The Token-Maxxing Bill That Shocks Every CFO — & the Fix

17:16Shensi Ding:help patrol yeah and then you know i've written about this and we'll write more about it but you know it's kind of like if you have this sort of evil genius who's a mass murderer but they're locked in a jail cell like they can't do anything right and it's the same it actually is the same thing as an agent though right like what what do you care if the agent is so smart it could do any cyber tech it knows how to do everything but it has no tools and you're just it's sitting there just talking to you like who cares it can't do anything the second you connect it to tools which is what everyone is trying to do right now that's where everything goes wrong well i heard with

17:46Gil Feig:slack too there's like major there's like a major leak there just as you deploy it you can get all this sensitive data just through onboarding onto slack yeah company information and i'll probably

18:00Shensi Ding:take that part out but yeah i don't know about that one i've talked to a couple people about

18:05Gil Feig:this one of our interviews was with gilly ronan from cybersarts and he had a crazy like doomer viewpoint but he's also being realistic he's like look if you are multiplying the amount of instances that you could be hacked and there are breaches it's obviously going to happen yeah so we were like talking about he thinks like really dark days are about also it's getting easier to find breaches too i think you can just tell there's a lot more like automated like ways to try to find bugs and like security issues um so yeah it's both sides easier to like create issues and also

18:37Shensi Ding:easier to find them all yeah to be honest like i i'm on call this week for our team i like to go back into the on-call rotations just to kind of see what's going on um and yesterday i had to manually go in and intervene because we all of a sudden had over a thousand bot signups in like an hour and we could see them actively scanning all the endpoints across our back end and it was called like scanner a scanner b scanner c and it's so hard to block them because they're coming from ips all around the world fortunately we have some good tooling with bot detection and we were able to to block them um but those are just getting really prevalent and all it takes is one and it could we know this from some recent instances like it could mean the end of your company um so yeah what

19:16Gil Feig:else are you saying i mean you probably read oh yeah he's so good at this research he does his And security reviews, too, for different vendors that we end up onboarding on, too. Oh, wow. Yeah.

19:24Shensi Ding:Yeah, I mean, I see a lot. We've just been seeing just repeated attacks. We've been seeing people just, you know, like, I'm sure you saw the GitHub one recently. I think that was not that long ago, where basically Wiz found that they were able to do a single Git push of a file and gain access to every single repository hosted on the platform. And fortunately, they responsibly disclosed it. But I'm sure Wiz did not find that manually. They're using AI. They're finding these things. Everyone's hearing about Mythos. Who knows? how true the whole secrecy and whatever story is but the point is like good models are going to be really good at finding these things so we need to get ahead of that so what is your view on mythos i mean my i guess i guess my take is like it's hypothetically or you know realistically i don't know which one it is i mean i think it's realistic that if we have an incredibly smart model it's going to be able to find a lot of things that have existed in these packages that we've been using for 20 30 years i think it's also good that we're letting it loose uh you know for for kind of like security and researchers up front to find those things and patch them because we saw how bad the Axios attack was where they just I'm sure they use an agent to find you know a sort of like some problems and find patterns of how they could easily inject uh something into the package without getting caught um but it worked and and so I think it's it's also the other problem here is you know a lot of these attacks don't come from Americans or from from people who who live a really great quality of life and are not you know not like looking for ways to make a quick book.

20:49Shensi Ding:It's people who necessarily need to do other things to find money in the world. They now speak English perfectly. They now write code perfectly. And they now have unlimited manpower all driven by AI. And so I think we're just going to see more and more of it.

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22:30Gil Feig:Visit turing.com slash S-O-U-R-C-E-R-Y. So as CTO, what are the precautions that you take? You have a bot detector, all these other things internally. How do you go about it?

22:41Shensi Ding:Yeah, so bot detection is one of them. You also, you know, I think in security in general, I think this is not commonly known, but your biggest threat is always internal, right? So we're less afraid of someone scanning our ports and finding issues as we are someone compromising someone internally and phishing an account and then using their account to do things or, you know, hiring the wrong person, hiring someone who's secretly a spy. Like that stuff sounds farfetched, but it happens. And that's why we're crazy about background checks and doing reference calls and making sure that we really are only bringing in trustworthy people.

