Shopify CEO Tobi Lütke on navigating a downturn, innovating in compensation & more | E1568

Alright everyone, it's a great show, today is Friday, we're bringing our Heavy Hitters back for interviews and today you won't believe it. Shopify CEO and Founder Toby Luca is back, he's awesome, this is his third or fourth time on the show. I have a great relationship, it's super honest, it's super sincere, we go deep into running companies, we scale companies, my goodness what a breakthrough the pandemic was for Shopify, the stock price in dealing with employees with RSUS underwater, what an amazing interview, it's so thoughtful. You should listen to it, slow it down, keep it at 1X speed and you'll probably want to listen to it twice.

Stay with us. This is an amazing episode this week about startups, brought to you by Spoken. Finally there is a way to build culture. and connection that is designed for a spoken story mode is fast, it is asynchronous but it is human. Visit getspoken.com twist to get 3 three months free. It's g-e-t-s-p-o-k-n without the e.com bar spin. Masterworks is the first company to allow investors exposure to the Blue Chip Art asset class Twist listeners can skip the waitlist by going to masterworks.io. Twist and Helpwear help you outsource the tasks that slow your team down, from data entry to world-class customer support.

Helpwear can help you become bionic. Go to Helpwear.com Twist. to get a thousand dollars off your first bill, okay, everyone very excited to have a friend of the show, Toby litka, on the show again. How are you? Toby. I'm very well. How are you? Jason. I'm fine. You know what it was. crazy summer, oh and for people who don't know, Toby founded Shopify and he did it in 2004. I met him. I don't know Chamath and I went to Canada and interviewed you. I don't know 10 years ago, maybe you. You were the first one on the program, it was actually in 2013, so it's almost 10 years, and you were also in 2021, so we saw the company grow and it was extraordinary during the pandemic.

Oh my gosh, the company grew and then you had. quick backtrack, it's been a crazy three years for the company, uh yeah, and running it has been a crazy ride, not for the faint of heart, I mean, this is kind of funny, it's like you know you like Shopify, it's a celebration of entrepreneurship and So, um, I don't see any reason why it wouldn't go through some kind of dramatized version of this. It's like I have a roller coaster. One observation about the construction company as it gets bigger and bigger is that the time between the ups and downs starts to get shorter and shorter and sometimes you have several in the same day um and uh um yeah, so there's this It's certainly been one of those years of high oscillation.

If I've ever seen one here, it's interesting how as entrepreneurs we perceive that with each passing year this business will become

more

stable and easier to operate, it will just fly to a good height. and there will be no turbulence and everything will be stable and I think that has happened to three companies in the history of technology and it happened in the third decade, like if you look at Apple, you look at Microsoft and Google, like they are sure. Now I'm on cruise control like three of those all-time great money printing machines, but then you look at like Airbnb or Facebook or Intel like chaos, right, it never gets there, it very rarely gets easy.

I think it's the truth. Yes, I wonder, I wonder. What you think about why this is is because, I mean, once you know, one notable thing about a set of chases that seem to become

more

stable and more predictable ends up being that they find something almost, I mean, very, very good. business model that is something self-sustaining or being a government or something very slow too, so I imagine, but there are many books and articles written by people who have encountered this and that's why people are like pattern recognition . or like they think it's more common, but that's just one aspect of the only people who have time to write books are the people who find these businesses the most.

Much, then, there is an overexposure of this type of experience in reality. I mean, this is a great thing about Shopify, it's like millions of entrepreneurs that we can talk to and they're all in the same boat, it's crazy to do this and it's hard but it's also exciting. I would be quite bored if things became very stable and predictable. I think you would be too red, of course, of course, I mean the fact that it's so dynamic and you know, maybe it has to do with there are some companies if they can capture, you know? close to a monopoly or you know they basically have it under control and operate, you know, you look at the duopoly of IOS and Android and the loyalty and their approach, I mean, it's probably a combination of that Google search just for you. know and everything else that Google knows outside of search like it's some kind of variable, what hasn't changed during this crazy period because you have the pandemic, you had the stock market correction, you have a very big competitor. which is extremely good. in what they do, yeah, and they changed who runs the company and I think you know that means you have someone who is super focused running the company, maybe like someone who wasn't as focused.

I'm talking, of course, about Amazon, so through this Over the last three years, what has not changed and what has been the most challenging? Yeah, I don't know if it sounds silly, but I mean there's a big difference between things outside and inside a company. That's right, it's like within the company we've been like there's a mission, but we're following it, like you know we build the best things if you know how to build them. We are getting information from the rest of the company. world about like you know what we should build what's needed what's useful um there were some significant changes around the beginning of a pandemic about like I mean click to like curbside pickup and this kind of stuff um but like um it's very much like it's actually, with all the craziness and the kind of melody and conversation, but talking about it is induced and it's like mom sending a message saying, "Hey, is this as bad as the city?", so it's like it's bad or it's like what happened. you guys actually, uh, you know, I remember a lot of people at Shopify saying, "Hey, for the first time doing this like this pandemic, my parents really started to get interested in this business.

I'm part of you, all of a sudden everyone paid attention, uh, which you know, again, variable results from that, but we kind of know the same thing, we celebrate with people who are achieving independence and hopefully we make the software a lot better over time and so , the company just keeps getting better, I think it's the best version of Shopify that's ever been by far, um, but externally people seem to think differently about the company and like if they overlaid the stock price on this kind of um, gradually every day they get a little bit more excellent thing, but I perceive it internally and it's you, postal stock prices super, like um, people have very different minds about how this is going, which is an interesting experience in itself , that's right, I mean, I have a fantastic experience.

Privileged experience of having, you know, running, I started writing the first few lines of code on something that became a company that then, you know, eventually became a public company and has a Tickler symbol and now I've seen multiple parts of a business cycle and um, I, I, I'm very, people always say, how do you manage noise distraction for depression and this kind of stuff? And I think that's never really affected me, so I almost say I'm a bit observant of the wolf thing and it's like you have an idea of ​​how the group ends up forming opinions and you know how reflexive this whole thing is and you know it anyway , I don't know if it's perfect, but I think it's back and forth, but it's obvious, it's an endless fascination for me to observe these things, and every once in a while, someone has to remind me by saying, hey, it's not just another you . "You're like in this Arena and then I say, okay, well, I mean, if you think about it, you have complete information about the business, you know where the business is going, so you're in the room where it happens." When making decisions with your team, you know the roadmap that you are looking at, you know that your customers use the product and you are studying, you know their behavior and then you have external commentators who have partial information and therefore their view of it and They have other things going on in their lives, whether they are journalists, analysts, competitors or you just know people on social media and therefore they just comment with incomplete information and of course you just watch month after month how the product gets better visits from consumers. stores and closing transactions, so yeah, it's very strange being a public company, I think for a lot of people, especially when you have too much attention, I mean, you could say you know, the press wanted to know who was going to win inside Trading inside. of the pandemic, this became an obsession for CNBC and everyone else who's going to win, who's going to win, and they basically picked two categories, telemedicine and e-commerce, but you made a really great blog post where you show this incredible breakthrough and then, I guess. a throwback to the meme, maybe you could talk a little bit about the bump that you saw during the pandemic and how it softened and became more of a straight line, um, eventually, yeah, so, this is kind of the adoption rate of commerce electronic.

E-commerce is a percentage of overall retail and how it evolved. I mean, this is very easy to understand. I'm sure the moment no one can move, people won't be able to get to retail stores and neither will people. Spending your money on experiences or going to bars etc., so what happened at the beginning of your pandemic is like people shifted a lot of spending to like saving on parties, actually, and the other part on goods. and because they are predominantly procured for e-commerce and that created a huge leap forward in terms of uh, you know, gmv in our emergence and business for a platform, there were actually moments in time like during this period where uh Cloud providers almost ran out of service, it was actually CPU like, yeah, yeah, storage, well, so, I mean, I'm sure you're familiar and you're listening, familiar with the concept of a bank run, uh, that can happen today.

So basically there was a bank run on CPU instances and just because everyone liked it, that was growing and you know companies have projections on utilization rates and they're building ahead of them but there's not much you can do . like building a massive advance, that just puts more costs on the books, so all of a sudden everyone realized we're going to make these utilization advances and, uh, we probably haven't done the other optimizations that we wanted to do in this time and so, um, people are sequestering resources that are not being used, it's kind of an interest, so there are a lot of interesting stories of the best of this time, we really saw this as if everything, um, uh, you know, It got very, very busy quickly, um, and then, then, I was wrong about this.

I was actually hoping that this would be a long-term springboard for e-commerce adoption because my theory was that people have found that there are a lot of people who have never experienced it. it's like it's not in people's habits when people say "hey, I need this", just "yes", for you and me, the first thing we think of is probably to take out our phone and buy it or order it or something like that, and um, sometimes I actually have to do it like I can go to the stores, um, because I kind of lost a habit, especially before covert, and I imagine this would be more of an effect, I think it is, and then , as lockdown orders eased, actually.

