How Shopify’s Tobi Lütke Works | David Senra

In a lot of ways, like take the social angle. A lot of companies are social technology in the sense that they allow us to go all in. The only time you're really allowed to spend, I'm going to say eight because that's the right number to say, really like 14 hours a day, just singularly pursuing a thing, is like we want kids to spend this time in school and that's okay, and then university you dedicate yourself. Other than that, you can't just not have a job and be really into things. It's socially not acceptable. So company building turns out to be the perfect excuse. Once you call it a company, it's not like tinkering around anymore with your ideas and you get to explore things. What a company fundamentally allows you to do is just run the counterfactual to the world you see around you. You get to try to build the thing that you think ought to be there and then you means test it against the market. And if a market agrees with you that this thing needs to exist, it moves energy in the form of money back to you so you can do more of the thing that you were pursuing all along. And not only that, it's self-financing. Like if you find out, again, I started a company which I didn't think was going to have this very big market, and along the way the market pulled Shopify out of the project I started. Essentially, that's an incredible intelligence to tap into. So you put all these things together and you say, well, look, the concept of companies is not old. We're on a 500-year run. The modern company is not that old. I find that if you take that mindset that companies are just a path-dependent solution to a social and somewhat legal problem, they allow thousands of people to join your project and it's called a job, and therefore everyone accepts this. Obviously you can make money, so it's a good deal. And then you can figure out if this counterfactual of yours might be correct or needs updating along the way. And at the end of the day, if you are lucky, you work with other people who are really all in and inspiring and taking it further than you. I just marvel at the institution of a company because if it wouldn't exist for some reason and someone would propose the whole idea now, it would sound insane. From first principles, none of this makes sense really.

Yes. Including mine, which you said, and you know that's hilarious when somebody you're running a 200 billion plus dollar company and you think that in the next 20 years we're going to look back at what we were doing at this point and be embarrassed by what we were doing.

Because it's like everything else. I'm sure when you listen to your first podcast, you're like, 'Oh my god, please don't.' But honestly, this should be seen as the most joyous of moments. You should actually do it if you haven't done it.

Okay, good. Because the difference between that and what you would do today is your progress, right? And as a computer programmer, I experience this all the time. I looked at old code and was like, 'What the hell? This is terrible. Why would I do this? This is way too abstract and complex.' And then I made better because I now have the skills to do so. And one of the saddest days of my life was when I opened old code and was like really impressed with how good it was. That's really, really sad, the saddest day of my life, because I'm like, holy, the implication of this just hit me like a train.

Exactly. It figures because I wasn't programming all day, I was trying to build a company instead, which honestly is very, very similar.

Yeah. Here's what I'm observing. I read a lot of books. I try to figure out, I think if you don't read books, you live a lifetime. If you read books, you live a thousand. Right?

It tracks, doesn't it?

Absolutely. I mean, you know, P is supposed to agree with me, but I really think we need to shout this more from a rooftop. The one weird trick seems to be just read books. It kind of doesn't matter. Just make a habit of reading books and ideally change every three books or so at least for one book, and that alone will give you a range that you can draw on for basically everything you'll ever do. So I read lots of books, lots of them. Especially when I went from programmer to a business, realizing I have to just learn business really quick. I got really dismayed with the quality of business books pretty quickly because frankly I think the business books are largely written by the people who have time, not the people who actually build companies. So you read between the lines as well. If a person who started a company or person writing a book is a salesperson, every problem can be solved with sales. If a person is a marketer, clearly every problem can be solved with marketing. At least that I can take away as a trap to not fall into. So I was determined to not be the engineering type founder who is going to see everything as an engineering problem because that would be called blindness and this would cap my capabilities. So I really tried everything and learning just how to build the team in such a way that I delegate everything and I have my different business lines and arrange things. This is sort of after the IPO and I realized I have to be a very serious public company CEO and so it almost killed the company honestly.

It was actually COVID that saved it at this point. I had the inclinations that something was really, really going poorly. It was a time we didn't have a lot of competition, which is also really, really hard for businesses. It's not a good thing at all because you don't have good rivalry and you can't sort of like even if something seems really good, you don't know because there's no one else to keep you honest about it.