23:13Shensi Ding:So again, I'm actually more afraid of that, of us bringing in someone, someone, you know, bad than I am of anything else. Oh, that's a good point. Yeah.

23:22Gil Feig:I'm so curious. This might be a little off topic, but when, because most of these are organizations that try to hack into companies, breach, and then sell the data for millions of dollars. what do they do with that data what happens what do you when they sell it to someone what

23:38Shensi Ding:what do they do with the data i think it depends on how does it impact you yeah i mean it depends on what the data is right so imagine someone steals all of uh i'm not gonna use i don't want to use merge as an example it's bad karma yeah our data is unstealable you know our data is unstealable but let's say like someone hacked plaid i'm just gonna pick them oh my god no their finance data. We can't. Those are not the data.

24:00Gil Feig:Cut all this. Cut all this. Make up a company. Yeah, yeah. All right, all right.

24:03Shensi Ding:Let's say someone hacked a financial data company that has, you know, a bunch of, I don't know. Bank account information. We need to roll this back. Yeah, yeah, yeah.

24:13Gil Feig:Okay, let's say there's a scenario. What would the scenario be?

24:17Shensi Ding:Okay, so let's say that there is a scenario where data got hacked, and this could be people's financial data and potentially their social security numbers, right? There's a few different things that they'll do. So first, they'll reach out to the company and say, hey, we have all this data, pay us for it. And the company has a lot to think about. They immediately engage crisis management and their thoughts like candidly going through their head is, you know, one, if we pay for this data from this company, are they truly going to then wipe all the data and get rid of it? You know, we still have to notify everybody because technically once a second copy of that data is out there, it's out there.

24:51Shensi Ding:So that's kind of the next piece. So people are thinking about how much it's going to cost to get them back. They're thinking about damage control. They're thinking about their brand, thinking about all of it. But the attackers know that. They know that actually this data might be useless to us. It might not be worth anything. But we know that to the company, it's their reputation on the line. And so that's who they're going to blackmail. They're going to go after that company and say, if you do not pay us for this data, we're going to leak it. And we know that means that you're going to lose all of your customers.

25:17Shensi Ding:There's other instances where they genuinely hacked credit card numbers and the data itself can just be immediately sold on a black market. um so that's another instance in either case the company that got breached technically has to notify everyone about it though they often tend not to do it um but that's why i think companies really care about it you know morally you should care about good security but business is business companies are thinking about their own reputation and how much any breach is going to cost them at

25:42Gil Feig:the end of the day okay so what else is the state of the ai infrastructure market what's going on

25:47Shensi Ding:i think i think cost is another one that's been that's been you know really crazy to follow along You know, you see everyone saying token max, token max. Yeah. And that's really great in theory. It actually is great in practice, too. You're seeing a lot being built, but then the bill comes to the CFO and it's actually really brutal and way worse than they expected. And even if they got double the productivity, they might not have had double the budget for headcount and they, you know, spent unreasonably. And so we've invested really heavily in cost savings using our gateway product, which has been been really cool to see as well.

26:18Gil Feig:Yeah. yeah and i think a lot more margin focus is also starting to increase like obviously we saw cursor increase their margins which is very very hard to do um but it is really important and there are a lot of really great open source providers out there too that are very cheap and maybe that's like the best platform to route to if you're doing like what's one plus one or like hello or like hi or like thanks um but it's really hard to automate that yeah yeah what else are you guys

26:41Shensi Ding:seeing i could share another this is not quite gateway um yeah another another problem that we've really seen actually is internal use of AI. So when we talk about our agent handler product, which helps you add integrations to your products, one of the things that we heard in a lot of customer conversations was, hey, actually internally, we want our employees using and automating everything. And I actually had the CTO of a really large financial firm say to me, my employees have been coming to me and saying, all my friends are using agents to automate this and do that and do that. And why aren't we?

27:16Shensi Ding:And he was like, because we're regulated, because we can't let you just connect all of our internal services to all of your external services. But really, they should be able to do that, right? And just security is a big problem there. So one of the big things that we've invested in and that we just see people with a lot more demand for is the governance and control over the agents and full visibility into what your employees are actually doing with them. So let my employees actually go and connect Salesforce and read all the data out of it and send it to other places, but also do it in a way that I'm going to detect if, you know, again, like bank numbers are being sent places or if proprietary data is being moved out of company boundaries.

