#261 Tobi Lütke - CEO of Shopify: How Shopify Became a Cheat Code for Entrepreneurs

31:22Most people didn't. Why the fuck is there not better software here for everyone else? Like why do I need, why is in 2004 the only people who can actually create new business on the internet, which is clearly one of the things that happened that is the greatest possible economic equalizer, or so we hoped, of our times. Why do I need to be a programmer to then become a retailer? That doesn't make sense. small set of people. And why is the software that I can find so unbelievably expensive or so incredibly bad, that's not right. And like to me, I can channel this sort of dissatisfaction of the status quo as this unending well of energy that I can convert into building.

32:20And I think there's many other power sources that people tap. Creates an internal drive. But it got to come from somewhere. Like, room temperature does not lend itself to forging things. You can't build something at room temperature. And there needs to be a stronger emotion. There needs to be guilt, shame, anger. Like, something strong and then ideally something that doesn't flame out fast. Ideally something that lasts. So therefore, everything that exists, everything that's built is a passion project by people. It's people who pursued and created something, usually in the face of naysayers and people who wanted to detract from that.

33:09And so that was it for me. It's a combination of pride in my craft. Again, I'm literally a crafts person. I apprenticed my craft as computer programmer. and dissatisfaction with what my priors have prepared before I needed it. And so I want to make sure that the people who come now to entrepreneurship find tools that are as good as I can make them. They will always can be better, but that's the fun puzzle of a company. It's never perfect, but it hopefully is always better than it was before. And so that's the thing that I just find to be the most fun things to dedicate my working life to. We see it all the time here because, I mean, like I said, because we use Shopify.

34:03But, you know, I mean, I just want to say, like, the backstory, you know, to summarize it and kudos to you. I mean, you solve two problems with, I mean, just the fact that, you know, Shopify was legitimately boring because you couldn't get a worker's visa. And the only way to make a living was to start a business because it was illegal for you to work. I mean, that in itself is, what a hell of a story. You know what I mean? And then we move into the, so you solve your own problem right there. Okay, I'll start a business instead. And then you solve, you know, a world problem for entrepreneurs a year and a half later.

34:51I mean, that's wild. Now, to be fair, a year and a half later, while Shopify launched, I'm going to say it was pretty good if what you wanted to do was happen to also start a snowboard store.

35:08It took a lot of additional work to make it work for most other products. If a product was very simple, you could do it, but it's funny. It was, you know, there's this old sort of riff on the JFK quote that people say in the startup ecosystem.

35:41We do this not because it is easy, but because we thought it would be easy. Nice. So there's a lot of ignorance that has also led to committing myself to this particular course of action, but it's also like wouldn't trade it for the world. I have something in the outline that says building when nobody's watching and the importance of doing that. I mean, what is the importance of doing that to you? I'm sorry, I didn't quite catch it. So building when no one's watching, years of thankless work before any recognition. I just, so I mean, again, I do believe in craft. I do believe in honing craft. I'm sure you and I will find lots and lots of agreement there.

36:33It's like deliberate practice. And just like, I find like, again, it just matters what you do when it doesn't matter as well. And it's not just that you have to be on. It's also like the way you do anything is how you do everything. It's another way to put this. I, you know, to me, like my core craft is computer programming. It's not what I spend really most or any of my day doing at work, but like it's like it's the specialization by which I came into everything else that I then learned. and so it's like the trunk of the tree of my knowledge. It's like engineering principles and programming is the trunk, and any of my business skills is a branch, and then what people sort of observe from outside are the leaves, if you will, if you want to follow the metaphor.

37:31I want to still grow my trunk. I want to understand and play with tools. I want to go and spend the Saturday evening just like sometimes just rebuilding something that I built in the past just to see how what I've learned and if I can do it better now and have these kind of projects. This is especially useful if you are building something that's going to take a long period of time. It's like there's no attention on it. It's like it doesn't matter. You need to be intrinsically motivated to want to move forward because there's no one really holding you accountable. Once your product is in market, things actually get easier.

38:10At this point you have customers who delightfully will tell you everything that's ever been wrong with your product every time you talk to them, which I love. It really motivates you and motivates me too, especially in the early days. Again, Shopify is now out in the market. We are in 2006. Customer support is support at Shopify.com, which also comes to me, right? Because where else would it go? And I will support, I will respond from support at Shopify.com, but it's still me. So when people send these like essays about how can you call yourself an e-commerce software and not even have feature like this?

38:52My initial response is like to write defending my product. And then I'm like, actually, very right. And then so next thing is, I'm going to spend the night implementing a good feature. and then respond the next day saying, what do you mean? It's right here. That's how you make products better. This is the loop, and that's just what you keep going. So how can you be intrinsically motivated to want to hone the craft? That I don't know. I think it's that internal drive. I mean, the way I took that, what we're talking about right now is quit looking for a pat on the back, quit looking for an attaboy, quit looking for recognition.

39:31just build your business and all of that all that shit will come later if you find success but right now what matters is building and you know i mean we we had a saying in the seal teams before that that also relates to this where basically we we had adapted the mindset that you know when you're not training the enemy is an entrepreneur if you're not building your competitor is while you're out there fucking around at the bar you know doing hob not working your competitor is getting better and better and better and better and that that is a that's a mindset that i took from the seal teams because you know if the enemy's training and we're not them we're dead and i've moved that over to business to where if you're not building, if you're not innovating, your competitor is, and they're going to bash you up.

40:32That's right.

40:36And the question is how to even, like is it possible to disconnect even from the need to have a competitor that might be training?

40:49I have mixed feelings on that. Do you? I mean, I think a competitor can be, for me personally when i built the podcast and i built the look and everything and a lot of podcasts looked a lot different i'm not fucking tooting my own horn here but i looked at the market i saw what everybody was doing everybody wanted to be joe rogan that was it you had a purple curtain you had a bunch of shit on a desk that means something to you or it doesn't mean anything to you unless you're joe you know what i mean like joe's got all this stuff there Everybody just copied Joe. Everybody just copied Joe. And I took a look and I saw everything and I said, what we're doing is going to be totally different than all of this stuff.

41:33Not that it's never been done before, but it's never been done in a podcast setting. And it's yours. It's mine. It's yours. It's something you built. It's your aesthetic. and it's not, and all the centerpieces are things that come from the visitors of your podcast. It's like you build something that's situated in the center of the very community that you build, which is a completely, like, it's a completely different, like, approach. It's not better or worse, it's just very, very different. And this is what I mean with, like, all the interesting things come from, like, doing differently. It's like exploring the different paths.

42:23And it's incredible how much people, like, so many people externalize so much of how they judge if something is good to running it through an internal focus group of how they think everyone else thinks. And it's like, that sounds really exhausting. Like, that sounds hard also. And I'm not sure it's going to be precise, right? Like, because we don't really know all the other people that well, right? Like, we sort of, like, maybe have a guess, but, like, how about just doing things that you really, really want to exist, right? It seems like such a basic idea, but I just find so many people are just like, they think there's a game out there that they want to join, which is called the podcast game.

43:18And then they look for the rules by looking at the podcast that are most successful. And they think that if they apply, if they intuit and extract as many of the rules as laws and then adhere to all of them, they might get the same results. You familiar with cargo culls? No. It's one of my favorite sort of World War II adjacent story. So Pacific campaign.

43:52Obviously other than the, I think, B-22s, no, none of the planes had any range, right? So to fly into Japan, you really needed airfields very, very close to Japan. Some of the islands there had indigenous people on them. And so the American bases were built, landing strips were created. In some cases, this was the first time any of indigenous people there had any kind of contacts with the outside, their previous contact with the outside came from, you know, every once in a while a wooden crate, which was how old shipping was done there, like would wash up at shore with things in them, magical things, goods of society.

44:46The people who then like got these items, they called them cargo, of course, you know, just like that was a status symbol and here are Americans which of course all the people could observe in these airfields doing these things and planes come and what we bring more and more cargo which of course is like means was a very very rich individuals and I don't know if they thought about about the people they observed as demigods but they might as well so now World War II is over and no one's going back to these islands for a while until people do. And what they find is that they're still running the airports.

45:35There's like... The shamans are wearing like coconut shells, like headphones, in straw towers, making sometimes noises that sound vaguely English. there's straw airplanes on the runway, and people are doing this because they want the cargo to come back. And it just tells you something really, really important. I think about the human condition. We copy behaviors to try to create the same outcomes, and we do it all the time. So much of the business world, if you look at it, is just people cargo culting. I've noticed. It's like putting flame stickers on the side of a car to make it go faster, really.

46:25It's not principled thinking. And so other people live in everyone else's mind, and I think disconnecting from this as much as possible is important. And I think when you talk with the greats in some categories, like artists or so, they just need to paint. they have so much painting in them they need to you get it out and they just don't care if there's a market for it i got a question for you just um you know as a business owner because i i agree with everything you're saying um because i never you know i i took a peek because i didn't want to do anything that anybody else was doing i still do that everyone i still do it every once in a while but I never watch.

47:18I also never want to look at something and then copy it. So I purposely stand back. So I'm kind of contradicting myself. But I'll take a peek as I scroll, and I'm like, oh, yeah, that looks good. That looks like shit, whatever. You know what I mean? But I will never dive in and study what people are doing because I don't want to subject myself to wanting to copy what they're doing or manipulate what they're doing in my mind and my own idea. I want everything to be 100 % original. But at the same time, I would look. I think competitors can drive you. I saw a lot of people that I thought were competitors start to copy what I'm doing.

48:13my competitors, I mean, it's funny when you start business who you consider your competitors to be, and then if you do find success looking at who your competitors are years down the road. I mean, it is fucking wild. You know what I mean? And now, you know, my competitors are the top people in the game who are actually friends. But I guess what I'm saying is, you know, along my entrepreneur journey, I mean, I don't, I feel like maybe I may have needed competitors as a driving factor because I'm a very, I'm competitive. You know what I mean? I mean, I've been competitive since a young age and I enjoy a healthy competition and that competition drives me.

49:01So I'm just curious. I mean, I can't imagine a world where, you know, and also looking at competitors, I mean, somebody that's a little bit ahead of you or maybe a lot ahead of you, I mean, it shows you what's possible. Like, it's a real living example of what's possible within your realm, which can, you know, that can be a driving, I fucking want that. You know, and that, and because this person's achieved it, it's achievable. And they're not that far from me, you know. Do you have any thoughts on any of that? I completely agree.

49:40When you look at a competitor, it depends on what you do with information. Is it like envy? Or is it like, are you looking to copy? Or again, like cargo cult with things? No. Like what you're describing is a rivalry. And that's a totally different thing from competition. Galvanizing a rivalry is good for both sides. that makes everyone better. Because I think this is an important thing. I don't think Shopify and Amazon have ever really been competitors. We have been rivals at times. And I think we inspire both like each other, but we do it in a completely different way. And so I think that's a really, really, really healthy thing.

50:28I think what I don't like is when people skip the step of having their own aesthetic, wanting to build their own picture, and then use everything else, everything they're doing, everything else they're perceiving and seeing as additional inspirations to do a better job creating the unique thing that they want to do. And I think that's a, it's probably not a super simple thing that I'm describing here and maybe the difference isn't as important as I'm making it out to be. But somehow to me it is. It's like I really, really, I value rivalries with, and I find that obsession with competition is often...

