The hidden pattern behind successful products | Mark Pincus (founder of Zynga)

28:59Lenny Rachitsky:Yeah, is there an example that comes to mind? Because yeah, what's a company or two that started very unambitious? I love the story of Bolt.new that really blew up last year. I loved it so much I cold mailed the founder because I was just so impressed with it. Yeah. And they toiled in obscurity on something that they were into and then they open sourced it. I think they were barely able to keep going with commercial development. And then they had this realization one day of, wait a second, if we take these web stacks, this virtual machine that we've been making work on the web, but we actually add that to an AI coding co-pilot, we now have something that's better than what anybody else has.

29:50And I think that was just a great story, that they were passionate about one thing and they stuck with it.

29:59Lenny Rachitsky:Yeah. Eric was on the podcast. We talked about that. Oh, he was. So impressed. um in a lot of ways slack also you know was humbled stewart keeps trying to start game companies and those turn into unexpected bigger hit companies um we'll see what he does next he now has probably so much capital he could just keep doing a game company this time but i think to your point like he might try again to unhumble go big yeah but each time right so he started a a big idea for the mass market MMO, which I've also loved, but really difficult. And they were humbled in that enough to say, okay, wait, there's this little teeny thing that our engineers use.

30:51Let's build a product around that. And it really takes a really attuned, curious, humble founder to call the ball on that. I mean, I can't imagine, I mean, I can imagine, I guess, I've been there, how hard it is when you've got investors and team and everybody going in one direction and you have to, we have to express confidence as founders, whether or not we have actual confidence inside. That's part of, I think, the dissonance of this. How do you express confidence? How do you stay in a place of intellectual honesty? How do we stay authentic and transparent and not rattle our team? You know, how do you, and I've, I'm still learning.

31:44I had, I had people, I err on the side of transparency and honesty and, you know, being authentic to a fault. And I burn out people in that process. And I did it Zynga and I have since because people will say the negative critique I'm working with me is, oh, working for Mark is like third grade soccer. And every Monday he comes in excited about a different idea. and they're not wrong. But where I can get better at this maybe is if we can build a culture with our team that says, okay, we are ambitious. We're so ambitious that we're not going to hold on to a B plus. Even if we could get funding, even if it has some traction, we have a North Star that we are not going to stop until we find product market fit against our North Star.

32:45And this isn't it. And it's going to take courage on our part. And hey, let's look around the room. Is everyone ambitious enough to do this? Or do you want to peel off and go join someone else who's already a rocket ship? Which that's a fair career choice for you to make. But I think that's to me the real founder mode is can you have the courage to tell your team and your investors that this isn't it?

33:17Lenny Rachitsky:That's exactly where I wanted to go, which is this other piece of advice you give, which is kill hope before hope kills you. Talk about just what that is because so much of your advice is kill your bad ideas quickly. So just kind of talk about that. And then I'm really curious to know what it takes to realize an idea is bad. When do you decide, okay, this is B +, let's move on? I don't know if I get credit for making up that quote, but I love it. Kill hope before hope kills you. There's a difference between belief and hope. Hope is confidence without basis. Hope is just, you know, it's a prayer, but it's not founded in anything that your lived experience.

34:11It's not founded in your experience with your product, your experience with people experiencing your product and the data. And I think that too many founders and teams keep going with the hope that this next release is going to do something magical. And I think that the best product makers, I like to say they're collecting winnings. They're not making bets. They already know. You know, if you talk to Brian Chesky about his launches, he already knows that he has a hit. He's not launching it to find out if people like it. And I talk about the difference between launching an MVP, a minimum viable product, and a maximum launchable product.

35:00Because if we're going off hope, we're getting to this MVP, minimum viable. The viable is the word we got to kill along with hope. Because viable is where hope comes from. If it's viable, it might make it. right? And there's a difference between get in the market early, learn. You're putting a product out that you're going to learn from, and you're putting a product out that you're going to launch, that you think you believe, not hope, is going to be a hit. And it's really important to be crisp and to make that distinction. And AI is a dangerous tool today. It's so powerful that it's dangerous.

35:44It's so powerful that it means we can get to a viable product in much less time and money than it took maybe three months instead of three years. And that's a dangerous drug because it means that what I thought would happen where we'd be today is that people would be using AI to build these incredible testing machines, failure machines that are testing, I like to say, more ideas in a week than your industry tests in a year. How are you testing 100 ideas a day instead of one in three months? I think AI is being used more to build one idea in three months than 100 ideas in a day. And what would it look like?

36:27I like to say, we should build it completely wrong before we know it's the right product. So build it wrong before you know it's right. And if you could build it right, great. But don't be slowed down by that. Because if we start off, if we say, okay, what can I believe today? I believe this is the wrong product. What are you going to do differently because you believe it's the wrong product? You are not going to waste three months building the wrong product. Oh, I'd rather waste a day or a week building the wrong product. But the point of what I'm building is to learn. So is it good enough to get signal and to test my idea?

37:04And I think we can usually pull that apart and test those pieces in the wrong way. So often it could be an ad. I cannot believe how many times a team hasn't even tested the ads for their product before they go and put in the market. It's an afterthought. And it was so often at Zynga, it blew my mind. I mean, I'll give you one story from Zynga. When we were launching our first expansion pack for FarmVille, which became a mass, these became massive business drivers for us. I think it was Farmville, English countryside or something. The team came to me and they said, okay, we have a$10 million ad budget and we're going to start running ads before the launch.