So basically where would ecommerce penetration have been if things like that were honest and 10 of the people were shopping online, it shoots up to 16, it goes up to 60 and in six months maybe yes, yes, out of necessity and then just it goes back down slowly and if it had kept the normal pace it might have been at 14 or something like that so you know net it's probably a speedup of 20 or something like that a speedup yeah are your remote employees feeling disconnected ? I bet so. well spoken is the workplace podcasting platform loved by startups like robinhood udemy at 15.5 and spoken just launched a new way for businesses to build connection and community remotely.

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This is a really easy way to get to know your employees and give them credit for what they want. Try it so you can get three months free at getspoken.com twist remember that you speak without e get s-p-o-k-n.com slash twist get s-p-o-k-n.com slash twist getspoken .com slash twist for three months free gets the E for excellent which It's fascinating when I go to a store now, I don't know if you have this experience, but for me, going to the cinema or the store is like going to a museum or like going to an amusement park where I think, wow! is special.

I'm in a place where there are things on a shelf and I sort them and there's a person who helps me navigate through all this stuff. The whole concept is very ingrained in me and of course the stock went up like crazy. that's a distraction within the company, I would take that, yeah, so how do you handle that? It's a little difficult to retain people. This is what I've heard from many CEOs who go through this. You know you like yourself as a founder. It could very easily be like any net worth X, Y or Z, it doesn't really affect me.

I'm already past that escape velocity, but for someone who may know a range and track person, this can be very distracting. a million dollars in rsus or five hundred or two hundred or five hundred well that's most of your wealth is there and it could change everything, so how do you deal with that? And the people you know are sitting there refreshing the stock price. of pushing code sometimes, yeah, I mean, if you've always had an internally inspired policy, but I mean it's hard to do this now in a digital world, but, um, if someone was seen looking at the stock price or was on a monitor or something and they were doing a presentation like you have to buy um uh uh like donuts basically Tim Hortons of Canada um yeah all those Maple Donuts are delicious um regular um every time you saw uh Timbits and in the kitchen you knew that someone got caught uh that's kind of funny um I I I think that helped I don't know if it helped but that was there as a little touchstone uh in that sense so people I knew it shouldn't happen all the time so at least talk about it, the other thing is like: I, I, I emphasized this many, many, many times, uh, uh, very frequently, that's in the run-up.

I reminded everyone that it didn't get 50. smarter in the last two months, um no, so you know, just because the stock went up 50, it's just that this is like remembering that at some point the stock will go down 50 and we don't get any worse either. 50 or demo or whatever we want, it's not this, it's not us, we work on the real market value of this business, which is unknowable and what the stock market is trying to do is create consensus plus a million other things which, um, I like them. How about the approximate value given current long-term thinking?

For example, how the time horizon of a market changes and, um, there are times when the market loves potential, um, yeah, which of which we have a ton, so there are times when marketers don't . It doesn't just value performance, which we have a ton two of, but our Market was very reflective of those things multiplying together and when all the potential is used up, it can look like this, so I don't know how much it helped, but it was all I got right now because I mean the pace of the market had taken Shopify to crazy levels and then that came back out, um, like that, so the Revol was pretty severe.

I don't recommend it to most people and um uh, yes, people like it, but from a perspective that you're asking specifically from an employee perspective, which is much more complex, it's easier to reason about these things. abstractly and on a kind of social level, but this is a kind of individual experience because everyone likes this, the strangest part of the experience is that, um, everyone around you joined in at different times, so that there is no common ground, there is no shared experience and of course for the people who might like it, who have a worse experience as axiomatically.

You have to like it. You're going to have to spend most of the time, whether you know how to talk about it or just trying to figure out what this means to them, then, you end up in this situation where you like it, you're going to be very aware of it. some really unfortunate unfair events uh like timing occurrences like I think I even put that in a post like wavy designed our

compensation

packages with the stock options and rsus um uh it's just sudden like the beta of the market will matter a lot. this is how and and and and and and the confidence of the investor classes is like um if Russia invades Ukraine the day before you join, your lifetime earnings could be very different than the tape if you had joined a couple of days before or if a Grant's action would have been a couple of days earlier and that seems like a weird dependency on figuring out how to compensate people properly, so anyway, well you made a tool for this, I actually got there the moment I saw this because I said because.

This doesn't exist, but how come this hasn't existed before? So we're going to show it on the screen here for the audience that's watching on video and you know there's obviously two pieces coming up, you can have some stock, you can have your salary and you said well I think what you said was let's give it to people the ability to plan scenarios because this is new. Most people who come to work at a company have never had stock options. I don't know a hundred people who come. work at Shopify in 2022 I don't know, maybe half of them have had this experience, maybe half have had it, that sounds good, yeah, and you're in Canada too, so in Canada it's not like there are many stores there, I mean, you had Ram, but it's like a handful, so maybe explain what he built and how it was received by the employee base and we have it on the screen now so you can broadcast it on Sports if you want and describe what we are seeing here, yes.

I think I think what I talked about before is a good setup, it's kind of a framing because you know, but you know, I, my experience the last time you got nervous about Lego attack backgrounds, like I, I'm very I'm a uh tech like I don't know how to hack Central Casting, it's like I just like, like, like, I love computers, I love software, um, I thought about that, I would always be a programmer, but I finally realized. It was um, I really like build systems and, yeah, computers are programmers, they're very good, they're great for people who like build systems because you write the code, you design the system and then you keep doing it to always, like in me at some point.

At this point, I had to make these decisions and I was asked what I want to do and what I want to do as CEO for longer service of the public company, and kind of a clarifying idea, you know, actually, most of the consequences . The consequential systems in the world are actually both human systems and companies themselves and incentive systems and, like, how do you know? It seems like every problem to solve in the world is a problem that takes a lot to solve. of people working from very diverse backgrounds working together with aligned incentives and and and and as you know, basically, but all I'm talking about is the modern enterprise, um, like this, like this, sometimes I find that something that we all do causes something very bad as it is. some kind of observably bad variable is probably better off as bad, yes, it can actually be very good, yes, yes, flipping a coin is like making a decision in a poker hand, you know, it could go very well, it could go very badly , TRUE? and I I think it seemed like the decisions were on the wrong side.

I think the company. I'm a big fan of treating business like a profession, like a professional sports team. and so we were thinking about something like I actually ran some poets like where we just chose like we found the exact salary, but most of the people in the company shared for various reasons between different groups and like respondents. um how much do they think they make and we almost didn't come to any agreement uh like everyone they didn't even understand what their

compensation

was yeah even though it's on a document somewhere and it goes into their bank account but it's not easy to determine. discernible to them as if they had seen this happen before.

I've had to explain it to people. Do you know what they paid you last year? Here's your salary Here's your bonus Here's your stake in a venture company Here's what your future earnings will be and they're like I don't make that much, they literally don't know how much they make and they usually underestimate it. I think so. I have seen the same. I have seen the same. Dynamic and it's really not like um. I don't blame people at all, it's just extremely complex. We've leaked the implementation details of highly complex financial instruments, um to uh, like the employment institution, um, for attack optimization purposes, for the most part, so that's why they like it a lot. of our estate, it happens, and you know that's all well and good, but you know that these complex instruments usually come with owner's manuals and, in reality, there are rules that govern how much we can say about the potentials of these things because No, we can't do statements about uh, you're looking for statements, no, boy, now, yeah, so in the end, this seems really less than ideal, we use tools like everyone, like book day, I don't know how much this costs. our use of the work day, but when I looked at what you really see, especially when the stock price is underwater compared to when you joined, you work in the instance on your actions and just like every cardinal sin of ux was kind of uh it's like your entire Equity line just disappeared when the stripes so I actually had people um not in my office but on Zoom because we're extremely upset because they actually thought that once they passed years, it never comes. back, it's just that they lost it, they removed it from ux, so anyway, I remember, I probably overshared it here, but we're good, so two things we want to do first, we'll take over ux, like this was like that. it's your product company we are good at this as all Shopify doses take incredible complexity from a commerce world and make it usable by everyone hopefully so this is the same problem let's build for ux Now what do we want from this?

Ok, can we, once we own the uax, can we actually move the agency? So, this is kind of getting into this concept of, can we just let people choose, because you know, sometimes executives that come in say, "Hey, actually I'd like it if that's you." doing 50 50, but can I say a little more? If this is available to executives, it should be available to everyone. um, if you're a top employee, you're sophisticated when it comes to your equity, your restricted stock units for people. Who doesn't know that you're going to say, Hey, listen, you were going to pay me 200 grand, you were going to give me 40,000 in options, I already made money at my last company, I'll take a hundred, but can I get some?