51:19Like, let's put it another way. Again, I'm a motorsport enthusiast. I love motorsport, racing. I grew up with Formula One. I get to know race cars myself. Were you at Formula One the other day? I was not there yesterday, no. Oh man, I want to go so bad. Yeah.

51:48Growing up in Germany, coming to Canada, suddenly no one gave a shit about Formula 1 and it was a hard adjustment for me. And thank you, Netflix, I suppose. Now everyone is into Formula 1. And I'm like, I'm so happy that this happened. This massively increased my quality of, at least my Monday morning discussions at work. so anyway then I

52:14then I'm on track for position maybe newer tires than the people in front of me like so I'm gaining a little bit when I come around the corner and I see that there's two there's not one car for position there's two cars and they are fighting I know I'm going to overtake them both very easily It's just like you lose a lot of time when you're fighting with someone directly. And so, I think that's the difference. I mean, were you able to... This sounds like learned experience to me. So, I'm curious, when you started your Shopify venture, maybe even your snowboarding venture, is that how you thought?

53:11Or were you looking for competitors? I grew up, I oddly grew up. So again, growing up with computers in the 90s, I know this sounds weird to make this analogy, but you're familiar with open source software, right? Like purely sharing, you build something, you shared, there's massive open source projects, Linux kernels, these kind of things. The open source is fundamentally positive sum. No one loses by someone else making a copy, like because in the world of computers, everything is infinitely copyable just for the price of electricity, I assume, which is essentially free. The real world is often much more rivalrous, like only one person can live in the house or on a spot, or only one person can have a physical object but in the digital world there is actually two positive sums.

54:03So I think because of that that I was a bit predisposed towards positive sum thinking because I've just seen it more in my childhood. So when you are creating a business you're not competing with everyone else like in that same space like you can very much grow the space because you bring something new like the way we talked about our snowboards it's just totally different everyone else had like a grid with like many snowboards and pictures and a prize we had essays about what we did with a snowboard throughout the day right like we just took them to a mountain and then said what happened that day basically and it's like sometimes wasn't even quite related to the snowboard itself but that spoke to a new group of people who might not have bought a snowboard at all if it wasn't like this or might not have purchased such a premium snowboard.

55:02So there's a growing market for more people aspect in this, which I always really, really try to emphasize.

55:16But you're right that it's somewhat learned. So what happened is...

55:23By 2015, so this is 10 years in the company's history, I don't think we truly had competition anymore for exact business. In the enterprise business, there was some players, but there was no one going for the small and medium business market. In fact, even really along the way, everyone deemed it as a terrible market to go after. And that was sort of a surprising thing. It never seemed like this to me. But I'll tell you, in 2008, I had to hire some people. I had some support at Shopify.com. At some point, I needed to not just make it to me. I needed to hire some people. There were like eight or something in 2008.

56:17eight people and um um we made some money and i still had some savings from snow devil but like i wasn't taking a salary and uh you know we were just living with my in-laws in their house um and fiona and i and um so we um we kept costs down um and uh um but it's hard to do meet payroll. I went to Silicon Valley finally and just started fundraising. So I wanted to, like, you know, I had learned how to do all this. And I did have a pitch deck and so on.

57:02You know, ultimately people passed for one reason or another on the company. And a very important big venture capital firm that everyone would recognize passed on the Shopify deal. And years later I met with the partners again. And then, I was like, hey, Toby, what did we miss?

57:31I was like, you know, reminded, you passed because you decide for yourself that there's like a global market of 40 ,000 online stores, right? Like this is the internet at the time. In 2008, there's 40 ,000. And if Shopify is successful, it might get 50 % of the market. That's like, that's still not enough to business to justify the valuation, which would have been very low. So what did we miss? Okay, here's what we missed is that Shopify itself was the solution to the very problem that they stated. There was only 40 ,000 online stores because no one made it easy to start them. Like the only online stores that existed, they were already rich businesses that had the$25 ,000 or$250 ,000 to make a web presence and build an online store.

58:31And like they were all attached to existing businesses that are already rich. No one built for the new entrepreneurs. And so Shopify grew its market instead of competing for percentage in a market. And I think that is like a very, very, very different thing. I mean, I... So you started this roughly in 2004. I mean, I feel like there were competitors of yours back then. I mean, I remember GoDaddy was the first one that I tried... I tried to build a website myself on GoDaddy. I did it, it looked like shit, and that's when I was like, all right, I need a website builder development guy. And then, you know, but there were other things that came along the way, I think maybe Wix.

59:25Shopify is not a unique idea at all. Like it's like, in fact, it's one of the most, I mean, there's hundreds of companies that have and do ostensibly the same thing. The technology industry is never about who does something first. It's always about who does something right, which is what makes it so interesting.

59:46All the e-commerce companies of that time, even if they started wanting to service new builds entrepreneurs, always fled the market because people had a lot of money. They serviced existing businesses and could make way more money. It was expensive to deal with small businesses. The general advice that I got when I was around was just use eBay. Like start your business on eBay. If it works, then talk to a company called, the one I got recommended was Miva Merchant, which would then take a lot of money to build an online store because now I have enough money to give it to them. And then you would re-platform again afterwards.

1:00:31And it was like specifically for the new entrants. I'm not aware of anyone making that specific goal. That doesn't mean it didn't exist and no one did it. There was one, the closest analogy was a thing called Yahoo Stores, which actually Paul Graham started with an interesting character in his own variety. He started Y Combinator later and which of course became the origin source for so many of the tech industry's greatest companies now. but his original project was a thing that got purchased by a company called Yahoo and then turned into Yahoo stores I tried to use that and could not make it work

1:01:20you've probably seen the headlines another trillion added to the national debt it's hard to even grasp the scale of it 38 trillion in climbing while Washington keeps kicking the can down the road more and more everyday Americans are losing confidence in the system. That's why we're seeing record demand for gold and silver right now. It's not just everyday Americans either. Central banks across the globe are buying gold at the fastest pace in decades. That's exactly why I've partnered with the award-winning company GoldCo. They specialize in helping people protect their retirement savings. They use real assets, gold and silver, and they make the process simple and transparent.

1:02:04Go to seanlikesgold.com right now to get your free 2025 gold and silver kit. You'll learn how to help safeguard what you've worked hard for. Plus, you could qualify for up to 10 % in free bonus silver, one of the best deals out there. So visit seanlikesgold.com today. One more time, that's seanlikesgold.com. Performance may vary. You should always consult your financial and tax professional.

1:03:03I mean, what did it do? So when you entered this, the competition thing, just I fucking love what you're saying. I just, I'm trying to, I just want to know, like, when did you, when were you able to totally detach yourself from the competition? and because i i feel like with my business germany i'm just now arriving there i wish i would have arrived there a lot earlier because i because i also see that it it it it it's a time suck it's a rabbit hole that you can go down and spend a lot of time discussing competition with the team and it yeah it it it's a it's a subject that never ends right And so I'm like right at the point where I'm starting to detach.

1:03:53Like I don't give a fuck about what anybody else is doing. And I think part of the reason that's happening is because we are launching other businesses in 2026. And that is, I mean, the show will always be my staple and I'll love it and da-da-da-da. But if I'm being perfectly honest, I'm more excited about a tech company called Glacier that we're launching in 2026. And that is taking my brain out of... It is detaching my brain from competition within the podcast world, which is more bandwidth in my head to build more things, to become more successful, is what I'm saying. Exactly. And I mean, again, back to my analogy of a tree, I mean, the podcast and the community built from it is the trunk.

1:04:44And you can now fill out the tree with more branches, right? Like that are part of it. So, again, and therefore you end up creating something that is not a direct analogous, has no other that are doing the same thing. It's like now it's like unique. It like becomes an oak, right? And I think that it's better to build something that's like a unique construct. It's okay that this happened just one step at a time and didn't come from some kind of crazy business plan ahead of time. In fact, I think the best businesses tend to be the kinds of businesses that would lose at every business plan competition, funnily enough.

1:05:29And I mean, again, my company itself started like this. So it's like a snowball store to e-commerce software to really what is Shopify's retail operating system, I suppose, now. But it's so many things. The comment on we didn't have competition, I feel like I should put some meat on that bone. Because it's, again, obviously not true that there aren't other e-commerce companies and so on. But what happened is I think we learned what we could learn from them. And again, I do think it's very valuable to talk about competition, but always from a perspective of what can we learn from them. What have they figured out?

1:06:17How do they uniquely handle their particular challenges? Because we're looking at the same problem space and find different solutions. And so in a way, they can act as to fill in the blanks. the paths you didn't travel, you can now see, well, they made a completely different decision solving a current problem. At some point in the 10 years after we launched, mobile phones became more important than the desktop browser, but the entire internet was built for the desktop browser. And suddenly all the sales were mobile. Like, every company in the space had to react to this. Some of them didn't, and that told you a lot.

1:06:57Some of them said, okay, well, we give a completely different interface to all mobile phones, like as a sort of companion system. You have your own brand on your own website, but if someone uses a mobile phone, you see the thing that our team created. To me, that seemed incredibly wrong because, again, the beautiful thing about Shopify, again, is almost everyone who's on the podcast has used Shopify probably recently. I mean, especially you to your customers. You just don't know it, right? Because if you bought something online and it didn't come from Amazon and you liked the experience, it was probably Shopify.

1:07:46We are not the brand. We are pushing from behind. We are pushing other people's brands from behind. So therefore, this is an article of sovereignty. What is ownable on the internet? There's two things that you can own. There's your domain and what's behind it, and there's your email list. Everything else is rented. everything else is leased from others like your facebook pages depends on facebook how much reach it has and so on that's not a bad thing it just is um if you're selling through uh etsy or so that is also very good but it is etsy's listing um and and etsy will determine if your products show up for such query or not but on your own website that is your space you're like you're you're gaining sovereignty there you can take that entire design that you have and take it with you wherever you go.

1:08:44You can get all the data from Shopify. This is super important to us. So then the mobile phone comes out, it's your job. We have to figure out how to make it so that your brand looks just as amazing on mobile phones as it does on desktop software. And that's what it helped everyone with. That ended up being the right decision, just as an example in this. So again, looking at the competition from a perspective or what can we learn from it and can we have a friendly rivalry with them then has always worked really well. Eventually,

1:09:27and here's the reason why to do this. It makes everything else easier to have an enemy. That is true. It's much, much, much easier to say, hey, this other company wants us dead, therefore we need to work really hard. Because everything else sounds hollow. It's like, hey, everyone, let's work really hard, because reasons. Did you, did you, I'm curious, did you use that to drive your team? So I ran out of credible things to point out at some point. And so this is why I talk about intrinsic motivation a lot, because I had to think about it a lot. How do you create an intrinsically motivated company where everyone works really, really, really hard when they technically probably don't have to right now?

1:10:21You can talk about a future competitor might come out of a Woodworks that does everything better. And of course, companies constantly get disrupted because they become lazy and fat.

1:10:36But the only way I found is for people to fall in love with the mission. And the mission is to make more entrepreneurship happen, make entrepreneurship more tractable, make our customers more successful. and know that if we fail to, if Shopify isn't a representation of the sum total of our skills and beliefs and what we know how to build the best possible e-commerce software at this moment, more people will fail, right? Because this is what we see over and over in the data. Every time there's an area that makes people give up in their entrepreneurial journey. If we then find a way to significantly make this easier.

