What Makes a Consumer AI Product Stick? | Josh Elman

17:22Ollie Forsyth:Having an expert that can actually help bridge that gap is an incredible opportunity. I think the same thing is true for, you know, shopping, for fashion, for setting up your home, for upgrading your home life in ways that you don't think about. So this whole world of kind of vertical services that are much more powered by AI and very different interaction model and very, very personalized to you. Those are just some of the things I get really excited about. I mean, there's so many more. You know, we talked about fashion and being able to actually have something made for you that you've designed in your mind, being able to connect with people in ways that AI facilitates.

18:02Ollie Forsyth:So it's like, hey, I want to ask this question, but you can role play it with AI. and then it might actually do some of the work to go reach out on your behalf to some things and bring you back answers before you actually then go have the human connection. I don't want to add or replace human connection, but anything it can do to get me closer to having even better, more impactful human moments is going to be incredible.

18:22Josh Elman:You know, I love all of these trends. One, you mentioned that shopping, one of your companies, whatnot. I'll be very honest, like when I saw these live shopping companies, you know, in Europe and in the US, I was like, they work super well in China, where it's best in time. They work super well in Asia, but to adopt that in the US or Europe is obviously very different. Whatnot just raised a massive round, I think a few weeks ago. What have they done so well that maybe consumers just didn't quite see? And investors as well.

18:52Ollie Forsyth:I mean, I think live shopping is just an incredible category. And I think Whatnot as a company has done a fabulous job really expanding their marketplace and expanding all the ways in which people can buy things. But what's really fun with something like live shopping is that it's much more about participation. You know, I can go to the store, I can go to a static store and just click on a few things. But when I'm actually on Whatnot, I'm hearing the story behind the products. I can actually ask questions. I can interact with the people who are presenting that. I can explore different things and different products and have just so much more depth and story.

19:26Ollie Forsyth:And we're not just buying a flat thing that does something in our lives. We're actually buying a whole story in a way that some new product comes into our lives. And whether that's fashion where you're talking to the designer or fashion where you're talking to a curator who's done so much work where they're telling their story of why they think these are the best. Whatnot has really facilitated so many new ways for that interaction to happen. And it makes the shopping, when you make your purchase, you feel much more both confident, engaged, and have a connection to what you're buying. So I've just been, I've been blown away by their execution over the number of years.

19:57You know, they were, again, one of those companies that, like you said at the beginning, is live shopping ever really going to work in the US?

20:05Ollie Forsyth:You know, there were clearly some evidence of it working in China. And when it starts to really flourish, you see massive new behavior and you see people buying and selling things in a way that is, again, much more real and much more about a human connection.

20:20Josh Elman:I think live shopping and also entertainment, right? You mentioned kind of live entertainment with interactions. There's this whole new trend happening now, AI microdramas. I think that's going to be a really interesting category to watch.

20:34Ollie Forsyth:I mean, I think that microdramas are a huge part of the next wave of entertainment. You know, it kind of started with TikTok and actually even Musical.ly, which I had backed it when I was at Greylock. We found a team that was building Musical.ly and they had an idea that short form video, again, initially with even like a music soundtrack, can create a whole different experience that you watch and you have a meaningful connection before you go on to the next one. And that as they learn which ones you have meaningful connections, it becomes this really wonderful feed of content that speaks to you once you both connect with the creators and connect with the content in a new way.

21:10Ollie Forsyth:And as that was sold to ByteDance and became TikTok, it has flourished in a way that it truly has some of the richest, best content anywhere. But now what happens is those are all these nice short videos. And often you want to go deeper. And often you want a richer story. And so the micro dramas have come in and people have been able to create these perfect vignettes. And they fit really well into places like TikTok and YouTube help first discover them. But then you're like, you're immediately hooked and you want to finish the story. Now, we can only make so many of those. And each of these companies has done a great job making a lot of different stories in a lot of categories.

21:43Ollie Forsyth:But with AI, we can open up this creativity to so many more people, people who might not have a studio or a cast or sets to go film something, but they can still imagine what is truly a great story and have that made. And what I'm excited about is how do we find those writers, those creators, those people with brilliant ideas, give them the tools to express them, help that get in front of more people. I think there might be incredible new marketplaces where people come together to see the creations from others, read those, engage in those stories and be entirely new media channels. Right now, a lot of the distribution might still be driven through existing social media channels, But I think there's room for massive new marketplaces that become the first place you go when, hey, I want a story, I just want to engage.

22:26Josh Elman:Super interesting. So guess what? We actually just created our first AI microdrama. You did? What is it? So it's on the Nike story. So an idea I had was, how cool it would be to go and interview all these incredible founders, the Jack Mars, the Phil Knights of the world in person. Slightly difficult though. But hang on, why don't we tell these stories in four to five minute micro dramas on how the most incredible companies cause startups, their origins. Obviously, there's always a bit of a romanticized love element part of each micro drama. So we collaborated with this company called Plot Party, which is like an early stage startup.

