Taking on Apple with Nothing CEO Carl Pei

23:39But when it was our turn, because everybody was so scared of working with startups, not only did we have to pay for the inventory we also had to pay four months before getting the product because they just wanted to be 100 sure that they would get paid and make money on the deal and we were like holy crap like what do we do about this because as a startup you don't have any cash um the thing we pulled off that i'm still really grateful for is one of our sales channels they believe in us so much because they wanted to sell the products after we uh after we make it they they wired the money to us like four months before getting the product like they had never done that before and they had to go to their board for approval but they did it but there's many like there's many cases like this where we've done stuff that's seemingly very abnormal or very difficult to do in order to even survive past this stage.

24:43So your supplier was like, I'm sorry, Carl, we just got burned by a situation ship with Andy Rubin and his essential phone. How are we going to make this happen? They're like New York landlords, like we're going to need first month, last month and deposit. Yeah. Yeah. But not just one company, right? They were burned by three or four startups in the past. Support for this show is brought to you by Salonis. I'm sure you've heard a lot of vague promises about AI, like it's a magic solution or a miracle cure or a bit of pixie dust. And if you just add a little AI, suddenly your business gets faster, smarter, and easier.

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26:33Alex Heath:This is a job for Indeed Sponsored Jobs. So what is it about nothing that has led to you surviving, but now also it seems like thriving? You just raised$200 million. Your sales are roughly doubling year over year. What did you figure out that no one else figured out? Was there one thing or was it a lot of things? It's a lot of things, but maybe to summarize, maybe it's pacing. or understanding of the industry and pacing. Like we knew that the industry was very tough and it's easy to mess up and we have to do basic capability building in the beginning because there's so many steps actually from having a product idea to shipping it at scale all across the world.

27:19So in the beginning, we kind of paced ourselves. We didn't go too crazy on the product definition. If you think about it, our early products were basically products that already existed that other companies have invented and made huge categories. And we just tweaked the design a little bit to appeal to a specific target audience and gradually grew our capabilities from there. I think now we're at a point where, going back to pacing, we have some of those solid capabilities, these foundations in place, which really enables us to take more aggressive steps into the future and take more risk on the product side, for instance.

27:57Alex Heath:Give people a sense of nothing as it exists today because I think especially people in the U.S., they don't really know the brand. You're mostly big in Europe and parts of Asia, India. Give us a sense of who your users are. What's the demographic? Are they mostly Gen Z? Where are they? And then how are you thinking about the U.S. now? Yeah, we are approaching five years old. We're roughly 800 to 900 people. We're approaching a billion dollars in sales this year. If we had an air horn, we'd play that, like the TBPN guys. So that's a huge milestone. Yeah, thanks. And our users are very young because when we built this, we were like, it's pretty much impossible to be popular among everybody in the world at the very beginning.

28:46So we got to pick a lane. And we found that the younger consumer really resonates with our products. I think that it's coming from a place of wanting to be different, like finding their own identity, not wanting the same products as maybe their parents. And, you know, when we were growing up, Apple was such a cool company. But when these kids today are growing up, it's kind of just another corporate. So they don't have the same brand power among the youth as they have amongst us. So if you look at our users, on average, they're 26. I think Samsung's average user age is like 45 or something like that, and it keeps growing.

29:25So I think it's a great place to start. And if we can really serve these consumers' needs really well as they grow up, I think it's going to create a really solid user base for us. We know Samsung has cornered the market on dudes with belt holsters here in the United States. Especially with the foldables. Yeah.

29:47Alex Heath:I heard, Carl, you have a view on foldables. Are you warming up to them? I'm holding the new Pixel Pro X Fold, and I like it. I wish I could say you look great with your foldable, Alex, but I can't. I can just block my whole face here. But yeah, just while Alice mentioned it, what do you think of foldables? I think it's an interesting product, but probably not for us right now, because if you look at the current state of foldables, the annual shipment volume is about 17 million units and annual shipments for smartphones is 1.2 billion so it's a very very small part of the market and if we look at who buys foldables right now it's usually men who are in business who do podcasts podcasts they need space to kind of sign documents or read documents so if we're targeting a more young demographic a younger demographic, it doesn't really make sense for us.