37:52I'm like, wait, you have 25, 30 million people a day using your product, but you're going to put ads somewhere else for coming soon. You have these people engaged. What if you just put something on the game board? And what if you don't just start your product marketing? You're still doing product testing to see what gets the most heat. What if you start putting different art forms of your English countryside locked on the game board and you just see how many clicks you get. And you just start testing the look, the feel, the marketing message. And at the same time, when people click on it, it says, coming soon, click here to be a pre-user.

38:41Click here to get access two weeks before anybody else. And it turned out everybody clicked on it, right? Because it's a change on your game board. And it both gave us direction on what was the right marketing and the right variant of the product. But the unintended consequences was we started selling keys to people for you and a friend, and we ended up selling$19 million worth of keys to get early access to the new expansion pack. And so we took something that was going to be afterthought, advertising, try to drum up interest in this product, and turn it into something that gave us signal and direction on the product and revenues.

39:27And so often, you can have, this is an existing product, but you can turn something that was going to be marketing into a kind of scarcity and heat driving feature, something that could drive revenues or something else that matters. So the way we should be using AI is as a testing machine, a failure machine, and a way to vibe code, cloud code, but build the lowest possible cycled version of your product that you can get signal back on.

40:07Lenny Rachitsky:Awesome. I want to ask you about something that I think might be on people's minds as they hear you talk for a lot of product builders when they think Zynga, they're not like, this is the product I want to build. And there's a spectrum of products you guys have built. There's Farmville and Cityville and all these things that I think turn some people off. Then there's poker, Words with Friends, Mafia Wars that I think people are like, oh, that's amazing. I love that. Can you just speak to that? Sure. I think if I'm unpacking that, when you say that the products turn people off. It's funny you say that because Farmville and Cityville were our biggest hits in terms of installs, engagement, retention, revenues.

40:52Now, Words with Friends and Poker were more enduring because they made the transition to mobile and the other games didn't. It's a whole other story. But I think the part you're getting to is that Zynga was in a lot of ways a victim of its own success. That it was, our games were so viral and took over the feeds on Facebook so much that your friend who was playing it started to bug you as a person not playing it. And that's fair. But what I would say, I think what's misunderstood about Zynga from the beginning and why we succeeded and we created eight massive hits out of 10 large game launches, we had a very high hit rate.

41:48It wasn't that we were good at virality. It was that we were focused on two things that I think we did better than anybody else. And we had lots of competitors, lots, and copying, and we still managed to keep winning. And so it couldn't be that we were just spammier or better at virality. First, we had this core mission and focus around connecting the world through games. And Bing Gordon and I kept coming back to this idea that I love. And I want your founders, product makers watching this to join me in thinking about, which is how can we add more dimensionality? I love this idea of, it's what I call a bold beat.

42:33It's how do I take this thing that's kind of gotten boring and rote, poker or whatever, how do I add a whole new dimension to it? And by adding social, by adding real identities, by giving you this, you're doing social networking, you're in this cocktail party, and now we're giving you a way to actually meet new people or improve your relationships in a game. Well, the reason why people, so many, especially middle-aged women, love Farmville and these games was because they had this kind of hobby, but they weren't doing it alone. And they were doing it with their good friends, making new friends.

43:12And in the game, our most successful features were co-op play. There were things that let you do gifting and do things of value for your friends. And so we called the games Invest, Express, and Connect. You could do something that was, you were being seen as creative. I like to say, people don't want to be creative, they want to feel creative. So we were letting you feel creative, look creative to people. It's what Mid Journey does for me today. And then we were letting you, so you were expressing yourself and then you were connecting with people around it. So that was the first thing. And then if you think at a mechanical metric level, our core metric was retention, not virality.

44:03We grew, we outlasted everybody because we had the best retention. I think we were the only consumer company in the world that tracked day 365 retention. I don't think anyone tracks it today. I talk about it in the book. I think it's a gift to your founders. I believe that the most valuable companies in the world, well, statistically, this is true, they have the highest day 365 retention. Can you build against day 365 retention? Yes. We can't wait till day 365. we can find early indicators of a positive day 365 and a negative day 365 retention. If you have low D1, low D30, you will probably not have high day 365.

44:51So those track, those are correlated, but you can have the opposite. You can have very high day 30 and a zero day 365, which is most products. And if you don't think about why someone would use this in a year, if you don't have that mentality, it turns out when someone tries our product, they think that way too. They kind of think, is this worth investing in? Whether it's a game or a camera, it's, am I going to use this in a year? Should I tell my friends about this? Or, you know, is this, should I bother investing? Should I bother giving it information about me or whatever? And I think there's a mentality to that.

45:32And I like to say viral-based companies, and there's been many, be real. We've seen these. They're sinking speedboats. They're trying to drive faster than they're sinking. They're trying to get more people in. And you can either go faster, bail water out faster, which is try to get people back or plug the hole in the boat or build a better boat that doesn't have a hole. But yeah, so we were tracking both in our games, in our network, what was the retention. And we were really constantly thinking about that. And I think the two things to take away from Zynga's success, in my opinion, that I hold is to have a strong innovation vision that translates to what your teams are doing every week.

46:26And we even built a metric that's still not used by anyone. This is an Easter egg if this doesn't get cut and anyone's still listening. We built a metric called ASN. And it stood for, we measured what was your active social network. So we looked at how many round trips you had with a friend or another player, meaning you took a turn and they took a turn back. You gifted them and they gifted you back. And we found that if you went from zero ASN to one, there was an 80 % chance we saw you again in the next month. And if we got you to a four, there was an 80 % chance we'd see you 22 out of the next 30 days.

