Cisco President & CPO on Rebuilding Products So Agents Can Use Them, Running a $460B+ Company in Founder Mode & the Rule of Thirds | Jeetu Patel

0:00Carlos: I actually run my company in founder mode, which is not easy, but it seems like you are also encouraging this type of founder mindset at a much larger scale. So I'm curious about how you actually make it happen.

0:09Jeetu Patel: What I found is there's two kinds of people. There are people who are functional managers that are very, very good at going out and making sure that they can run their functional well. And then there are people who are like owner mentality that run their business. By the way, you need both. It's not like one is better than the other. If you're an owner mentality, you can tend to piss off a lot of functional people. So you have to make sure that if you make the cultural change, you make it very explicit, that we value an owner mindset.

0:32Carlos: Jitu Patel, President and Chief Product Officer at Cisco. We're seeing more agents using the internet than actually humans. So what does that mean to Cisco and the products from a security and safety perspective?

0:44Jeetu Patel: Assume that you're a retailer and you have enjoyed a direct relationship with your consumer. They come to your website, you've got some advertising, you've got some upsell, you've got some cross-sell. All of a sudden, you've delegated now, as a human, the job to an agent. So it's the agent that's going to talk to the website, which means that the agent is not going to be succumbing to cross-sell and upsell quite the way that you are.

1:04Carlos: How do you ensure that you stay in tune with what's coming next so you can catch that next wave and not be late about that? So I have a rule. Hey, this is Carlos, CEO at Product School and your host on the Product Podcast. My guest today is Jitu Patel, President and Chief Product Officer at Cisco, back for his fifth time on this show. He ran his own business for 17 years, then went inside a$63 billion company and calls himself a late-stage co-founder, 36 years late to the game. He also says Cisco has no product managers, only feature managers, and he means that as a strategy. Here are the things we'll cover.

1:45Carlos: Founder mode at Cisco scale, and why it annoys functional people. Holding company to platform company after 250 acquisitions. Agents past humans in token use and what that breaks. When you can build anything, what you don't build is the job. His 15-year-old daughter's hoodie startup and the pricing lesson in it. Let's get into it. AI helps us generate ideas, draft plans, and spin up work in minutes. But faster doesn't necessarily mean better. When everyone has their own AI tools, their own outputs, and their own context, you get fragmentation, fractured version control, scattered review processes, decisions happening in parallel, not in concert.

2:30Carlos: Rebuilding context between people and platforms costs you time and momentum. That's where Mural comes in. Mural gives teams a shared visual canvas to bring work together. You can generate structured starting points right on the canvas instead of moving outputs between tools. Keep all of your context in one place. And compatible AI agents can contribute alongside the team, bringing in context from the tools they already know. The future of work is still human.

3:03Carlos: Learn more at mural.co slash mural-ai. G2, you are back by popular demand, man. I'm back. How many times?

3:13Jeetu Patel: Fourth, fifth?

3:14Carlos: Fifth time. Fifth time. Wow. Thank you. You've been supporting us since the very beginning. Even before you joined Cisco, you were still a CPO at Vox. But I tell you, your team lies.

3:27Jeetu Patel: Because if G2 wouldn't be in this business, he'd be an actor. There's no freaking way someone would give me a job. Bald, fat, Indian guy. How many of those have you seen? Quite a few, actually.

3:45Carlos: But Gitu, one of the things that I want to cover with you is this concept of founder mode. As a startup founder, I actually run my company in founder mode, which is not easy. But it seems like you are also encouraging this type of founder mindset at a much larger scale. So I'm curious about how you actually make it happen.

4:03Jeetu Patel: 17 years of my career, I ran my own business. And then I went to a very large company. And what I found is there's two kinds of people. There are people who are functional managers that are very, very good at going out and making sure that they can run their functional well. And then there are people who are like owner mentality that run their business. By the way, you need both. It's not like one is better than the other. I'm clearly the latter. I've always had an owner mentality. But the people, if you're an owner mentality, you can tend to piss off a lot of functional people. Because what the functional people want is they want to make sure that they're staying in the swim lane.