23:03Josh Elman:And yeah, we published it, our first one a couple of days ago. I'll send it to you afterwards, but super interesting, you know. We do all the storytelling. They do a lot of the creating. It just goes to show the different types of entertainment you can create. I'm not a movie director, just hopefully a good storyteller. And we can now create dramas and get millions of views from it.

23:27Ollie Forsyth:Oh, that's amazing. I can't wait to watch it. And I mean, you're a great storyteller. I've seen you through these podcasts be able to put together just amazing stories. Now I can't wait to see how you do that. I remember the Nike movie from a couple of years ago. I think it was Air, if I remember. And that was like an incredible movie. And it's always hard to take a corporate story and actually bring drama into it and make it feel cinematic. But now that anybody can have access to these tools, I'm sure you did the same in just a short little micro drama. And I think so many people have that talent.

23:57Ollie Forsyth:And the hardest part now is going to be less about the creation. We can have a lot of people with talent, but it's still going to be the things that resonate. Finding an audience, figuring out how to build a relationship with the audience where they come back to you. The Nike one's great. Now I might want to hear the Amazon story or the Microsoft story. Because I think about great companies from the Pacific Northwest, or you might go around the whole world and keep telling these stories that people don't know. But in a way that, you know, I'll love your style of truly creating the drama and interest.

24:28Josh Elman:And it's all about taste, right? But I think, you know, as we enter this new era for media, creators, it's also just what can you do so differently that you can own? You know, I kind of feel like creators should be building products that they can own. and obviously just build hopefully into incredible companies, now's the time to be doing it.

24:47Ollie Forsyth:Yeah, and I think for creators, there really is an identity that they build. And they build a relationship through the content that they produce, through the stories they tell directly, through the stories that they bring out from other people, through the stories that they might create through AI. But it still becomes an identity and a relationship over time. It's not that you can slop lots of things in lots of different categories, but it's really that relationship with the creator that is what's powered the most recent wave of these incredible user-generated content companies. And then I think even as we move into an AI world, it's not just like some Borg AI is going to be making things.

25:25Ollie Forsyth:It's still going to be people making things to tell stories that they have. And those relationships you make with those storytellers, those creators is still going to be very important. And for each person, it's building that set of relationships.

25:37Josh Elman:You know, one thing I've been super surprised about to be honest is we've had all of this amazing technology emerge in the last couple of years, but we haven't seen any new social media networks, sites emerge. You've worked at LinkedIn, you worked at Facebook, you've been at Discord on their board. You've also been Alex and maybe a bunch of others are missing. Why haven't we had a new social network emerge in the last few years?

26:04Ollie Forsyth:It's a great question. And I think, you know, in some ways we haven't needed to. Like the social networks we have are at billions and billions of users, you know, or hundreds and hundreds of millions. You know, you mentioned Discord and Musical.ly, which, you know, Musical.ly became TikTok. Both really started growing in 2015. That was the year that I got to invest in both of them in those early days. And we had to navigate this question even in 2015. Well, we already had Instagram and Facebook and WhatsApp and Twitter and LinkedIn in 2015, why would we even need things like Discord Musical.ly?

26:36Ollie Forsyth:And they both solved a very different problem in our lives. Discord was great for people who were trying to come together to play games and engage. Musical.ly was great for people who wanted to actually tell stories and view stories from other people. So much of Instagram, I used to say, was the back-facing camera, look at the incredible place I'm in or the incredible latte I'm having. Musical.ly was the, I'm just going to create something. I'm going to put some music behind it, do a dance. I might have my piles of laundry behind me in my room, but because of my dance and because of this song, it's going to feel like a great creation I'm proud to share.

27:08Ollie Forsyth:And it's obviously grown up a ton from there. And we need something that feels new, that feels different. I've got a story I want to tell. I'm going to bring everyone together who's telling these kinds of stories. And this becomes the place you go to read those stories. Maybe that looks more like a marketplace than a social network, but I think there's a huge opportunity for that. But I think a lot of the attempts at social media between then and now were things that felt derivative, that felt like, well, I'm already doing it elsewhere, come and do it here slightly differently. You know, there's a lot of variants of X and Twitter that actually feel very similar to X and Twitter, which is a slightly different group of people.

27:47Ollie Forsyth:It's hard for those to catch and truly become mainstream. But I think we're on the cusp of seeing some things get invented that have us thinking in new ways, asking questions of very large groups and seeing information that isn't actually available and that people wouldn't otherwise be sharing in social media that can become a whole new network. I think we might see these creator marketplaces where people are actually creating new stories and publishing them for other people. I think, still think, you know, as we talked about coming out of COVID, there's room for networks that really help us get back out in the world and do more in the world and kind of bridge that online to, you know, IRL life.