47:09And so we could actually, build and innovate against that metric. And it made sense, right? Because if you saw positive feedback loops, it's like someone likes your photos, comments, that's probably the biggest dopamine hit we get.

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48:50Lenny Rachitsky:It works for a little bit and then dies. And you've maybe built more social consumer products than anyone. There's like a dozen that have worked. AI obviously changes the game in theory. What do you think needs to be true for something to work again? in today's world. It's probably equally surprising to you how little we're seeing in social and consumer in general. It seems like people have kind of given up on the idea that a social app could take off or be viral. And I see them every so often. And they've given up for good reason because nothing's proven and nothing's working. So I like to think first, is there latent demand.

49:37So if just because a category doesn't exist today, it doesn't mean that we don't want it as consumers. In fact, the best opportunities are usually the opposite. And in 2007, when I started Zynga, video gaming was a$23 billion business, but I had stopped playing games. I didn't know anyone who played games. It was like not even a top 10 activity on the web. and I thought there's a latent demand. I love games. I love playing my family, but I can't get people to play games with me and it's too much investment. It's too hard. It was crawling across broken glass to get someone to play a game with you.

50:18You literally, I got my nephews who are intense gamers to play Rise of Nations with me and we set up two machines for them and two for me. And we had FaceTime going on a machine and then the game and we were on a game server and we did that one time. I was like, that is a lot of effort. And it was fun, but we did it once. And I said, my premise was, okay, I believe this could be and should be a mass market activity. I believe adults want to give themselves permission to play, but I got to make it so accessible, so cheap in terms of what it asks for them. Free, not just free even, which it wasn't.

51:08It was$60 to go buy a game. So I made it free, and I said, I'm going to make it a game you already know. Three clicks and you're in. And I'm going to ask five to 15 minutes of you to do this. And you're going to trip over it. It's a breadcrumb somewhere. You're not going to, like say, we don't go to the comic book store, but if the comics were in the newspaper, we'd read them. So I believed there was a latent demand. And in fact, today, gaming is a$280 billion industry. And I actually think there's latent demand. Again, I don't play games. No one I know plays games other than my nieces and nephews.

51:46And yet it's this big a business. So I actually think there's another massive growth waiting in games because they're this big and it's this boring and adults aren't doing it. They must be some. It's very big, but none I know. So, okay, so social and consumer. I believe that we have beyond a latent demand for social, we are being social, right, online. We are on Snapchat and Instagram and TikTok. but I believe it's lost the adrenaline. I think a lot about adrenaline. Is there a heat in it? Are you excited to go get on Instagram or do you feel a little bit like you're eating potato chips? Are these positive calories or negative calories or empty calories in the middle?

52:38And I think one interesting thing, we looked at NPS, net promoter scores, and we saw that when people quit Facebook and quit Instagram, they went from a plus 35 to a negative 35. People have a feeling like they just quit smoking. People are proud to tell you they're not on Instagram, right? They're not missing the party. They're like, whoa, I got off it. So I think all that's to say, I think it's the biggest unexplored opportunity there is on the internet. I mean, I think, I feel very confident that someone is going to reinvent this social experience for the agentic AI age. But how are they going to do it?

53:28I would guess that they're going to give us productivity again. Part of what we got, people forget Facebook gave us massive social productivity. We were able to stay in the loop with 300 or 1 ,000 friends. LinkedIn gave us massive productivity. And they still do, but they started to move away from that productivity into a realm of wasting time because they wanted to engage more and have more ads and less LinkedIn, but they might have ads now. But definitely, you know, Instagram had TikTok envy. So, you know, they started doing that. And so I think there is a new step function of productivity that we could be getting in that experience that our agents are letting us stay even more in the loop with the people we care about or you know but not wasting our time as much so and i'll also say this there's a side of this i call this social thing the cocktail party okay that's that's the big uh instinct vein for me and i think about that cocktail party and i think where is that happening or where does it want to happen?

54:45And how do we add things to the cocktail? We'd love to host the cocktail party. And if we're not, we'd love to be at it. We know it when we see a great cocktail party. You know it. You feel it. You're like, oh, I'm so glad I'm here. And it moves from like obligatory, I'm at this party, it's the birthday party, to almost like greed. Like, I love this party. I love the people I'm meeting. And what do you get at a great cocktail party? You often get great leads. And so that cocktail party that for me, it started with Napster when all of a sudden all of us were connected to each other and the great lead was a music file.

55:23But then Friendster, Facebook, LinkedIn, what we were getting was better lead generation. That was better productivity for our time. Before that, we would go to Google for a lead or Craigslist and it was a lot of noise to signal. And now we're like, oh my God, I could get on Friendster and find a date. And it's actually a good lead. I had a good date on Friendster. So what I would say to people is like, look, if you want to reinvent social, look for where the cocktail is, or you could host, and then think about how is lead generation happening. It might sound weird when I say lead gen, but what is LinkedIn?

56:06LinkedIn started with lead gen. All the productivity, the value started in a utility in being in this cocktail party. Today, and by the way, with Zynga, I said, I'm going to go to the cocktail party. Everyone's hanging out on social networks. I'm going to drop games in the middle and give them a new dimension to network in the games because they want to be on Facebook. I want to give them more to do. Today, we're all hanging out on our Claude, on our GPT, but there's no cocktail party. So my Easter egg to people is, it's a quiet, lonely cocktail party, like the web was before social networking.