1:11:20It's the people who otherwise would have given up make it. It's entrepreneurship stops via hurdles and it's when some people at some point in some emotional state are too encumbered by self-doubt or you know the stresses of building a company and they encounter some kind of thing that has stumped them and if they're in a wrong mindset, they might call it quits at this moment. And if the obstacle wouldn't have happened, you know what it's like to be an entrepreneur. It's a roller coaster. It's ups and downs. It's like valleys and peaks over and over again. And sometimes in the valleys, it gets pretty close, right?

1:12:07Like there's pretty dark days in any one's entrepreneurial journey. So, again, I think falling in love with a mission or at least falling in love with being on a mission with people you really care about, doing difficult things for worthy people is an incredibly fun thing to do. In fact, I think it's kind of an optimal way to spend your life, really. And I think we've succeeded significantly. significantly. Today we have plenty of competition. I'm not going to say we have no competition left. It's like it all came back and again, much more easy to study what other people are doing. AI is like changing everything and there's not a company that's safe in the world and I love it.

1:12:55It's so much easier. It is so much easier. It's so much better. It's so much more fun. It's so much more creative, it's so much more driven. I mean, I get to, like, I saw many transitions in my career of the technology world. I saw the internet arrive, basically. I saw Web2.0, which, whatever that is. I saw, you know, like, the mobile phone coming, and now what happens with AI is just, like, another platform. Like, usually people should be enormously lucky to see one transition of a platform in their careers. I'm like four in now, and it's unbelievable how exciting this is to have to invent everything.

1:13:43That's, I mean, I want to move in. I mean, since you brought up AI, I would love to talk about, you know, what you think that looks like and are we at the, I mean, is this as big as the invention of the wheel or the invention of electricity but but before we go into that i just you know one thing that just talking to you now that that comes to my mind is obviously um probably one of the best engineers i mean in the world and you know what i'm what i'm i'm not trying to blow smoke right now what i'm getting at is you know what what what what But what drew me to Shopify is how you were able to simplify everything on the platform for a dummy like me.

1:14:33So, I mean, some of the things that stuck out to me, for example, I've always, you know, it was always like, how do I connect my social media to my website? Like at the time, that was really important to me. And these web developers, that's going to be another$10 ,000 to make that, you know, connect that. I pull up Shopify and I'll never forget it because that was such a headache for me. I was like, I really want, I need social connected to the website. And I remember, I remember building the website and saying, do you want to connect your Instagram account to your Shopify store? Click this button.

1:15:08And I was like, are you fucking serious, man? This is so, this is easier than putting a PowerPoint together. It's prompting me to do the shit that I've always wanted to do. And so kind of what I'm getting at is if you take a complicated mind, you're very into this, you're way more advanced than 99.9 % of people in the world when it comes to building this stuff. How are you able to get you and your team, how are you able to dub it down and know what basic green entrepreneurs need, you know, in building their website? I mean, to go that granular, you know, from that advanced of a mind is just, it's honestly, it's pretty mind boggling.

1:15:58Well, but it's easy. Like, it's like you talk to them a lot. Like, I mean, it's Monday now, right? Sunday evening, I watch videos of people using, like interviews of people and recordings of new entrepreneurs using Shopify that our, you know, teams create. And it's lovely, right? Like you would, like I have like, I'm like in like 150 of my customers in WhatsApp right now will tell me, like Shopify is collaboratively created with our customers, right? Because again, the best, like if I want to grow my business, what I need to do is make my customers more successful. And that's like, it's very rare to have a company that's so aligned with its actual customers.

1:16:54And also, one of the funniest advantages this company has is that there's very few companies on planet Earth who have such inspiring customers. I mean, you're not a customer, you're a pretty inspiring guy. Hold on. Let me just... So you are watching video interviews of your customers every Sunday. Yeah. I mean, I'm just going to bring another thing up. but one, I got to thank Lulu for connecting us. But I mean, we just released our PsyOps docuseries on Shopify. And I'm going to be honest, like when we reached out, I thought we were getting the special treatment because of our mutual connection, Lulu, and maybe because it's a big podcast.

1:17:40I thought we were getting special treatment, but after hearing, and I appreciate that, thank you, because nobody else could launch the docuseries. It's on Shopify. I think we're the first ones to be able to do it. And it's because your team jumped through hoops. But, and thank you. But this, so that's not like a, that's not a special thing. Like you, this is what you guys do. You get in touch with the customer, with the entrepreneurs and you figure out what they need and you do this every, every Sunday. Yeah. I mean, it's, I mean, I don't do it every Sunday, but as many Sundays as I can. Like it's, it's my team like makes super cuts of the interviews we do.

1:18:18and sends them to me so I can see how people get stuck and so on. But because I use Shopify, I use it myself. I'm a user of my set of shops going and I sign up for new shops and go for onboarding and talk to customer support from pseudonyms. I'm red teaming my own company all the time. So I'm a pain in the ass to work for because of that, but it's also like that's kind of what you need to do when you're trying to like... Look, as a CEO and founder of a company, it's dangerous to get disconnected from a product. People get really, really, really good at telling your combination of words that makes you look elsewhere.

1:19:06I've had plenty of such experiences in my career. And so, you know, be in all the details is important. I review every single project that's going on in the company every six weeks. And it takes 12 or 4 days, usually three days. We go through every single project. We have an entire system. We have an entire piece of software that everyone uses to rebuild, where everyone registers everything that's going on. In fact, that was largely inspired by military, actually. A book called Team of Teams by General McChrystal. Excellent read. Anyway, so we built an internal system that's sort of asynchronous distributed information system about what our teams are working on, all the projects, progress updates, who's on them.

1:20:07And then this bubbles up into a six-week review and then we go through them and I have a super, like sometimes a quick, but like the team is there. We can quickly talk about how things are going, what's stuck and then keep going. And then we move, try to move all of these projects to build everything we can in such a way that it works well with everything else. And I don't think this is the only way to build software at this scale, but it's certainly the only one I have discovered that allows us to build a software like Shopify at this scale. Because automatically what you're trying to accomplish is you want people to use it and I believe that every user of every piece of software of every product in the world can intuitively tell you if a team that creates it gave a shit about the product.

1:21:18I think this is just known to us. It's like it's invisible and we don't have good language but I think everyone can tell. And so well if you want to build a product that where people would answer this question in the affirmative, you have to give a lot of shit. There's a lot of shit has to be given about the tiniest of details, about minute architecture, minute, the chunkiness of the buttons of the design systems and stuff like this that no one, like it would be so funny. I mean, I guess this is why the Silicon Valley show and HBO was so funny. when people who are in the tech industry kind of get exposed to the shit that we discuss and have discussions and meetings about, right?

1:22:05Like, it's, like, ridiculous. But, like, unfortunately, this is what it takes. So, yeah, so we go through everything and we talk to customers. And why? Why? Because, look, I mean, I don't want to criticize you. Where did you learn that? Where did you learn to reach out to your customers? Oh. It seems like the most successful tech entrepreneurs in the world have all have a grasp of this concept. And there's a whole hell of a lot of people that have no grasp of this concept. But I mean, where did you, I mean, when did that, how did you figure that out? Yeah, it's, well, I mean, I was a customer support initially, right?

1:22:58So, I did it because I had to, and then I could hire people for doing it, and at some point along the line, I started making choices that weren't right, because my sort of inner model of what an entrepreneur goes through when using my software was just like starting to be dated. And I'm like, well, I have to figure out a way to be more connected. And, you know, I did, actually I haven't done this in a few years now, but like until like a few years ago, I did like actually an afternoon in customer support, you know, just like maybe once a quarter, a half year or so. And it was always very good for me.

1:23:48Just a very humbling experience to actually help people, especially at their vulnerable time when they're confused. They call for a reason. They call because something is really important happening and they need help. So I don't know. You need empathy for the people using the software. And I don't know if I, yeah, I just came back to doing it this way. Here's my strongest belief that,

1:24:25I was cringed a little bit when people say like, people have like clearly a bit of, I hear this a lot when people say, I don't know computers or I'm not technical or so. Well, Well, no one's supposed to be technical. The whole thing that people have to be technical to use technology is because of skills issues of people like me. It's completely unfair. And you don't have to be technical to use a television. You have to turn it on and you go to the channel. So that's the engineers and product designers doing a good job with a medium.

1:25:04But if you were better, no one would ever feel like they can't figure out something. Computers don't get to make people feel dumb. That is not their role. They are tools. Hammers don't make people feel dumb. Screwdrivers don't make people feel dumb. We have a only

1:25:29field, the only field of tooling, support and infrastructure that somehow is allowed to make humans feel not good about themselves somehow. And it's just normalized. What we actually should do is give people superpowers because that's what it does to us, like to us, the engineers, to us, the technical people, computers, the way I talk about computers will be clearly very different from how most people talk about computers. Why? Because I do love them for what they can do. They are incredible. But to get the power that I can extract out of a computer, again, I had to sacrifice my youth. It's path dependent for people who, for unexplained reasons, wanted to cultivate rare but valuable skills around computer programming and understand them at an intrinsic level.

1:26:32And most people can experience them as the incredible, most powerful tools that you may has ever come invented, but everyone else should do that too. And so I think, luckily, I think now with AI, we are getting there. This is the best thing about AI is we kind of get a do over. But like there's too many stories of people feeling inadequate, not being able to accomplish their tasks, because we just cannot make software that meets people where they are. So no matter how hard I work and my teams work, it's never going to be enough to really get all the way there because it's just like, unfortunately, there are limits.

1:27:14but again every single time someone doesn't end up giving up on an entrepreneurial journey means there's one more business that's gonna supply employment supply I think it's just like it that someone else becomes an entrepreneur in the in the eye of their own children grandchildren family and again I think it's a it's an identity changing event and so it's important it's it just feels really really really really meaningful to be able to work on something like this it is it's i mean i can't even imagine how many lives it's transformed and put on a a higher trajectory than what than what they were but you know moving moving into ai a little rabbit hole here i mean you know a lot of people are worried about ai we've talked a lot about it on the show you know people are worried it's going to take their job probably is going to take a lot of jobs It's also going to make things a lot easier.

1:28:11I'm curious as to your thoughts, I mean, are we at something that is, is this as big as the invention of electricity or the invention of the wheel or the invention of the internet? I mean... I think so. This changes the entire way of life in the next five to 10 years. It does. It really, it's, I know this is going to sound crazy and scary and probably will be quoted back at me at various times when people are somewhat down on AI. But I just think AI is actually under-hyped right now, and that seems almost very hard to believe, I know. It's just, You think it's under-hyped? I think it's under-hyped.

1:28:50Wow. For all the hype that's already existed, it's still under-hyped and what it can do.

1:29:03It's just without losing, without having to allocate some of our like, like rarest and most specialized people to like to everyday problems is just huge. I, it's so easy to run into examples here, but like, I just like, I'm getting so many stories right now from family members and friends who are solving like really, really, really tough medical problems for them that they couldn't solve. And they've done all the right things. They have done every test. They've talked. They've gotten second opinions. They've described. They came prepared to every doctor meeting. But then, you know, at some point, they just start one of these projects on ChatGBT or whatever and put all of this in there and then just like let it go into deep research on this.

1:30:03Like again this is something you have to be comfortable with data and all these kind of things and maybe like people do it anyway. Well and it just sort of figures out what's actually going on in a way that you can show up to the next doctor and just finally get the thing that you were looking for. And why does this work? It's not because it's smarter than the doctors. The doctors are way smarter, way better. But a doctor only has 15 minutes to sit down with you. They have 15 minutes, maybe 20, to look at the charts, talk to you, get information. And 20 minutes of a doctor's time is probably worth hours of an AI doing something right now.