4:38Jeetu Patel: You stay in your swim lane. I stay in my swim lane. I'm going to run my function. You run your function. And then we'll just go at it that way. Owner mentality people poke their nose into everything. Like this is not working for the business. I don't really care whose function it is. I'm going to go tell them it's not working because we got to fix it so that we can make sure that we win in the market. it annoys the shit out of the people that are on the functional side of the house. So you have to make sure that if you make the cultural change, you make it very explicit that we value an owner mindset.

5:12Jeetu Patel: And so at Cisco, we've actually done that. We've actually said we value an owner mindset. So when you think about this, don't think from your function and your silo. I think of myself as a late stage co-founder of Cisco. I was 36 years late to the game, but it's my company. If anyone tries to fuck with my company, it's not going to be good. you know, back off, especially at a time when you're in wartime mode and you're at a time like this when things are moving from you're having a platform shift and everything's changing and you're refactoring your entire business. It's very hard to be in a functional mode and actually win in the market.

5:47Jeetu Patel: So what you want to be is in complete owner mentality founder mode. And so So when you make a decision to go to a company, try to assess whether or not they're in which mode they're operating in. If it's in the mode that you don't actually value, don't go there, you know, because you will find yourself superbly frustrated all the time. Unless you have enough agency to change the mode, you know.

6:10Carlos: Yeah, I want to connect that to what you just said, war mode versus peace mode. I mean, it seems like a couple of years ago you went through an important org design. instead of having the traditional business unit design, you went into a more platform, cross-functional platform design. You know, that's a big change, right? Like, how do you do it? How do you do it? Uh-huh. What are some of those operating principles that can articulate this type of change?

6:34Jeetu Patel: I think in large companies, majority of the things you cannot be doing top-down dictation on. But there's a few things that you have to find religion in, And those things, you cannot actually look for bottom-up buy-in. You have to just go drive it. And so in this particular case, we used to look like a holding company. We had done 250 acquisitions. Everyone wanted to be a GM. They thought that the way that they would progress in their life is by being a GM. The problem with a GM is every GM wants their own sales, their own marketing, their own product, their own engineering. They don't want to talk to everyone else.

7:08Jeetu Patel: They just want to keep growing their pie. And so before you know it, you're not a$63 billion business. you're a collection of$100 million businesses. And it's incomprehensible for the customer when you take$63 billion and you divide it by$100 million, because you've got way too many businesses that you can't really have your go-to-market distribution channels even make any sense of what the hell you're trying to sell. And so what we had to do was we had to move from being a holding company to being a platform company. and a platform company means that your priority has to shift from building a feature in a single product to making sure that you actually become part of the larger platform.

7:50Jeetu Patel: So the way I tell people is we don't have any product managers at Cisco. We have feature managers. We build features for the platform, right? And the platform is what we sell. We don't sell individual products. And if you can do that right, you can actually shift the entire dynamic on how customers consume your product. Because one of the biggest reasons that startups fail is not because they didn't build the right product. It's because they didn't really understand how to go out and drive it through a distribution channel. And startups will fail typically, and large companies fail at this as well.

8:26If you start a company, you might never get your go-to-market going.

8:32Jeetu Patel: But if you get your go-to-market going, let's say you build a company, you built a product, and that's great, and you've actually had an extreme success. Now you say, I want to become a multi-product company. What do you do? You build a second product and a third product. If the second product doesn't leverage the route to market that you've built with the first product, you're going to fail in the second product. You won't become a multi-product company. You'll stay a single product company. It's very important that you don't actually create multiple routes to market because you can only go out and attack so many go-to-market motions at one time.

9:05Jeetu Patel: And so that's pretty important. When you go to a large company, they already have established routes to market. And when you have an established route to market, if you say I'm going to read one too many TechCrunch articles and start to go build products in different routes to market that you don't have an attack vector into, you'll fail there. And so it's extremely important that you actually drive your entire organization to making sure that they're leveraging the distribution channel that you have. And just because you have a sales team of 20 ,000 people doesn't mean that you can sell anything with those 20 ,000 people.

9:39Jeetu Patel: You can only sell through those 20 ,000 people buyers that they have access to. And for the buyers that they don't have access to, if you sell it, you are at a disadvantage compared to a startup. because you've got all of the lethargy of a large company, but you don't have any of the agility and scale that comes from a small company and scale that comes from a big company. So that's what you have to keep in mind as you go through it.