56:51And my challenge to your listeners is figure out how to make it rowdy, figure out how to make that cocktail party social and socially productive and you will probably you know find gold there i want to come back to your thread on your your question was how do you how do you know when an idea is a b plus right yeah okay i love the question on well how do you know if it's a b plus and what i would say to you is how do you know if you're with the right person like you're dating what was your experience dating? And my experience has been that when I'm with the right person, I know it. I'm not asking, is this the right person?

57:40I'm like, fuck yeah. I love this person. This is my person. And that's the best feeling ever. And I hope everyone can experience that. when you're with the A - person, you're with the B +, you're asking, could this be the one? You're like, you're, and, you know, Osho said, if you're torn between two paths, they're both wrong. You know, you have feet in two canoes. If you're asking whether or not your product is an A, it's not an A. And you're full of hope. You hope it's an A. It doesn't mean you might not have the chance to turn that into an A, But the first point of intellectual honesty is to say, okay, it's not.

58:24And then, well, how do you know, how are you getting validation that it's not? You don't have the validation that it is. When you have lightning in a bottle, when you have true signal, everything works. It's anecdotally, you love your product. You're addicted to it. You show it to friends and they love it. Your metrics show that it works. I mean, did we have to ask if GPT was it? Did we say, oh, is GPT it? I'm not sure. We're like, no, I'm fucking living on that, and it's making me dream of new things to do, right? So I'd say that the hard part about this is, what do you do with a B plus? First, can we be intellectually honest that it is a B plus?

59:16And then what do we do with a B plus? Do we just kill it and start all over again? Do we use it to learn? The power is knowing it's a B plus. That's the first point is, okay, this is not it. Now what do I do with that? Is it a way to learn? Do I see examples that are near this that are it? Can I find anything proven or near proven? And when we realize it's not it, we look for more things to do. And it's such a hard lesson. Two weeks ago, I pulled the plug on my Dot Earth project for like the fourth time. I've been building my version of the metaverse for 20 years. It's what led me to Zynga. I call the metaverse that I want life at the speed of play.

1:00:07We're getting closer and closer to that anyway with AI. And by the way, I define the metaverse, I give Reid Hoffman credit for this definition, as blurring the lines between the virtual and the real. And that is where our lives are going anyway. So we're getting more and more metaverse-ian. It's not being in this other escape to immersive world. It's that the virtual and the real completely blur together. but I kept coming at it from the game side and I went native, not in the good way. I got so into wanting to prove I could build this experience that I was building this game engine, web browser-based game engine and I was not getting a product market fit.

1:00:53I was being too ambitious. I was not going for a small, small idea. I was going for a really big idea and it was really hard and I pulled the plug on it after four years and$25 million in just this one version of it. And in the last two weeks since then, I've been more inspired around ideas than I have been in four years. So there is power in pulling the plug on a B plus and even more on a D.

1:01:25Lenny Rachitsky:There's a whole discussion I have about the abyss, which you talk a lot about in the book, of how that's such a source of good ideas. But I want to touch on distribution. Just as we're on this thread, something that's come up a lot on this podcast is just how with AI making it so easy to build stuff. One of the biggest challenges becomes distribution. Always been a challenge. Always been hard. Harder than ever because there's so much happening in the market constantly. It's so much trying to get your attention. All the channels are full paid and SEO. What's your just like advice to founders? What do you think needs to be true for a startup to break out?

1:01:58Lenny Rachitsky:Because it's so hard now. So let's start with talking about consumer distribution, which I understand better. Yes. There's one question we got to back up and really explore, which is, is AI a new platform? And I would argue that it is not yet a new platform. It is an important technology. we have a new kind of portal to that in GPT or whatever chat we use, AI chat. But it's not, in my mind, a platform. A platform in the traditional sense of it was a hardware platform. Well, it's definitely not a hardware platform at the consumer side yet. People are... I'm trying to explore that, but it is not yet.

1:02:50And then it became at least an interface platform, whether it was a Windows interface or a browser interface or a social network that opened up. And in the case of mobile, it was both hardware and an interface. we're not at that point yet. I believe we will get there. I don't know how. I have ideas. But we're not there yet. And it's important to acknowledge that and say we're still in the mobile and web era. We still use a browser. And even though we're in this chat app, it is not a platform for other apps and experiences and developers. It could be. I hope it becomes one, but it's not yet. And we're kind of like halfway to a platform.

1:03:43We are in a point of discovery. New technologies that break through at the consumer level unlock discovery. That's really important. Discovery means when we first got our phones, we were installing new apps all the time. Now we don't ever install new apps. The average app installs per user per month is zero. So it's really important to think about that, that not only are we not in discovery, but even when we are, it doesn't stick. There was something like 40 ,000 new games launched last year in the App Store, and zero became top 10 hits, and zero even sustained top 25 or 50. So your odds are bad.

1:04:30Okay. So it's not an ideal moment to be, you can't launch consumer right now with high confidence. And that's just something that we have to acknowledge. And it makes consumer and consumer categories like social and games almost not investable. They're still getting investment, but it's very hard. It's much easier to be prosumer or enterprise now, but for good reason, because we're seeing those companies scale revenue ARRs very quickly. So I do think it's a great time to be working on consumer ideas. And you asked about distribution. Distribution is just so crucial and core to any consumer, any business idea, but any consumer idea.