30:44But because Apple is doing a foldable next year, I think that might open up the market. So after their release, we can reassess. I remember reading something like 87 % of Gen Zers in the States have an iPhone. And it's like a status symbol to them, even if they don't necessarily love it or feel a lot of loyalty to it. How are you going to break through that? It's really tough. And also every year, the Apple market share grows in the U.S. And if the young people already, like if you say 87 or 90 % of the youth already use iPhones, just think about what will happen when they grow up. It will become a monopoly, right?

31:27So I feel like the smartphone business is really tough in the U.S. for us because of these dynamics. And Apple's behavior has definitely not made it easier for us. kind of there's a social part, the brand part, but there's also the lock-in effect with iCloud and AirDrop, iMessage and all that stuff. Yeah. Which is making it really hard to switch. So I think US will be it's a really important market for us going forward. It's already the biggest market for our earbuds and headphones, so our audio products. So we can definitely see that if there's not the lock-in situation going on, U.S. would be a big market for us on phones as well.

32:11So we see the potential. And as we're now looking into new form factors into the future, I think that for those new form factors, U.S. will be the most important market because we already see that for our audio products. Why not for our new form factors that are not necessarily competing with iPhone, but they're just brand new products that can be used together with iPhone.

32:36Alex Heath:The lock-in thing is really interesting to me because, yes, it is still difficult to switch, although I would say with cloud and the fact that a lot of apps now easily sync, it's not as difficult as it once was. Also, the porting data over has gotten faster. I remember when it took hours and hours to transfer your data to a new phone, right? And now it's relatively fast. I mean, I just did this with the new iPhone. But I've been sitting here with this Pixel that Google sent me to try, and it's cool. and I want to experiment with it, but I just, I don't want to relearn a decade plus of OS knowledge and just, um, feeling it's like this, it's this, I don't know.

33:16Alex Heath:It's, it's very hard to put into words, but it just, it feels like one of the biggest things to overcome is actually just people being set in their ways. And maybe you can't, maybe, maybe it's very difficult to teach an old dog new tricks, which is like, I guess I'm, you know, I'm an old dog as it comes to phones now, but it sounds like what you're saying is if you can get 24-year-olds on board when maybe it's like one of their first phones and they haven't been comfortable with iOS for over 10 years, that's the real opportunity. It's not like you're maybe going to switch millennials necessarily over en masse.

33:46Alex Heath:Is that fair? It's fair, but I still think we'll have to address the lock-in issue somehow because if a young person is chatting in group chats on iMessage with their friends, they don't want to be left out. Yeah. Well, can we revisit that for a second? I know there was a moment, I don't know if this was just a stunt or if this was a long-term plan, Carl, but you guys actually created your own iMessage solution, right? Can you bring us back to that moment? Yeah, I think around that time, two, three years ago, there was a bunch of companies trying to jailbreak iMessage. I think they were running virtual Macs in the cloud to pretend to be devices that support iMessage.

34:29And we had this iMessage problem, especially if we want to target the US. So we worked with one of these startups and it didn't go very well. I'm sure that was the first thing on Tim Cook's desk that day. Yeah. Your YouTube video. So it got a lot of interest, but we should have vetted the startup security measures better. So we identified some security issues and it was a big controversy and we shut it down like within 24 hours, never to be reopened again because in hindsight, this workaround thing is, it's not secure. It's also like not permanent. It's easy to patch on Apple's side. So maybe we should just wait until, you know, governments around the world, you know, force Apple to open it up because we're already seeing trends with the European Union and DOJ really challenging Apple and some of their behaviors.

35:33Yeah.