1:30:52but where I can put thousands of hours in and some tasks just benefit from just intelligence being projected into this directory over a long period of time and can be solved. And I think that's a lot of things but it's usually tasks. It's like here's the task of taking the information that has been collected you know all the scans and all the reports and all these kind of things and sift through them, go through all the literature, figure out the latest developments, you know, compare and contrast it with all the medications that have already been used and the reports about, you know, just like this is, it's just a thing that humans could do, but like we just don't have enough people for doing this.

1:31:41And so I think just like that alone changes the world in a way, right? And so it turns out that it's true that jobs will change, although much... This always gets into really... Everyone has sort of a different question and different jobs in mind. I think what AI really does is it outmakes tasks and it allows more people to work like you and I because we have teams for... If we need something researched, we have people we can email and they will research it for us, right? Like, and send us back a report. And I think more people should, like, should have ability to have something like this. And frankly, you know, sometimes it just, speed matters.

1:32:27Getting something back in like a minute actually allows you to, like, it might not be as good, but like, you can then make modifications and ask it again and like, like help yourself figure yourself out so i think it's all this stuff is pretty remarkable but yeah um it's where i am most excited about with ai right now it's just i'd be see this so the thing i spent more time on than anything else on um at shopify over the last couple years is how how to integrate um a helpful ai into shopify the software right because for exactly the things we've just been talking about. I see it as a personal failure and it's almost physically painful for me when especially my software makes people feel inadequate.

1:33:22I want my software to inspire people and make them more ambitious than the others would be, not less. And so AI. Like we have this is integrated in Shopify, it's called Sidekick. Having a, you know, infinitely patient, extremely knowledgeable, you know, kind, non-judgmental AI sidekick as part of your entrepreneurial journey is extremely game-changing from our perspective. This exists, this is an integrated job for everyone to get access to it. And the conversations people have with their tellers are just like, it's remarkable. Like, you know, the big businesses ask it to run reports, the new entrepreneurs ask like, where do I have to go in Minneapolis to register my business?

1:34:22You know, it's like, how do I open a bank account? How, you know, like, it's all the kind of questions. That's going to be embedded inside of Shopify? It already is. It's hundreds of thousands of people are using it daily. It's just like, in fact, you can ask it to do jobs for you. You can say, hey, here's my, here's, I got the, I got a PDF here of my supplier for the summer collection for products. Can you please create the products and add them? And, you know, just go and do it. And it's like, I hope it's doing a great job doing it. Like, it probably might get some things wrong, so it will definitely show you a review screen for everything, but it's increasingly able to just join your team as a team member, right?

1:35:11And again, especially for the solo entrepreneurs, that is an incredible change because now they have, I mean, a team of one. Like, that's cool. Wow. They literally have an assistant. Yeah, they have an assistant. Holy shit. I can't wait. I got to go ask my guys if we're using this. Yeah, you should check it out. It's fun to have conversations with. I'm super biased here, but I'm a really, really big fan of this. Again, most of the intelligence there comes from the wonderful advances of labs like OpenAEI and Tropik and others. But Shopify is a bridge company, fundamentally. We are bridged between the world of the global world of commerce and the technology world.

1:36:03Like our job is to go and get the best things that the technology industry can do and make them available for people who are trying to self-actualize, right? Like this This is our native habitat. And so that power that we are getting for helping people with AI in doing this and what we can deliver to the people who are just going to sign up tonight for and trying to build a business, it's just like absolutely remarkable. And that's why I say it's still underhyped.

1:36:38That's amazing. That is, wow. That's incredible. Let's take a quick break. When we come back, I'd like to talk about how you run your team. I know you run it lean and would like to just move into that. It's a good one. My days don't slow down. Between work, the gym, and time with the kids, I need eyewear that can keep up with everything I've got going on. And that's why I trust Roka. I've tried plenty of shades before, but these stand out. They're built for performance without sacrificing style. I've put them through it all. On the range, out on the water, and off-road. They don't quit. They're lightweight, stay locked in place, and are tough enough to handle whatever I throw at them.

1:37:30And the best part? They don't just perform, they look incredible. Sleek, modern, and designed for people who expect more from their eyewear. No fluff, no gimmicks, just premium frames that deliver every single time. And that's why Roka is what I grab when I'm heading out the door. Born in Austin, Texas, they're American-designed with zero shortcuts. Razor sharp optics, no glare, an all day comfort that doesn't quit. And if you need prescription lenses, they've got you covered with both sunglasses and eyeglasses. One brand, all your bases. Roka isn't just eyewear, it's confidence you can wear every day.

1:38:12They're the real deal. Ready to upgrade your eyewear? Check them out for yourself at Roka.com and use code SRS for 20 % off site-wide at checkout. That's R-O-K-A dot com. All right, Toby, we're back from the break. We're getting ready to dive into how you run your team. So I was picking through your outline and saw that you like to run small and lean teams. Who doesn't? And this is a growing pain that I'm trying to figure out right now. If we want to go and we want to bring everything in-house, which is kind of originally what I thought I wanted to do at the beginning of the year. And now I'm starting to think, I don't know if I like all these people running around and I don't want to get, I don't really want to get any bigger in deal.

1:39:05I like to keep, I think the way I'm going is I like to keep my internal team extremely small and lean and nimble and then start to outsource more and more to other companies, not individuals, because I think companies might hopefully care more about their reputation than what I have been dealing with. So anyways, I just want to get your thoughts on that. Yeah, I mean, at the end of the day, everything is about the team. A company is actually not a thing, really, if you think about it. A company is like a collection of individuals that we just call a company. Every company is getting... Like a company can't gain skills by itself.

1:39:59It's just the individuals in the company might develop a skill or you might bring someone new to gain a new skill. So it's kind of like, honestly, the beautiful thing about companies is that they get to align a lot of people's incentives all in the same direction. And then everyone gets to, you know, spend their day together doing hard things, hopefully, unique things and so on and so on. Reality is there's a huge amount of complexity in just getting these incentives aligned, right? Like it's so often that lots of people just like end up like sort of grinding against each other and like all the energy is sort of diffused by the grinding noise they make by just like being in each other's way.

1:40:44And the solution to this is like, I mean, it's like one of two things, right? It's like it's either you drive people towards making a consensus decision, like or there's going to be leadership. And those things are kind of opposite. And I don't think that's a commonly held belief. So how do you set this up? I mean, I'm a big fan of small teams. I think small teams in general are... I mean, the best size team is one person. That's just like anything that one single person can do should be done by one single person. because that requires zero coordination. It's like in your head you can consult.

1:41:36If you have all the skills to do something, then you don't need to coordinate with anyone. Books tend to be so good because they're written by one person, but usually with an editor. So now you have one person holding the pen and being able to construct an incredible fantasy world with all these characters and like perfectly, like everything written in the same tone of voice, the characters act consistent to previous chapters and so on and so on. If you would give every chapter to another team member and write a book, there would be no cohesion between these kind of things. So like especially if you don't actually, if you try to do it all at the same time, because then no one can coordinate, no one knows who Bob really is.

1:42:31Bob shows up in one chapter different from a chapter in another chapter. A lot of companies unfortunately run like this and just try to write a book by accelerating it in such a way that they puzzle out the tasks and give them to a bunch of people and then you end up with kind of a mess.

1:42:52So at a certain size, when a task is bigger than a book, you can't do it for one person anymore. Now you do need a team. But you should understand every single time we do this, you are still trying to create something that feels to the people who are gaining on the other side, like the product, needs to feel like it was written by a single author, even though you had, in our case, like three and a half thousand engineers building the thing. So that requires an enormous communication challenge which isn't to be underestimated. The second best size of a team is five with an ability to flex up to eight for a short period of time but it needs to be temporary.

1:43:38That's what we found. It seems like that military came pretty much to a similar conclusion, right? Like in squad sizes. I am not a military expert, but it certainly seems that way. I found that these teams, like I think parceling things into teams that fit that mold, that size is the best as long as you have a clear person who plays a role of editor and someone Someone who kind of knows what overall needs to be produced, how to make decisions. Someone who can be escalated to if two teams disagree on something and who can help with coordination. That's basically what we six-week reviews do at the global level.

1:44:25And then I work with lots of others who hold the editing pen in other areas at smaller levels. I don't know if that specifically answers your question, but I think what I found is there's a lot of myths around that really, really are in people's ways. And I think this is why a lot of scaling of small companies ends up going poorly. And I have a pretty controversial take on this. I think part of the reason why there's so many myths about teams is because only people People who have time to write books are the middle managers. It's not really the people who actually ended up making a difference or having the leadership position that truly end up writing the books.

1:45:16Whereas usually the books are written by middle managers who ended up being in some industry that was just experiencing rapid growth for extrinsic reasons like telecom. Like the telecom industry in the 2000s, like then for half a century of mega growth, it started out, let's call it 100 million, 100 billion size of industry, went to multiple trillions just because of demand. So if you had a pulse, whatever you were part of grew a lot, probably despite of everything you ever did. and then people make a lot of money and then retire and then write a book about their pet theories about how they did it.

1:46:04And that's what everyone studies in business schools. And it just is completely independent of what actually matters. So things like don't micromanage is one of those things. No, micromanage. Like, it's crazy to not, like, not micromanaging is an insane idea. Like, you gotta be in the details. Like, don't micromanage if you don't know what you're doing. Don't do the things that make your team do worse than what they otherwise could do by themselves. But always be there to help them do better if you can. But you find so many people were like, oh, I don't want to be a micromanager, but you guys are basically barreling down in this car at 200 miles an hour going over a cliff that you just can't see yet and I have a map and I know it's there.

1:46:58No, just like actually help them drive around that thing, like that's a good idea. And so that's one of those kind of things. I got myself in a lot of trouble with just getting out of the details for a because I've thought I need to become, you know, I'm running a public company now. I need to be CEO, like, I don't know, from central casting. I need to trust but verify and, or not even verify, just trust, trust faults everywhere. And it's like, that's fine, but like, it just doesn't lead to, like, eventually people will know what combination of words causes trust and everyone's allowed to be an intelligent actor and the local incentive system.

1:47:42So if you can basically do whatever you want, as long as you just use a particular way of explaining it, you will, because that's expedient. And so eventually things will go poorly. What I've found with my direct teams is I want people who have some strong specialization in something. Usually it might be the law as background, or it might be an engineering background, or design, or anything. I want to work with people who have been clearly excellent at something and then spend time adding more skills, like building range and perspective. I want everyone in the team to be able to put, at least in theory, do a reasonably good job switching roles with others in my executive team and I want people to be as little beholden to orthodoxy as possible.

1:48:43In fact, I actually require for all my team members and leaders that at least once a year they go to some international conference or maybe a podcast and talk about how they do their area of the business differently from how other people do and therefore better. That's a good topic for me to talk with them about in a one-on-one, but also just keeps them thinking about what opportunities do we have to do things better? Because nothing is ideal in companies. We are not actually very good at building companies at this point in day and age. It's understudied as a field. And then through these conversations, I try to build trust with them and make this an actual thing we talk about.