10:05Carlos: Because right now you are at over$460 billion market cap.

10:11Jeetu Patel: Whatever today's number is.

10:13Carlos: And like over$63 billion in revenue.

10:16Jeetu Patel: $63 billion in revenue last year. This year, the guide is we'll be north of 70.

10:22Carlos: So as you look at the breakdown, you said you make a lot of acquisitions. So how do you make sure that that integration goes as smoothly as possible so they actually become Team Cisco?

10:34Jeetu Patel: So we have dialed down on the number of acquisitions we make because one of the challenges we had at Cisco was most people would tell me, hey, Jitu, this seems like a very important market. What are we going to buy? And that seemed like it was the wrong question, because you should never have your strategy based on what your acquisition strategy is. So now what we do is when they come to me, they say, Jitu, this seems like an important market. What are we going to build? Now, that doesn't mean that if you have a true north that you've defined and a company comes along and they can accelerate you in achieving your vision, that we would be shy to deploy our balance sheet.

11:09Jeetu Patel: We wouldn't be at all. We made an acquisition of one of the largest acquisitions we made under Cisco was under my watch with Splunk. But the strategy is not to be acquisitive. The strategy is to be very clear on what we're going to build. And if something comes along that accelerates our end-state vision, then we won't be shy to deploy the balance sheet. But otherwise, we're just going to keep building. and that also gives you a lot more like mental peace because you're not just desperate about oh my goodness like we've missed this market now we need to go out and desperately buy someone else and the only times that I that I look to buy someone is if the founders are committed to taking on a larger vision where they're actually going to join me in solving the problem that we have encountered at Cisco when we acquire a company the first thing we do is we kill their brand.

12:02Jeetu Patel: We try not to keep the brand. No more sweatshirts of your brand that come. I mean, there's exceptions like Splunk. We've kept the Splunk brand because Splunk has such a good brand. But most small companies, I prefer buying small companies rather than large companies. We'll kill the brand. We'll integrate it into the platform. And I take the founders and I give them a larger mission. And the mission typically would be not just go out and take your company and do something with it. I always tell the founders, don't try to make your company a$100 million company within Cisco. Try to make Cisco a$5 trillion company.

12:37Jeetu Patel: And what are you going to do to make that happen? And that's going to give you a larger aperture. Then they ask me, why should I stay at Cisco? One of the big reasons to stay at Cisco is if you stay for a four or five year period, my commitment to them is I'll make you a better operator than you could have ever been if you were not working at Cisco. you will understand at scale motions you will understand how to go out and run some things in the way that's you know you're running like the world's largest startup that the next time you become ceo you will be far more successful than what you would have been had you not worked at cisco and that's the commitment that we make to them and so far we've i've made personally about 28 acquisitions there was one company where the ceo was like a jerk and didn't work out well 27 of them worked out pretty well and what we do right now in my team is the way I've configured my team is it's a rule of thirds one third of the people are very good at navigating Cisco they're consummate operators they know how to navigate Cisco the other third we get from the industry that are systems thinkers that know the industry and the markets that we're in pretty well and the third third are CEOs of startups that I bring in to say you know work with the other two constituencies but break glass and go out and do things that we would not be able to do and operate in complete founder mode if i look at one of my key guys dj sump up who um runs used to run a company called armor blocks we got him we killed that product we killed the brand but he's actually running our biggest platform and ai initiatives right now he's running all ai and all platform for all of Cisco, right?

14:19The guy was running a 20-person outfit, but he is getting to

14:24Jeetu Patel: be such a great operator that hopefully he'll never leave, but when he does leave, he'll be a much better CEO than what he would have been had he not been at Cisco. And that's the promise you want to deliver.

14:35Carlos: That's a fun fact. I met someone today from Cisco and the leadership team that said, I had an offer on the table and I came to ProductCon last year and I heard you to speak and she ended up joining your company because of you, that type of dragon energy that is so hard to find in an arch enterprise.

14:58Jeetu Patel: No, I think that's great. Hopefully that person is still there. Otherwise it'd be an awkward moment. Okay. Oh, you're here. Okay, yay. Thank God. My God, that was stressful. But no, I think we're lucky because we've got a fantastic mission. Look, every once in a while, you find a company where the body of work that you do is going to shape the lives of billions of people and is actually going to shape the way that the world operates. And Cisco happens to be at that point right now. We've got the right amount of scale, but we've got tremendous amount of ceiling to grow. And I feel like this is, like I'm hoping that the people that are there at Cisco right now in the next five to 10 years are going to do their life's best work at Cisco.