28:24Ollie Forsyth:you know, Partiful is one example and Andresen Horowitz's portfolio that I think is a really exciting thing that if you're going to different events, Partiful actually is the places you really want to be and it becomes a great way to go out and explore the world much more with the community that you have. In real life though, it's super hard.

28:42Josh Elman:Do you remember Bebo? I do. Yeah, so I spoke to the founder for the first time. It's the first podcast he's done in about 10 years. It was Michael Virch. He's incredible. Yeah, Michael Virch. We spoke on Monday and I asked them the same question. Why hasn't there been a new social network emerge? But I also just think the appetite and the consumer websites on how we engage with these social networks has massively changed. You know, we don't post on our Facebook timelines as much anymore. X is our go-to maybe consumer app for all these content. Clubhouse back in the day, which was an awesome app.

29:16Josh Elman:You know, Subsec, another A16Z portfolio company. There's just different appetites, right? Again, I kind of just wish there was a new social network which emerges, you know? We haven't had any new apps in a few years.

29:29Ollie Forsyth:I mean, I've heard a lot of people kind of say that and want it to emerge, but I also say, you know what? We have great ones. And maybe we're pretty satisfied. And after I've checked out the people who are sharing on Instagram and talked to some of my friends who are still on Facebook and seen what they're up to and commented on their posts and went to TikTok, I'm no longer going, what else do my friends have to say? But I do think we're going to see things about what are people creating? Where can I go co-experience things with people? Now, one of the amazing things with Discord was it was one of the rare places you could really easily game and talk at the same time.

30:03Ollie Forsyth:And it was actually a new behavior that brought people together that then became a place people stayed and chatted. And so I think about what are those things that are those new behaviors that bring us together that then once we're together, now we'll also stay and do other things. We also talk a lot about AI. And right now, a lot of AI is very single player. I interact with the AI to help it do things in my life, but I don't yet have it plugged into our group and understanding our group nuances. And when I have it join a group, it's not helping me do other things with the same group of people.

30:36Ollie Forsyth:You know, group chats have become such a popular form of social media. Maybe that is in some ways the new network that we aren't thinking about that we really have developed over the past few years. I have way more local group chats than I probably had 10 years ago. But when we bring AI into some of those group chats, does that create a whole new pattern where we're now interacting? And even more, what if the AI is interacting our behalf to bring us together? And it's like, hey, I'm talking to it, you're talking to it, they're talking to each other. Now when we have a conversation, we're much more informed.

31:05Ollie Forsyth:I think we're just at the cusp of many of these ideas. Starting to get explored and have people trying them and I'm really optimistic in this wave a few of these will catch. I'd like to double down that.

31:15Josh Elman:Okay, so if we're going to go down this approach of multiplayer communication between agents and consumers, especially on maybe communication apps or all of this, helping bring people together. Realistically, what does that actually look like? Is that Josh and Ollie communicating together maybe with a bunch of their mutual friends? They're trying to meet up for the weekend, trying to figure out where to go. I mean, is that just the basic?

31:40Ollie Forsyth:I mean, I think it's a great basic place to start. That was actually the example I was about to give you, which is I get into my weekend and I'm like, which of my friends are even available? Now, it's a little bit embarrassing sometimes be like, who's up for something and get crickets back. And you feel very vulnerable when you're asking that question. But what if I could go to my agent and I'm like, can you just root around and see if anybody's up for something this weekend? And it could talk to some other agents and to see if anybody's asked their agent the same question. And once it has, it starts to make a match for us.

32:07Ollie Forsyth:And in some ways people say this sounds a little bit dystopian, but I think in some ways it's actually AI being the glue that brings us together that I can take some of those innermost thoughts. I kind of want to do something. I don't really know. Has anybody seen Odyssey? Maybe everybody else has seen Odyssey. Who hasn't seen it yet that might want to go? And if you can actually plant that seed in somebody who cares about you and can go root around and find somebody else, maybe that becomes a way that now brings us together. So I'm always looking for these opportunities where the agent can make us have better human experiences and more human experiences and make those happen.

32:46Ollie Forsyth:I've always dreamed that imagine that we're all on a Friday night, a bunch of people are sitting at home talking to their AI about something and it recognizes, hey, there's like 10 of you in San Francisco, in Noe Valley. Why don't you all go to the board game cafe and just play there? You know, they got two tables ready. I can even reserve them for you right now. Like, wouldn't that be amazing if it actually moved us from talking to something online to bring us into that real world. That's insane.

33:16Josh Elman:Okay, so a couple of questions there. It feels this is maybe like the basic middle layer of ideas of where we could go. If we think crazy big, how crazy can this actually get?