1:49:31We talk about trust as a battery, essentially. Like, it's something that you charge over time with every interaction. Like, we do something together, you solve a problem, or you do the thing that you said you would. That's a small charge on the trust. and then, I don't know, like you show up late for every single meeting or you kind of phone in on, you know, slides for whatever, whatever, it loses some trust. And so I found it very helpful to just go and like, hey, here's like the things that added some trust and here's the things that you lost some, so we're kind of even right now. And if you just eliminate the ones that lose trust.

1:50:11You say this? Yeah, I say this. You're very direct. I'm very direct. That's how I am. I'm German. So I'm like, it would be odd if I'm not direct. So might as well lean into the stereotype. I speak direct like this. It's not always received the greatest. I'll say that. But I like to speak direct because I've, you know, as uncomfortable as it can be to speak direct, if you don't get lost in the conversation, it's very precise communications. It's this is what we need done. This is don't do this again. This is why. Let's brush this shit under the table and move. I like to speak like that. I get a feedback that I can be unapproachable, intimidating.

1:51:05I have very high expectations, which I've always had very high expectations. I mean, I grew up in the fucking SEAL teams. and then I went to the CIA, and then I built a company. And everybody that's here right now, I think, understands, like, yeah, Sean has extremely fucking high expectations. People that don't understand that don't last here a night. And I think it can be, like you had mentioned, I can be a pain in the ass to work for. I can be a pain in the ass to work for. I have extremely high expectations. and you know but we wouldn't be where we are today if i didn't have extremely high fucking expectations we would just be like any other mediocre fucking podcast mediocre company and so when i hear that like oh sean has high expectations yeah i do have fucking high expectations because i want to be the fucking best and if you don't want to be the best then get the fuck out of here.

1:52:03Exactly. Is that how you run yours? You have to make it clear. I think the only problem in this entire story that I've heard is that people can't do it, want last year, figure out how to make them not even show up. Make this more obvious. And it's funny how hard this is for companies, because there's this sort of belief that every company should be absolutely for everyone. No, that's not right. Like companies, we want diversity in companies. We want there to be a company that's excellent for people that it's excellent for. And not like, you know, if you take everyone's favorite color and blend them together, you end up with mud brown, which no one likes.

1:52:48And we have enough mud brown companies, right? Like, so, you know, some people want something different out of their career. They want to work hard on worthwhile challenges for worthwhile people. And I think the earlier, as you said, the more you heighten the misalignment with the people who just probably wouldn't, shouldn't be joining, the better things go. And so it's actually an unkind lie to obscure this, if those are the expectations. And these expectations, the high expectations and the exacting standards and the, hey, we are building something unique and that is uncomfortable with what we are, all that is 100 % lot bearing for the success.

1:53:40There is no chance this is an accidental success. That happens to have these sort of downsides of high expectations along the way. And because of this it was harder than it otherwise would have. But like now that we have arrived, some way we can stop having these expectations. No, fuck, they are the reason why everyone is there. And everyone who wants to work for you wants to work for you because that was part of the story. and if not, then it's not going to work. And it's actually kind of unkind to not tell people early because they might, you know, our careers are not that long and people should like only work for places where they can be one of, where they have the potential to be one of the top performers at.

1:54:27And if we already figured that out in recruiting, that like, yeah, probably not going to be one of the top people who probably isn't what they are going for, but would be a solely contributor, that's miserable. Someone who is a mediocre performer at your podcast, would very likely be absolutely badass somewhere else. So let them go be a top performer somewhere else. I think that's a hard one lesson and it's maybe even an unpopular thing, but it's also just kind of true. And as I say, truth doesn't care about everyone's feelings. So it's better to explain this. I mean, I see. Thank you for that.

1:55:14I can tell that it's very obvious that entrepreneurship is, you are very gung-ho about that. You want, I mean, that's the whole reason, you know, you started Shopify is to jet launch entrepreneurs. And, you know, just through our discussion, I can tell you, you've found a lot of freedom and I have too. In entrepreneurship, it sounds like you think there's no better time to become an entrepreneur with everything that's going on in the world right now. And so, you know, why? Why is now the time to become an entrepreneur? I think it's the perfect storm right now of where individuals and small teams have more ability to do greater and greater things than at any other time.

1:56:12I don't know, this is really absurd, but if you look at a sort of global GDP through all time, there's charts for this. Like, I think our world in data is a great website which has these kind of things. You can look at from, like, Christ's time. We had, like, for 2 ,000 years, GDP on planet Earth is exactly a map for how many people were on planet Earth. The only way to create productivity, if you will, which is what GDP measures, and of course these are approximated numbers because no one actually reported GDP in 800s. But the only time productivity on planet Earth ended up is when a person was born or when a piece of burden was added.

1:56:59And so then we have industrial revolution. We figured out how to use steam to make kinetic energy and then electricity. And suddenly these things decoupled. Suddenly we could use kinetic energy to make things. We could make factories and steel and railroads and all these kind of things. And wealth in the world due to productivity just massively increased. This is where everything we like about the world, about the economies we have, about the standard of living, about how many people we can keep alive, all this stuff happens because of this one moment. And now we have another thing that we put on top because it's not just kinetic energy, we can also project intelligence into worthwhile tasks in a loop forever until they're fixed or until now they're not fixable.

1:57:55So, because of that, we now have a small group of people who not only have the skills that they show up with, they also have not a work class, but if the best programmer is a 10 out of 10 programmer, every team, every individual on planet Earth currently has access to a six out of 10 programmer as well, and a six out of 10 designer, and a six out of 10 entrepreneurial advisor, and a six out of 10 lawyer. Now, there's a lot you can do with this. And so it's a great, it's just a glorious moment for more people to reach for independence because we are at the beginning of something and there's leverage in doing it.

1:58:43And also because I also just almost want to persuade people to try it because I think one of the best versions of the future is one where many more people are active participants and put something out there again. We need more people to create products and services that other people find valuable. The amount of new businesses being created has been declining for a very, very long time. No kidding. It's been a leaky bucket. Every generation has been slightly less entrepreneurial than the previous ones ever since the baby boomers. Is this throughout the world? Throughout the West, yes. It's recently starts leveling out again.

1:59:27It's just, it's cresting, and even in some countries, there's been more new business formation again, which is really, really hopeful. Now, there's a school of thought that says, well, this is because people are losing their job, and it is true that one thing that happens when people do lose their job is sometimes they make their plan B their new plan A. Right? Like lots of people are like, I've been sitting on an idea. I wasn't looking for doing this right now, but I have an opportunity. So I'm going to make a go at this. We saw this a lot in previous like financial crisis of Lehman Brothers this like time.

2:00:12We thought we were dead when this started happening, but it actually turned out that more and more people are starting to build businesses on Shopify, and we could help a lot of people there in these times and doing COVID again. So it is a time where people should have a plan B in mind and see if there's an opportunity to make this plan A, and they can access so much more help than before. And so I'm very, very bullish on this. Do you have any thoughts on renting versus owning? I think both. I don't want to make a moral judgment. I just think it's like on these things, because it kind of can veer into their territory otherwise.

2:00:58I think you should definitely own something. There needs to be a home base that you can fall back to, like some base camp for you, which no one can take away, it's very good.

2:01:13People are generally more ready to improve, do home improvements on the house they own than when they're renting. And I think all the same things apply. It's just like there's more future expected value of working on your email list or on your website. because otherwise it might be going away. So I think it's important to have a home base, but then also just like take advantage of everything else that's out there. So many of our customers grow massively through things like Facebook and advertising on Facebook and so on. Like these are amazing tools available to new businesses that, again, like 15 years ago you would have to go to a television network and probably, I don't know, have dinners with decision makers and figure out how to raise a lot of money to place a lot of ads.

2:02:11It's not just like, there was no possibility of just creating one ad or so. So it's very expensive. Now you can just like run a hundred dollar campaign and see how it's going to go. So I think everything is just kind of ready and so much more accessible. Yeah, I would definitely agree with that. Are you guys, are you seeing a spike at all in Shopify accounts opening? Usually during times, yeah, like it's, I don't have a right, I'm not right now seeing one, but like it's generally, like I mean, COVID was crazy and well documented and before, It's usually when things get a little bit more tough going that there's more entrepreneurship.

2:02:58In fact, it's funny, almost all the companies, this is something you can easily check with other people from tech industry and other industry, other entrepreneurs. If you ask them, almost all of them ended up starting their companies during some kind of nuclear winter or something. I'm sure before I started in the shadow of dotcom, I always remember that. That's a long time ago now, but you know what.com was? It's like mostly e-commerce. It's like pets.com and that then. And then everyone's like, oh, never mind. All this technology stuff, all this e-commerce stuff is useless. Now it's all falling apart and we never need tech companies again.

2:03:40Yeah, it turns out the ideas were right. They're just a bit too early. There's not enough internet there. So anyway, against this, I only learned really about this. I wasn't paying that much attention. Then I tried to fundraise and then everyone told me, well, what, e-commerce? Like, haven't we tried this before? Yeah, yeah. What about, I mean, toughness in handling failure in entrepreneurship? I mean, do you have any failures at Shopify that you want to talk about how you got through them? I mean, I think the best I can do there is essentially just confirming that what much more eloquent guests you have will also say.

2:04:29I mean, I know you have a Jocko episode somewhere around here, and he... I think he makes a point really well. It's like, you've got to roll with the punches. In fact, life is a school of hard knocks. It's like, you've got to learn from this stuff. A common sentence around Shopify is like, well, if you have to eat shit, don't nibble. like just go i love that i mean i think i think that the i've had a lot of failures i mean in well i can't say i look forward to the failures because nobody does i mean it is it is your to me it's your roadmap it's the it's all right that happened that sucked that cost a lot of money that cost a lot of time that was painful you know, whatever it is, but now you know, I'm never fucking going to do that again.

2:05:32Exactly. Ever. Yeah. I mean, we have this case with like, I mean, we have had downtimes because someone made an avoidable mistake. And it's like, okay, well, what happens then? My sense is like anyone who has enough professional pride is plenty fine on the self-flagellation about this, like we don't have to add much. I'm just like, yes, this was expensive. Yes, we all wish it didn't have happened. See it as your tuition. Like it's like a degree, you know, one more thing that is going to be incredibly important for you to have learned for the rest of you. I know like people are like, well, are you firing people?

2:06:21Well, I mean, no, because I just paid a lot of money for them to learn this lesson. And it's like, this is the worst time to fire people about this. So I think, I believe in second chances. Now, if the same thing fails the same thing a bunch of times, then, you know, my offer of second chance becomes highly conditional here. But, like, it's like, it's, I think, I don't know, I've gotten to the point, I feel a little bit like a veteran of the rollercoaster of entrepreneurship now. when I find out my company is actually, like I thought we were good at something and then I look deeper and I realize we're better at it.

2:07:01I'm excited. Like it's like, hey, we're doing pretty okay. And we were terrible at this thing, which we now know. So now I know exactly how to become a better company tomorrow. You know, just like, this is like my roadmap is clear to your point, right? Like, so I think you can adjust to this, but this is almost not helpful, I think to say,

2:07:23because I don't think that makes it easier for people who have to go to hell. You just have to go for shit, like eat some shit along the way. You're going to make mistakes. I've made huge mistakes. I had an entire department, a massive part of a company with over a thousand people that we thought was going to be part of Shopify's, what we call main quest, basically what we're working on in logistics. and we had to exit this business and I wrote about it publicly about how I made this decision. Because I also think you need to say when you make a mistake, it's okay to say it.