27:55Shensi Ding:So that's another big. And for that, you see companies being like, this has to tightly couple with our identity providers and keep up with all of our employees. And if they ever leave, they immediately get access revoked. Just been seeing a lot of demand for that sort of thing.

28:09Gil Feig:Yeah. Another thing is also granular access. So for example, if you hire a PR intern and you want them to have access to like your account, so you want them to be able to see the accounts in Salesforce, right now it's either you give them full access to Salesforce or you can't get them access at all. And there isn't really a great solution for the in-between, but we were able to make it so that like IT manager or that CTO can make it so that PR intern can only like see accounts and nothing else. Like as hard as they try to like write data to Salesforce and they try to delete any data, it's just not possible.

28:35Gil Feig:So we're able to help you do that. Yeah.

28:37Shensi Ding:And one of the problems there too is like people aren't just using one platform for all of this, right? People at companies are constantly saying, I want to try this new platform, this new platform, this, and security can't govern that. They can't keep track of what's being connected, where. And so part of what we built was basically that central hub. So, you know, you built, you connect to all the software in one place on Merge Agent Handler, and then Merge Agent Handler connects to any platform you're using. So if you have some intern who's like, I want to try this new AI tool, you say, okay, you can use that.

29:05Shensi Ding:But the only tool you're allowed to connect it to is Merge Agent Handler. That connects to all the tools in a more governed.

29:11Gil Feig:What's also cool about that is it's kind of like the employees, like central node for all connectivity. So whether they're using codex or cloud or, you know, perplexity or whatever you're using, all the connectivity and the actions go through that node. So the CTO is able to see all the activity, if there's any security violations, and also if they want to revoke any access or add more access. Can I ask this? What are the most popular connections? Yeah, I mean, it's just like general, like productivity tools, like ticketing systems. like file storage systems like Google Drive, Box, Dropbox. Also, people are really obviously like messaging systems are very common just for like automation of communication.

29:44Gil Feig:Email is very popular. Also, like code repositories are very popular. But yeah, just like general, general like productivity tools. There are more specific connectors that are very popular for specific functions. So like obviously for accounting, it's like the most common accounting systems like QuickBooks, NetSuite, Xero. Marketing teams also are starting to use a lot of different platforms too, like hubspot um like a hr i don't even know how to say this one but yeah like all these like different like um geo different platforms too um but yeah just overall like it it everything is getting connected and even if there isn't even if there isn't a public mcp server we'll generally we specifically create our own tools so that's not like a blocker for anyone yeah we've also

30:24Shensi Ding:seen a lot of like customs systems of record for specific industries like credit healthcare And then actually just more of a fun one that we've done as well is, you know, we have a bunch of consumer connectors that we've built. So like Whoop and Aura, for example. One fun use case was we saw an employee at a different company connect their Whoop to their Asana task tracker so they could see how their stress correlated with the tasks on their board. Oh, my God.

30:50Gil Feig:Oh, my God. That's hilarious. Wow. Do you guys watch these trends, keep track of them for marketing purposes and for sales purposes? What have you seen over time? So I think we're just naturally really interested in it. So we just follow a lot, obviously, on Twitter. But then also... No, internally. Oh, internally. From all of your customer use, are you watching the trends of what people are shifting to? Because obviously, a lot of these code platforms are new. And some of the old SaaS platforms, they're boring and people don't want them anymore. We get a lot of heads up on roadmap plans, where people are planning on going, where they think things are going.