33:30Ollie Forsyth:I mean, if you think crazy big, you just wake up every Saturday morning and you talk to your agent or look at your calendar and you just go, I've got a rich day for you. You're going to start here with this person. You're going to have a break this afternoon and you're going to go have dinner with these friends because everybody was looking for something tonight. Sunday, you'll do this. Tuesday night, it's this. Your agent all of a sudden is just becoming your social calendar and you're really getting out in the world a lot more. And every time you've talked to it and you're like, oh man, my favorite shirt got really frayed and I want a new one.

34:03Ollie Forsyth:It's like great, ordered for you on your way. like this is sort of this dream of what having that true assistant looking out for you is and the goal again is to save you time from the things you don't want to be doing to do more of the things you do and that you enjoy and that you love and by the way a lot of people need time for themselves the agent should be able to protect that and help remind people of that too coaching you getting more exercise whatever goals you have wanting to eat better or indulge yourself sometimes Sometimes, you know, having a partner who understands your goals and sometimes gives you encouragement and sometimes gives you the tough love that you need.

34:43Ollie Forsyth:I mean, that's what we look for. I mean, I love my mother and she's great at doing both of those. Sometimes being my biggest cheerleader, sometimes being my biggest critic. And it would be amazing to have something else in my life that is helping me do that. I love my mother. She gives me tough love and encouragement. But I don't talk to her about everything and I don't talk about everything every day. and there are times where I would love somebody who kind of has the day-to-day understanding that gives me some of that too and even if I haven't called my mom in a week, reminds me to do that, although I'm usually pretty good.

35:13Ollie Forsyth:Super fascinating.

35:14Josh Elman:It makes me think though, what type of platform could actually create this? Is it one with existing distribution, the likes of GPT, Claude? Are they going to enter this space? Because it's going to be very difficult, I think, for a new very small startup to merge into this category if they didn't have the distribution these AI models have?

35:36Ollie Forsyth:And I think it's going to be piece by piece. I'm a big believer that if you want to become a very big company, you can't start by trying to do everything. But you have to start by doing a few things really, really well and earn the right to do more. You know, again, I keep coming back to Discord, which earned the right to be the place that we played games and that we had a live chat during games. And as it earned that right so well, it became a place we chatted more. And we chatted more about just playing games. And then we did spend more time there. And then more people did that. And even people who didn't play games came over to use the service to chat with friends who might also be using it to play games.

36:11Ollie Forsyth:But it slowly earned the right to be something that you relied on for more. And I think for a lot of these assistants, if you just say, I'm a general thing, I can take care of everything. You don't earn the right to be really trusted for getting me a few things done. And so what is that agent and that assistant and that product that goes step by step by step? And once we learn to turn to it for one thing, it now earns the right for something else and something else. When I think about Siri, and I know it's something that I spent a lot of time over the past many years thinking about, Siri was actually amazing to earn the right to do a few things for you really well.

36:44Ollie Forsyth:Place phone calls, set timers, set reminders, send a text message. But when you try to do more things with it, it often couldn't. There were things you would expect it to do and get it right. And it didn't. But over time now, you only get so many chances to go, now try one more thing. Now try five more things. Now try a lot of things you can imagine. And you'll have a much better conversation when it can't do something. It can explain to you that it can't do it and really understand that as opposed to just like put up a hand and say, sorry, I can't help you. And so I think there's so much opportunity for new products to do the same thing, but they're going to have to go step by step.

37:21Josh Elman:You know, when we think about the new rules of consumer tech, voice is going to be huge. It feels we're just scratching the surface. You spend a bit of time on Siri. You know, what are you excited about right now in voice? And again, it feels like we are just literally scratching the surface.

37:37Ollie Forsyth:When I think, you know, we're talking here and people are listening, like voice is an incredible medium to express a lot of thoughts. You can often talk much faster than you type. I'm one of these people that tends to think out loud. and so I'll talk and talk and talk until I kind of fully refine my point of view. Voice is also lossy though. Sometimes you wander and ramble a little bit until you get something. When I'm typing, I might type it and ramble a little bit, but by the time I edit and polish the thing that I'm typing to send or communicate to somebody else, I've gotten it really tight.

38:08Ollie Forsyth:And so I do think a lot about where voice sits as one part of the entire continuum of communication. I think we're gonna have a lot of times where voice assistants should be able to let you ramble and let you have that long thought pattern and then help you distill the real meaning out of it and capture those core thoughts. We have a lot of these, you know, on the work side, we have all these great meeting note takers that kind of record everything and synthesize them incredibly well. On our personal lives, when we have ideas, we want to be able to ramble and think and dream and have it sort of capture what we need to do.