35:34Alex Heath:Is India your biggest market right now? For phones, yeah. And followed by what? Because the company's based in London, followed by the UK, Europe? Followed by Germany, actually. Germany. Okay. I'm so fascinated in India because there was a story recently where you're seeing like 140 plus percent year-over-year growth there. You're growing in terms of just like general market share awareness too in a way that a new brand hasn't really done. What is it about India that has worked for you? We know the market really well. Like even the previous company, OnePlus, was really big in India. And I think now what we're seeing there is consumers are changing.

36:20The economy is growing very quickly and the middle class is growing. And middle class consumers, they want something different from the past. Like when you don't have a ton of money, you want the functional benefits of something. But if you start having more disposable income you care about other things as well the kind of emotional benefits of a product do i like the design do i like the brand do i like the software user experience so we're seeing india shift in this way and i feel like us as a company we're pretty well positioned to like to succeed in this new world of expectations whereas if people just care about efficiency like can I get the most spec for the lowest price it's really hard for us because at a small scale compared to the apples and Samsungs of the world we have to pay more for our components so this demographic shift or this consumer shift we're really seeing a lot of traction here but

37:20Alex Heath:you're going for the high end too right so like the nothing phone 3 launch pretty recently happened in the US a few months ago and that's priced at like$800 it's just up there with you know the base iPhone, Samsung. It seems like now you're really trying to go after the more higher-end market. Is that fair? We have a range of products, starting from phones, starting from$200 up to like$1 ,000, depending on the configuration. On average, we're selling our products at around $350 US. So whilst we have the high-end one, the volume driver is around$350. 50. And so when you look at all that money you've now raised and looking to the future, I mean, you have a lot of options for how to invest it.

38:07You have hardware, software, now AI. How are you thinking about allocating that$200 million you've raised? We need to be very careful with the money raised because I think first of all we should become profitable. We've been kind of like a ship that's been in the ocean for a long time, for five years, and it would be good to just dock the ship so the entire company can feel like how it feels to be a profitable company. And then we can decide to go faster and go harder and kind of set sail again. But I think it's good to just arrive on land and take stock of the situation first. So we're definitely going to be very careful with how we spend our money.

38:54But this also enables us to invest into the future. So if we say that our regular business that we have now, the smartphones and the audio products, let's be prudent, let's grow, but let's not waste money here. I think we have a little bit of budget to try new things. And that's where I feel like we're in a sweet spot in terms of scale. Like we're not small and we're not huge. If we're too small, it's hard to create quality products. Even if your concept is cool, it's hard to have the raw engineering horsepower to actually deliver something of quality. And it's hard to have the supply chain relationships and all that stuff set up to ship it at scale.

39:39So I think we definitely have that, but we're also not too big that it's really hard to steer the ship. So I feel like we're in this really interesting sweet spot. And given all the developments in AI right now, there's going to be so many experiments, both on the hardware side and the software side from all over the place. Startups, you know, Magnificent Seven, everybody's going to start trying new things. And when we started five years ago, we said tech was boring. We wanted to make it fun again. I think it's definitely a super fun time. So we're very excited to put our hat into the ring as well and participate in exploring and finding the new form factors of tomorrow.

40:19I know a big next step is what you're calling the essential OS. I saw that you're targeting 2028, which is a little off into the future. It feels like a lot of the hardware companies at least haven't really painted a picture of what phones are going to look like in part because I think they're afraid to self cannibalize in some ways as a lot of the processing power and whatnot moves off your device to some extent. How are you thinking that those devices are going to look in a few years down the road? Yeah, I think the reason why others haven't thought as much about it is because Because, I mean, I've been inside of some of those organizations before.

41:03They're more like a CPG company, consumer packaged goods company. Like, what are the features we have? What are the features the other competitors have? And how can we sell more than them? And how do we grow our sales every year? And that was the reason I wanted to have something independent on my own. Because it would not be a great outcome if we just did that. like it would just be following the industry. I wanted to have a chance of really building something unique. The reason why we picked smartphones was also that the smartphone is the most important digital device we have today. It sells the most.