I mean it's the same but it depends. It's a mindset change. If you compete with another company, there's a lot of 'we need also a version of what they have,' copying, you do the Xerox strategy very quickly. Companies tend to get obsessed. There's companies which have the most active channel in their Slack is a competitive analysis channel where people just bring everything everyone else is doing. And I think while that has some merit, the problem is it makes companies very reactionary. In the arts, part of everyone's art studies is early fine arts. You copy the great pieces, copies of great works. Your next painting is not at the quality of a Van Gogh. You just copy it. Mimicry is actually not an excellent way of getting to excellence. And companies end up falling very much into this. Whereas if you treat other companies in your space as rivals, it's much easier to have a positive sum outcome there because rivalries inspire you to be best. Like Agassi could not have been Agassi without Sampras being there. And he very clearly states this in his book. The Sampras that existed during the Agassi era that Agassi understood wasn't a real person. When you read Sampras's biography, he just liked tennis.

Agassi hated it. And so the rivalry he created for himself created him in a very real way. In The Last Dance, which I loved, Michael Jordan admits that he might have made up this slight at some point, which to me is one of the most profound moments.

Interesting. Hip-hop history is incredibly entrepreneurial. We just recorded with Jimmy Iovine for the documentary two days ago or whatever, I don't even know what day it is. And that's exactly what he said. They understood the business of music before anybody else.

We actually see it from inside. It was the first category of music that just killed it on Shopify. It's like opportunities converted into products like that. And it's a beautiful thing about Shopify, a front row seat to just seeing how high agency the different industries are and how quick they absorb new ideas. It's a different topic but...

It's like millions, right?

I'll be a cosplay public company CEO, like a 60-year-old guy in a suit. That's sort of what everyone emulates for whatever reason. And it just worked really poorly for me from a product perspective. The company did fine right all the way through. COVID happened though and I'm like, okay, so what my company needs here for me is five different things. One of them is all plans are invalidated fundamentally. Everyone who has a plan, just please throw it out. We need to go and re-derive everything we're doing because again, everything is based on a very long tree. You start with axioms and then you make a huge amount of decisions on top and then you get to a conclusion and that means this is how you spend your day-to-day building this thing because of these things. If any variable along this way is invalidated, what you should be doing is re-derive the entire thing on top. You should always prune back the decision tree all the way there and go forward. People not being able to go out of their houses, it's one of those things. I don't think we all knew that was a core assumption we had, that people could just freely move around in the world. But we got told that we can't do this anymore and it ended up being quite long during COVID, at least in California and Canada and some places. So we need to rewrite everything and that was kind of clear to me. That's how you structure a computer program frankly. I went through the entire roadmap and what I figured out is first of all that was really, really hard to get and people were fighting, even very much resisting talking about everything that's going on. And I found out why because there's just a lot of boondoggles going on there, just like random projects by random people that I would never found out about.

Because the company was like let's say 4,000 or 5,000 people, it's quite distributed. We started in Ottawa, Canada. We had like a Toronto office and Montreal office and so on. And so it just turned out that in the Toronto office there was a fairly big project to build features to add to Shopify so you could use it for running a supermarket. Because they decided that the supermarket industry is very large and we should go and capture 1% of it, like the Dilbert comic. And frankly, I'm not saying those are wrong decisions. The really surprising thing about building a business or just in decision-making in general is that making the right decision is actually child's play usually. You can make wrong calls which end up because of world changes being the wrong call later, that's a different thing. But most of the bad options in front of you just prune themselves away. They just don't make sense. They're too expensive or off mission or whatever. The problem is, and I think school unfortunately accidentally drills this into people, is that there's one right answer is sort of what people think. And once they find a right answer that could plausibly accomplish the goals that they set out, they go with it. But there's probably hundreds of great answers and one of them is far less work, far more modular. Especially in an engineering project, the best solutions are always modular and components. You build one thing and it will work with everything else you did. Lots of the bad software that people use are things where none of the pieces fit together and a huge amount of code has to be written to extend the new thing to make it usable from everything else. I'm not going to bore you with those kind of details. But if you look at the project brief, the team killed it. Probably everyone made their bonus. They delivered the thing. It's just an island upon itself. And after it's delivered, nothing else in a product works.