38:42Ollie Forsyth:When you have just a quick idea and you want to remember it later, Voice is often a better paradigm than having to type it in because it's the easiest way just to quickly express your thought. I'm not yet a believer, though, that we're all going to move to voice for everything. I think it's always going to be a balance. And I think the idea of a voice-only agent doesn't really make sense. It's a, hey, there's times where I want to type. I might be in a quiet place. I might not want other people to hear me and I do want to express something. And I think voice isn't always the best use. if I want to refine my thoughts a little bit before I send them over to an agent or to another person.

39:20Ollie Forsyth:But we're doing a lot less with it today than we should be. And I'm really excited for this massive wave.

39:26Josh Elman:Voice is also such a great tool. If you're coming to like a podcast show or if you're preparing for a speech, it's actually a pretty cool interaction tool as a sparring partner.

39:38Ollie Forsyth:Oh, interesting. Yes, and with a lot of these new duplex modes and what some of the new technology is doing. The AIs can now let you do a lot of role-playing and sort of preview conversations that you're having before you go have them and help you truly refine your thoughts. I mean, I find voice conversations when I'm in the car. I love using voice to just go back and forth with something because I have to otherwise be focused on the road. But when I'm sitting on my couch, I don't often want to talk to my phone or my computer. I often there do just like typing and reading and scrolling. So it's going to be a matter of being able to go back and forth very smoothly with all these modalities.

40:13Josh Elman:Yeah, I think it's going to be really interesting. And, you know, especially if people use these voice tools to prepare for speeches, if you can prepare with the person, but virtually, that'd be quite cool, right? We just had Reid Hoffman on the show, for example, one of the biggest interviews I've done. And I just thought, let's just try with GPT, right? As a sparring partner, just bouncing ideas off. And actually, it was pretty good. And I know you and Reid work very closely together when you're at Greylock. and it was a pretty cool experience. If you have Reed virtually and you're doing a virtual kind of like preview mock-up, that could be quite cool.

40:48Ollie Forsyth:No, that's great. And I mean, Reed's one of the most incredible founders and thought leaders of our time. And one of the fun things I've seen him doing is building Reed AI, which is actually not only can you just interact with ChatGVT as a sparring partner, but actually building something that has ingested and learned about him and creating sort of a double for him. Now, it's still very different than having the real live person and interacting in the moment, but it's incredible proxy to understand how he thinks, how he might go about certain situations to test things and to get really, you know, instead of just reading his writings or watching previous podcasts, it's an incredible way to synthesize it to at least see how that AI may apply things to new situations.

41:31Ollie Forsyth:and then when you get to interview or interact with the real read, you feel like you're ready to go have a much deeper conversation because you've actually experienced some of it before. Like I think these ideas of these doubles are really a fun way to sort of be a precursor to a real meeting or in, you know, but not in lieu of.

41:50Josh Elman:Exactly. It did actually help. We talked about it a ton. So people can check it out. We'll put in the link in the comments. I also think just like the way these consumer apps are thinking about pricing and how they're thinking about monetizing is very different, right? So many of these AI tools today, they're literally giving all of their products away as cheaply as possible, basically for free, right? Which is very normal, just to get as much distribution and attention as possible. Is this still the right way to build a consumer app today? And at one point, does that become a challenge when they start having to try and make some money so they can make investors happy?

42:25Ollie Forsyth:This is a really interesting challenge of our time in technology. For many, many years, you know, as I first was getting my start in my career, actually building a website was actually quite expensive. You had to go buy physical servers, get racks at data centers, actually put them up in the data centers, manage them, have people who are managing them. So if you want to just build a website, like you actually needed to raise a lot of capital just to fund that. I remember in my first week when I joined LinkedIn, one of the things we did was move from one set of racks to a much bigger set of racks in the data center and they needed the entire company.

42:58Ollie Forsyth:I mean, it was maybe 15 or so people at the time to actually go and move computers from one rack to another just to remind you of the costs. What got amazing in this era of cloud scaling, Amazon web services, all these new stacks was all of a sudden you didn't need that same set of heavy upfront infrastructure costs. And it became very, very cheap or so cheap that you could scale these consumer things quite far to serve many, many people and the product you were building mattered more. Fast forward to today, hey, we have costs again. You know, and actually they're variable costs. They're these inference costs.

43:32Ollie Forsyth:You know, they aren't just even this fixed cost of infrastructure. And so we really need to figure out, you know, what you can give consumers for free, what you need to be able to charge for. But we also know that for consumer distribution, the willingness to pay doesn't always come up front. You know, in enterprise world, you can sell to a company and, you know, and sometimes convince them that this is going to be valuable for them. They'll actually pay you, you know, on a contract. Obviously with a lot of product-led growth, You see this sort of get in the hands of employees before they have to do it.