41:44It's got 1.2 billion sales a year. And we use it for many hours every single day. So we thought that if we're able to enter this industry, survive and grow in volume, Then we have a great foundation to deploy software and services on top of. So it wasn't like to make a smartphone company. That was never the goal. But the smartphone was a tool that we could possess to create cooler stuff in the future. I don't think the hardware is going to change significantly. I think we're at an era where the hardware improvements are marginal. So every year we'll see better battery, slightly better cameras.

42:30Not a hand projector is what you're saying? No. Probably not. But the software is really a place where there hasn't been a lot of innovation, if I'm being honest. Even in the Palm PDA days, it's still a similar UX to now. You have full screen apps, you have app stores, you have home screens and lock screens. Styluses are even back. Styluses are back. I think the future is definitely generative UI because theoretically the phone has a lot of context over you. And why are we all getting the same experience when we're all individual people? We have different needs and different priorities. And beyond generative UIs, it's also going to be a lot more proactive and agentic, meaning that once we have an intention, once we know what we want to do, the gap should be a lot smaller than currently.

43:23Like today, even grabbing coffee with a friend, that's like five different apps, right? Like scheduling, texting, Uber, Maps, et cetera. Well, so when you turn those five steps into just one user interface with AI, I think some may say you're also kind of abstracting away those services, whether it is the Starbucks app UI, the Yelp app UI, the payment app UI. How do you feel like those companies are going to feel as they kind of get asked by potentially you guys or Apple or now OpenAI as they try to bring them in? Say, hey, we're just going to show parts of the UI for you. Maybe there's less opportunity to discover other things in those apps.

44:07How do you think those companies are going to navigate that? It's going to be a complicated path to navigate. They don't want to be dumb pipes, right? Yeah, 100%. So on one hand, there's the ecosystem of apps, but there's also the consumer that we need to bring along this journey. But maybe I take the ecosystem first. I think we're also pretty well positioned here because if you're a huge company, they might feel bullied by the huge company who just wants to steamroll them. And they're like, hey, this is our API. This is how you need to connect and go do it. Whereas for us, we can say, hey, you know, we don't know what the future is going to be.

44:47We think that it might be like this. And we don't know exactly how to work with everybody. We know your brand matters to you. You have a lot of, you invested a lot of money into building your brand equity. So let's co-work on something together. At the very least, it's learning for both sides. You'll learn how you can navigate the new world better. And we can learn how we build the products better.

45:08Alex Heath:That's a very diplomatic answer, Carl. It does seem like currently, based on where things are going, your biggest competition on this will probably be Google, just because they're already starting to do some of this. Like the new Pixel has some very lightweight, agentic stuff. It'll start like surfacing things from email when it makes sense in text, which is nice. Apple is obviously way behind the eight ball on this. Maybe they'll catch up. Maybe they won't. but yeah I'm curious how you think about competing with Google especially because you know the your phone is based on Android I mean Android is open source but yeah what is it like competing with Google and how do you think about them especially on the AI side as you're trying to also build this AI OS?

45:54Sometimes being small also has it has its advantages like we can move faster we can make decisions faster potentially take more risk I think taste is going to matter because when you're introducing people to a brand new way of doing things or using a product, the more beautiful it is and the easier it is to use, the higher the chance for a product market fit. And I think we should be humble. We should, you know, ship quickly. Instead of spending five years or three years on a project, we should spend nine months to 12 months to test a new form factor. Instead of spending hundreds of millions of dollars, we should spend like 10 million, 20 million to test something out and really be close to the consumer.

46:38Like take the feedback and iterate quickly. I don't think we have a, we're going to be able to do a one hit wonder. I think Steve Jobs did that a couple of times in his career. He reimagined like industries and the first product almost always hit. I don't think we can do that. But if we can't do that, the plan B is to iterate quickly, take feedback, don't spend too much money and just ship quickly. It seems like one of the tenets for your AI approach is kind of looking at memory, like your personal space, personal search, whether that's with the essential space or some of the tenets of the essential OS.