I was trust falling. I was like saying, okay cool, you seem passionate and you seem to know what you're doing. I trust you to do the right thing. And when I hear, obviously we're going to keep talking, you give me updates on things. People learned pretty quickly what are the projects that I'm interested in, told me about those and nothing else. People learned how to direct my attention to the things that they wanted to have my attention.

The moment I went through absolutely every project, I did it myself. Took like many 16-hour days. I canceled probably 60% of the projects and over the course of a year I turned over every one of my executives. This is basically the consequence of this because I just realized that in many cases the core skill was, well, I don't want to be unfair, it's just that trust was broken in many cases. And in a real crisis, like COVID, again COVID was hard, hard, hardest time of my life for sure. In a crisis, if everyone is a one, before some people go to zero, in a crisis some people go to 100. And I found it's almost unpredictable. In fact, if I would have been betting before COVID about who's going to be contributing the most, I would have been wrong I think entirely.

I have been thinking about it for a long time and I still haven't gotten a good answer. I don't think they would have known. This is the interesting thing. I think a real crisis tests you in a way that nothing else does. And nothing prepares you for it. I think at the end of the day the thing that I have found is people who can adapt the fastest actually quite self-identify. Now I would be able to predict it very simply: have you started a company before? So Shopify is by a founder, by founders, for founders, causing more founders. It's a celebration of entrepreneurship. We believe entrepreneurship is glorious and people who reach for heroes and doing modern-day heroics go on a hero's journey with lots of naysayers, overcome incredible odds and lots and lots of headwinds. That conviction runs really deep. Sometimes you buy companies, of course. Many of the people we purchased are still at Shopify. People don't stay for a very long time because I think it's such a place for founders and for high-agency people. So I always had a Slack channel with all the founders of our companies that we purchased. I always did a founder offsite with them once a year. They're just, I find their advice just to be so good. They all have been responsible for people's livelihoods and that changes you. So I went to the founders channel and said, guys, I need help. This place is crazy here.

Yeah, once I realized that. And it wasn't like one moment. It was just like...

I think at a moment of like, where do I go? Who do I have most in common with and who can actually relate to the types of problems here? Because again, my relationship to Shopify is different, right? I started it. It's just different from everyone else. But the second best thing is talk to people who have had this type of relationship with the thing they created. I asked a lot of the founders to become my executives. In some cases, I took people from individual contributors in an engineering team and put them in charge of a very large thing. You know what, every one of those things worked and it was really remarkable because it really fed into an intuition I had anyway. And what I found is during COVID, the founders of companies were actually not doing well because they were similarly managed. They were like irritants.

They don't settle. They talk about absolutes. If something is wrong, they say so. It doesn't matter if everyone has agreed to move on or something. It just gnaws on them in a way that's deeper than this other thing.

Exactly. And so I feel like this is a very special thing. And companies reject it. Companies cocoon them. Sometimes they find such out they give outskirts like the skunkworks team. It's like daycare for people who otherwise tell you that your stuff doesn't smell right. And it does smell. So once I'm like, no, you don't get to put them in founder daycare. I'm going to put them right in front of you, in fact on top of you. And so the difference that made to this business is nuts. And so this is why I'm saying COVID saved Shopify because I needed to take a move that was like very much, okay, I built this company, I got to this point, it's important, it's actually maybe even more important during COVID than before because it was kind of like for millions of small businesses their livelihood for this time and only way to make a livelihood. And I'm super proud of what we did because I think the businesses that started, came early, actually grew and did better doing it.

Which is the craziest thing. If a business has ever raised their customers like that started on the platform, it's the greatest. I love this thing. And so I mean again, they're fantastic. They're heroes. They're glorious. They're wonderfully discontent. My customers have the same irritation with my software and they tell me it's like, it's perfect, right? It's exactly what I want. And so this was one of those moments saying, you know what, Toby, maybe you didn't build Shopify completely by accident and your intuition might have been actually helpful and cosplaying someone else is probably not what you need to do.

15 years now, yeah, about.

Trust your gut is sometimes good advice but it really depends on your gut. No one is born with intuition for building businesses because first of all building a business is completely, every decade is different. Some problems are persistent. Like I laughed, I listened to I think the episode you did on Larry Ellison. You were describing his frustration with problems in his sales team which literally I had to, it's like, you know what, I didn't actually live, I have to live that horror. I could have actually, if I would have read the right...