31:27Gil Feig:and also honestly on the partner side because we have so many different partners and gill and i are also meeting with them a lot we hear a lot of industry gossip about like future plans for like what they're doing with their api partnerships that they're going to establish um so we hear a lot naturally just because we are in the middle of all this activity um so yeah i don't know yeah

31:45Shensi Ding:gossip just like naturally comes to us yeah a lot of the giants that that seem stuck right now are planning big moves we'll see how fast they move on them but there's some exciting stuff coming

31:53Gil Feig:yeah speaking of one of those and your favorite person uh salesforce and their headless announcement yeah yeah i fucking love benioff you do i do i know i'm long i'm long benioff she's read all his podcasts yeah i listen to all of it yeah and you had a story that you guys were about to meet him and he didn't show up yes yeah so one of our team members her husband works at salesforce and he was like oh like i can get you guys invited to benioff's holiday party like where do you guys want to go and we actually had like our board meeting we were like oh like you know what like we should go like we like we wouldn't work we've been trying to like work with salesforce for a while let's let's try to go and so gill flew out um for one day for one day on economy um so he's a holiday party in new york um and so we go to this holiday party we're like ready we're prepped i've read all i've read his books i've listened to every podcast he's been on i deeply researched all their products things they were buying new tech they have yes um and then we're sitting there and then he just never shows up no and then like four hours later dj's cleaning up gill's still like let's just sit here and just hope he comes back but but i think what was really helpful from that time actually was that we i did do a lot of research on salesforce and like as a gill and um we talked a lot about it and one thing that's really remarkable is it's very hard to have a dominant product and company for 30 years through multiple tech shifts and so i just would not count benny off out um i think like he's able to adjust really well to whatever market dynamics are coming and i think it's partially because of his philosophy of like the beginner's mind that he always talks about in his book like if i started the company today what would it look like and so i think that if if salesforce can do a headless um could make like it could do headless like anyone else can um it's really really impressive what they've been able to do because it probably is very hard for them to accomplish that yeah and salesforce i i especially think

33:37Shensi Ding:they'll succeed with headless just because throughout throughout the past like they've

33:40Gil Feig:always had people who don't know what headless is also explain that yeah so essentially like

33:44Shensi Ding:you never need to go to salesforce you can have your agent it can it can you know go sign up through the API or through a CLI tool, like a command line tool. It can, you know, create accounts. It just kind of does everything without actually going into the platform, headless being almost UI-less. And in the past, they've already shown that they're open to this for 20 years because they have an open API and a lot of people have built on top of them. They've built a great ecosystem around them. It's their moat. It's their moat. You're using other tools. They actually, you know, maybe they do, but like on the surface, they appear to not care if you really go into the app.

34:17Shensi Ding:They just care that your whole stack is built on top of the data that's stored inside of there. So this is actually nothing new, right? It's just saying, okay, now agents are capable of using APIs to a whole additional level. We're going to facilitate so that they can do everything via API or MCP or whatever you want to refer to it as. So I think they've shown that that was a moat. That was something that was very successful for them. And this is only going to continue that.

34:40Gil Feig:Yeah, we've taken a lot of inspiration from what he said about Beginner's Mind for our company too. All the time. I would not cut him out.

34:47Shensi Ding:Every day. If we started the company today, what would we do?

34:50Gil Feig:What would you do? We did it. We're doing it.

34:54Shensi Ding:We did it. We fucking did it. We did it.

34:57Gil Feig:That's a good answer. Yeah. Wow. How'd you come up with that? So I guess because you guys are so close to the metal and you understand everything that's been evolving with APIs, can you explain how that market has evolved? And do you think more companies are going to take the headless approach? I think you have to because I think a lot of times um not for all software but for some software like you're not going to have time to make a decision for what vendor to use we notice this with packages a lot also in cloud code scarily but like you know it'll just decide which is the best package to for your product um and so they you'll probably end up picking vendors based off of that as well um and so I think you have to do that in order to compete so you need to make it easy for people to sign up create accounts pay um as much as possible because not everyone's going to want to meet with someone there are exceptions of course like infrastructure security products like someone will want to it's still a trust-based business where you want to meet with someone you want to you want to gauge like how trustworthy someone is and if you can really rely on them um but for a lot of like very simple use cases yeah you don't you get an agent an agent can make the choice

35:59Shensi Ding:and also headless really removes a lot of the the barrier of learning any new platform like even salesforce which isn't you know necessarily a technical platform like you i can remember the first time going in and being like what is an opportunity i just don't grasp this concept It makes no sense to me. Yeah, but like technically, let's say you want to have this whole business that you're running. You know, you are the one person company that's the next, you know, unicorn or whatever. You can't be knowing the intricacies of your hosting platform and of Salesforce and of everything, but you need all that stuff and you need those functions going.