47:15How are you thinking about that? Do you feel like that's like uniquely accessible way to get into AI for a lot of people? I think that's actually the core of what we want to do. If consumers get to learn that the more context I feed into my AI or OS or assistant or whatever you call it, the more utility I get out of that, that's going to be the trigger to give rise to a new array of form factors. because sometimes you have your phone in your pocket. Maybe you're walking or maybe you're at a dinner. The phone is not always there for you. And as soon as people realize that the more context they can feed in, the better output, I think then new categories will start growing.

47:59And I spent some time to think about 10 years from now how the world will be and what categories will be popular. I still think phones will be popular. It will still be a billion-unit-plus industry simply because there's still hundreds of millions of people on Earth who don't have smartphones. So even if we in the Western world, we upgrade our phones less frequently, it's still going to be an important device for us. But then you have all these other people who are going to come online and use smartphones. And I really also believe that the new form factors for context capture will be a billion-plus categories in the next 10 years.

48:39Alex Heath:This is like the puck that OpenAI is developing with Johnny Ives, stuff like that, wearables. Stuff like that. Nobody knows what the perfect form factor is. We're all looking for PMF at this point, but let's see. I mean, something like that, maybe. For those who don't know PMF, product market fit. That's what I thought the talk button was going to be on the new headphones. I was like, oh, I feel like that's kind of like no matter where you are, no matter what you're doing, that's going to be the AI button. We made a tiny step with the talk button. So if you have a nothing phone in the Ear 3, you can use the talk button to record your ideas into Essential Space.

49:15Yeah.

49:16Alex Heath:When we were in LA together a few months ago, you were talking to me about the ChatGPT integration you managed to pull off through the headphones, where they're essentially the only headphones that you can talk to ChatGPT without doing multiple prompts like you have to do on iOS. It's a little jankier on iOS. How are you thinking about ChatGPT, though? Because they have the most memory of any AI product right now. I think they really see that as a key competitive edge for them. They're going into devices. You support ChatGPT in the phone and the headphones right now. But how do you think about that over the next few years?

49:53Alex Heath:Do you feel like your all's interests kind of collide in your competitors? Or do you feel like you can be a platform, a hardware platform, for these LLM companies who want more distribution and want more context and your devices would be the way they would get that? I think long-term, this is a very good question. I think long-term, it would be really bad if we just become a hardware company because if you look at our products and the different components we have in the product and the different types of companies in our value chain, a hardware OEM has the lowest margin out of everybody. So the chipset maker has higher margins, the OS provider has higher margins, etc., etc.

50:38So it will not be a great outcome if we go through this new cycle that's coming and we end up still being a hardware manufacturer. It's a good place to start and the only place we could have started, but we shouldn't end there. But that's the long term. In the short term, there's a lot of practical things we need to navigate. So if there's opportunities to partner in a meaningful way with any of these larger companies that can also, at the same time, provide value to our consumers whilst not blocking us from achieving our long term ambitions, we'd definitely be open for that. In fact, we're entertaining a couple of these conversations right now, but it would just be bad to become a hardware company, say, in 10 years from now.

51:26Alex Heath:So what does that mean, though? Does that mean you need your own foundational AI models? Like, what does that mean for your AI strategy? The way I see it is that the models are, there's so much investment in the models, and there's so much competition between different labs. So one month, one model will be really powerful and another month, another model will be really powerful. So with our resources, we won't be able to compete. And I think globally, if we look at all these model companies, I feel like they're going to enter a price competition or a price war, which will erode their margins further.