2:08:08I think keeping decorum there is just fake. The reason why I make good decisions and have built good intuition is because I have added failure lessons more than most along the way, at least in this space. So.

2:08:26Is a husband and a father of three, this is another thing that I'm constantly battling about is, how do you find the balance between work and family? Yeah, balance is hard. I think harmony, I guess, is better. I like working. I really just do like working a lot. I love my job. I love a puzzle that life drops on my desk every day. It's a different set of puzzles every day and I happen to like puzzles.

2:09:07I do, if it's at all possible, like, I mean, we're having dinner together, right? Like, my wife insists on dinner at 6pm, which I find inconveniently early as a European, but like I've acclimatized. And we have dinner together and then, you know, my kids now, every boy, they're all sort of at 10, I think, it's at 11, 13, 15 now. So there's plenty of things for us to do together, which is really, really awesome. And, you know, we played video games together and stuff like this. We try to have hobbies, but like I do, you know, I do try to be there as much as I can. Luckily, we have phones. I know phones have a bad rep.

2:10:00where people are not present, but thanks to the invention of phones, I had a much, much, much larger presence in my kid's life than I could have had if phones wouldn't have been invented. And so a little bit of multitasking, a little bit of like, hey, I can actually go with you to the thing because in worst case, I need to step out and take a phone call. And the kids also knowing that that's a choice that I make and I stand by and they will like, they can make different choices later, but like we are building important companies that are meaningful and that's what our family does. We're builders, right?

2:10:38And so I think that's keeping all this in harmony rather than trying to think about it as like rivalrous too much has spoke very, very well for us. Are you, are you able to be present with your family? Yes. Or are you constantly thinking about how to improve and make Shopify more successful? Okay. That is a background process that can go on very low priority, but I don't think I can turn it off, truly. I don't think I'm able to. It's just... So does that mean I'm not present? I mean, it's like, again, it's me. It's like as present as I can be, right? like like am i as present with my family as i can project presence on any individuals yes like absolutely but um i don't know there's like i'm kind of i think by nature a little bit like predisposed for solving problems and wrestling with issues and like again i like puzzles so i think I don't know, I've learned to be unapologetic about that because, again, a lot of books say talk in absolutes.

2:12:00A lot of books talk that you're absolutely present in a way that I don't think even think is accessible to people with ADHD, frankly, or not. And somehow that is like, you know, all of the implied moral judgment of a book is now resting on your shoulders if you say no to this. And I was like, yeah, I think I have a pretty good thing going and I have a deep and meaningful relationship with my kids. So anyway, I think that's the goal. Do you, are you teaching your kids entrepreneurship? Yeah. What age did you start? Like as soon as I could talk. It's like, how would you improve anything around you?

2:12:41Like how would you redesign your toys if you were, if you have a question, I'll answer every question. I mean, I have policies. I should say this stuff. You asked them how they would redesign their toys? Oh, yeah. Oh, yeah. Like, they don't get an allowance, but they get a pitch. So, like, they can look for opportunities, like, you know, vague beliefs or whatever, and we negotiate what they would make. And, you know, the nice things, they've all realized how lazy I am, so, or busy. And so therefore, they completely intuitively by the time of, I think the youngest was four, worked out how to make a cartel.

2:13:29And it's just like, we're going through all of business history here. They now have a monopoly on all sorts of things. They were stocking my favorite chocolate that I have a weak spot for. So it's hilarious. And I love it. It's like, I love them kind of hacking the system. And just because, again, they are also little people and every person is an intelligent actor in a local incentive system. And for all the designing of an incentive system you can have and do as a parent, you can't really prepare them. So, but you know what? They're pretty good at preparing themselves. They're pretty good to see through the games and figure out what's behind it.

2:14:12And I just, I think, I love all that. But we've done lots and lots of trying to expose them to hard problems. That was really hard because COVID is a COVID period and especially Canada COVID was sort of like California COVID. And a little bit more enthusiastic about somehow never going outside again than most places. and so you know sort of the school of hard knocks was kind of hard to reproduce so we did a lot of this with you know I just got them to play way too hard video games like together as a team you know like basically inducing chaos and problem solving and you know Dungeons and Dragons my wife ran a Dungeons and Dragons campaign with them which was like designed to be really hard and so it's like this kind of stuff so these are the things we prioritized and it helped.

2:15:10I love that. How would you reinvent your toys? I want to break the idea as early as possible with my kids that the world just is. Everything is changeable. Everything is improvable. Everything around them is designed by people who are no more intelligent than they are and potentially didn't even care as much about the as they care right now as kids because there's nothing more real than a kid that's all in into something. They don't do that for any kind of external or extrinsic approval. It's all intrinsic and true. And the real motto of our family is really that it's a super simple sentence. It's just everything is interesting.

2:16:10And so we don't allow our kids to say things like that they're not good at something. They can only say that they're not yet good at something. Like they correct each other at this point. It's like, I'm no good at public speaking. Everyone looks at them. Yet. and then everything's okay. The reason is like everything's interesting because it is. Like people, I don't want my kids to treat anything as a black box, right? Like it just like, this just is, like a computer is not allowed to be a computer. Like a computer actually does things. It's a thing called a transistor which makes something called a NAND gate which then makes some other gates and at some point you can do calculations and then there's memory and accumulators and a CPU and eventually it's just math.

2:17:06It doesn't do anything magical. It just does a sequence of steps that manipulate memory really, really fast. And so magical things happens when you can do something very simple very fast. And so, you know, just breaking black boxes with them is important. So my policy is when one of my kids comes up at the book from home anywhere and asks me a question, I will stop what I'm doing and I'll answer it always. And they know to not misuse that now, but they used to, which was also adorable and funny. And usually I try to answer their question. If I can't, I sit down with them and figure out with them how I would research the answer to the question now, and then I send them to go do it, and then they have to report back, ideally, usually at dinner.

2:18:01And so I think that was a set of little vignettes in how this all goes, and I think that's, I mean, like, are we perfect parents? No one is. Like, this is, this book for us. Yeah, if you're instilling critical thinking into your kids, I love that. I just started this with my four-year-old. Now when he asks me for help, I ask him if he's looked for any other solutions. Exactly. Instead of helping him, he's four. I make him look for other solutions. And then sometimes he can find one, sometimes he can't, but at least he's going through the motions of, oh wait, maybe there's another way out of this.

2:18:42Maybe there's another way to solve this. Maybe there's another way to fix this instead of just asking for mom and dad to help every single time. I love that. It's exactly the same thing. What I love specifically is the implication of everything is interesting is really, really helpful, right? because, you know, like, I don't know, kids have to learn things in school that they just don't find interesting initially. And it's like, or some concepts is like, okay, why? But like, it turns out the story behind this is always interesting. Like, I remember, like, I read a book about the history of, I have no idea why I read this book, but it's a history of double entry accounting and why it got invented, what problem it solved.

2:19:38And it's a crazy story. It's like it was invented in Venice by the merchants and it's literally responsible for the Venetian empire. And it's like, holy shit, that's like double entry accounting. That sounds like worse than watching paint dry, right? Like, but it turns out that if you understand the story behind stuff, like why someone did did a thing or what problem it solved or at least what the characters were like that had to solve the problem. Everything is interesting and it's like just so like finding the interesting bit to connect with the thing that you want to understand is actually also a skill and it's like it's something I had to learn because I had to like man trust me I love computers, I love engineering, I did not need to learn finance like it wasn't my first you know like I kind of had to do it.

2:20:32I'm a company CEO and also just a lot. There's a lot. The cool thing about a job is it's super high expectations, in terms of the range, which is perfect because I like building range. But I had to learn how to trick myself into wanting to learn things because, as anyone with authority problems can attest to, I cannot just go learn stuff because someone told me. I can only learn the solutions to problems I've had. So, um, um, and so I need to go and figure out how to construct the problem environment for myself or at least make it a story I want to, like, explore deeper by tinkering with it or something.

2:21:15I had to, like, you know. So, anyway, I've learned how to trick my own brain to do it, um, uh, and it's been really important. And with the kids, it's just as fun. Love it. Love that. I'm totally stealing the, how would you, reinvent your toys starting today. You're right for it. But well, Toby, let's take a break.

2:21:37Gents, let's be real. Most skincare isn't made for us. And if you want to look a little younger or just feel more confident when you look in the mirror, you need something simple and effective. That's why I started using Caldera Lab. Their high-performance skincare is designed specifically for men. It's simple, effective, and backed by science. I especially love the base layer. It's a nutrient-rich moisturizer that absorbs fast, leaving a non-greasy, matte finish. Since I started, I've definitely noticed my skin looks smoother and more hydrated. My wife even noticed. Caldera Lab spent years developing and testing each formula with leading cosmetic chemists to make sure it works.

2:22:23In a study, 100 % of men said their skin looked smoother and healthier, and 93.8 % reported a more youthful appearance. Their award-winning serum, The Good, is packed with botanicals and antioxidants, and their eye serum helps you reduce the appearance of tired eyes, dark circles, and puffiness. You don't have to settle for complicated routines or steal your partner's products, upgrade to skin care that's made for you. Upgrade your routine with Caldera Lab and see the difference for yourself. Go to calderalab.com slash SRS and use code SRS at checkout for 20 % off your first order. That's calderalab.com slash SRS and use code SRS for 20 % off.

2:23:41You're gonna get epic range days with me and damn near every guest that's come in the studio. You're also gonna get behind the scenes content and guest updates. You're gonna get first dibs on new merch drops and limited edition items that will never be sold again. Plus, exclusive offers from our partners you won't find anywhere else. So subscribe to the Vigilance Elite newsletter right now.

2:24:13I talk about all the stuff that's going bad because I'm concerned and I'm foolish enough to think that maybe I can make a difference. But, you know, I think it's weird because the interview that's released in today, we talk about this exact same thing. But, you know, I think the biggest, you know, we've made a lot of impact, you know, through this show for the country and in the world and whatever. You have. But the biggest impacts that we've made are the guys like Justin Hughes who painted these paintings.

2:24:53And veterans, which we're going to talk about, it's in the outline. But just people that are coming out that are trying to build a business, trying to bring their gift to the world, and nobody's given them the fucking attention or the, you know, just a little bit of an exposure, just enough to, like, let them see the light. Yeah. You know, and I think that's the biggest impact that we've had on this show. It's not about, you know, exposing corruption or stopping fucking funding for the, any of that. It is, it's people that have been able to make a new life because we gave them the time of day.

2:25:32Totally. I mean, also, don't get me wrong. I'm also like plenty of grateful for exposing the bullshit too. It's just like we need like it's more automatically viral right like and so like if everyone starts like only exposing the stuff that's wrong we actually forget what's going right. There's an effect I don't know if you come across this I think Derek Thompson wrote about it I was not like at Atlantic that's where I saw it for the first time, the, um, I'm doing fine, but everyone else is fucked effect, if you come across this. Like, I think it's like 80 % of people think, like, self-described in the United States as, I'm doing okay, but I think, like, 80 % of the people around me don't.

2:26:21And, like, that can't be true. Like, so... How does... has our perspective so skewed? There's some countries where it's like 90%, like South Korea. 90 %? 90 % of people think. What do you think it is? I mean, I think it's self-indulgence and the inability to self-reflect, if that's what you think. But I think it's not as many people are doing, like some people are doing poorly, 100%, but it's not 80 % of everyone else, right? This is the thing. It's like there's fewer... In fact, in a lot of ways, it depends on how you look at things. Like again, I don't know, it's just like the richest person on planet Earth 100 years ago could not have had a cell phone.