But that's the amazing part. I'm glad you just picked that up because he's like, I'm embarrassed. He's like, I'm 40-something years old, I've been running this company forever and I didn't understand the incentives with my sales team mattered and they almost destroyed his company.

Yeah.

Yeah.

I was like, okay, I need to try something. You have to do things differently systematically. Obviously, if you do the same thing, you get the same results. Differentiation requires new ideas. Instead of spending the next 10 years of my life figuring out how well I can cosplay someone else, what would a company look like if it just taps entirely into my intuitions and my biases? I'm doing literally the opposite now as I did before because this didn't work. So maybe the opposite works and worst case I triangulate the midpoint between those things. So enabled by the very clear, fast and obvious success of asking people from this channel to step up and run the company with me, my real set of intuitions here, again, intuition is your entire life's story rolled out for you to make a snap decision in a moment. What does my intuition say about what a company actually should look like? Let's forget about the path dependence. Let's go full tabula rasa and go up from axioms. And I started with really, really, really nothing. I started a project on GitHub literally. Engineering tools, my intuitions, again, what is the first principle of a company? What are the inputs? What are our decisions? Put in config files. What titles exist? What levels exist? How, you know, I asked for all the sales compensation data, all the market data and put them into the repository. I turned them into machine-readable build files because they got them as PDFs and so on. So I built a thing that then created, at the end I had all the information to create a model of a company. Literally this is Python code which takes configuration files that we agreed on, things like how many people should report to a manager, all these bits, and then computes them using something called a solver, like a set solver specifically. And then with all these constraints, all these imports, what should Shopify look like? What departments exist? What levels exist? How many people are there in which group and everything. And of course the first version was very utterly incorrect and then I realized...

I started it and then I got like two, three other people in it to help me with this and really, really got into it. And so this is called Shopify OS. This Shopify operating system is a really large part of Shopify. What it did is it became irrefutable that we didn't know all the principles. We had something, there was 8,000 people in the company and there was 5,500 different titles in the company. And so in some of them I was just senior and senior staff, but in some groups senior staff was lower than director and some above. And it just, when I tried to make something software-addressable and try to reproduce it, it showed every crazy, unviable choice in the company very, very easily. So there's a system in engineering, not actually a well-understood part, but I think it should be, called desired state systems. And what desired state systems are is it's a thing where you say, okay, here's what should be. You hold that up to what is. Like you click on a website on a link and your React library behind it, what it does is it says, okay, I compute what it should be. I see what it is and now I figure out what is the minimum amount of steps I take to get this to that and that's what you see on the web browser. I need a desired state system for this company. So we have this model, we create it and then we hold it up to the company and the job of HR is to be this reconciler, like how do you take the minimum steps to get from here to there or change what we have in this system to approximate what we actually want. So this is very technical. Here's the effect of it. Think about how much politics this removes. Then Mike, head of sales, comes to me and says, 'Hey, I need 50 new salespeople.' I can put this now into the system and it says, well, that means you have to either make these changes or you're going to lose some of your engineers because the system based on our agreements recomputes everything. So we can always look at the counterfactual and then it's not like, yes boss agreed while playing golf to hire 50 more salespeople and now someone has to carve, you have to find a pound of flesh somewhere in the engineering team and suddenly you don't actually work on innovation anymore because you never actually made the decision to not hire engineers because your budget doesn't allow anymore. But you did make the decision to hire salespeople and maybe this is the right decision but now we can actually look at the consequences of every one of those things. So it was hugely successful because it just created such legibility for us and such simplicity. It also just told us that so much was undecided. Like for instance, we took the concept of, in engineering this was already around, individual contributors is a really, really excellent career track. You can make as much money in good companies as an individual contributor as you can as a VP or manager. The best paid people in many companies are now individual contributors at this point in history, especially in machine learning, like at least in the machine learning labs like OpenAI. But no other discipline really had that. You had to become a manager to progress in your career. And so I think one of the consequences was that then I really looked at it like, hey, I need more great engineers. The best place to recruit them from was my own management team. And that seems silly and especially because are they actually great managers? They're really well respected because they're good engineers. So maybe, but don't they want to code? And so we created this sort of mastery system we call it where every job has this ability to stay, you can get these basically level upgrades frequently and at any set of responsibilities, if you're insanely good at it, you can make lots of money. And that just seems like of course you design it like this, why would you not?