More equity exactly, so it's a negotiation that people are willing to have with the top five percent of the organization, but it's very difficult to do it with everyone, but you found a way to make it easier, which is like an equity calculator. mortgages. I know sometimes you go to calculate your mortgage, you got your score, you got your down payment and so people can really understand and move the sliders back and forth. I probably need to speed this up like, I mean, the biggest changes that we made here are like I really uh uh, I just moved everything to the keys of your annual income like it's calculated based on um, you know the big value, like if We figured out a heuristic by which we can convert the old system into a new system and then everyone got an offer. um to uh here's the new system what's your wallet size and uh for everyone who opted for what was basically everyone now it's like something where every quarter you make a decision and you get the stock options that you pick and the you get at that value, so, when, so, this is like this, this is actually where the real differences are in the system, so we've completely moved away from Freedia Grant, we would be um, you're just getting the agreed upon value. you're getting, I think there are some discounts, like you have on the screen right now, but it's for people to choose our CS or the stock option depending on what they want, but if I take more stocks I get a little bit more because I have more skin in the game I take it and it's and it's more risk you're you're like you should adjust to risk to a certain extent as well as um and frankly insome cases, just for cash flow purposes, we actually want people to take uh to check out the options because they are also playing with a bad purpose on our side, so we have our ability to offer incentives for people to come into options, which we're not doing much, fifth, but in the future.

You can imagine that we would like that if everyone was in cash, maybe there would be more discounts for options for people to access that or whatever. I think there's a lot, that gets a lot easier and there's a real commonality to what everyone's doing that doesn't require something like that where don't forget that you're also getting Equity where don't forget that you like us use met like it's text free and publishing tags and so everything becomes verycomparably easy in this market, we are all tired of hearing so much bad news, my goodness, the layoffs, the funds for inflation are running out, but investing in the early stages It's starting to heat up again, believe me I know I'm doing all these meetings so all is not lost.

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The good thing about this too. I think you know you had this great post where you said Hey, listen, we're not a family, we're a sports team, we're here to win, we're here to get better at our jobs every day, everyone has a role on the team, everyone should think about their contribution, uh, and you understand that. If you don't make a contribution, you can't be on the team, that's how teams work, whereas in a family, if you're a mess, you're still part of the family like we've all done. I have someone in the family who is a complete disaster, but being a product company like this and then letting people have agency is great because what I find is that sometimes people come to you as a leader of a company and I .

I've been through this on a much smaller scale but they're looking at you like why are you doing this to me or like they're imposing this on me. I don't have the capacity. I'm just a victim here and it's like you're not a victim, you chose to work at this company and now we're making it even easier for you to choose the long term versus the short term. Hey, maybe you need cash now that you're over the skis with your mortgage or you have to take care of a parent you don't want to take too long you just need cool cash, but you can set it up quarterly, it's a bold decision, my goodness, the financial organization should allow it , it's crazy, yeah, they must have been like no other, Toby, annually, every two years.

What did they tell you when you came up with this idea? Well, I asked for five weeks, uh, like twice a month. I just want to do it with a paycheck, which I rightly pointed out, but a lot of our European employees like it. getting monthly, so anyway, you have to do it twice a month to find out that this team wants to spit out the coffee. I just wanted to do it. I mean, you always ask for, you know, negotiation when you figure out where you land, but like um uh. Yeah, I basically wanted to make it super independent of uh, like you choose how you want it and it comes out to you in terms of Asus cash or shares, depending on what you choose.

Again, stocks are down a bit. you actually get more shares because, again, money is like you know stocks go up, whatever you want, you took a stock, you have a bank that's worth more, it seems like you think about the counterfactual of uh if you would have been in the system all the time um um so it would have been internal like a lot of internal complexity wouldn't have existed uh with the system which is interesting because I mean, I've been trying frankly to get to the system for many years, it's not like it wasn't, it wasn't. the first time we talked about this, uh, like that, um, and I have a particular propensity to want to rethink things, especially if everyone does the same thing, but I'm really suspicious of it, there's usually a way to do it better.

By the way, I don't know. I don't know if it's better, but I will let you know that there are clear disadvantages that people can Level in that, for example, it's clearly not as retentive as a three-year option. Grant right like um uh so what you're saying is yeah if you want to lock people up, give them the gold and the handcuffs like. By having them trade every couple of years, you could dominate them a little more, so if you were in Lord it over mode as a management team you would say, well, we can have our thumb on these people, but I suspect that if you want the best people to give them agency, it creates less of a relationship between parents and children and more of a relationship between peers.

Exactly what I'm going for you, you're right. I did it. You liked my note on leadership. I wrote one. leave, well, which is like there's basically three things you can do in a company, you can leave too early, which sucks for you, you can leave, uh, too late, which actually sucks for you and the company, and you can leave just in time. which works for everyone and I think the kind of retentive component of stock options, like taping wives, often just causes the bad sides of these things to be like people who really want to be somewhere else.

Stay because they have to and honestly, that doesn't really work for the company or you, you'll be better for it. I think everyone should work on whether we can be a superstar, uh, and yeah, so that's me. It's not happening now I don't know if you've been following me and I don't want you to have to comment on other colleagues at your company, but you know you look at Google and Facebook now that you know Sundar. it's like you know people need to refer and Facebook is like you have to reapply for another part of the organization and they won't even do layoffs right there, they won't take the medicine, they just say we're cutting 10, they're like let's go to reorganize, make all these units smaller, you have to reapply to go somewhere else and a lot of it has to do with stock compensation, a lot of it has to do with forcing people to reapply for their jobs and it's dysfunctional and to your point, if you're a player, if this were the NBA, we want you to have as many playing minutes as you deserve and hey, if our team does, you know we might not have enough minutes to go around.

You'd be better off playing for a team with the worst record and playing more minutes and maybe that's better for you and that's really what you want as a boss, no one wants to deal with this dysfunction and the dysfunction at Google has really piled up, you know ? I remember talking about the initial idea of ​​Google. I'll just say I've seen your superiors believe it in the early days and they're like we have a money printing machine we're hiring all the talented people we can find and if they're super smart and talented we'll find out what work they do later and then someone told me that if you're working here you can't create a competitor, it was literally Google taking the money printing machine and saying that's how it would be. to be like someone like the Yankees or the Knicks, to have so much money in the Lakers, we're just going to pay the 10 best, these 10 players to be on our bench as backups, even though we know we can't put them on. the game so that they are not on other teams that could win the championship was a crazy move but nobody wants to live with that dysfunction yeah, I mean, it's a theoretically perfect game to do well as if it's what you want, as if it's a great strategy.

I mean, I think Google literally had a bank, like um, they've even called it that for a while, I don't know, I think, I think, um, I mean, there are cycles and there are fads and I think I think um. I'm always suspicious of how these stories end up being reported. In a way I see how people end up being right. I mean, obviously, writing about Shopify is incredible, the ability of people to turn something into something that sounds like that. Kind of a blatant, random decision that came about on a whim, but actually I know we've been, you know, discussing, you know, philosophy, like sociology and first principles, for about three years and because we built something completely different, but like uh . you know, above the iceberg component is being reasoned abroad and you know, I think actually all of this is probably a good thing because I think most companies are just one, I think they're starting to see their role. again, companies like it and I think people have tried to push companies into the realm of I don't know, kind of like making fun of Academia a little bit um and there are downsides to that and um, I mean, I don't even want to say. but I think there are some companies that have gone as far as to see what value there is in daycare, to extract and I guess they run the counterfactual with the rest of the industry to make the workplace a little bit more like that, I think it's outrageous and I'm glad I didn't have to participate in those kinds of experiments by employees so I think you know humans are awesome and I like that it's so much better but everyone seems to think that you know it's the same as you know it's hard to create environments that are creative and, um, but if you set your mind to it, uh, and you don't like it, just copy everything that worked for others, uh, and try to build something that's like that.

It is worth it for the type of problems you are solving and that increase the culture of your company. You end up with something that just your creativity comes from everywhere and where, hopefully, people fall in love with the products that you're on. creating and um where everyone holds each other accountable or actually reaches out um you know someone is falling behind and likes to help Romancing like hey this is what you're missing uh and let's work on your growth so you can be part of their team and you know that's exactly what everyone wants, don't you?

So we're hiring people who are super signed up for these kinds of things that we pay very well for, like um um, but we pay, you know, almost. paternalistic way in which we make all the decisions about what is good for you, so this was our opportunity to change to something that is consistent with the way we want to run the business well. I mean, it's also going to self-select people. Those who want agency and people who want agency, I think that will correlate with people who make good decisions for themselves and when you run a business, I mean speed matters, you have serious competition, you want people to make decisions and you No.

I don't want people sitting around, a lot of companies have had big challenges because no one wants to make a decision and that's why startups exist. How many times have you found yourself slowed down by time-consuming tasks like data entry and rescheduling all these meetings? Imagine how productive you could be if you quit all that admin stuff and started focusing on things like product growth and support, where the people are as a service and it will make you bionic and before you finish reading this ad, I just want you to go to helpwear.com turn around, sign up and get a thousand dollars off right now basically help where it helps Outsource the tasks that are slowing down your team and reduce mundane data entry to more complex tasks like customer service and even AI operations and wait until you hear about your customers access Google Microsoft Amazon and more, you know, people are scaling, they have big data sets, AI operations, you get the idea, all these mundane tasks can be done through help software, imagine to all your best employees and now imagine them not wasting time on administrative tasks. and have them all focused on growing and developing their business, that's what's possible with helpwear, so go to helpware.com twist to get a thousand dollars off your first invoice.