1:05:28And it can't be an afterthought. It's not, I'm going to build the best mousetrap and they're going to come. distribution has to be part of your product and part of baked into the strategy deeply and proven from the beginning. And if you're just building this product and hoping they will come, hoping it'll spread virally or word of mouth, that's hope strategy, not a belief strategy. and it doesn't mean you shouldn't keep experimenting and now is a great time to experiment. And in fact, it'll be 100 times more expensive to try to get the same things in the market in a year because it'll be 100 times more noise.

1:06:16And once there is distribution, there'll be a flood of competition. But when distribution is this broken, it is even more core to your product and your strategy. And I think we're seeing many more successful companies that find a prosumer approach, that go after their power users, their whales, the people who care enough to find it, care enough to spend money on it up front to sustain a business long before we can get out to consumer. And there is a great idea that I got to, that Gary Tan had that I'll repeat here, because I loved it so much this week, that if we get in the mindset of basically intelligence on tap, free tokens, and if we think that the amount of tokens that we're buying today, that will basically be free in a year or two, that the token supply is going to go up so much.

1:07:23Our demand will too. But if today we start building, reimagining consumer services based on free tokens, I think that's such an interesting innovation zone. And it could sound like a dot-com business plan when I remember ordering pig ears for my dog, Zynga, and wanting to send thank you notes to the VCs because they were cheaper than at Petco, right? That's not a good business plan. So, you know, giving away tokens at a loss isn't a good business plan, but it might be in a phenomenal business because what the dot-com thing had wrong was the price of pig ears wasn't going to come down or delivery wasn't going to come down, but the price of tokens will.

1:08:06And so I think that's another kind of Easter egg of an insight that I'm intrigued by. And I think founders are going to do something really interesting with it. Because games don't work, freemium games and freemium apps that have to go and hit the AI. Even if you want to spend on it, you're hitting token limits, right? So getting around that today might unlock really interesting innovation. And also just another Easter egg thought on the social cocktail party. I love the idea of the agent being in the middle of brokering our social relationships and getting back to that lead gen, dating, jobs, general listings.

1:08:57But I love the idea that the agent has our context and knows my context and your context. And we have this membrane, I call it the social membrane, this intelligent membrane of trust. And it gets smarter and smarter at knowing when to change, dynamically change that trust or change that attention level that it's going to take from us, like a great chief of staff. And it could share less information with both of us than it knows. It could be you're in Marin and I'm like, Lenny, let's hang out. You're like, Mark, I'd love that. So, okay, let's have our social secretaries work on that. There's going to be an asymmetry in your interests and my interests in any given weekend and hanging out.

1:09:44And how do we broker that without hurting one of our feelings. There's some really interesting spaces that the AI and the agent can broker between us in ways that start to give us both productivity. They find ways for us to get together without getting in a bad place of, you see me on your calendar for Saturday and you want to be with your kids.

1:10:15Lenny Rachitsky:I love all these ideas you're sharing. Like what I'm hearing there, there's this always this idea of why can't we just, here's my calendar, here's your calendar, let's just find time. And like the issue there is you don't want to ever feel like, you don't want to look like you're, you got nothing going on and you're like the most boring person. Like you don't want to be the other person. Yeah, it's totally open, available to you. Yeah, exactly. And even worse, you don't want it to, you don't want it to schedule you for a meeting, you know, that was not your priority. Yeah, that's right. Just to close the loop on the distribution part, what I'm hearing is like we might be on the verge of a new distribution platform, a way to get out and for people to discover you.

1:10:51Lenny Rachitsky:It's not there yet. I'm somewhere between belief and hope in this because I don't have enough evidence to believe it. And it's a little more likely to me than just hope. I think right now there's a obvious race and competition around coding between the major LLMs. I think they're going to get back to consumer and prosumer and developers' hearts and minds. And I think they are interested in developers' hopes and minds, but first they're competing on this coding front. But I think where we will get to in one way or another is that there will be some kind of consumer-facing platform for AI apps and agents.

1:11:43I can see so many consumer-facing agentic services that make so much sense to me that I think consumers will want. But they're not going to get it because if it's just buried in, I doubt they're going to get it buried in the mobile app store. And I think it's going to be in OpenAI's interest, Claude, Grock, to see these apps, consumer-facing agentic service apps happen and see them be successful with their LLM baked in. And the more it's uniquely instantiated to OpenAI, the more it drives their consumer value proposition. One example that is my number one, is my Easter egg on this, is I think there should be an agentic travel agent.

1:12:39So a perfect example to me of a place where I think there is latent demand, and the only reason we don't have it is because it doesn't make economic sense to offer it to us because we won't pay enough for it, is a travel agent. I believe if I offered you a free 24-7 travel agent that was always there for you, knows your travel context, knows you, and will actually book, not just book travel, but I think the most valuable part is when you're in the middle of a travel, a trip, be ready to rebook your flight and be on top of your travel logistics as they're happening. and often failing. And I think that's valuable to all of us, but not available to all of us because travel agents couldn't make a living.

1:13:34They weren't getting enough commissions and we weren't ready to pay enough. So the internet has grown through us getting a better deal. But I think the next area of growth probably will include deals, but I think it's going to be about getting amazing services And that's my prime example. But if someone built the best travel agent today, maybe we'd find out about it, but it's a tough road. But if it was specifically baked into OpenAI or Claude and gave me a real clear reason that I'm getting value from my GPT beyond, you know, there's a lot of generic value I get through AI chat today that I'm having more and more trouble differentiating.