52:10I think long term maybe two or three companies are going to thrive and the rest will have a very hard time. So this is not a good place for us to invest. And also if we study the model companies, they're all kind of pivoting to do either deep enterprise or to do applied on consumer. So I guess it's also a signal that they're not seeing a ton of improvements like step change improvements in the model capability. They need to apply the technology in new ways to help consumers and users. So I think for us, we should focus on applied, and we should focus on applied towards consumers. And the thing that we need to be really great at is to help people capture context and then action on the context.

52:59I think that's where we can also build our moat. I sense that deep enterprise isn't really your passion. It's a good business, but no, I'm a consumer person. I mean, the entire reason why I entered this space is because I love these products as a consumer. Yeah, so you definitely have a distinct taste and aesthetic. As you seek to go broader, do you find that the aesthetic is resonating more broadly or could it actually be turning some people off? I mean, I wear your headphones around all the time and I love them. But, you know, I don't know, people are like, oh, maybe I'll just stick with my AirPods and blend in with the crowd.

53:43I know there have been a lot of ads about that as well. How do you balance that, like trying to, you know, really develop a striking aesthetic? I mean, even the fashion stuff you're doing and the photography stuff you're doing feels kind of high fashion, which traditionally has been kind of exclusive, right? Yeah, it's also a great question. I think it goes back to the pacing thing I said, like, you know, when we're just starting out, we have to be super opinionated. because even if 90 % of the people hate us and 10 % love us, that's perfectly fine for a startup that's trying to get a foothold in the industry.

54:16Is that the stat on your end? 90 % hate, 10 % love? No, it's just a theory. And if you take a step back and just try and think from first principles, with our current design aesthetic, there must at least be 3 % of the world. at the very least that would find it like would love it and we're not three percent market share yet in fact we're quite far from three percent market share but I don't know if you noticed in in 2025 we have been evolving our design language a little bit we've added more metallic accents slightly toned down the transparency so it's still very distinctively nothing, but we're seeing an evolution in our design language.

55:07And that's kind of our experiment. Like we know we need to keep growing and we need to cater to more people over time, but we also need to do it in a way where we keep what's different about us and not lose track of our early adopters. I hadn't really thought about it that way. That makes a lot of sense. Yeah, the new headphones are kind of more silver, maybe a bit more accessible. I mean, it's tough, isn't it? As a hardcore gadget nerd, you're like, I want to make something that looked like those yellow Sony Walkman headphones from the 80s. I mean, that's what I see when I see these. And I'm like, these belong in the MoMA, you know, essentially.

55:48But it doesn't necessarily mean that it's going to get you to millions and millions of users. But our 2026 roadmap still looks very cool and very exciting. So on that side, it's not tough. I'm very excited about our future products.

56:03Alex Heath:Talk about this a little bit as most you can, because I was saying like, even there's a Financial Times story about the recent fundraising. They were like, you're talking about robotics and even integrating into electric vehicles. I assume you're looking at glasses. I assume you're looking at all kinds of wearables. Like where does the Nothing brand go next? Like beyond phones and headphones, a watch, like how are you thinking about all these different categories? Yeah, I'm just trying to figure out what I can say right now. Just share us the roadmap. If we think about the context or the memory being in the middle of a person's ecosystem, then the smartphone is going to be an important part of it, but only one part of it.

56:44Glasses is an interesting category. I was really bearish on glasses before because I even went through the pain to do LASIK, to not need to wear glasses. I think the bar is very high. I used to think the bar is very high to get somebody to use smart glasses because it doesn't feel comfortable, and you really need to provide a lot of utility for somebody to want to use it. But I've been quite surprised, actually, by the growth of the Meta Ray-Bans. This year, I think there are five times more sales than last year. So it's something worth thinking about. We haven't made a decision around glasses, but I'm warming up to the idea.

57:23Alex Heath:I think it's fascinating, Carl, how you engage with the nothing community and customers. And like you're a YouTuber. You're a very successful YouTuber, which I don't think many smartphone CEOs can say. And something I love is you actually review competing products, which is super unusual. How do you think about just engaging the world as the CEO of a company like this and doing that? Like talking about competition, for example, is something you just don't see consumer electronics CEOs do very often. So was that something that just was natural to you or is it a strategy? There's an underlying logic to it.