That's it, he-l-p-w-a-r-e.com, reduce the draft for a thousand dollars off and welcome to the draft. family help software let's talk a little bit about layoffs, you had to lay off a bunch of people, uh, that's a first for you, uh, how did you come to the decision? And you know how it was forYou, as a founder, have to go through it. that I think for the first time I think it was the first time you had to do it, yeah, it was definitely the first time you had to do it, it was uh, I mean, but also crushing anyway, it's like it was uh, I see, um, I believe in searching. well-defined, different tasks, you know, building a company that is really worth working for and I feel like every job offer is our commitment that this is the right place for you to join, so your career will go better. when you join here um and our mission is going to advance further when you join here this is like actually the concept of employment is for an agreement that this is like the optimal uh uh uh uh something to do to be free of alignment there is alignment between these two things, yeah, so, it's overwhelming, for multiple reasons, it's great for individual experiences, which, uh, yeah, and you hear about it, of course, and you want to do good for people and you have to tell people What are you?

I'm going to do something that's going to be something very momentous. ours in scratching because, um, I made this commitment like I see that I've read them. Compromise and in some cases I was probably wrong. Some people should have accepted an offer from a company that didn't have to go through this now. I couldn't have known it back then, but it still doesn't measure up to mine. standards, so some of our hardest days um, uh, the reason we had to do it right, um, I mean, we also could have chosen not to do it like it would have been possible, uh, uh, potentially, not to do it, I think it would have been easy for everyone, but actually worse for the people who might have been affected.

This is a hard thing to defend and people should take the other side for me to steal, man, this, but um. The reason why through the Service is like we have to hire a lot in advance for the explosion of e-commerce that we talked about before, just like the servers, the servers should have had next year or maybe even two years of capacity, so you We're hiring what within a year or two, in terms of your thinking, yeah, it's going to be more than uh oh man, we more than doubled that, so it's like 6,000 people in two years. or something like that or a little more. is that we expanded a lot, um, because, you know, you know we didn't want to compromise the product that we see, so, for example, customer service as a product, it's like again, we meet people very early in a business journey, they often, um, are. brave but like their commitment disclaimers we might actually call each other to ask what the next task is. um, they like, um, they're not sophisticated yet, uh, like they're just on a learning journey, but there's a lot of new things to learn. but after they start, very often people start the store at the Festival before they join in or do anything else, so, so when someone talks to us, we see this as if actually our product is represented, it's set up to the Web. browsers for people and that required a lot of you to know how to get ahead and because you didn't want to compromise this, the quality that we set on those things, so you know, there are also some reasons why We had to build capacity ahead of demand because it just takes a while to get it on board and um when we didn't need it once we knew that once we had the data um it's like, well, now we can get involved in saying "okay, well." let's change the job that you're doing, let's find something else, but or let's let people in certain groups, for example, start a bank, let's visit, that's not fair to everyone else, like that, like that, in a dynamics perspective of the company, it would simply be like that. would compromise the virtual reality of the company and the way we were solving problems, so we are really the right decision, yes, I mean, continue to manage for you as if everyone buys into this concept, as if we understand that this is an environment dynamic and the reward for working. in a dynamic and competitive capitalist system is that you can win, you can lose, you can make mistakes and then everyone accepts that and it is a double option, people can leave at any time and the company can change its plans and that is why The West and capitalism in the West has won against authoritarian societies that can make unilateral decisions to choose the winners, like literally in a competition where the government can choose the winner, say China, um or any other country that they can't beat. , fierce and tenacious competition will always win. we're always going to win and we were sitting here, I don't know, last year, two years ago, I was in this debate when my best days in general, sometimes, oh my God, like China is going to roll us over, and I was like um, I won't.

So sure, I'm not so sure you know that if they don't allow entrepreneurs to fight in the arena, you know that's why we're battle tested here and you have this giant competitor in Amazon, you have to wake up every day and these. two Gladiators face each other this is the next jumbo point I wanted to go with you uh with you they have a tenuous relationship an impure relationship with their Partners you have a pure relationship you support people who want to sell things on the Internet you only work with you to the extent that you help them.

Amazon studies the people on their platform and let's be honest, you know, call it what it is. Amazon basics, 50 other white label brands, they copy them, they pull the rug out from under them and uh you know it's becoming an antitrust issue for Amazon so obviously you don't have to comment on their antitrust issues but I'm curious when people call that customer service line you talked about and the customer service like feature as an actual product is brilliant, shout out to Tony Shea, may he rest in peace, our friend at Zappos, who really know, I think it set a standard here for everyone who lost a good one there, oh it's so brutal.

I was thinking a lot about him. when he was at Burning Man um and uh, you know, you think about his contribution there and you think about what is your advice to those people who sell when they come into your ecosystem, what does a person say on the phone? Like, hey, should we put our stuff on Amazon or should we go straight? How do you think about that? If you were giving advice, let's say one of your brothers or a cousin opened a store, what would you advise them privately and tell them this is how to think?

About getting something from being listed on Amazon or baby, these are the things that should concern you. I mean, that shouldn't surprise you. I wouldn't reflexively say no, it depends a lot on what you're selling. That is, if you are selling some type of essential items, but you definitely want to be on Amazon because that is where people look for them, but it can be a correct strategy as long as you have your eyes open as Amazon is in no way. to do something here with a brand name store that hasn't been done in retail since forever, that's exactly what Kirkland is, this is like you know there's a whole like a Trader Joe's.

I think it's kind of like a North American version of ID, like it's just like, oh, it's still Brands um, the retail industry is like a beautiful manifestation of capitalism and it's a very pure form, like what's normal, right, the question is obviously, what do you need to differentiate yourself if you have a unique product like that and you go to Amazon? Soon you will not have a unique product, the same if you go to Alibaba like AliExpress, very quickly you will no longer have a unique product, but if a particular product is like, we find that very rarely is it actually the direct product. but again in our capitalists, um, like in our Adam Smith society, uh, so we tend to think too much about economics, about utilitarian value, like goods and therefore the likes are much more about there's much more emotion there is a lot more like belonging to various So, um, the story is this story that, as you like, there is how often have you had the situation where I don't know like you, you ran into someone who carries, use a similar brand, maybe like a type of car or or or um something that excites you and you feel an instant connection because there is one like this out there this is not well made up this is a hobby book so um uh you know, yeah the concept central to your business is um that you stand for something as a business and that you have a liquid that there is a community of people like even you should probably be everywhere because you should look for people who go for your idea and your vision of the world even everywhere and I can get involved Amazon likes people to make different decisions about this, you know, so you know we have a lot of Shopify stores, uh, people that were on Amazon and then very public actually copied you and left them there and I guess I don't know about the current status of all birds, but they have a complex history, for example, and they are one of our favorite stores because they started on Shopify and then they went public as one of our clients, which is cool.

I don't realize they were built from your stack. Wow, yeah, it's cool and cool, like amazing entrepreneurs, and so, um, it's like that. I guess what I'm saying is that I don't have a direct answer because it really depends. on like on you Amazon is just a sales channel at the end of the day it's very good it's like sometimes it could be the best in the world and for some categories at least um and uh people should like entrepreneurship it's difficult Enough No, don't say no to a channel for some idealistic reason like idealistic or do it if that's consistent with your brand, but like me, maybe Amazon can play a role and I love the idea of ​​just putting a small part of your product offering there to acquire customers, spread the brand so that people don't get anything when they visit the site, but then you have these more unique things and, you know, I think there are some that you know, with sharp edges, sharp elbows. business practices that I think we need to think about with them.

I think they should just get out of the core business, like get out of the private label business, and then just this idea of ​​maybe leaning on people about their pricing like it should be. It's up to the merchant to decide what the price is at whatever store they want if they want to charge one price in their store and one price at Target in person and one price on Amazon, you know, that should be the merchant themselves. Talking about the pace of delivery, there was this idea that everyone wanted everything immediately and then I've seen signs that maybe for some categories, if you need deodorant or a liter of milk, of course, yes, bring it to me as quickly as possible. but it seems like maybe we went too far in compliance and people are now choosing.

I might do this a little slower if it were cheaper or I can get fewer boxes. We could talk about what you're seeing there in terms of compliance. What do consumers want and what is best practice? Yeah, I mean, I'm needed in this right, because we're building warehouses and all this kind of stuff, so, uh, it's um, I mean, it's probably one of the favorites like me. I just find the delivery word and the world to be absolutely fascinating, it has all the kind of components from the 90s, uh, peace, like computers, like it's like you build your own computer from similar components and and If the power supply from your motherboard yeah put some memory in and then you go to Radio Shack and get a faster quartz and you solder it because that's the best way to know it's like people are also doing these super non scalable things and not productive.

It's like building a muscle car, you say, yes, it's a carburetor. I need to put different tires on it, but we hope all retailers go through this. It's clearly not intended for them, so this is actually something. Shopify is trying to fix it, of course, but the sooner the better, but there's a uh, depending on it, it's exactly the kind of Needs, sooner is everything, so it's almost like you can't get together, get things done as quickly. , do not do it. play it's like there's no demand beyond two days three days speed um if you're in another category like uh anything that's something you want instead of something you need um like you know, Alberts sneakers or whatever, before it's better. a better experience is um, it's a digital equivalent, I guess, um, um, when you go to a physical store and the music is perfect, the lighting is great, the stores don't creak, the people, the help is like the people in the store. they're friendly and it's part of the experience, it's going to give you what you really want, which is lifetime customer value, you're going to get repeat customers because, you know, a lot of the first sales are actually high margin, especially with uh, the kind of occurrences of uh uh advertising changes now and um, it's really later when you pick up uh margin um uh so, it's a big part of it, but it's not like it's quite, it's a friend of the crowd that goes down. probably sevendays in Bitcoin like never again.