1:14:28And it's just, I don't even know anymore if I'm asking a question to Claude or to GPT. And so they, at some point, and that's why they're differentiating themselves right now on coding. And there's real value and that's an amazing business. But they're not differentiating themselves very much at the consumer level.

1:14:52Lenny Rachitsky:Yeah. To me, the question is, are they just going to do it or why do they need anyone to do it? If they are building this AGI, they can just do all the things. So I think it's going to be interesting to see if they just want to eat the entire market of everything where they play nice with other startups. Yeah, that is going to be interesting. And look, we can see past examples with Microsoft. Microsoft was a brutal monopoly. They were a brutal platform. They ate everything around them. and then with us, we saw it on Facebook. The two areas that they just didn't care about going into was music because it was really painful with IP rights and games because they didn't want to hire artists, but everything else they did absorb.

1:15:38Lenny Rachitsky:I want to go in a different direction and touch on, you have all these really amazing nuggets of advice for scaling company, managing people, hiring people, working with people. I want to just kind of touch on a bunch of these. one is this idea of making everybody a CEO at your company. Talk about that lesson. All my management principles I got to through desperation. I don't like managing people. I say every day you're managing people is a day of work. And it's a necessary evil for us as product makers because we can't abdicate and just have someone else be CEO because all of a sudden the priorities get messed up and teams don't have to listen to us and we're now feedback, not direction.

1:16:21So that's a failing path. So we have to be a CEO. But then the question is, how do we get to spend the most time doing what we love and the least time doing what we don't? The bigger principle to me that I started to get to was that, oh, I'm like, all of management is just how do we get people to do the right thing when we're not in the room. So I was like, okay, if I give them a hill to take, and if I make them a CEO, make them a real CEO. I mean, they have operating control, degrees of freedom to take that hill however they want. And they can give me a plan, a budget, and then do whatever they want within that.

1:17:01What I found was I didn't have to manage them. So they're not coming back to me with questions. And certain kinds of people really want to be a CEO. What I also found was it was incredibly motivating for people. It's motivating to me. I always say, I'm a team player as long as I'm running the team. So can I hire other people like that? And I like to say, I was a frustrated expert witness when I worked for other people. and those are the best people to turn into a CEO. They're kind of a little bit of a know-it-all. They think they have the right answers and we're going to find out if they do. And so we let them actually be a CEO and they have all this pent up demand to actually go and prove that they were right.

1:17:49And that's a beautiful thing. So yeah, I love this principle of make everyone a CEO. And we're kind of going there in Silicon Valley with this idea of get rid of middle management, You know, Brian Armstrong's saying everyone should be an individual contributor. Everyone should be managing a lot of other people. That's really kind of, to me, the best CEO is like the best player at the position and is doing the thing they're great at and they're not wasting their time on management.

1:18:18Lenny Rachitsky:You mentioned this idea of an expert witness, and you also have this nugget of advice of staying close to the metal. I love this general advice. Talk about what you mean there, why that's important for someone in their career. They go together. We start our careers in our 20s very close to the metal, meaning we are individual contributors and we are working on getting the primary data and building the actual product usually. We're in the trenches. And the people in the trenches are usually closest to the data closest to probably the right answer, but they're also usually furthest from making the decision.

1:19:02And that's what I call the expert witness syndrome, because you're called to the stand by the adults and you plead for what you passionately believe is the right answer. And then you're excused and then they make a decision and then you have to deal with the consequences and disagree and commit. What if I'm disagreeing because I'm fucking right, and now I'm committing to clean up your mess because you're wrong? That's why many of us become founders because we just are sick of being in that position. You're also closer to the metal. When you go become a CEO, when you become a founder, part of the paradox of it that I believe we have to be careful about is that we stay close to the metal.

1:19:49And I believe the best product CEOs are in the minutia of the details. All the stories about Steve Jobs, I was so impressed when I heard that he insisted on picking out the carpeting in the conference rooms. And I tried to have that same mentality of micromanaging the really small pixel level details that matter. And I had a great conversation with the founders of Discord. And they came to this conclusion too, that they needed to actually be an inverted pyramid. And they said, we realized that we outsource, we delegate the most important product decisions, the UX, to our least experienced people.

1:20:35And they're doing this every day. And we decided to turn that upside down and say, we as founders need to be kind of the first and last mile for the product. And we have to be the ones who bless. Our best use of our time is making these minute decisions that change the product user experience. And so to me, that's being close to the metal. Brian Chesky believes in doing things in non-scalable ways and doing it himself with the team by hand. There's so many stories about Jeff Bezos and Zuck of the thing that mattered most, they would go and work two days a week deeply with the team on it. And it makes sense.

1:21:22If you were the best product maker in the company, we want you on the field. We want to put you on the ice. We don't want you to spend your time talking to investors and managing and scaling.

1:21:34Lenny Rachitsky:Yeah. Elon famous for this too. You have this line in the book along these lines, micromanagement is beautiful. You should micromanage as long as you can. I believe that. And I did that building Zynga to a fault. I mean, we got to a point that I had all the way to 50 employees. We had a standup call that would go on for two hours. And I had everyone's name in a spreadsheet and I had what they were supposed to do yesterday and what they're going to do today. And I go through name by name and say, okay, did you get that done? Can everyone else verify they got that done? Okay, what are you going to do today?