58:04I think my team hates it, but I always say we got to get 10 times more out of the money we invest because we have so little money compared to our competitors. I heard Samsung has a billion dollars a year in marketing budget for just the US alone. We're nowhere close to that. Every dollar we spend has to do a lot more. We have a lot of weaknesses as a smaller company in this industry. We have to pay more for our components. We can't have as many engineers as we would like to build all the cool stuff. so we really have to look at all the potential areas where we can turn these disadvantages into advantages and I think content creation is one of them because like nobody would do it if you're a publicly listed big company like it's so easy to say the wrong thing and like it's impossible for them to do so that's why we should double down here and we started experimenting with content creation about two years ago.

59:08I think last year we did about 600 million organic views on our content, mainly short form. And this year we're probably doubling that as well. And next year I'm trying to think of how we get to like 5 billion, like 5x or 4x. But I think because I think this is going to be a really unique opportunity for us, especially as we're targeting the Gen Z and Gen Alpha. Like they spend all their time on these social media, platforms.

59:34Alex Heath:Do you work on retainer for podcasts who are looking to grow their, uh, their online views? No, that's, that's, that's super impressive. I mean, is the team that you're hiring for that? Are they just like these like cracked early twenties, like super online people? Like, how do you, how do you do that? How do you just organically create billions of views for a brand? Um, two things have been, two ideas have been really helpful. Um, you know, in the beginning, we created these like high-end like branded mysterious type of content and then one day a friend pulled me aside and said hey what you're doing is kind of cringe like you're just a brand trying to sell me things just like every other brand but you know i just want to be entertained so don't be a brand be a why can't you as a brand just be a creator so that was a big mindset mindset shift for us.

1:00:24And the second thing for short form was just create a lot of content. Like so far we've basically gone through all our archives, all our long form content we've clipped into short form. And it's just like a numbers game. Sometimes the algorithm likes it and it gets a lot of views. But I think looking into the future, there's just a lot more we can do. Like we don't even have dedicated short form content. Everything is reused. Just dedicated content can help us a lot. We have users all over the world. In some countries, they don't speak very good English or their culture is very different. So in Japan, we just hired a YouTuber who will hopefully join our team very soon and start creating, you know, YouTube native content in Japanese.

1:01:16So we're trying all these ideas to really double down on our content. Well, at least we know that if the whole phone thing doesn't work out, you have a potential career as a YouTuber. That's my backup plan. I feel like the trust you're building just by being more transparent is probably going to come in handy. There's been all this conversation over the last 10, 20 years about consumer privacy and data. And now AI companies are kind of asking for it all and just saying, hey, it's going to come in handy at some point. How do you think about that proposition and how accessible it really is? Like, when's the right time?

1:01:55Security needs to be raised to the highest strategic level at the company because, I mean, or trust. Like it has to be one of the main strategies for the company. because if we're going to build this memory, like we need people to want to share their memories with us, their context with us. But if they don't trust us, they're not going to do it. And I feel like we have a lot of work to do. We're currently beefing up our security team and our processes internally. But I also think we have a unique opportunity here. As a smaller company, I think we can do things that are more transparent, more down to earth, and through that also help us earn the trust.

1:02:39It's a product question as well. Like when we define the products, like how do we surface things to users in a transparent way? How do we give them more granular controls over what we have and what we shouldn't have? Recently, in Essential Space, we added a feature where you can look at the memories, all the memories you've stored, and you can delete them either one by one or you can just disable all of it. But we need to do more things like that on the product side as well. I know another area of controversy is what a photo or a video even is in the world of AI. I know there's this kind of longstanding idea that the cameras sell the phones, but now it seems like the outputs of those cameras are kind of increasingly AI generated.