Depends on what it is. It's usually a little bit earlier, but we broke this down into a couple of things and what we're working really hard on at Shopify. That, in the future, even for smaller retailers, what you will see on a product page is a store guarantee that says it would be with you tomorrow, in two days or before the weekend, those are actually the three important things, the last one gets overlooked, um, because um, a lot of things that people want, they want for next weekend, that's a very common thing. Ah, that's fascinating, it's like your home is projected as your um, you know you're going to play.

It's time to unpack like your face is gone just unpacking all the things that come into our homes takes a little time, you know, these have free warranties that we think are very valuable, we're going to have thousands. and billions and billions of dollars we're going to allocate to a thousand thousand people and billions of dollars we're going to allocate so that, from the buyer's perspective, the big guys can get things with such guarantees from as many small businesses as possible because that's fundamentally It's hard to do, but it's very valuable and no one has built it, but building Amazon is something very different, which is unique to them, they have a warehouse of 20 million skus and they can all be grouped together randomly, that's not the way small, medium and small businesses work, have smaller catalogues, etc., the details are not.

It doesn't matter, we'll do it and I think that, you know, at this point we're finding that there's a growing number of small businesses that have actually started right, rebranding from free delivery to sustainable like, uh, uh, actually. , like um. slower delivery options is what I meant, more sustainable because the faster you go, the more likely you are to go on a plane that is not carbon neutral at all, so, you know, I think people will choose different places in " "This is a really interesting thing in terms of the abundance that we have in society. I was reading an article before I came on the show and they were talking about how now there are all these examples of GDP going up while emissions are going down and you." Well of course you can have it both ways, it's called technology, it's called thoughtfulness and I'm figuring that out as a consumer and maybe it's because I have kids and I'm getting older, but I'm just thinking about my footprint. waste I'm letting you know my iced coffee at home instead of buying a bunch of boxes of blue bottles.

You know, I got rid of the boxes of sauce they came with. The Lacroix train comes every two weeks with boxes and I just drink iced tea instead. I think people really care about that footprint, let's talk about the payments you have, now you have your own payment channels, you have your Shopify payments, uh, I think you call payments, yeah, um, and then we have a store payment that many people have. something familiar to be entitled because it's when you see you buy something from someone and you get like a code and then everything assumes I love that, oh that's so simple when you just go to a website and you have to pay so ' Are you like you're going against Stripe?

There's PayPal, you have it built into the system, why would people use Shopify payments versus Stripe? It's basically a wash in terms of cost, but it's simpler and more elegant, well. In reality, it's as if much of the software underneath buys payments from Stripe. This is fun with long-standing partnerships in technology. Do you sometimes wonder if Patrick has any other similar partnerships that have seen both companies grow so much? Shopify did it and started it from a point where we first started partnering almost 10 years ago and you know we like it so it's been really one of the big success stories there so um the stripe is ours, you know, technology partner for For many of these components, we certainly have enough, like a large enough part of a logistics software world and the commerce software world to keep us busy, so why do people use it well ?

It's the reason people come to us now it's like your conversion rate is massively lower if you don't have Sharpay it's as common as card abandonment rates on every non-

shopify

ecommerce software skyrocketing because people come to the checkout, they come to get the store here and they leave it, it's death, it's death to figure out how to fill out my information again, literally, I see this sometimes where I think, I'll wait until I'm at my desk or, for some reason , this website won't let me autofill and I'm wondering how it can't autofill in 2022, like this is the table.

The bets are what they are, but you know, I understand that they have some small store, they don't even go through the user checkout process, they just set up their store, they don't even think about the user experience because I don't know what they are selling, you know, some custom made product, they are not software experts, what? Do you think about this phenomenon of buy now and pay later? Is it here to stay and people love it or is it a fad? How do you think about that and your role in it? I mean, it's something that people buy.

I mean, it's something that we offer to merchants that want it and there are some groups that it's extremely popular with, in part because, I mean, there's a lot of credit card-like things that they're involved in, they're taking a lot of . of risks that you know are brave companies, because you know that normally the companies are of better size, they are not brave, so the way that this current manifests itself is like in the rates that they are pushing and, um, yeah, you know . Consumers on the one hand are deciding, hey, maybe I should just get a debit card and just use buy now, pay later to basically get the credit back and because that actually allows underwriting to happen to people who are willing to doing so, a much cheaper pill.

And that's one thing, especially with younger buyers, that is very, very common. That's why you see that you don't pay as much afterwards, or why it initially became so big so quickly, and then, you know, high. it's a great unlock for high AOV for higher cost merchants like the mattress, uh, Peloton bikes, etc., like things that cost, are big, like a pretty big outlay is perfect, considered purchases, yeah, could take a buy considerate and maybe do it a little. more, yeah, it eliminates a little bit of friction, like, yeah, okay, if I pay it monthly, I mean, no, I don't need to do that and sometimes I get these offers and I'm like, wait a second zero percent and I can afford it. for three years for my iPhone, maybe I should do that and I think I don't care, but it seems to be a really elegant solution for some traders who like Saying that those you know have headwinds maybe it makes sense, yeah, yeah , it's, it's, it's what it does.

I mean, I know some of the data like, again, it's not a universal source, but for some companies it's an absolutely massive change, um and really. and then it made a big difference here, like a big difference for their cash flows, a big difference like the expansion of web products, you know, the number of people who would like to be able to buy them, again, their credit is, I mean, our economies are built on top of credit, like um um, our economy gets better, you know, for the better for both of us, right, like uh, you know, sometimes people are bad with credit.

I think that would like that to happen periodically and then we usually do some kind of correction um, but uh, like there's a lot of brainstorming about how to do credit right and it's like now companies are starting to do it, like a company was extremely good at that. um, brilliant, yeah, exactly, I mean, he's like, I mean, he's done. with this type of subscription even on PayPal, uh, on both days, so he's been thinking about this longer than everyone else and you know that the software industry is the way that software books offer new possibilities and you know that the Credit cards are all you need.

I know I'm still like that just uh pushing everyone to like rethink um you know we have a subscription that should happen and so I think it's I mean to your point competition is good and so so much, I am, do you know if? All that at this point pay later will eventually do is improve the credit card products to absorb some of the experience of this, you know, because it's like if it's structured more fairly, it's much higher up. On the ground, it's clearer how much it costs in the end, yeah, so I guess that's not what they're paying for, they get a huge credit card bill and everything is obscured and you know Max is very clever at designing these things that he's going namely. like, yeah, this will be the 25th in this cohort, yeah, no problem, let them break, they can, they'll pay their bills, they got a job, we have the data here, they'll pay their bills, hey, this group, yeah, it's we may want to. hit the brakes or give them a different treatment and just do it up front and you know, speed them up if necessary, eh, but yeah, I'm considering it, I hope people aren't maxed out on their credit cards, yeah, and they're Buy Now, paying later is the only thing that worries me.

It's like those two groups of people are competing to empower people to make purchases. I just hope they have an idea of ​​what everyone else is doing somehow. I suppose. marketers do it and their technology, I mean, they do it, uh, but that's the right thing to worry about, you know, when you hire people today, uh, we've seen some generational changes, like we're generation xers, we just want to work and crush. They put in 50-60 hours a week and we take a lot of pride in racing, what are you seeing with these younger generations? Because you're hiring a lot.

I'm sure there are a lot of Millennials, obviously, but there's probably a lot of Gen Z coming in and I'm assuming you work primarily from home, how do you manage this younger workforce? Which we hear a lot about, maybe they don't have the same work ethic, some of them maybe don't want to come to work. Labor participation in the United States. United States, I don't know if you track these numbers, but you know in 1999 we had 70, now we have 61 62, like we have a huge number of people missing from the workforce here in the United States. Don't know. about Canada I think my Canadian has a lot of Canadian employees and I find that they stay longer, work harder, are more consistent, appreciate the work more.

I don't know if that's your experience too, it's definitely mine, but how? Think about employing, hiring and managing great people at a time when it seems like some people don't want to come to work, a lot of people are choosing not to work, but I mean we have to recognize that there is an unbroken chain for so many since humans have been around, but like what one generation expresses about the next, yeah, once, right, sure, sure, probably because I think the book looks different, in a way, but like, uh and Austin, Texas, including, every generation, both struggle with a partner. of really, really, really, really bad ideas that just get deep into the filament and then people like to have to figure it out right, like me, I, you know, that might have been communism at some point, you know, like and and um uh. you know, hopefully, people are paying attention to the report cards there, um, that society has come back the way that's going, um and it definitely doesn't work, no, it doesn't really, it's like that because there's a lot of reasons why it doesn't. you should do it.