2:27:10In fact, there's a lot of things they couldn't have had. You know, just like we've come pretty far. And like things... I just refuse to believe that everything is going down in the shitter. I think what has changed is we are gaining all the information. We are just like, and we're kind of fully prepared for it. We are moving. I think the net amount of bullshit on planet Earth has probably been reasonably static. And the amount normal people will encounter in their life has exponentially increased. And I think that's skewing people's mind. The problem is it might be self-reinforcing because I think pessimism, taking pessimistic perspective just means people don't do things that they otherwise, like if you think you can succeed or like, again, you need some optimism to, like you can't start a company unless you are somewhat optimistic about the future, right?

2:28:13Like you kind of have to know that at least your own tomorrow is going to be better after you start this company, but not to engage in doing something. And so, yeah, I think if you all talk ourselves into everything is fucked around us, then I think then just we can talk ourselves into literally that happening, even though it's currently, at least by survey, people would not self-describe this being in bad shape. That's a good point. I mean, do you feel like that being... Do you consider yourself to be an optimist? Yeah. I mean, I'm long-term optimistic. Short-term, I can be pessimistic too. I mean, fundamentally...

2:29:03There's a study of this. Matt Ridley, a great book called Rational Optimist. and he sort of made a study of optimists throughout time. And the conclusion of the book is everyone who made future predictions that they're optimistic was ridiculed, like underperformed the people who were naysayers about the future, very much so, got a lot of shit for it, and all of them were too pessimistic for the future that actually ended up happening on every issue they were optimistic about. So it's like, it's funny. We just have a bias towards the negative. And so, you know, I'm long-term optimistic, but I think the reason why we end up in the optimistic outcomes is because the high agency pessimists help us steer us around the problems, right?

2:30:04So the pessimists are really, really important as well. So I think this is how it composes. I mean, we talked about the AI earlier. Clearly, I mean, from an individual perspective, there's going to be a lot of disruption. But from a society perspective, there's just a lot to like that we might get to. And frankly, it's there anyway. So this is not even like, you can't stop it. But I think there's a lot of people talking about the negative downsides without the clear and kind of amazing things that could happen. And so I think it's worth keeping those in mind too. You know, just, I mean, you live with this stuff.

2:30:45I don't. But I have interviewed a lot of tech giants this year, you being one of them. And, you know, you know, what's funny with the AI stuff is that all the people that don't understand anything about AI are the are the naysayers, the pessimists. And, you know, I have my own concerns. You know, I'm not I'm not saying that, you know, that I don't because I do. I have a lot of concerns about AI, but I don't understand it. But when I talk to people like you, like Sriham Kashan and anybody, Joe Lonsdale, Palmer Luckey, Trey Stevens, anybody, Alex Wang, all these guys that are in it, in tech, that understand it, not one of them is wanting to pull the reins back on AI.

2:31:36Everyone's an optimist. And so when you think about it like that, it's like, well, everybody that actually knows what the fuck is going on is an optimist. And everybody that doesn't have a damn clue what the hell is going on probably don't even use AI at all in their daily life are the ones that are pessimistic and saying that the world's coming to an end because of AI. In industry, it's a bit more of a mix. It's like there are some people who have been absolutely instrumental to inventing AI who are quite on the other, like on a more pessimistic side there. But like it's like, I think what the pessimists also just like, they take a very reductionist view of humans.

2:32:22Like humans are ultimately like adaptable species. We're always talking, like the joke around nuclear war has always been it's just for cockroaches left, now it's for humans. Like we figure out everything. We are way more resilient. We live in a lot more crazy, I live in Ottawa, Canada for 20 years. That place is fucking cold. It's like, there's just fucking no way anyone could survive at this place without a huge amount of modern technology. Like we're basically, you might as well be an outpost of moon like there in the winter. It's like, you know, just like you grow out like in 15 layers and whatever cheek might be exposed is like hurting.

2:33:07It's like, it's crazy at worst days. And yet we live there and it's a wonderful place to live outside of maybe those days. At some point, one of my sons asked, like, Dad, why do we live where the air makes you hurt? Which I thought was a pretty well-put question. Anyway, so, you know, like, technology is all around us, and technology actually is there to make our lives better and make us be able to do more and make the ambitious people be able to accomplish more or, in fact, inspire people to reach higher. I mean, I don't know. I was inspired by the technology I used to build Snow Devil. I used random Japanese programming language.

2:33:58It's not the programming language itself. It's just, like, ultimately more amazing than other programming languages. These are all just sort of dialects of each other. But, like, somehow it spoke to me, or rather I felt my brain spoke Ruby and I just didn't know it. I found I could write better code, I was more inspired to sit down. There's just technology doing this to me and I find exactly the same thing with AI. It's just the unbridled fun you can have just tinkering with it, just trying things. There's a new model that came out this week and it's just like you know you make like incredible infographics, like I was reading a white paper on some rather dry stuff, and I just put the white paper into this new model and said, show me what an amazing professor would have at the end of a lecture on this topic on their whiteboard.

2:35:02And I just made the whiteboard, and it was all like here, the concepts and connecting and showing, and it was beautiful. It was so much easier for me to learn this way because I just liked the visual thing. I just could sort of think myself into a classroom with an eccentric but wonderful professor making blackboard sketches about the topic. It just made all much more sense. That's crazy. That's coming from a bunch of floating points that someone trained in a data center not far from here. How is this possible? This is like modern magic. And so it's like the wonder of it is just wonderful. And so I want to be optimistic because what happens is when more people, like I am not an artist, I can't even with an actual whiteboard, like after I know the topic perfectly, ever make such a beautiful, like if any amount of time I I could not have done the same thing.

2:36:02But I have demand for this. Like I want a computer to do this for me. Now I know I can cause a computer to do this. Maybe there's a business there. Like if maybe you can follow this thought all the way to like a new form of education, which then inspires more people and so on and so on. Like there's, what we need to do is make services and products for each other, right? And that depends on the tools we get to use, and those are giving us leverage, just like electricity did at a industrial revolution. And so I just feel like it is quite predictable, because we have played out this movie many times before in human history, of what happens when you give everyone an incredibly powerful new lever and tool.

2:36:51I'm with you. I don't use it that much, but my team here, they use it every day. They're always wrapped up in it. They're always talking about it. You know what I've noticed is that it seems to – it's like you can offload bandwidth out of your mind into an AI, and it just frees up bandwidth to make it, it enables you to work on more important things, more innovative things because the AI is, you basically said this at the beginning of the interview at some point. Yes. That, you know, at least I think you did, maybe in different words, but it's creating more bandwidth in people's minds who learn how to use it.

2:37:40Yes. And I 100 % see it in my team here. And so everything that I've actually seen other than deep fakes is positive. Yeah. And those are fraudulent, so they are illegal. Right? Like this is the other thing. Everyone's like, well, what we do about the things that can now be done. Well, they are legal. You know, like our existing body of laws is pretty clear on how we think about fraud. Right? So, I mean, but like it's not like, again, now I feel the need as everyone who talks about this to acknowledge that there are, you know, anything that's powerful can be used powerfully for good and for bad.

2:38:32What then matters is how distributed it is. And I think it's also that we live in a time where like i don't know like the second like like again i run a company that's like makes billions of dollars of uh like of revenue and um uh is worth um hundreds of billions of dollars um and uh it's um i am in whatsapp with the people running and training these models at all the labs because I am of the industry and I know them. I have no access to better models than everyone. The second they release something, it's going into an API. That API can be called from everyone's computer that's connected on the internet, which really is every computer, with the right command that you can literally copy from a website and paste into a window of a program you've never launched called Terminal.

2:39:29and it will respond from that quality API for less than a penny. And it's awesome that we live in a world where, like we could live in an alternative world where these things are trained and someone pays$100 billion to purchase it and then there's a one-on-one and only one entity or one company could use this. We are not living in that world. And I think that's amazing. The open nature and the direct distribution is the thing that I'm so thankful for because it's completely path-dependent. This just happened. This is how the first one got released. It created an aesthetic for releasing these, and therefore all of them are released.

2:40:14We'll never think about it again. But the world is incredibly path-dependent. If slightly different choices than the first chat GPT or GPT would have been released by a handful of people in an office in San Francisco, uh would have created a different uh go-to-market strategy which then everyone would have copied that and we would be in a completely different world so we i think we are one of the most optimistic outcomes they are like these things are extremely well distributed and available and everyone can tinker with them and i think that's good and you got a great way of thinking about things i love chatting with you about all these random things you know um we're getting a little we're let's get into some of your hobbies you know on the break by the way nice shooting thank you that was amazing i still smiling from us i mean this is me smiling like this is about how much you can that was like god damn it it's like kind of hoped it wasn't as fun as it was because i i have to go back to canada and i can't do this so it's a good time well i got you i got you a present so i don't know how you're going to get this back to canada oh but if you can find a way look oh boy oh boy that is uh go ahead open it up

2:41:36yeah that's this the sig p211 gto sig sours first attempt at uh the 2011 that's the same one you were shooting out there so i got a friend at sig his name's jason he's a huge fan of shopify too and uh anyways he wanted me to present that with you so i'm going to connect you guys um yeah after the podcast thank you so much that's crazy and we will find a way find a way we will find a way that's amazing yeah i mean i like i told you i actually again i grew up in Germany and then live in Canada. It's not, let's share the call, liberal laws related to weaponry. And so I just haven't like encountered, I'm just like, just actually, I know this sounds really basic to you, but like, they're beautiful.

2:42:31Like, I just like, the objects are like incredible. And anyway, it was so much fun. Thank you so much. Maybe a new hobby for you. You have to spend more time in the United States, it seems. Thank you so much. Okay, I have something which I think you will find cool too for you. This is amazing. Thank you. And all right, so one of my favorite things we do at Shopify, we just started this like two years ago or so, maybe a bit more. Yeah, when you split an online business, it just feels like, sorry, it feels like not,

2:43:11it's a bit abstract, right? Like it's just like, it's not tender. Like if you're in a real store, in a real space like this, it's so tactile. It's like you can all take it in. If it's busy, you see, you can sort of, so you build an online business and it's like, it's amazing. It can be very big, but like, it's just like, there's something about our brain that cannot, even when you just look at numbers it doesn't matter. So we were talking about e-business and it's going really well. Not just a little bit, but you started 10 years ago and we've started making these physical moments to celebrate milestones for people.

2:43:58And then Harley, I, with my president of Shopify, we take them and sometimes when we travel, we get to give them to merchants as a, you know, appreciation for doing business with us and celebrating a milestone. So they checked. You're not exactly there, but I feel like you like pressure. So I jumped in the like so we have this award which you will oh man grow into oh dude yeah that is awesome yeah congratulations charm marine show on reaching 100 000 orders in January 2026 so we must be close you're close this is awesome we've used AI and predictive models to model this and we believe we can just make it and I feel like your listeners can help out oh man and we'll we'll we'll get some good sales going and then you hit 100 ,000 orders and then you have a new perfect artifact here to celebrate this.