44:00Ollie Forsyth:But even if they want to pay, if they find it valuable, they can find ways to expense that service. So they don't necessarily need to think about it as paying out of their own pocket. On the consumer side, it is all going to be ways that we need to figure out how to subsidize the inference, having consumers pay for that. On the plus side, with the rise of mobile gaming, the rise of subscriptions, consumers are much more used to paying for digital things than they were 10 or 15 years ago, let alone 20 or 30 years ago. They are willing to pay for things that are valued through Apple's App Store, through Google Play, through just online subscriptions with all the different tools out there now.

44:38Ollie Forsyth:When people hit a certain level of engagement with a product, asking them to pay isn't the same hand to the face that it used to be. It's now very much an invitation. If this is finding you value, it's costing us money. On the other hand, we need the cost to come down. With what's going on with AI, with inference, being able to switch models, having open source models, we're seeing just the beginning of how much cheaper you can actually build these things. And I think over the next couple of years, we're going to intersect with how much cheaper these can get to build and serve, with how much customers are willing to pay for things that are of value or entertainment for them.

45:13Ollie Forsyth:And I think we're going to be at the right intersection point where you'll be able to bring in both ad models, purchase models, subscription models, and fund the cost of inference. But right now, it's still a little bit expensive. And as investors, you're looking for, are you going to have enough value that people would be willing to pay or would be, you know, advertisers would be willing to pay to get in front of those customers? And will that intersection actually happen? And that's sort of what the big bet is over the next few years in consumer. But it all starts with a product of value.

45:42Josh Elman:What is a great consumer product actually look like today? And as an investor, when you're looking at all these thousands of companies, are there some characteristics that just tickle your box? What's the golden list for Josh?

45:57Ollie Forsyth:Things that I look for in a product are where it has a really clear value that you can describe to somebody. If you start using this product, you get this thing that didn't exist before where people will raise their eyebrows. Now what's cool with AI is there's so many cool new things you can do, it's easy to get people to raise their eyebrows. The second is when that person does go and try it, do they have a good experience? are they actually going, wow, I can figure out how this fits in my life. And often it is going to replace something they were doing elsewhere. And is it a replacement that is an easy substitution or is it a really hard one?

46:27Ollie Forsyth:And so I always like to ask people, what did you stop doing when you started using this new thing? So if they've adopted a new product, what are you no longer doing? If you can get a good answer to that question, now you know it can intrigue people. You know that it can get them actually, you know, trying it and using it. And then do they want to spread it? are they so excited about it that they'll evangelize it to other people? Sometimes that happens naturally to the product with network effects. Sometimes it just happens because, you know, with like Chat2BT, we're all so excited about what you could do.

46:56Ollie Forsyth:You don't need to Google anymore. Chat2BT just gives you the answer right there. Like that spread very, very fast. And then I look for why will people stay retained? So not only do you need to have gotten me intrigued, gotten me to adopt it and stop doing something else potentially, gotten me to share it and spread the word, but now stick. And if I keep engaging with this product over time, now I know, hey, we really are onto something. And one of the best ways to keep somebody using something is with a little bit of a network effect that keeps them and other people using it together. But it's not the only way.

47:28Ollie Forsyth:Some of it is the more I put in here, the more it does for me, the more I don't want to move my information elsewhere because now I've built up a history. Sometimes it's, you know, if I'm going to one of these marketplaces, you know, especially like we're talking about some entertainment, these great creators are here and I want to see them keep telling stories. And if I'm there to keep seeing them tell stories, then other people want to be there to get in front of the audience too. And then you'll have this great effect where all the great creators will want to be on the same platform to reach the audience and it will continue to go as a loop.

47:56Ollie Forsyth:So I really look for that entire process from, is it intriguing in the first moment when people actually adopt it? Do they really use it and stop doing other things? Do they spread the word about it? And then do they stick long-term?

48:09Josh Elman:It's never been harder though, right, to grab the attention of the consumer. So when consumers are thinking about, is this thing going to save me time? Is it going to save me money? It's all around these network effects and the value adds, right? How are the network effects different today versus even two, three years ago?

48:27Ollie Forsyth:I mean, the first thing is actually it's never been easier to get consumers' attention. There are so many channels that we're paying attention to. Things that rise up on TikTok or Instagram Reels or YouTube go viral very, very quickly because people get excited about something new. So the idea of having something that as long as it's so compelling, people want to check it out. I've seen people go really, really fast just by getting in front of people. What's harder, I think, is to your point, getting me not just to try something, but to actually stick. It has to be such a good product doing that one thing really well out of the box that I either stop doing something else or I turn more behaviors over to it.