I want that, um, it's so weird that people say, Hey, tell me more about socialism and communism, yeah, just write down the Russian red lines from the 80s, like when we were little in the 80s, they said on the news that you They showed people lining up to get one. of one type of bread like someone wants that like one type of bread in a store and there isn't much left. I'm not even going to do this like this. It's not me making a statement in the mail about the Next Generation, even like it's kind of offering an example of how here it's like a real confusion that existed that uh you know that existed although I mean, I do know that there is flirting with uh that direction uh of a particular Specter again I think the way I think the bread lines um it's actually Funny people it's like I have very fond memories of these bread lines.

I know quite a few people from East Germany, but who really likes it, which is of course a post factum rationalization after you no longer have skin in the game. However, I think the real tragedy. it's obviously to waste human potential right, again we have zero authority to even choose how you're going to contribute to the greater good, right, that's it, that seems like we should stop aspiring to that right when someone like me I don't know how she steals men, but that somehow improves society, so think about how not everyone had the lawyer of their choice and everyone contributed to one typeof bread, we all ate wheat bread and it was amazing, yes, it's a strange thing, yes, like a post, it's a strange throwback to Simplicity, maybe or something that was elegantly simple and it's like no, it wasn't elegantly simple , which was lack of abundance, suffering, hunger, boredom and lack of freedom, is what it was.

Is your statement such a bird? um uh, the anti-work Reddit guy uh, if you make it into a category, this is kind of a current thing, that's the problem, it's interesting, I mean, we see some of this in in in in companies um like a sometimes there are sometimes we see things directly reflected but it was like a trend like a couple like a while ago in anti-book like an idea like that arises in a q a is is I mean that's why absolving as if I were going to make a phone call. I'm going to do the least amount of work like your manager should be able to figure that out and there's always been people who have called you on the phone and I think the most fascinating one is the people who have three jobs and they're developers and they're so good at That's what they say: Here's how to manage your three simultaneous phone calls and laptops and desktop monitoring like there was a story in the Wall Street Journal today about it, like desktop monitoring. software that has always existed in Customer Service, by the way, or if you are a merchant or if you work on a sales desk or you are working in Finance, they have always had their desktop locked, they know the keystrokes that they have to know because there's money at stake and transactions and all this kind of stuff, but that kind of thing is you know people now have to think that if there's abuse in the system, I think bad managers say there's abuse in the system, so Therefore, everyone has to suffer and it's like I don't believe it, but I don't believe it.

Run, I don't handle thousands of kids, I handle dozens, but how do you think about the abuse in the system that has been portrayed in the media and subreddits? Because I don't even think this is a widespread problem. I think it's like a five. percent problem if it's small, but uh, if it's a small thing when people believe it, but it's also absolutely fascinating in terms of that, it's a problem that couldn't exist in any other decade like in an office it's like You couldn't, you can't do free work if you have to show up for office, so, um, um, so, um.

I haven't found a person who is so good that he can actually do free work. I think there are a lot of people who would potentially have the ability to do this, but I don't think they can do context switching, so I just don't, I'm not afraid of, um, the guy. What if it were, if they did it, it's in my mind if you have someone on your development team, yeah, or you'll say your sales team or a writer, whatever, and they're so talented that they can do three jobs. at the same time without anyone. Knowing this, it is a failure of the three managers of the three companies, they did not identify their excellence and appoint them CTO or vice president of engineering.

Yes, you can challenge that person. It's like having Steph Curry on your team and you never thought he would do it. tell him like you know what you should shoot all three of them, you should shoot from the logo like Let It Rip guy like that's management's failure to recognize Excellence. I mean, you're thinking exactly like me. I have um, I think people have a tendency to solve problems on the wrong layer and spend a lot of work investing in what they would like to somehow make work. I think almost universally these problems, uh, if there's a problem that people encounter, they're actually problems with performance management.

Clearly there is no clear set of expectations of what you want from someone and if your performance management is not good enough to say that this person is completely underutilized and therefore should have been able to do a lot more for a mission . or it's like calling it on the phone because we're actually doing free Zoom calls at the same time and we have a camera splitter that goes in all directions um and and like then when it's um, I don't know, this should just show up. up, no, it's certainly harder, like uh, to do it in, in, in, in, in, in, in a digital world, but, again, also in hiring you, you like this, everyone has a style, there's an exercise for each company individually, but part of your hiring process is I mean, it depends on what you need, but like us, we want hard-working, smart, ethical people because if you only get two of those things, the third one will kill you every time. , so, then, you like to be in all of these. instances where you're missing ethics, um, because you're defrauding what ah is a reference, maybe to choose a word, but like, oh, I mean, like people that you know when they're doing unethical things, yeah, It is unethical to adapt at least your colleagues.

You like the rest of your team, even if you don't think companies would also like a movie about considering ethics, but your colleagues certainly shouldn't do this too, yeah, no, it's completely unfair, listen, you have to go away I believe is you. I had you for over an hour. It's great to talk to you and it's great to see you doing well. By the way, I make investments in private companies. That is mine. I invest in 1,500 companies a year, but I was watching the stock market this summer and sold a bunch of these ETFs. I had a bunch of stuff and I thought, I'm going to pick the 10 companies that I think make the most beautiful product and have great leadership and I like it.

I literally bought Shopify stock this summer, so all of this now I have to make a disclaimer. I'm a shareholder uh and uh. I was talking to Tim Ferriss actually on similar things last year oh yeah, talking about how amazing you are as an executive who thinks from first principles and builds things and like you know you have to make bets on people and their vision and it's a very easy bet for me, at least for Tibet, over the next decade. I'm buying shares. In companies that I think 10 years from now I feel comfortable that the leadership will have done a great job just listening to their customers and creating products and making them 10 better every six months, whatever it is, five or ten. percent as capitalization, you know?

Innovation, you know, uh, innovation is so powerful and you're just watching how you build this company, it's been great and I'm so excited to be a shareholder now, so, yeah, coming back to work for you, I can't understand it, yeah. Yeah, yeah, yeah, this is all you're letting me out of my cave, um, uh, but that was a really nice thing for you to say, so it's like yeah, so, that's extremely kind, so thank you very much. , yeah, that's right, listen brother, uh. It's great to see you do that, if you want to work at a big company, I don't know if you have a lot of open wrecks now or probably some strategic ones, you know, I think this will be one. from the big companies from uh Our Generation

shopify

.com, look at the job openings and if you want to build a store and be an entrepreneur like it's really an amazing career path to sell things online, you have how many merchants now, how many?

Just as we close here, how many people is two out of two million, it's amazing, yeah, what I'm seeing is all this now, um, I'm following all the influencers like Tick Tock, YouTube, etc., and they all like to reach out to the top. in their ability to generate advertising revenue and they say you know what I should do. I should do what Kim Kardashian does and I'm just looking at the pool of influencers so I literally found an influencer. I wouldn't say which one in Canada and I thought you should be an entrepreneur and we started talking.

I said, I'll give you twenty-five thousand dollars to just jump in and see if you can build a business out of this because you passed a million followers, but there's like 10 different ways and the first thing I said is how about we create a store like Shopify and like the people in your orbit, you could sell this type of branded product and then combine the content of the product? And he said, yeah, that's amazing and I like it. It's great that you exist to train people to be entrepreneurs. Reminds me of eBay back in the day.

You know, they just empower people to have agency in their lives. It's okay brother, thank you, thank you very much, greetings, brother, see you soon, always. fun to be honest, thanks for having me, what an amazing interview with Toby, such a great guest and we really thank him for coming and giving us so much of his time. Upcoming producer Rachel is back with OK, Boomer, enjoy, OK, Boomer. I understood the task Hello everyone, thank you for listening to this segment of OK Boomer. Today I'm talking to a returning guest, Jules Terpak. If you don't know, Jules is a digital culture commentator and today we are going to talk about our lives. moving more and more online, so hi Jules, hi Rachel, how are you?

I'm fine, so before we start the show, where can people find you on social media if you have a lot of people asking? Yes, in Jules terpak. I'm mainly on Twitter. and Tick Tock, I would say awesome and I know you do most of your videos remotely, but I like being in person, so do you mind if we move this to your office? I guess it's awesome, okay, we'll do it. the rest of this in person with jewelry and I'm going to get on a train to Grand Central and see her there see you soon bye, thank you very much Jules for inviting me to your office today, this is one of the Only recordings I've done in real life.

I don't make that many, so this is great for me. I'm uncomfortable, yeah, well, you know what someone has to do to make you uncomfortable, and honestly, I'd feel a lot more uncomfortable if they were. in the metaverse, I don't know about you um, but today I want to talk about um, it's the metaverse that we're going to because we already have apps like be real, which everyone knows, I'm a big fan of um, we're publishing. those are reels basically at the same time as your friends, you get one notification a day, it's instant, if you don't know what Google is, you live under a rock, we always talk about it on the show, um, but it got.