1:03:26I mean, I know Apple makes every sky blue. Samsung is creating an image of the moon on top of the moon. I mean, how do you think about that moving forward with computational photography and what a photo from a phone even is going forward? Computational photography, I don't think, is an area where we need to necessarily lead the industry. But we need to keep up with the consumer expectations. What we're doing on the camera side now that we're really focused on is presets. So in our playground, you can upload the presets you made and you can download other people's presets. We work with photographers but also smaller creators to really make the camera experience more fun.

1:04:10I think that's where we should really focus our energy because if we're targeting the next generation consumers and they might want these cool things to play with and share amongst friends, et cetera. And I think we only have a little bit more time. I have a burning question. Where did the name Nothing come from? I feel like I work with a lot of startups who are talking about naming themselves or a product and I say to the founders, all right, are you prepared to say the name of your company a thousand times this year and a million times over the next five years? and you say, oh yeah, we're building nothing.

1:04:49You know, I think some of them might initially be like, I'm not so sure about that. But now I feel like I've really grown to love it. I mean, how did that come about? Like names are important because you have to live with it for perpetuity. But they're also not that important in the sense that if your company is unsuccessful, any name is a bad name. And if your company is successful, any name kind of grows on people and becomes a good name. like think about apple that's such a strange company name it's just fruit like imagine calling a company banana um so i think it doesn't really matter that much if we're going to build a successful company but the you know it was really hard to find a name in the beginning we even acquired the the name essential in the beginning because we wanted to name the company essential um because the word just was such a beautiful word and it had a lot of great meaning but then we thought, hey, we should probably not do that.

1:05:45We should probably have our own legacy that we build. And it was really hard to come up with a name. So nothing kind of came out of frustration because we couldn't come up with anything better. Let's just call it nothing. And when I said nothing, we all kind of liked it. And here we are. And the lawyers hated it. Every time I have an interesting name, the lawyers are always like, no, you can't register this name, but we got it through. Recently, we have a joint venture in India where we're building a factory. And I said, let's call it the factory. And the lawyers again were like, hey, you can't just call it the factory.

1:06:25But I'm hearing some good news on that front. So maybe it will be the factory.

1:06:29Alex Heath:Oh, wow. The factory lives. You have to love watching the LinkedIn influencer dudes try and learn something from every new tech story. They're like, what can we learn from the name ChatGPT? It's like either the name is actually a stroke of genius because it's so tech-centric that it's completely transparent about what it is. But I think I'm with you, Carl. It's kind of incidental more than anything. Yeah, I think it doesn't matter. There's so many terrible names out there. My main criteria I tell people for naming is that it has to actively be not terrible once it is out of the terrible zone it's kind of in neutral it's just kind of a lever i mean i don't know uh if you thought of this as well but when we were talking about the name access for this podcast i mean there's certainly some baggage with that name especially in media but i was like that's just gonna look like really fucking cool as a logo when we get a designer to do it you know and then we bring the designer in and he's like wow what a word he's like i could do so much with this word.

1:07:33And I mean, the nothing dot matrix, I mean, all of a sudden it's like, oh, it works. You know, as soon as you see the word nothing in the dot matrix logo. I like access. I'm sure it will be a great name once the pod grows.

1:07:45Alex Heath:Yeah. Well, Carl, we appreciate you coming on. Thanks for having me. It was fun. Thanks for nothing, Carl. No, you just had to do that, didn't you? I did. I did. I'm a dad now. We're new here, so please follow, like, subscribe. You know what to do on all your platforms of choice at AccessPod, including YouTube, where we have full video of the show. If you like this episode, please leave a five star review, not less than five, and a thumbs up if that's also what the platform is asking. It means a lot. It helps the show get seen by more people. Please subscribe everywhere you get podcasts. You could find Alex's newsletter at sources.news and you could find me at Hamburger on Twitter.

1:08:30and at meaning.company.

1:08:33Alex Heath:Access is part of the Vox Media Podcast Network. Our producer is Shiraz Dume. We will see you next week. Bye.

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