49:05Ollie Forsyth:And we have a lot that we already have in our digital life. And so we already have a lot that we have in our real lives. But even, you know, I used to say there's so many things that can move from real life to digital life. And COVID again sort of showed me what that saturation point is. So now as a product, you have to figure out some new wedge into somebody's digital life if you're a digital product. And then becoming so good that it becomes a habit and that you can pull other people in. You don't just have to get that one person. You have to get more and more and more people. These are very, very hard challenges because you're substituting versus just expanding, which I think 15 years ago, we were all getting our first phones.

49:42Ollie Forsyth:There were so many things we'd never done before that we could do on our phones. Today, you have to be better than those things. But I think with AI, we have a real possibility to be those products that I'm like, well, that is so much better that that's great. The last thing you didn't talk about that I think a lot in this competition world right now is that's cool, but if somebody does it, can't everybody else do it and copy it very, very quickly? And so we do live in that world where all great ideas, people are chasing fast, whether it's other startups or big companies. And the hardest part there is if you're that founder who has the idea and the insight, even if other people can copy what you did, they can't copy where you're going.

50:18Ollie Forsyth:They can't figure out where you're going ahead of you. They can't necessarily replicate that. So staying on your line and really living up to your vision is sort of the best thing you can do in today's sort of competitive market.

50:31Josh Elman:This is the hardest challenge for founders, right? the idea to clone is no longer months or weeks as basically days.

50:42Ollie Forsyth:But I can only clone what I see. I can't clone where it's going and I can't clone the next thing. And over time you build that relationship with the user, which is like, yeah, I tried that other thing, but it was missing the essence of something that was really special. And so you stay with the product that really has that essence. And so much of building an AI right now isn't just a product that does things, but that has personality, that has relationship, that has an identity that you actually stick to, that has a way of interacting with you that it can learn over time to be even more personal to you.

51:12Ollie Forsyth:It actually has a point of view. And so I do think that while everything feels like there's eminently clonable things, the people who build these durable platforms are finding their way to really connect with their customers and connect with their networks in a way that is really rich and much better. And the hardest part is all of us in the early days is teasing out, you know, which are which.

51:34Josh Elman:This is just a small observation, but as I've been thinking about all these apps I've been using over the last six or 12 months, they're all based in the US. Why are American startups so good at consumer social versus maybe the likes of Europe?

51:48Ollie Forsyth:I've got to think more if that's true. I mean, a company like Lovable came out of Sweden, for example, that's just an incredible company. You know, all the things 11 Lab does, you know, didn't start here in San Francisco. So I don't think it's true that the best ones started here. Musically, for example, started actually as a team in China. They had spent some time in the United States, but they were actually a team in China that was learning. And there's so much innovation that's been happening in the Chinese ecosystem, for example. Some of those lessons, you know, we talked about whatnot earlier, you know, was sort of inspired by some of the original growth of live shopping in China.

52:21Ollie Forsyth:So I do think we're at this wonderful place in the world where more and more innovation is happening everywhere. What's really unique, though, about the Bay Area is how many people here, maybe not just the founders with that idea, but the next wave of people have truly come and been able to help scale and find those companies and find those paths to independence and find those paths to network effects. And we have so many people in the Bay Area that have been part of some or many of these journeys. I mean, I myself live here and I've gotten to be a part of so many different companies that have made this journey from something that was a really cool idea to a really durable platform.

52:54Ollie Forsyth:I think to get that acceleration can happen anywhere, but you can really get the right expertise even faster when you're interacting with people from the Bay Area. So whether that's visiting, whether that's deciding you need to live here or hire people here, I think it's a very independent question for every founder. But I do think if you are going on this journey, you want that expertise around you, which is part of why, even for me, I'm on the VC side now because I'd love to be able to help as many companies as I can navigate that incredible moment from we kind of got something working to a really durable company and platform.

53:28Josh Elman:You know, I also read Hoffman's question. So I'll ask you as well, is SF still the best place in the world to start a company?

53:36Ollie Forsyth:I don't think it's the best place in the world to start a company, but I think it's a very important place in the world to scale a company. Because I think if you believe that you have a great idea and you've figured out how to get this into the first set of people, but you want that expertise now to go, okay, how do I truly make this durable? there's just so many people in and around the Bay Area that can help you do that. But I don't know that that always means you have to live here full time. I think it does mean that it helps to be a part of the ecosystem. I also think if you are a B2B company or selling to other small companies, there's just so many here that it's an incredible place to start with adoption.

54:12Ollie Forsyth:But honestly, if you're building for consumers, a lot of what you're also building for is culture. And I'm not sure that the SF tech culture is 100 % transferable to everywhere else either. So it's not like you always want to start everything here. You want to also make sure you really understand the culture of other cities around the world and other communities around the world to make sure that you're really being able to do something that will affect mainstream consumers where they are. So I also don't want to get too much SF glasses. You know, I'm a little jealous. You worked at Apple, Robinhood for the time.