I think: if we already have applications like be real where we are watching our friends do what they are doing at that very moment at exactly the same time as us, what is the next step, like what more moments can we get, yeah. like you just said, everything is becoming more instantaneous, so the news cycle is getting a lot shorter when it comes to likes on Twitter and Tick Tock, like you're not talking about something within the first 12 to 24 hours, like the wave has already passed and We're looking at that with being real too in terms of almost replicating the real life experience, so everyone feels this Co this collective feeling of being somewhere at the same time, yeah , is what we are seeing in being real and I mean.

That's not new like Twitter. I think there's always been that more instantaneous feeling when a current event happens, like you run to Twitter because you can search for the name of the current event and it feeds in real time to whatever was most recently tweeted. So that's always been there and in terms of Clubhouse and everything that we're achieving, yes, moving more and more towards collective online experiences to, yes, again replicating this in real life. We're seeing a lot of full circle situations with Netflix starting to do weekly. falls like yeah, cable was always in the past because people are finding that people love it more in the way that it's like the transition from streaming service to social media and like everyone's talking about something at the same time and they felt, yes, embraced together, we almost were.

I was also talking about it before this recording started, how interesting it would have been if there was a real being centered around Euphoria, so yeah, you can't like watching Euphoria with your friends, you're in a different city, but what's up? ? If the people at HBO knew exactly when the shocking times in Euphoria would happen and every time that happened you would get a notification, you would have to take a photo of your reaction, it's like watching those immersive experiences happen instantly. It won't be that far from what we're doing now. Do you think there's a chance Netflix, Hulu, or HBO will launch their own social media platform at some point in the near future?

Don't know. That's because I think we're all very overwhelmed with the number of social media platforms that we have, I said this in an article like TechCrunch that we can only compartmentalize, first of all, our identity and also extend our minds to as many applications as Yes, applications Of social networks right now there are more than five that are strongly positioned, like how many you can click on during the day. You know, I have my typical rounds of Twitter, Tick Tock, Instagram and, for me, I can't really go over that. Don't go on Facebook or SnapChat anymore because I think it's too much for my mind, so we'll see in this that it's something like that.

I don't necessarily want to say Monopoly or I like these super app situations where I like it. There are certain platforms that are all-encompassing and take power over every aspect of this industry, that's what we're seeing, we'reseeing that Tick Tock is about to launch Tick Tock which is separate from Tick Tock app. it's going to be a copy of be real, so yeah, we're just looking at that and like you, we had talked earlier today, like Instagram is trying to move forward that way too, so yeah, that's super interesting too, It's funny how we saw the Instagram guy. from trying to copy it, be real um in a report that came out and basically there was like, yeah, like if they were creating it internally, it'll probably come out like something that comes out in your story.

Everyone I was talking to said why would we want to be real for our Instagram story like we already have close friends? Being real is at least for me. I don't know about you, the URL is even smaller than my close friends' and then there is another platform that copies it. Snapchat. I think they both tried to copy it and Tick Tock came out basically the same, exactly yeah, basically the same thing and it's like, oh damn, okay, so it's interesting to see that as well as almost a timed experience. that would become a new normal on social platforms in the future and it would be real as the app as we know it now might cease to exist because we want to consolidate the apps we use just to become more users and easier to use.

What I do balance with apps is actually where I get my news. I love the axios app so much. That's one of the applications that I love. I use this platform, it's called Feedly, mostly on my laptop where it's like going through a bunch of different news articles that come from newsletters. I don't use the Wall Street Journal app. I think I like Axios, and Reddit would be where I get the most news, but I'm always in China. news app, so that's the only category of app I wantI'd like to be interested in seeing a new one pop up, um and recently you showed me a new one, you said it was called revolve, yeah, LLB, yeah, and basically its tagline was Tick Tock for the news, right? and all the news we see.

It's like it fits inside a screen. I think it's like half your screen, so it's really very short as a visual, so it's aesthetically pleasing, but it's also like yeah, yeah, three to five sentences about something that come from vetted sources, ya whether it's like Legacy Media or just more like Independent Media established at the time they select, but I've been using it here and there for the last few weeks since I found out about it and it has that Tick Tock feel to it. you keep going, you see the little things throughout the day, you can choose the specific things that interest you.

I liked, of course, technology and social media, all these different things. um it's just kinda nice and quick. information that doesn't have everything personal mixed in like on Twitter I get a lot of my news but of course within those Scrolls there's a lot of stuff like people like to post or whatever, yeah, so it doesn't have that Yeah, do you think there will be other industries that will come out and like tick tockify like other platforms have gone off the rails? Obviously we have seen news, now try to tick tockify with this volv app, but is there? like anywhere else you see, I could probably pick this up.

I feel like I can't think of another specific one right now, but it's just the way things are moving in terms of, first of all, people's lack of focus, but that's not the case. Like lack of concentration, it's all a product of the information overload we're all experiencing, so people can only like it if they spend more than 30 minutes of their day on something that's a huge amount of time and yes, people. I realize that there's all this consolidation in terms of length of media that's happening, so that people feel like they even care in the first place because they see more than 10 minutes into the video, if they see something, they think: "I don't".

I don't have time for this, there are a lot of things on the internet that I could scroll through that are shorter and could be more concise in giving me my information, so it's like every industry has to adapt to those types of messages . I agree. um I want a podcast version, I actually don't know if I want this because I think I'm definitely like the result of someone who grew up even though when he was little he didn't have a device or anything. So, I don't think I really got into technology, probably until high school, it's probably like we were the same age, that's probably when we were first allowed to do that kind of stuff now.

You see much younger kids, but I basically grew up with technology and we like our formative years, I guess I'm definitely a product of the attention economy in the broadest sense possible and I was in Trader Joe's the other day. go downstairs at Trader Joe's um I don't have internet access so that's my audiobook time and I thought you know what would be really cool listen to me on Tick Tock for the podcasts so they're like 30 minutes and 30 seconds. Snippets and they just pipe in as a bunch of 30 second snippets that I would like to download properly, so it would be like an hour of 30 second snippets or something like that, and if I don't like a snippet, yeah, yeah, if I don't like it like.

I like the snippet, I just tap the side of my airpods or whatever I watch with wired headphones, but if I was using airpods this would be cool, it holds the case like, tap this to take it off my airpods, go to the next snippet of 30 seconds and I say. Wow, this is crazy, like my attention span is getting so small. I saw a tweet the other day and I retweeted it because it was like we need shorter podcasts and I thought, yeah, yeah, I love podcasts that are 30 minutes and under. how long is my purchase, if I go for a run it's probably around 30 minutes, that's a sweet spot for me, and then for YouTube videos it's probably around 10 minutes for me I think.

I get a lot of good content out of a 10 minute video, anything longer, I would go to Hulu or Netflix, at that point you know, I prefer to watch it as a documentary or something, obviously there are exceptions, like commentary videos, where again. I'd like to get up and walk around my house like it's clean or something, but for videos I just sit and watch my attention span is 10 minutes on YouTube, that's a good point along the way because I have friends here like in the film industry and everything, and just like even quick cuts and movies are getting shorter again to help you, yes, attention, it's also like I saw an author talk on Twitter recently, you know you're not competing with other books . compete with all types of media, which has always been true, but as this media landscape gets bigger and democratizes and involves everyone, like all users online, if you are a public user and you post to your creator or whatever, it's like overuse. word, but like you're competing with all these media, you're not just competing with books like it's affecting everything, how do you think that's going to affect the economy of creators in the future or creators as a whole, like you said in the industry of cinema?

We've seen it affect things like jump cuts. Do you think a shorter attention span will affect creators well? I think it just goes back to what we're saying: people need to adapt to serve the masses now that they have it. To cater to people who only want short-form content, of course there will still be people who want to use long-form content for a wide variety of reasons, but yes, creators need to get used to being more concise in their messages and, with good luck doing it. However, that doesn't take away because of course they're in a longer form, there's a lot more nuance, and therefore when there's more nuance, there's more value, so people have to become great storytellers, yes, so that it resonates in some way. that's healthy for humanity, yes, no, you've also seen this impact on things like writing.

I use the Hemingway app, which is like a platform that you can use on your computer and it basically teaches you how to write like Hemingway, who is really famous for writing short, sweet, pithy things, um, and it's kind of like grammatically making that keep your stuff really short and to the point, I totally recommend that if people are trying to write like a newsletter, maybe um, and I'm like, well, this is kind of like that. Crazy like trying to write things super clear and concise compared to how we were taught in school to try to do creative writing classes like word count, yeah I exactly hit a word count and I wonder how times have changed like I.

It's like they really need to stop teaching kids to reach the sports count and do a lot of this creative writing, so true because, oh, I only took writing classes in college even though I was like a major and It was like, you know. What would have been great as a writing class for a major is learning how to write these short, concise pieces because now creative writing hasn't helped me, that hasn't helped me at all, no one cares what color this guy is. What is happening with Netflix? You know what I mean, yeah, and the creator economy just showed the kind of messages that attract people.

You know, people who took over the writing spaces and just the media spaces before, where you know, the highly educated had. I've gone to certain schools and I like the kind of language that a lot of people use in different books and it's all like it's not appealing to the masses and it's not easily understood by the average person. There's also an element there, like how concise you can make it. in a way that is not simplifying the information, it is simply humanizing this information again so that as many people as possible feel compelled to use it so that these algorithms can collect it and show it to their ideal audience like well, it's all strange, it's funny how we're seeing this as well in all different types of industries, I already mentioned, I love axios and now that we're talking about it, one of the reasons I really like them, um.