15:35Jeetu Patel: So, and I'm pretty sure that they will because we will be doing some crazy stuff in the next few years.

15:41Carlos: Well, let's talk about some of the AI crazy stuff that is going on right now. I want to get your take on this. I think we are at the beginning of another super cycle. We're seeing more agents using the internet than actual humans. And all these new AI assistants like Instinct, Muse, Crock-Bot, Dots. So what does that mean to Cisco and the products from a security and safety perspective?

16:07Jeetu Patel: So let's take a look at the stats right now first. So sub 2 % of the world is using agents in any kind of power user capacity today. My prediction is that in the next 12 to 15 months, you'll have about 30 to 40 % of humans using AI in a power user capacity. Agents in a power user capacity. Not AI as in chatbots, but just delegating work, long running horizon tasks to agents. So that's number one. Number two, in February of this year, agents surpassed humans in token consumption. By August, agents' token consumption had grown 14x and now is five times that of humans. So when you start to think about the exponential curve that agents are on, these agents work seven by 24, they're going to keep working.

16:54Jeetu Patel: 60 % of the world's compute is today, by the end of 26, going to be consumed for inferencing capability, not for training. But scaling laws and training still apply, and people are going to spend much more on training than they've ever done before, which means the growth rate for training has not slowed down, but the composite ratio between training and inference has way surpassed training. And what does that tell you? That means that agents and AI is actually working. People are using it. The biggest challenge that you're going to have is going to be one of safety and security. People are going to be concerned with it.

17:32Jeetu Patel: The second big challenge you have is we're going to be supply constrained with not enough compute, not enough power, not enough network, not enough data center capacity for the foreseeable future, next five, seven, ten years. We happen to be in both those businesses. And I think with agents, personal agents are going to be like the next chat GPT moment that you see in the market. But here's what's going to happen with agents that's going to be really interesting is you will have an enormous amount of pressure as a business with understanding the business model shifts that are going to happen as a result of the disruption that agents will cause.

18:15Jeetu Patel: And let me give you a very simple example. Assume that you're a retailer, okay? And you have enjoyed a direct relationship with your consumer. You have a website. They come to your website. You've got some advertising. You've got some upsell. You've got some cross-sell. You can sell them something. You have a store. They can come to your store. Everything's great. All of a sudden, you've delegated now, as a human, the job to an agent. So it's the agent that's going to talk to the website, which means that the agent is not going to be succumbing to cross-sell and upsell quite the way that you are.

18:50Jeetu Patel: And even if it does, even if the brand gets smart enough to do that, you now have an intermediary between the brand and the consumer who is the agent. So I think there's going to be profound shifts that'll happen in business models that if you're... How many over here are in a company that's sub-100 people? okay how many over here in a company sub a thousand people how many in a company sub 10 ,000 people what do the rest of you guys do okay my point over here is you will have a profound shift in business models and whenever there's a big shift in business models you know when you go from direct to indirect when there's an intermediary when there's disintermediation of the middlemen, that creates a lot of opportunity for wealth creation, but it also makes sure that there's a lot of disruption that happens.

19:46Jeetu Patel: And you will actually start to see that be very, very prominent now in the next wave. And by the way, the third phase, which is physical AI of robotics and humanoids is already here. If you go to any of the semiconductor fabs, you go to Taiwan and you talk to TSMC and And look at where, like, there's a ton of robotics work going on all around the world. And so what you're going to start to see is we all, as product people, have to get very good in figuring out what kind of product management vocation evolution needs to happen in the world of AI that was different from the world pre-AI. And especially in the world of agents.