Yeah. Like take an example in engineering, if you're 100 times better than other people in this discipline usually, you can make more money than a vice president. Now that depends on the value you can bring, but it is possible. And I kind of hated the way we did compensation in the industry. Again, these are boring topics and you just...

What I love about entrepreneurship is the level of personal responsibility people take. I said as much earlier when we talked about the founders who have been responsible for people's livelihoods, it changes you. It does. I don't work myself well in an environment where everything is predescribed. I don't like joining other people's games. All these kind of things are my biases and again we're implementing my biases here. So in COVID, this is 2022 I think or '21, suddenly Shopify went down 80% of stock value. That's a, again, I didn't think that was a problem because I think the stock market is basically like Polymarket, it's sort of a betting market on the future value. It's not like, you guys are wrong then you're just bad at betting. In fact, I work on a real market value of a company which you guys are betting on but I even don't know. So there's such a discrepancy from the way I see people talk about stock price and how I or have ever or inside of companies perceived it.

Well, in my head I'm relieved because I'm like, you know, I mean where the stock...

Yeah. Yeah. Of course. Because...

I was not about to raise money. I had enough money in the bank. I'm, you know, German, so I don't pay debt much and so on.

The unit economics are amazing. However, I don't want to say this right, but I honestly don't remember the exact numbers. Like at the high point of our stock price, I think we were trading at beyond 50x of revenue and stuff like this. I'm like, yeah, that's not exactly value investing here, right guys? And so, I get it like...

No, but like when it is 50 times revenue, I see it as my obligation to do that.

Right. My job is to build the best company I can. The betting market says that I can deliver that kind of thing. And I'm like, yeah, maybe, but you got to give me a moment here. I need a moment here for doing this.

That really tracks. And so but one of the effects was, and this is right, well people got stock options at...

Even if you say, 'Okay, well, I'm super game here to get us back there,' this is going to take doing. I realized the psychological problem with everyone being so underwater and having to spend years getting to basically the zero point where the stock options are worth even a penny again. And of course they were like, 'Well, but that's the company. The company gave me those things at the time. I received them. I was passive in this interaction. Therefore the company has some kind of responsibility to kind of make me whole here.' And I think that's actually, you know, I not necessarily see it this way because the risk was there and these kind of things. And again, it's other people voting that's causing this price. I didn't set it. However, I do receive a point like they had no agency in the process. So we rebuilt our compensation system to completely work the opposite of what everyone else's does. We give people, 'Here's your annual salary. Here's an internal system. You go in, you look at it. This is a number. Now you get sliders. You can say how much do you want in stock? How many do you want in RSUs? How much of this do you want in shop cash actually? And how much do you want in cash?' And you can change that every quarter. It's like you decide how much money you want. And you can even use a tool that's there to lock in the value of the stock you receive for three years. Like it's, again, sometimes orthodoxy can come back on the table if you get there from good principles. Like you can actually join Shopify and get exactly the same stock option deal that companies get at other places by using the tool we give you. But you have full agency and you make this choice. The consequence of this compensation system is kind of beautiful because what happens is first of all it's super predictable. Second, you know, if you go stock and the stock appreciates and you hold them, you make more money. If the stock goes down, you now get more stock options in your next quarter. So it's rebalanced against the actual value every quarter. So it works really, really well. It's very popular. It was kind of hard to do because doing this worldwide with people in many different countries was like kind of a legal nightmare because there's all sorts of rules around changing of salaries. We figured it all out. So we have a blueprint of how people want to do it. Works really well for us. But we're kind of proud of it because it's just, again, it's a point of differentiation and we believe it works much better. And again, I want people at the company to also feel like this is a company that is never sleepwalks into anything, right? We are deliberate about things.

No, it was already there. That was a 2020, early '21 project I think. And then I think the stock market, when did that change? Like '21 late. Some of these years are totally running together for me because it just was, I mean, there was no weekends, there was no...

Yeah. And he's just like, 'Man, you're going to remember the beginning of your company, you're going to remember the end, and like so much in the middle is going to...' He said exactly what you said. It just like blurs together. Yeah.

I totally agree. Lots of years are totally running together. I have reasonable record keeping on this. And especially with all this AI agentic like reprocessing of notes and press and so on, you can actually reconstruct these histories and timelines. And I'm fascinated with this right now.