36:30Shensi Ding:But, you know, and Lovable is a great example, right? Like you have your site, Lovable deploys it. It gets it running in the cloud. Maybe it's not like infinitely scalable, but it works. There's no reason that you shouldn't be able to tell an agent, you know, locally, like go build this thing. and it deploys it to AWS in a very scalable way or to Cloudflare in a very scalable way. Like everything can just be built and done by a local agent without you needing to know how any of it functions, just using sort of headless integrations all from one central agent.

36:59Gil Feig:Shanti, you mentioned like a really interesting thing when you were describing Salesforce. And I don't know, maybe it changes with this wave of companies, but in the AI world, like everyone is so ai pilled but it is evolving so fast you guys made a concerted effort again to like rebuild and pivot towards these new opportunities but how do you see that playing out especially because you've you've been founding companies for a while like how do you see this next generation evolve like do you think people will be able to adapt like that i i just think i think it'll be hard like i think right now it's very much easy mode for a lot of these companies and But every year from what we've seen, like we started a company in 2020 and I hear like everyone says like the year they started is the hardest year.

37:41Gil Feig:But like when we started in 2020, it was like peak COVID and we fundraised when people weren't even used to doing Zoom meetings. And that was like very hard. And then the year after, like then like everyone was fundraising crazy. The year after everyone died. And then after that, like then it became just like a crazy again. And so, yeah, I just think you need to really learn how to adjust regardless of what happens with the market. And I think Benioff's really good at it. And I think a lot of these people are not going to be used to that. Can you tell when you're looking at companies or you're like seeing them online, like which ones are big or not?

38:12Gil Feig:I think I think the best way to succeed is to just do things. And I think if you over intellectualize your company building instead of actually doing anything, you're too high on Maslow's hierarchy. And that means that you're not actually able to suffer later. So we talked about this a little bit off camera, but we were talking about talent and recruiting. and you were saying some of your best hires came like off cycle, not through like fundraisers and that kind of thing. What do you look for in talent? And what are those kinds of traits? I mean, you have to actually be interested in what we're building.

38:44Gil Feig:Like if you're only joining because like, you know, like you think you're really hot, it's going to be easy. Or like, you think you're just going to like only make a lot of money and you can just coast. That's just not the company that we are, that we are. And for most companies, that's just not a great fit. so it's really just like hiring missionaries versus mercenaries and filtering for that and it is hard like i think during like the period like the more upfront you are about how hard it is to do company building the more you're able to weed out the people that are just trying to coast and just like ride on your coattails and not do anything um but yeah i mean it is hard and like it's interesting to see like all these like people joining bouncing from company to company to company where they think will be really easy because once something gets hard they're just gonna abandon you it's a common i know christina cordova had a really great tweet about this but i i totally agree like you just you see those people and like they have really great resumes but they're just not on your they're not in the boat what was her tweet i forget what that exactly was but it was basically just like it was after one really hot company was going through a tough time um and like a lot of they were people were starting to leave and it was basically just like yeah when like when you like hire these people just because you're really hot like they're just i forget the exact I don't know.

39:52Gil Feig:I don't remember what it was, but I don't know if it really resonated with me. I don't know if you find it. It's shiny object syndrome. Yeah. Yeah.

39:58Shensi Ding:You find it, you see it a lot too in interview processes where you're talking to someone who's just like, I'm, I, you know, I'm interviewing currently only with top hyper growth companies and I want to de-risk with every single question I ask. I want to understand how I basically have this like high risk, high, or sorry, low risk, high reward situation, which just doesn't come often. So those, those are the people that we try to weed out pretty quickly too.

40:20Gil Feig:yeah also interestingly like some um some candidates will be like oh like what is your cash burn like you're not spending a lot but i also want like a real one percentile um salary oh my god how are you to get that oh my god what are the craziest asks that you've had

40:34Shensi Ding:i mean we we've had oh so we had someone we were like okay yeah so like people want to just like

40:40Gil Feig:join the exec team with like no experience really yeah they're like oh i'll just be coo or i'll be co-CEO and you're like what I was like who are you yeah no that does that does happen too um but yeah obviously or like someone will just be like oh yeah like I I want you to pay like public company salaries and it's like well then why are you here like you like the way it's supposed to work when you go to a smaller startup is like you're taking a bet on the equity you can't make more when you're going to smaller startup and maybe you can there are some companies where you can do that but like I think the rule like also like in order to find people who are really there for the company, yeah, you have to take a little bit.