20:30Jeetu Patel: and what you can't do is get intellectually lazy and just delegate work to an agent what you have to get is intellectually superior by using an agent to boost your thinking and right now i think there's a lot of slop and if you can do one thing when you walk out of here don't contribute to the slop contribute to the distillation and clarity that people have because in a world where you could code anything what you choose not to build is far more important than what you choose to build but what you choose not to build requires judgment it requires taste it requires instinct it requires a visceral understanding of the market and the customers and that is the job of the product manager to make sure that they can direct that so make sure that you folks are thinking about that as you go through it it's an exciting time to be alive in tech i feel like if we do it right this is the best my daughter right now is 15 years old if i could have one wish and what you know like you want her to do whatever she wants to do and whatever she does well but if i had one secret wish is like i wish she got into product because there's so much opportunity but she actually it was interesting she's 15 she has a boyfriend which is like very awkward um you know it's been going on for a year but her and her boyfriend are now he's a great guy and everything but it's still very awkward two of them are starting a startup and they're like well we want to she likes streetwear so she's going to start a startup for going out and doing streetwear hoodies and t-shirts and sweats and all that kind of stuff so here's what she did 15 years old this blows my mind not particularly tech savvy doesn't like coding doesn't like any of the tech stuff very good with social media and creativity loves makeup that kind of stuff built a website for hoodies designed the hoodies reached out to three companies one in china one in vietnam one in la for the manufacturing process and then was telling me about what she's going to do from a pricing strategy standpoint.

22:29Jeetu Patel: I'm like, how much are you going to charge for these hoodies? It's like, I don't know, dad, like$325 between 275 and 325. I'm like, that's expensive. It's like, dad, I'd rather sell few units at a higher cost because the profit margin is going to be higher. And sometimes if you charge higher, people think it's better. For 15, that's extremely sophisticated to understand your pricing strategy, right? That is only possible because she used Lovable. She was able to go out and build a website within 24 hours. She was able to design the products. She was able to understand what's going on. And the fact that she had to go out and reach suppliers to figure out who's going to manufacture these came from Chad GPT.

23:12Jeetu Patel: Like she just understood the entire ecosystem so well. And I think that's who we're going to be. You know, That's the next generation that's actually growing up. So we have to make sure that we can start to think about this in a very creative way, end-to-end as a business. Product people have to think about the entire business. You can't think about it functionally. If there's one function that should be in founder mode all the time, it should be product management. Because you have to think about sales. You have to think about marketing. You have to think about engineering. You have to think about product management.

23:46Jeetu Patel: You have to think about pricing. You have to think of packaging. You have to think about finance and account. every single area has to be thought about as you go out and build your products. So it's a great time to actually do this with AI. It also gives you a lot of disruptive ability to do things in a way that you might have never imagined before. And use AI not just as a productivity boost, use AI to do things that could never happen before. And please, one thing I would ask you is every PowerPoint deck you see these days, every product you see these days looks the freaking same. We don't want to become a world where AI has taken away all originality from people.

24:26Jeetu Patel: You want to make sure that you inject a level of creativity into this thing, and we can do that. So use AI to enhance our thinking. Don't use AI to be intellectually lazy.

24:37Carlos: Gitu, one of the challenges I see in product is that your customer is not always a human. In fact, you just mentioned that many of your customers can be agents on behalf of humans. So as you design an experience. It seems like today agents are pretending to be humans and kind of hacking the system. And then sometimes they get these blocks like Amazon recently decided not to allow Muse to go and purchase stuff. So how are you thinking about designing those type of products for both humans and agents?

25:06Jeetu Patel: So I was this morning, I was in Austin, I just came from Austin, we actually had our WebEx event over there. And we just launched a bunch of agents and a personal concierge for every brand. So every brand can now have a personal concierge agent for every customer of theirs. Think about what agents are going to be able to do for you. It's going to be able to give us complete personalization. If you work with Cisco, it'll give you safety and security. But the third thing it gives you is intense amount of scale, because you now are not bound by just having human caps of how many people you can go out and have a personal concierge with.

25:42Jeetu Patel: Like historically, you would be able to say my top 20 customers, my top 100 customers are going to have a named account rep, right? Over here, you're going to have your every single customer, no matter how big they are, how small they are, they'll have a personal concierge, they will be able to do everything from support, to sales, to consulting, to anything that you want them to do. And that's the way that you have to we have to kind of think about this. So I feel like there's a business model shift that we have to fully internalize by ourselves. And if we do that right, the amount of opportunity economically that'll exist right now is going to be at epic proportions compared to what we've ever seen before.