2:45:26This is awesome. Thank you. This is going in the studio. And now we have to hit it. You have to hit it. And then I have one more thing which I want to show you. This is actually really cool. You were just about to say we were talking about hobbies. Have you seen, do you know what an LMP2 car is? No. Okay, so Le Mans prototype, this is what I'm racing. in Survivor Tech. So this is what the car looks like. This is the next. This is just the way the design looks. Yeah, I'm really excited about it. You know, cars are faster than they look cool, right? And on that car they have the other space for Shopify merchants.

2:46:16So you have like 30 the uh your brand like if you agree like yeah yes vigilance lead holy shit this is awesome are you serious let's go it's it's cool we we we we love uh uh repping our our brands so dude thank you holy shit that's cool yeah thank you if you come to one of us races they are really fun uh i would love to come to one are you gonna race yeah um it's yes so fun it's every single time i get into the these cars i'm like i can't believe they let me do this and then for first lap i'm like i can't believe like i how is this like how is this supposed to work and then you just get like get used to it and you remember it and then then it goes good but man um Thank you.

2:47:16That is very cool. Thank you. I think that's very cool. Thank you. And thank you so much for your kind gift. That's awesome. My pleasure. So let's move into, I mean, you have some extreme hobbies, calculated risks. Let's talk about some of that. Okay. So I don't, look, I feel extremely self-conscious to talk to you about risk. I feel like that's not... maybe a little bit more on an adrenaline side, let's put it like this. But yeah, I mean, I like kiteboarding, that's fun. But I think motorsport is just something I got into the last 10 years and I have started taking it much more seriously now.

2:48:06as every hobby, it's full of terms and lingo and so on. It's hard to talk about it without falling into terms that people will have no idea about. But I love, I mean, the first time I got on a track, I was just like, it was kind of similar to the shooting earlier. It's like, I thought I'm going to like it, but of course it was so much better than like expected god damn it and um so so unfortunately i know this movie anyway and so you know i i kept coming back to uh track and track days and eventually um i did some races with friends you know like the in like uh master miadas right like you just like all beaten up mess like rip out everything make them light and uh we did endurance racing which I like particularly.

2:49:03It's like when you go and race with some other people, like some other drivers together for six, eight hours and you share the car. I didn't take it initially too seriously and just had fun. I mean, my common story for me has always been like i love doing difficult things um surrounded by friends um and uh to me entrepreneurship is like this uh you know just like racing with teammates is is really good and um yeah eventually i get in a car that um it's quite a like a radical car so i've got a track like a car but just like it doesn't look like a mclaren or a ferry or something it's it's just made for the track.

2:49:50It has lots of downforce. Downforce, I mean, as in pushes the car to have extra grip, the faster it goes. You hear these stories about Formula One cars who could drive on the ceiling of a tunnel, no problem, because they can. It's like they generate a ton of downforce. Anyway, so I got into this and that became my hobby. And the best thing about it is that it's something, it's one of the only things that you can do with professionals together. It's like amateur and professionals drive in endurance racing together. And so yeah, I'm racing cars that are these high downforce cars, they're called uh lemar prototypes lmp's um lmp2s to be specific um which is the the top class of uh amateur like pro-am amateur class as an amateur and um yeah they turn out 24 hours is the biggest race i've done i i am planning to do the 24th of lemar this year which is the largest race in the world That's awesome.

2:51:02And I just love it. That's awesome. I mean, it seems like you talk a lot about risk, calculated risk. It's in my outline several different times. I mean, what do you say to people that go through life always playing it safe? Yeah. curious what you're what do you do because it seems like for I've had this observation like I can usually tell who of the people I know like broke a bone as a kid you know just because if they didn't they just spent a lot of their life trying to avoid to ever break a bone and the ones who did kind of know that it's kind of it sucks but it's not that big of a deal and I think ultimately it's better to break your bone at some point as a kid when you heal pretty quickly and then afterwards.

2:52:06I think people make too much of risk. It's clearly a factor but to avoid risk you have to be careful but if careful I don't know it's better to be competent than careful. just get good at things that are worth doing and then figure out how to get there and just do. It's like it's, I don't know, there's so much of the total possibility space for a company of moves that are good or ideal, that don't also have a good deal of risk. If that's the only space you can operate on in a company, there's no chance you're going to make it compared to someone else in the same space that will take some risks.

2:53:05The problem is you will obviously look foolish at times. You take risk. Again, it's public. You will have to accept something doesn't work. And they do and you move on. And you do that once or twice and then you realize, well, that's not so bad. Just like we're breaking the bones and then you have so many more possibilities in front of you. And so with hobbies it's kind of the same. You just have to take some risks. And I like adrenaline and so I suppose it helps me. I call racing Zen Buddhism at 300 kilometers an hour or whatever, 200 miles I suppose. Almost. It grounds me and I can focus. Well, Tovi, we're wrapping up the interview.

2:53:58I know you got a flight to catch, so I just have a couple of questions left. One of them being for future entrepreneurs, for people that are on the edge right now, wanting to quit their job, wanting to take a stab at entrepreneurship, find their freedom. I mean, what advice do you have for new entrepreneurs coming into 2026? I think the most important sentence that everyone can internalize is, you can just do things. I love that sentence. I love that that's a meme. That's the kind of sentence that, like, was sort of whispered amongst entrepreneurs and entrepreneur get-togethers in the past. And now it's like trending on social media.

2:54:36And I think this is one of the best things that can possibly happen. Just honestly, like, reps. I was talking with one of our customers, entrepreneurs, there's a company called Gymshark, which I think a lot of people have heard about. Ben, the founder of Gymshark, did five other stores before Gymshark. He was delivering Domino's pizzas the entire time and Gymshark just hit. Do the wraps, just try it. The thing that people need to understand about entrepreneurship is like the failure case is not failure. The failure case is not learning anything. And I think it's much more risky to not try building a business from that perspective.

2:55:28Everything you do, everything you learn, every skill you pick up along the way is going to be the fewest forever. and the experience you do, even if a thing doesn't automatically plan out, is something that you're going to bring to literally every task you'll ever do. It's the wonderful thing about our intuition is underrated. Our intuition is our entire past, all our life's experience rolled out for us, brought to the moment to try to make the best possible choice for the conundrum in front of us. And if that involves what it's like to start something, to build something, to negotiate deals, to potentially have employees, to be responsible for someone's livelihood.

2:56:13If any of those things are in your past, you just will make a lot of quite valuable decisions with more accuracy afterwards and higher competency. And so I think it's incredibly valuable as a pursuit. And what you know, it might actually work. You know, it just turns out that unless you're trying to build a business that is sort of another version of something that someone else has already done without many modifications, if that's what you're doing, that's a pretty busy space. But again, on the internet, you need to find your 1 ,000 true fans. That's it. That's the job. If you build something that a thousand people will be deeply into, you'll figure out how to build this as a sustainable business afterwards.

2:57:03And that's much easier to do when you build something that you yourself are incredibly excited about than if you go and build something that other people might deem to be a good market for you to go into. And I've seen this over and over and over again that the best businesses on the system and in general in the world are things that solve problems that entrepreneurs, they spoke to them. They need to be founder product fit more than there needs to be product market fit. I think founder product fit is actually one of those things which I think is often overlooked. and I'm obviously incredibly privileged and lucky here because I found it very, very early.

2:57:49Again, you find your gift, hopefully, if you're so lucky. You then develop your gift and cultivate the skill set as I did with programming and with building commerce software and then you figure out a path to giving it away which if then other people deem that of value and pay for it, which again is one of the most sincere ways of appreciation and a vote for everything you've built. If that all comes together, you have a business that can sustain you and then you can see where it goes and some of these journeys just go pretty far and, you know, or in fact never end, which is the best thing to encounter is one of those problems that you deeply care about, trying to solve it, but you can't because it's like infinite and we just like get to keep doing it.

2:58:46And that's, I think that's really amazing when it happens and all of us is locked away behind entrepreneurship. So, um, it's best to just get the reps. Yeah, man, you are just, um, You need to get out there more. I mean, I think you're helping me with that right now. You're extremely motivating. And I mean, it kind of, it's kind of say that. I'm not just saying that. I mean, I'm, I'm, I'm the motivation that you can bring towards future entrepreneurs is massive. And, um, and I'm, I'm huge on entrepreneurship. I hope all, I hope all my kids are entrepreneurs. Like I never want them to have to fucking work for somebody.

2:59:29and um and i'm just you know we're i don't even know if that was in the episode or out of the episode but you know i mean i told you that you know the number one thing that i get out of this and i think that the biggest impact i can make is on future entrepreneurs and uh and i just fucking love doing it man it's just to be able to make somebody self-sufficient and just find the freedom of entrepreneurship and in all the things that come with it and you know i am a pessimist I will bitch with the best of them. But, you know, in all honesty, like there's fucking nothing that I would rather be doing.

3:00:05And I bitch because I'm passionate about what I'm doing. You're helping get to the optimistic outcomes. You know, what's the craziest? I need to say this because I just like you will appreciate this. Like, there's like, again, public company, you can put everything in a spreadsheet and it's just like reduces is the fidelity of a world thing. You know, the stat that we at Shopify, or certainly I at Shopify, like separate more than any other, it's like every 24 seconds, someone has their first sale. Man, that's cool. Every 24 seconds, somebody has their first sale. That is awesome. It's a great feeling.

3:00:47It's a great feeling because it's like, I mean, this is like, it's awesome to have a personal mission uh it's it's awesome to have like uh like trying like again i just like you care about entrepreneurship a great deal and like being able to build something that then causes more of it is incredibly gratifying but that scale is just wonderful and it just means like there's just so much demand and like again if ii we can make it simpler and just like it's like such a good moment right now. But yeah, like, you know, every 24 seconds, there's a chance that this is someone else's, someone's first sale and they will remember that for their entire life.

3:01:32And again, their identity might change in that moment from being a builder to now being an entrepreneur that someone else has deemed valuable, like deemed or anointed to be a true entrepreneur by making my initial purchase. And yeah, that's what it's all about, isn't it? That's what it's all about. Well, Toby, it was an honor to get to know you, to interview you, to bring your story and just pick your brain and to listen to some of that knowledge. And I hope to see you again. And I love, love, love what you're doing for entrepreneurs. So thank you. Awesome. Thank you. I enjoyed it. It was a great deal.

3:02:14This is the test. Thank you so much for having me.

3:02:27No matter where you're watching Sean Ryan's show from, if you get anything out of this, please like, comment, subscribe, and most importantly, share this everywhere you possibly can. And if you're feeling extra generous, please leave us a review on Apple and Spotify podcasts. If you're a podcast host, listen up, this one's for you. My name is Ali Jackson. I'm the host of Finding Mr. Height, a dating and relationship podcast that I've been doing for four years now, sharing my positive and practical approach to dating that's built on my own life experience. And I wanted to share another experience that I've had, my secret behind monetizing my show.

3:03:04It's called Red Circle. And I was just telling my colleague about how much I love their platform. With Red Circle, not only am I getting a seamless hosting experience, but I also love the support I receive in ad sales. It's not just typical ad sales either. It's targeted opportunities based on my show and my life. And the platform is super simple. You just set your preferences and Red Circle matches you with sponsors that align with your show. You can vet every opportunity and their platform gives you great analytics. More recently too, my Red Circle team has brought me opportunities outside of my podcast on social media to really augment the podcast partnerships, bring them full circle.

3:03:36I just can't recommend them enough. If you want to give it a try, go to redcircle.com to get your free trial. That's redcircle.com for a free trial.