41:16Shensi Ding:The risk in high risk, high reward is the equity and lower cash. That's what you're doing. If you're getting the same amount of cash, there is no risk trade-off.

41:24Gil Feig:Okay, so I want to go back into the SaaS-pocalypse a lot. I don't think we uncovered that enough. So what are you seeing in the SaaS world? I mean, the public markets, they've become so volatile off of all of this, but whether it's enterprise sales or other kinds of trends that are going on. yeah i mean i think enterprise sales for these large companies is much harder because the time to build the same exact product in-house is just significantly lower um there's also just less leverage like when you're doing a negotiation against the customer for why they should renew um yeah like you can always just like oh i could just build this and before that that meant a very different cost but now the cost for doing that is very very cheap yeah and i think people push back

42:04Shensi Ding:on that a lot at the beginning and they still do a bit but as models get better and better like we actively vibe code we we do this every day and now it's not just like hey go build this thing and now let me correct it a lot no ai is coming back to you asking clarifying questions and it's going and building a pretty robust system it gets to the point where english becomes your programming language like yeah at some point are you going to need to buy sass or are you going to be able to say duplicate this best in class platform also i think like consumer expectations are higher now

42:34Gil Feig:like you just expect significantly more automation and so the sass platform cannot keep up with the expected automation it's just hard to compete like you don't want to have to buy a platform and then build your agents on top you just want it to come out of the box does that make you nervous

42:48Shensi Ding:i mean i think we're good at this motion you know and and we also have a sort of like in some ways forward deployed team and the idea is you know a sort of if you can take off the shelf software that does most of what you need and then have someone customize it to exactly what you need at a relatively low cost which is what ai facilitates then i think there's still a lot of value in sort of platforms powering or buying sort of ready-made software off the shelf, because there's still a lot of nuance and a lot of detail that you avoid having to figure out that falls outside the time it takes to code in general.

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44:00Gil Feig:What really stands out is how clearly it explains why each stock is included. And before you invest, you can even backtest your idea against the S &P 500, so you're making decisions with real context, not just guessing. And beyond generated assets, Publix lets you invest in stocks, bonds, options, crypto, all in one place. They'll even give you an uncapped 1 % match when you transfer your investments over from another platform. If you want to build a portfolio that actually reflects your thesis, visit public.com slash sorcery. Paid for by public investing. Full disclosures in the description. Enterprise AI runs on Merge, the AI infra platform for integrations, agent tooling, and model orchestration.

44:38Gil Feig:So your teams ship product, not plumbing. Mistral, Dropbox, and Drada already trust Merge in production. Start building at Merge.dev. founders scale faster on deal set up payroll for any country in minutes hire anyone anywhere get visas handled fast and get back to building visit deal.com slash sorcery that's d-e-e-l.com slash sorcery i think we've become like a little desensitized to the valuations for ai companies or ai enabled companies yeah do you think they're rational what do you what do you see with silicon valley and maybe even the broader market could be upper market yeah i i think it's it's it's crazy because the public markets are has just such a different story versus the private markets obviously so i think it'll be interesting to see when like opening in anthropic go public because then it'll become like a kind of like a merging of the two um yeah i don't yeah i don't really want to like talk shit get hit so oh my god but yeah like i mean obviously i have a lot

45:41Shensi Ding:for like private thoughts yeah to not to not name any companies like i remember when when we first started merge we were like candidly it was it was really frustrating to see some companies where we knew what their revenue was and we knew they were raising it like a 3 000 x multiple on that revenue we were seeing insane valuations and like you can't help but be a little jealous or a little just like come on like why is this happening and you have vcs telling you you don't want that that's not the thing but in the moment you do it of course you want that um and we're really glad we didn't because obviously a lot of those companies ended up falling and some of them ended up doing really well but but most didn't and we're seeing it now a lot of the numbers that are coming out some of them are really really successful companies and are obviously going to continue to grow um but we know specifically like we know the numbers we know sales figures for some of these companies raising at hundreds of millions to billions and again we're looking at thousand x to you know hundred to thousand x multipliers like a lot of these companies are going to fail um or they're going to be doing well but just not be able to raise their next round and and they're going to be forced to massively lay off and slow down how do you stay focused through