54:43You've obviously helped the team at X, Facebook, LinkedIn, Musical.ly.

54:48Josh Elman:Which is your favorite? Oh my gosh.

54:52Ollie Forsyth:I mean, you can't really pick a favorite, but in my career, I will tell you that I had this period of time that I joined Twitter late 2009. And so we kind of got to go through the 2010 and it was this period of just true missionary work, believing that we had this incredible platform at Twitter that could be so much more for the world. And I got to live and breathe it every day with an incredible group of people. And it was at that nascent period that we knew there was something and we were trying to solve really hard problems. But before it was so obvious that it had to become a real mature company.

55:27Ollie Forsyth:And I just, I, if I look back, like if I could just have done that year on repeat in my career, kind of late 2009 to late 2010, that was one of the most special times of my entire life. But everywhere else I've gotten to work was just been, I mean, I've got to work on things that it was always my dream to help people make things that matter for the world. And I've gotten to help do that. I was never a founder myself. I never went and started a company from scratch, but I was always what I call an early joiner where I'd go find these things and say, we're going to go make something great. You have an incredible idea that's getting started as a momentum.

56:01Ollie Forsyth:How can we make it last? And there's so much joy in that. And the stuff we did at Twitter is probably some of the most meaningful work of my life and still see it to this day play out. And I still feel like, ah, it could have even been so much bigger and so much more important than what it is, even though it's a product I still use the most every day. How many users were at Twitter when you left? When I left, we had gotten well over 100 million users. And when I joined, we were at maybe barely 10 million actives. What's the most interesting lesson you learned from Jack Dorsey? You know, what's funny is I didn't actually work with Jack.

56:36Ollie Forsyth:When I was at Twitter, it was the Evan Williams era. And Evan had founded Blogger and he had really helped build Blogger and he had this vision for how Twitter was going to become this next wave of media with people communicating. The single best lesson that I remember from Evan was, hey, we've got a lot of smart people in the building. We've got a lot of smart people who are using our product every day. Let's not just think we know what's best. Let's listen to them. Let's learn. And then when we make decisions, let's make sure we engage with them on our thinking as well. One of the most controversial things that Twitter had launched was the retweet.

57:14Ollie Forsyth:The idea that, you know, originally, and this is again, ancient history in sort of the tech world now, but when the retweet first launched, the way people used to do retweet is it would come from their account and it would say RT and then the name of the person you were retweeting. And instead of building that product, everybody realized everyone wants to retweet and share voices from others, but decided Twitter that the authenticity of the original poster was more important than switching the words to look like they came from your name. So the retweet became a Josh retweeted Ollie's post and that you would see Ollie's face in your timeline.

57:50Ollie Forsyth:And that was one of those both listen to the world on how they wanted to repeat others' voices and amplify others' voices, but also take a very hard line that it was not about moving the words to the retweeter's voice, but actually maintaining the original tweeter's voice. And the retweet and the quote tweet feature that we have now are all part of how it still retains the original person's voice. And there was this incredible lesson on listening but still having a strong point of view and then communicating that back out and engaging in discussion even when a lot of people weren't happy with it at first because it changed the behavior a little bit.

58:24Josh Elman:That's insane. 2009, okay, I was only 11, 12 years old. So I don't remember all of this but I do remember creating my X account, Twitter account and I think what has been useful now obviously today is awesome and let's see where it goes next. For the audience, if you're not following Josh, go and follow Josh. Always awesome. insights into what's happening in the tech world. We should have mentioned Tech Week is coming up in SF. So if you want to get a flavor of what's happening in the Bay Area and startup land, A6CZ hosts this awesome Tech Week every year, SF Tech Week. I went last year, absolutely incredible.

58:59Josh Elman:It was like 2 ,000 events or something. And just awesome experience. So hopefully see you there. But Josh, this has been awesome. Your first official podcast since joining A6CZ. So thank you so much for coming on the show.

59:11Ollie Forsyth:Thanks so much for having me.

59:14Josh Elman:Thanks for listening to this episode of the A16Z podcast. If you liked this episode, be sure to like, comment, subscribe, leave us a rating or review and share it with your friends and family. For more episodes, go to YouTube, Apple Podcasts and Spotify. Follow us on X at A16Z and subscribe to our substack at a16z.substack.com. Thanks again for listening and I'll see you in the next episode. This information is for educational purposes only and is not a recommendation to buy, hold, or sell any investment or financial product. This podcast has been produced by a third party and may include paid promotional advertisements, other company references, and individuals unaffiliated with A16Z.

59:54Josh Elman:Such advertisements, companies, and individuals are not endorsed by AH Capital Management LLC, A16Z, or any of its affiliates. Information is from sources deemed reliable on the date of publication, but A16Z does not guarantee its accuracy.

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