It's all like a bullet point format, so for example, one of their newsletters that I love is called Prorata and it shows me all the recent VC raises that happened that you know like that day and they're all done just in bullet points. . and it's like this company raised so much money led by this person and it tells me everything I need to know in two or three sentences and that's it for me, I love that and I wonder if that will carry over to other things. which we see as books because I read a lot of audiobooks, I listen to them at double speed, so I guess if I'm not listening at double speed, it's definitely still sped up.

I rarely listen to an audiobook that isn't sped up. um, but I guess that already makes it a little more established, so my brain is kind of keeping up, but for a book like one that I'm physically holding, um, I don't read them on an iPad. They tend to read them simply with paper and they imitate all that takes a long time and I'm reading a book right now I think it's called books there it's like an application it's called The Confidence Game but it's In fact, it took me that way. Emma Walsh's rapper is my favorite but he took me a long time to get over the first one and I don't mind at all.

It's a really good book. I highly recommend him, but he's probably taking me. a week to finish the first part well, which is a long time compared to how I'm reading audiobooks at full speed and that's interesting, it's almost strange because the books have chapters, yes, like YouTube in the podcast has like everyone marks right chapters, yeah, yeah, it's like books have chapters, but it's like when it comes to fiction books, it's like you can't just read a certain chapter, I mean, you can't skip, yeah, and when it comes to of non-fiction kindness, yes, like me.

I don't know, history isn't always very important, but it's interesting, I bet you, and this is like looking into the future. I bet you there will be if this doesn't already exist, basically like a spark, but still. in written format for people like me who still like to read just tweets, you know, yeah, basically a book, be like, yeah, this is Pride and Prejudice, but only as a 10-page version of Pride and Prejudice, like this That's what happens, yes. like a threatened tweet like a cover of classic books and I wouldn't be surprised at all if that happened and maybe not for a book like you're reading it for the craft of writing because there's something to be said about reading a book. for the craft of writing, which I totally understand and respect.

I know writers, yeah, so, I totally understand the craft of writing and, um, but I mean more informative books tend to be what I read. It's not me. I'm not a big um unless it's like a science fiction book. I don't know if I would have actually read a sci-fi book that's been tweeted about, but informative books bythose I talk to here like to force it like that can't be that far away like there's no way, that's why every like video is the future, it's such a big message because yes, at the end of the day it keeps you visually stimulated and yeah, obviously, psychologically when you're learning everything and it's kind of weird that people have to learn how to navigate videos, even if they're writers or something, it's the main way to communicate across platforms right now, everyone's trying to catch up. its peak in video and, um, The company I work with is often descriptive.

I love g-script. I love the stats about, like by 2030, how many hours a day we'll be watching or immersed in a video, it's literally like it's only 24 hours, like Tick Tock. Like, the app that does this best is because you need to scroll through it, um, so it's not necessary. I guess you can probably just, oh no, them. Loop, if you keep it on, you have to hover over it, so you need to. to see the app, you have to hold it, you have to hold it, it really engages you in every way, and it's funny, like everyone wants the most condensed version that gives you the full picture, in the quickest way possible, and we've been watching this very efficiently in agencies, yes, with journalism, where, um, the increase in this is like a culture of edit first and then, where even people publish Cycles news on the Internet and, although it may not be the whole story or the accurate information they just want to be the first to post it and then once more information comes out they can edit it later and there are a ton of different news sources um talk about this.

I know Ryan Holiday has written a book where he's gone over this incredibly, so he's like just go, there's no time for reflection or Loneliness and then it's like you're saying these new sources that are publishing things is like if they were just posting them to be part of the attention and have something available to click and, but like, the information lacks value and Nuances because yeah, you just confronted these things with posts like likes and people commented before like oh, you're late to things, oh, when it's like 48 hours later, yeah, because I wasn't posting about something within the first 12 hours because, like you.

I can't do a rigorous analysis of a topic or a current event in such a short time, like if you post something within the first 12 to 24 hours, it's a big emotion, yeah, a reaction, you can, well, there's a goal. report like okay, what happened, yes, okay, like an objective report, but if you are, you can't make subjective reports that are diligent in such a short time, yes, important, the vast majority of topics, yes, I'm I completely agree with you and I do. Do you think that's going to affect the way young people, our generation in particular, watch the news because I know that's something we're both very interested in, like the latest tech news?

Obviously a big part of our podcast is about that, how? Do you think we will be Our Generation in 10 or 20 years? We will consume news. Well, I think our generation right now is like I have a lot of positive things to say about our generation, but I don't have the words reactionary, reactive, like just. like there's too much emotion online right now and it's called causing a lot of polarization and like I'm just polarization, just like easy bullying and all because people don't care about context, they care about how this information is mimicked to them. on the internet and I like how entertaining it is, everyone is looking at things through an entertainment lens right now which is disgusting but it's getting so extreme that I think we'll slowly see a peak soon and then like a 180 people. being like that is not sustainable and this is terrible for my health, mental health is terrible for the humanities, health, um, but right now we are seeing that as extreme in entertainment and mimicking everything, it's just that yes, I even think that the people are a bit like that.

They're older than us and they have kids, they're starting to see this style of parenting where they take their kids to maybe this was also partly during the pandemic and people have the ability to leave super condensed areas and live in more remote areas. , but I've seen my friends who are a little older than me, my age, have kids and then say, yeah, we don't want our kids to like technology like we do and I'm like, wow, this is really interesting because Now it's like we're the generation that's having the social guinea pig effects, yeah that's super scary and hopefully in the next 10 to 20 years like we're talking about we'll still be putting information online but I don't know if necessarily it will be in the form of likes for you, short form content on Tick Tock, for me, longer form content in podcasting.

I bet you it will be something like the new one we have. It hasn't been seen before and I'm a little excited to see what it will be like. Definitely what the next level of all of this is is interesting, yes it feels like it's an immersive side of things and immersive technology like AI is democratizing a lot, but then it's expensive to get involved in this more immersive technology so I think we've seen a discussion about independent creators in the last three years like, oh, this growth of creators and independence, blah, blah, but I can easily see it. like when things are expensive, like when the power comes back to the big players in the game and they like the institutions because they have the money to support people to thrive in these spaces, so that's another interesting part of the media right now because they're really democratized right now. because, like Tick Tock, you just film on your phone, you can post it and it can be super casual, but like these immersive things that are a much more intense production.

I also see creators like you said now, it's as easy as the barrier to entry. it's pretty low, but within a few years I can see them becoming agencies that own certain things, like there's also Axel Weber, a tick tocker who was accused of this. I think he comes from an agency like tick tocker. and almost like they're jilted, but basically I think Disney kids like how our generation had Miley Cyrus, uh, Selena Gomez, like those people, like Disney employees, yeah, they have Tick Tock employees and creators like They come to the app and they own it. under an agency, obviously, they would get paid a lot less, but at least it would be a consistent job, maybe they could have benefits, yeah, and I took the state capacity on them, yeah, yeah, I think, uh, I think that's the next level of children's acting. no, my bloggers, it's not like, uh, Charlie Demilio likes to dance on the screen, yeah, it's like agency-backed kids on Tick Tock, so Tick Tock Clubhouse, yeah, Mickey Mouse Clubhouse, oh my god, no should be confused with audio applications, yes, exactly what I am.

Talking about Britney Spears, Justin Timberlake, more and more part of Mickey Mouse Clubhouse, I can see it now as a tick tock or whatever, the social media platform is Clubhouse and that's scary, that's terrifying, that makes me a little nervous , there's a lot. There's a lot of talk about sharing right now, although I don't really like knowing what the two words are together, but it's like sharing and parenting, yeah, like oversharing, yeah, um. I think we'll soon see a law about children on social media, which is I don't even think it's obvious, yeah, to what extent they will be because it gets into the conversations that we talk about, we're talking off camera, but how do we do it? , you do not need to have consent to record people. in public, but now there's this conversation about what you have consent to broadcast and then the way you like the news and people on TV have to have waiver forms signed by the people who appear in the media, like that's keep going. to social media because right now these viral content platforms as if there are strangers again being mimed and criticized on the Internet who were not asked to do it too and that comes back to the question of the search for actions as if these children They wouldn't like it.

They dance whatever, but they have no say in what is published about them online, they don't understand what a fingerprint is and I don't think any of us understand the weight yet until we talk about something like we talked about in our latest podcast. Something bad happens and you have a wake-up call for everyone and you like the value of our data and the value of our digital footprint. Yeah, it's going to be really scary to think about, but I hope so. I thought okay, dad hit a real negative and scary note, Jules, thank you so much for talking to me today.

I think this is a really good conversation to talk about where we might go in the future and as I say quite often, while I love having online friendships in real life, for me it's definitely the That's right, I know this isn't It's your thing, but I hope we can do it again soon. I enjoyed it, thanks Rachel, amazing, thanks guys, bye, thanks.