46:44Gil Feig:all that there's just so much noise i think yeah we just have to think long term and also like i think we just have you just have to focus on like your wins for like your customers and the type of customers you're onboarding and like what your actual business metrics are um but yeah like obviously like it's it's a it's competitive market with when it comes to recruiting talent like it definitely makes it a lot harder especially for people who are optimizing just for like what has like the biggest valuation what has the flashiest like numbers um and so that's where you really filter for missionary versus mercenaries.

47:11Gil Feig:So I think you guys have been a little bit humble. I know. And I think these are some of your customers. So some of your customers are names like OpenAI, Perplexity, Netflix, Uber, Mistral, Dropbox, Freshworks, and more. So how did that happen? Yeah, a lot of work. Like it was very a lot of work. Yeah. When we first got started, especially because we were infrastructure, a lot of startups like were very scared to use us. I remember talking to Ram and they were, I think like a hundred employees at the time. And we were really scared to onboard them because our product was so like early. And yeah, it's, it's, we've obviously gone like a long way since then.

47:48Gil Feig:Obviously they've grown a lot on us as well. And yeah, we just, we've had to adapt the company a lot. Like I think after our series B, we made a really concerted effort to move up market segment, our team, have a more mature sales motion and also just make sure our product was really enterprise ready. And that was really hard. But like last year was really when it all started kicking in.

48:06Shensi Ding:Yeah, it really took climbing a logo ladder, riding off the reputations of each successive company size growth to be able to close that next level and prove that we could handle that.

48:16Gil Feig:Yeah, and then once you close up, not fucking up.

48:19Shensi Ding:Oh, yeah. Yeah.

48:21Gil Feig:Was it intimidating getting bigger and bigger logos? Oh, my God. Yeah. It is. Yeah.

48:25Shensi Ding:It's intimidating every day. We power critical functions for a lot of these businesses. We're talking their core. You log in. That could be powered and heavily driven by Merge. You go and you use some core AI model and it looks up any data from anywhere. That's us as well. So these sort of things like we cannot break. We cannot go down. Everything's like four or five, six nines of uptime. Absolutely essential. And if you lose that, you can lose all your customers overnight like some companies have recently.

48:54Gil Feig:Wow. Yeah. No pressure.

48:56Shensi Ding:No pressure. None.

48:57Gil Feig:Yeah. You guys are so chill. Oh, yeah. Yeah. Speaking of that. So one of our sponsors is Brex and they're all about performance, spending smarter, we love faster, love Brex. And so this is a question I usually like to ask as it regards to performance, but like, how do you think about the metrics you use to measure success? What are the next milestones that you want to go after as a company? So yeah, revenue obviously matters the most, but also how much money we spent to get that revenue. That's really important. So we're always looking at like our gross margins, our cash burn, yeah, our cash burn multiple, what our runway looks like.

49:33Gil Feig:Those are just really important for us. And we're always looking at that every week.

49:36Shensi Ding:Yep. And then the metrics that we believe obviously heavily lead to that, the quality of our product. We think our reputation and how people view us in the market is the driver of that. And so for us, it's never been okay to be in second place. We want to be the leading platform always. If we receive any negative feedback, we action it immediately. It's critical. We are the number one product on the market. we will not let that change.

49:58Gil Feig:What are the biggest misconceptions that you think are happening in tech right now? Girl. This is a program.

50:04Shensi Ding:I need to know that. Like, they told us it would be easy. I know. We need some hot takes.

50:10Gil Feig:Dale, come on.

50:12Shensi Ding:Hey, Rose, this is the SAT store.

50:14Gil Feig:The biggest misconceptions.

50:17Shensi Ding:The biggest misconceptions, what about, what was it about?