1:22:06And I completely micromanaged, but we were much more effective. And then I kept micromanaging things. I'm like, if you can be in the room, be in the room, assuming that you are the best player. So yeah, I think it's less contrarian saying it now than it was 20 years ago. But when I was building Zynga, we had to apologize for things like micromanaging or expecting massive results from our teams. And I think I'm happy to see that that's becoming kind of accepted as more – it's closer to best practices today, I think. But my point about like that management is get people to do the right thing when you're not in the room.

1:22:58The first principle is be in the room if you can be, as much as you can be. And then only delegate when you get to the point that you can't possibly be in all these rooms at the same time. And then all these management principles are just different strategies to try to get people to do the right thing when you're not there. And I love these non-scalable ideas that actually scale your skill, what you're trying to do as a product maker in the right way. And one of the ones I love is this idea of tech assistance and this idea of a teaching hospital. How do you pass the vampire blood of you to other people?

1:23:42Like you have this burning mission and passion around your product. Like, how do you spread that to other people and have them spread in the organization? The first thing is put them in the room with you. Like, so the idea of this teaching hospital was, okay, I'm just going to put as many people as I can in the room while I'm doing these product management meetings and have my passion and ideas and approach, you know, spread to all of them too. And that worked. And then grab someone from the ranks and make them your tech assistant. Have them just follow you around for six months or 12 months and make, make it the mini me, the person who is you in your twenties, who was the expert witness, a little bit of a know-it-all.

1:24:30Um, and, and start having them follow you around to pick up, learn and absorb everything you do and give them projects to test them. And, and then hopefully you've created a mini me that you can now put in at, in a much bigger role somewhere else. And in fact, Andy Jassy at Amazon, everyone on the C staff used to be someone who'd been the tech assistant to Bezos. So that idea actually scales and you kind of get it for free.

1:25:01Lenny Rachitsky:I love this phrase of transferring your vampire blood. Oh man. Maybe one last nugget from the book along these lines is you have this line of just the number one job of a CEO is to be right. Talk about that. Well, that's another one that I stole from Bezos. But if I get to pick one thing that you do as CEO, I'm going to pick that you're right. So even if you don't operate the ship or the factory that well, I'd rather that you picked the right product, the right strategy, than your phenomenal execution or inspiring people or managing. because being in the right body of water matters more than the right boat.

1:25:48And a great boat in a dead lake bed isn't going anywhere. And so I look for that in people. Like, are they right? Like, that's the best resume. I could see that you were right about something. And I look for that in the team. And it's less, do I like your style or approach or your personality fit? I'm like, I'll take misfits who are right. I'm like, I want those really smart expert witnesses who are intellectually honest. And the more people you have around you who are right, they're putting balls in the net.

1:26:33Lenny Rachitsky:I want to maybe end with a question about your kids and parenting. I talked to a bunch of people that know you well in preparation for this conversation and every single person commented on just how wonderful a dad you are and how much time you put into that part of your life. And a question I've been trying to ask folks that are parents and great parents in this AI era, and there's a lot of stuff I want to ask about, but let me start here. It's just what's something that you are teaching them or helping them develop that you think is going to be important to them in this crazy world where we're entering of AI.

1:27:06Lenny Rachitsky:Thank you for asking about this. I think my greatest role and job and service to the world is trying to grow good humans. So I really, really put a lot into it and take it seriously. And I get so much out of it. I like to say I'm growing my best friends. And so far, it's true. So there's a couple of principles that have come in philosophies that have been important to me as a parent that I've just seen. I do them naturally and I see that they work over time. The first one for me is I have five kids. Every one of them is just such a different version of a human. I have a special needs son who's fairly extreme special needs.

1:27:57Our new one-year-old baby has a gene mutation, and she actually may also end up being very neurodivergent. So you just have this wide range. My 15-year-old girls, they're twins, and they're completely divergent from each other. This first principle that I've found is meeting them where they are. and and and it's with kids i find we can kind of talk down to them we could talk to them as kids um and or we can kind of treat them like adults and neither of those are right it's like we gotta like find engage with them at the altitude that they're at but as human to human and find the way to do that.

1:28:43And then once we do that and meet them where they are, I think we can bring them to surprisingly sophisticated places that may be way beyond where they're supposed to be in that moment. Like my twins, I started playing with math with them when they were really, really little. And then during the pandemic, I taught daddy math because I saw that their school was not equipped to do online homeschooling. So I taught them and their friends daddy math. And I just tried to teach them a math brain. And I didn't know where they were supposed to be. They were in fifth grade. But I just started for them and their friends, just trying to teach them how to approach math in a way that's fun and curious.

1:29:28And then I found out, we found out later, I taught them all the way through eighth grade math. And I didn't know it. They didn't know it. And that was cool. And I'd say, how does this apply in the age of AI and where we are? I feel like we're at the end of this 100-year cycle of mass-produced education, which was get the most knowledge in, get everyone's averages up to the best place we can, educate 20 million graduates a year or whatever number. But it was factory-produced. And it was for a certain kind of work. first factories than knowledge workers. Knowledge working is going away. It's changing, but we're still teaching knowledge education.

1:30:13I feel badly about it with my kids. What I've tried to do with my older kids is teach them to have critical thinking more than... I say, I don't care if you go to college, which is a little hard for them because they're achievers. And I don't care if you go to college. What I care about is that you develop critical thinking and you find a way to be useful to people in the world. And my one daughter, Carmen, she's also neurodivergent. She has ADHD and dyslexia. And she created a brand of sweatshirts called Comfy Fancy. And she also has created a gathering, a group for neurodivergent middle school kids called NeuroSparkly.