26:22Jeetu Patel: But it requires an entirely different way of thinking. And it requires that you don't become part of the herd. You become contrarian in your thinking. When everyone says go this direction, start thinking about going someplace else. and be contrarian in your thinking. But don't be contrarian just for the sake of being contrarian. Start to question why everyone is going that way. And typically, when you start to see herd mentality, there's not enough thought going into the herd mentality. That's when you want to make sure that you create counterintuitive thinking. It really helps. And in product management, that is the only way you can get an insertion point when there's an incumbent.

27:02Jeetu Patel: Otherwise, the incumbent has an advantage. But the way that you get an insertion point is because you've created counterintuitive thinking and you've created asymmetry where there wasn't any otherwise. And that's what actually creates a level of tempo and momentum. By the way, tempo is contagious. So once you start winning, like at Cisco, no one thought six years ago, they thought that was freaking nuts going to Cisco. Like, what are you doing? Are you crazy? Right. Now, there's a spring and a step in the employee base. And now people call me from the outside saying, hey, can we come join you?

27:34Jeetu Patel: You want to make sure that you're starting to build things that actually get your employee base proud. And the team that does that most effectively is a product management team that gets the entire company to feel the temple. The brand and the momentum gets felt for the better or worse by how the product management team operates. Because they create the long running true north. and when they create the true north, if it's going to be a shitty true north, no one's going to follow you and everyone's going to be in a malaise. But if you create something that's exciting, everyone's going to love it.

28:10Jeetu Patel: Now, the excuse a lot of people have is, well, I don't have budget. Budget does not precede a vision. A vision precedes budget. And so you always want to start with something that's a vision. It's so easy these days to build product because you can actually build a product with one or two people and a bunch of tokens. So don't let that hold you back. Make sure that you actually have extremely discontinuous, asymmetric, creative thinking that gets injected.

28:38Carlos: And just to try to bring the point home here, you talk about judgment, operating in founder mode, try to stay in touch with what's really going on, hopefully build instead of buy. but there's also a lot of legacy in a way. You have a core business that you have to run and keep the lights on. How do you ensure that you stay in tune with what's coming next so you can catch that next wave and not be a late adopter?

29:11Jeetu Patel: I have a rule. Every week I have dinner with one person outside of Cisco. And the reason for that, I only have one objective in that dinner. I want to learn one thing that I didn't know from that one person. I have enough questions for that person that I can get one insight that I did not have prior to entering dinner. And I need to make sure that I can teach them one thing so it's valuable for them as well. I think large companies especially, even small companies, we get very insular in our thinking. You become the sum average of the five people you spend the most amount of time with. so keep changing the five people and make sure that all those five people are always at all times smarter than you on some dimension you know because it's important that you actually learn from them it energizes people when you learn it depletes your energy when you don't learn you know because then you start worrying about the stupid stuff that doesn't matter when you're not learning when you're learning you're just focused on learning and so that's what i typically tend to do is make sure that i'm always in a learn-it-all mode like you know Sathya says.

30:16Jeetu Patel: And I think it's a great way to be. Because if someone gives you feedback about something that's not going well, just think about it this way. They care enough about you to tell you things that are deeply uncomfortable to them, because it's much easier to say that everything's great. If they come and tell you that something sucks and that you're not doing a great job, it's only because they care. And so make sure that if someone gives you feedback that's negative, you preserve those people in your life and you actually make sure that you bring them into your life more often you welcome them because that means they care and if you can and seek them out what i tend to do is the people that are the closest in my inner circle don't give me false flattery they'll tell me when something's working they tell me when something's not working so that you can constantly make sure you're improving because all you have to do is be 1.27 percent better today than you were yesterday.

31:14Jeetu Patel: And if you do it for 365 days in a year, you're 100x better by the end of the year because of sheer power of compounding. It's just math. If you do that for two years, imagine what happens. If you do that for three years, imagine what happens. Man, if you do it for a decade, imagine the disproportionate kind of advantage you would have over someone who is not thinking in that growth mindset. It's tremendously accretive. So that's the way that I would think about it.

31:42Carlos: Well, to many more years learning from you. And thank you again for being part of this. What a way to wrap up the day today here at ProductCon. And we are going to invite you all to join us in the after party at the rooftop. Thank you, Gitu.