out of Jasper is. Now been confronting the fact that they didn't necessarily have their own platform that they were building on, whereas obviously with a Canva, you've got 10 years of design software that OpenAI is not going to recreate in their Canvas thing in the immediate future. In contrast to that, Harvey is solving a really hard problem that— but then you could still wonder, well, I don't know, what's GPT-5 going to do anyway? With that sort of background in mind, what leading indicators are you looking for in terms of how people pick problems to solve or possibly how they think about structuring their business? I'm very intrigued, for example, by aligning your revenue to a more like service-based thing. If we can solve a ticket, that's a dollar or things like that. But yeah, what are your kind of heuristics for what inspires you for applications?

I think the first and I think most important thing is like deep customer centricity. Because I think that being able to really attach onto like a specific persona and a specific, like a specific person who you can see the light of their eyes and you And literally feel the pain that they have. That's like the most important first thing. Because I think especially when we're talking about this, like fast evolving platform layer that is increasingly building its own thin app, like highly generalized application layer on top, it's more important than ever to be highly opinionated and vertically focused about what you're building. So I think that's the first piece is deep customer orientation. I think a second piece, personally, I'm, I think that the further afield from, call it the existing tech has eaten the world. Yeah. So things that are maybe going into industries that have not historically had as much tech penetration. So like the mining industry or the real estate and the construction industries, like we've spoken about, you know, I think those are places where I think there's a lot of immediate leverage to be had with that customer orientation and focus. I think that then the third piece is being able to really build really intuitive user experiences and products that are actually like deeply aware of the jagged edge of what the software is able to do today. Because I think that if you're going a little bit further afield from the straight and narrow use cases, you, you'll probably be able to get a meaningful amount of value from using AI for that problem, but it's not gonna be 100% solved. So being able to actually tailor a user experience around those kind of shortfalls of the model and to actually account for those is extremely, extremely important. So when I'm talking to promising startups or advising founders, I really want to see those 3 things in order to feel like they're really set up for success in the next decade as things continue to evolve.

Cool. That's great. That could be a good note to end on. I think that's all my questions. Anything else on your mind that you want to share? Any last drops of wisdom for the audience?

No, this has been awesome, Nathan. I really appreciate your time and the thoughtful questions. It's been really fun.

Cool. Likewise, I've had a great time. John Mlodowicz, Head of GenAI Product at Canva. Thank you for being part of the Cognitive Revolution.

Thanks, Nathan.

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