1:31:07and it's taking this thing which should be a problem and a deficit and it's making it a way that she can connect and help a lot of other kids. I'm proud to see that. I've also, the dissonance that I feel in this moment as a parent is that my kids are in this educational system that is trying to prep them to get into a good college and to be a knowledge worker. And I know that game is over. And I know, so what do I want my kids doing? I try to teach them to, look at the deeper, the meta of what's going on. When an adult is trying to convince you of something, when a teacher has a point of view that you don't agree with, try to understand why.

1:32:00What's their agenda? Where are they coming from? What's their lived experience? and how has that impacted it? So I'm trying to teach them to ask better questions, not no more answers. And I think that's, you know, and I'd say in terms of how that spills into their online use and what I try to promote and discourage, I try to promote how can you be generative in what you're doing and not consumptive. So what can you do online or offline that is generative, that is actually putting something new out in the world because that's how you're going to get something back and not consuming, not being a passive consumer of content and experiences.

1:32:46And sometimes it works and I see them doing that and then sometimes it doesn't. But that's how I'm trying to navigate this. I also tried to make it till they were 16 with no phones, no smartphones, and I got to 14. I got them flip phones. and they had internships at Niantic working on Pokemon Go. They built a first-time user experience, which is really good, that they, I think, used, but they had to get smartphones for that, and they still have them. And so I tried to make it, and I didn't.

1:33:20Lenny Rachitsky:Oh, man, that's hilarious. Oh, and I'll say one more thing. For my older girls, I keep a running Google Doc of life philosophies. And anything I say to them is like a quote I say over and over. I'm like, okay, I'm going to actually like write that up with stories. And I keep it in this document for them. And who knows if they'll use it. But they do start to repeat some of them. So I know they read it. You know, one is nothing's personal. Don't ever take anything personal. And if you assume nothing's personal, you're probably right 19 out of 20 times. and the 20th time you probably handled it right because of that.

1:34:05So that's one, you know, and don't be a victim. You know, the world doesn't happen to you. It's happening around you. And, you know, we're defined how we react to the world, not by the events that happen to us. So I'm trying to, you know, give them these, you know, and they're teenagers, the older two, and, you know, and I'm in it and learning and I've got two littles that, you know, a one-year-old and a four-year-old who sleep with me every night.

1:34:39Lenny Rachitsky:Oh, man. You're busy. I feel like it's clearly what your next book is going to be is these life philosophies. I feel like these are useful for people, for adults, I mean. Yeah, I wanted to write a book on parenting saying everything I know about parenting I learned from my dog Zynga because I had her before I had kids. And she was like a person. And, you know, I gave her clear boundaries and freedom and love in between. And, you know, she believed that she was a person. Is there anything else you wanted to share before we wrap up? The thing that I've gotten that's resonated most in writing in my book of life for the last 30 years, it took me a long long time it took me until i started zing at 41 to finally identify and articulate my why and i think for all of us it's so important to get there and we might do for a long time before we actually can say the why but i figured out that mine what i talk about in the book is i want to create an internet treasure like you know when people say mark how do i know that you're going to work hard on this next thing or you're post-economic or you're a board rich guy or whatever.

1:36:03I'm like, well, I haven't done my thing yet. What does our soul need to do before we die? Or at least to be in integrity with it, what do I need to be working on and know that I gave everything I had against it? And it's to build an internet treasure, which is a service We can't remember life before or imagine life without. And I believe as product makers that that's the greatest ambition and the greatest thing that we can offer the world. And my friend Bing Gordon says, you know, one day those treasures will be in the Smithsonian. And I think he's right. And, you know, I think it is the greatest opportunity that we have as product makers in this era is to build those digital skyscrapers that the next generation can't believe anyone ever lived without.

1:36:56And so that's my ambition and why I'm still like rubbing sticks together. And yeah. Writing books.

1:37:05Lenny Rachitsky:Speaking of that, to help people build their own internet treasure, your book is coming out very soon. I think around the time this episode comes out. Tell people where to find it. Anything else you want to share about the book? well you have a copy I just got a copy two copies somehow two because you're important uh we hope you read it twice um give it out to a friend so uh I would just say that life is speed of play is my it's I'm trying to share my my playbook and philosophies and And I'm hopeful that somebody will steal from my ideas and take it further. And we're all kind of in a conversation.

1:37:52And I love this podcast and you hosting this cocktail party. And we're all trying to move the philosophies and the craft of product making ahead. And we're all learning as we go. and I hope that my book can be something referenceable and I hope it's easy and fun to read because I have pain reading a lot of books.

1:38:19Lenny Rachitsky:It is actually very easy to read. It's like very not that long and it's very bite-sized. So great job with that. Oh, good. Mark, thank you so much for being here. Thanks for sharing all this wisdom with us. Thanks. This is fun. This is actually, I've done some podcasts about the book and I didn't want to talk about the content of the book on most of the podcasts. And on this one, I did. And I'm trying to only go into places that I want to talk about, which I tried to do in the book too. So there we go. Thank you for inspiring me to want to talk about product. My pleasure. Thanks, Mark. Bye, everyone.

1:38:59Lenny Rachitsky:Thank you so much for listening. If you found this valuable, you can subscribe to the show on Apple Podcasts, Spotify, or your favorite podcast app. Also, please consider giving us a rating or leaving a review, as that really helps other listeners find the podcast. You can find all past episodes or learn more about the show at Lenny's podcast.com. See you in the next episode.