50:19Gil Feig:In tech right now, yeah. Everybody's tied to their screens looking for the next, like, model release, but, like, what's the higher picture? like oh yeah okay so i mean one hot take i want a hot take that i have is that i've noticed a lot of companies like kind of over engineering their like ml usage like they'll have like they'll build their own custom models they'll try to um train their own models when really like you should you could probably just use the generic model and then focus more on making your product better that's good that's my i mean when should you build versus buy i mean yeah there are some specific situations where you like obviously you have to and maybe i don't know but i i've noticed there are some companies that i was very surprised to hear how advanced they were when it came to training their own models when their product was lagging and i and i don't think that their customers end up actually seeing the benefit of all that work and sometimes you need to just focus on like what everyone could publicly see more i actually want to second that you see a lot

51:12Shensi Ding:of people trying to build like a custom harness or you know um use something like a workflow builder to build agents that are that are repeatable and all of that and i just ultimately think none of it matters because we're almost at the point now where English is the language that you use to tell an agent it will be deterministic very soon we already see it you just say hey go do x thing that hey go do x thing is your artifact from then on out that gets repeated by the agent infinitely so I think all these platforms that are around like build agents that are more reliable and that do things more repeatedly and none of that really matters all that's going to matter is just can you type it in English somewhere have that run on a periodic cadence for your background agents um and then do you have auditability for and observability for security okay all right well

51:57Gil Feig:this is an easy closing question what are you most looking forward to this year it's not easy what's your favorite color i don't know oh yeah this year i mean there's a lot we put a lot of hard work into the past few years um and like it's all really coming together so i'm this i'm really excited for it to just like finally come through i actually bought a spell early this year oh she's really into spells i bought like an etsy spell away like you bought i'm sorry you bought a spell yeah you never bought a spell is that why you're on sorcery you know like this started as a witch podcast oh really yeah i love witches no i i'm just kidding oh i have a girl only ten dollars for three wishes i know that's it i know and one of them already came true and then they email you Yeah, the other one's like on its way.

52:47Gil Feig:Are you sure you're not from LA?

52:53Gil Feig:Do you have crystals? No, I don't. No? No, I don't. I do ask everyone what their horoscope is, and I actually did not believe in horoscopes until when we started this company. Like 80 % of our early team members were Tauruses and Libras because they can endure abuse really well. I know. What are you? I'm an Aquarius. What are you? Taurus. Yeah, he's very abusable. Damn. I know. It's very abusable. That's great. it's great i'm a leo oh you know you are a podcast host what is it what does it mean though i just like i actually don't really know other than you're just like flashy i think that's the only thing i don't really know anything about i'm quite an introvert oh really yeah my family was making fun of me at dinner last night because they're like everything that you've been afraid of since you were a child you're now doing it's like facts face your fears yeah um yeah i have i

53:42Shensi Ding:I have one other one that I just forgot. Okay. So, wait a second. Oh, okay. So, yeah.

53:49Gil Feig:This just in. This just in.

53:50Shensi Ding:What I'm really excited about for this year. No, what I am really excited about for this year is that companies are going to actually start using AI agents. So, we built Agent Handler and a lot of our products Gateway because we saw all these problems with us trying to use AI. And we were like, oh, yeah, this is clearly a problem. Everyone's going to hit it. And then we start getting on calls with customers to sell it. And they're like, yeah, bro, like we just gave our employees access to chat GPT in the browser. They're not allowed to use anything. And that was painful because we were like, we have all this stuff ready and like no one is ready for it.

54:22Shensi Ding:And this year we're now starting to see companies being like, we need this, we need this. And we now not only have those products, but we've been able to run cycles with a lot of the early adopters. So they're built out and they are ready to sell as companies start to like kind of come online this year.

54:35Gil Feig:It's a great way to end it. You're ready to go. We're ready. Thank you guys so much. Thank you. Awesome. Hey, it's Molly. If you enjoy our interviews, check out our newsletter, Sorcery.bc, where we deliver a once a week top deals and tech headlines email and also go deeper on our podcast interviews. Subscribe to Sorcery today. And don't forget to subscribe to the podcast on YouTube, Spotify, Apple, or wherever you listen. Link in description to sign up.