That's right. So I'm like, let's engineer a company, be a company engineer. I told my team...

Everything. I require my executives to, I mean at least tell me, but actually do it, go to a podcast, some international conference and talk about how Shopify does the thing the conference is about differently and why that's better every year. If they don't have a good answer for how they're doing this right now or how they would, that's what I'm working on with them to crystallize that message. And there's a couple of reasons why I do it this particular way that we can get into that are partly psychological but like it's also...

It's, I study the brain quite a bit and you know the main conclusion you get to about the brain is really that the brain is a retrospective narrative alignment mechanism. It's actually terrible record keeping but it mostly attempts to take the most salient version of our self identity and reconcile the history with it. And it sort of rewards you for actions that are directly congruent with this identity and it dissuades you from dissonance with your own identity. But you can actually change your identity quite a bit and that actually makes this whole process work for you significantly.

Literally affirmations work, right? Like affirmations work, which is the dumbest trick that works.

I'm a toolmaker. Like I always project very idealistic, but I'm actually not that idealistic. I'm super, I'm like a crafts person toolmaker person. My entire life was making tools. Literally my pro, my pro, I chair as a tool. I make tools very often for tool makers. My hobby is making tools for engineers who are people who make tools, right? So like it's a fractal, my life's a fractal of tool making. It's all about tool making aesthetics. It's all about the craft behind it. But also not because of craft for its own sake although I appreciate that too but even that's not for idealistic reasons because appreciating the craft behind the tool making happens to be pragmatically an excellent way to get really good at pruning. Like everything is about outcomes.

The affirmation that like you are, if you tell yourself or write down a hundred times something about yourself, that writes it into the neocortex at such a deep level that your brain will start reconciling you to that. It just works. I've used that very often to, like, I was terrified of public speaking until I just sat down for like a week and every day I spent like 10 minutes just writing that I like public speaking. I love public speaking.

I know. Yes.

Yeah. Like, and a week later, and I knew it's not, this works when you know what you're doing, right? Like you don't even, it's not like a placebo. It's actually like you just actively change your prefrontal cortex in this moment. So I use this often. I sort of write to myself message in a bottle and these kind of things. That's all of a different topic, but like, so the point is like I tell...

Yeah.

No, it's just like generally when I feel like something is like, hey, there's something I figured out that I really like and now I have to write a scheduled message to myself to remember it because like I need space to repetition on the idea.

I mean for instance like we have a company keynote, like kind of thing, like a company get together summit once a year in Toronto for a week. And so usually I did a keynote there and like then I write a message in a bottle to myself of what was good about the process, what was bad about the process, what to do next differently and all the topics I left on the cutting board just so like to get a head start. So that's a random example of that.

I think trial and error, but like I think the hints are like everywhere, right? Like it's, I mean affirmations are one of those things that like, I mean there's a reason why we like, society creates rituals, right? Because rituals end up being largely affirmations on repeat, right?

Like so manifestation, these kind of things, I probably books too. You know what the funny thing? I think everything works. If you just do it. The question is what's effective and quick.

And it's parallel construction. They all come to the same conclusions in different words and so...

I'm personally, I mean in the, in the Stoics department, I'm extremely taken with the Stoic philosophy. Control what is under your control, know what is, and then do the best possible job. It's the job is the thing. Like the whole project in life is just try to become very, very good at something and ideally cultivate some significant skill, create potentially service or products and then share them with as many people, right? Like you do this because that's what you're on the planet for, right? Like it's like do things that matter in the world that are under your control, but also sign yourself up for like, it's okay to sign yourself up for most interesting places as long as you remember what your job is within them. So in this way like I love the current times and I love the technology industry. I have a role inside of it which is like I'm taking care of millions of entrepreneurs and small businesses that you know are trying to use the word of technology, use word of retail through their own work then that's actualized and that is a worthy goal and worthy job. And so like you know AI comes out and I'm like people are like, 'Well should I start an AI lab or whatever or should I like, don't you want to work at OpenAI?' And it's like I mean everything would be a stream. But you know what? What's really cool? Pursuing the same problem in a changing landscape, right? Like now I get to reinvent everything I've already done. How fun is that, right? Because I really care about these problems. Anyway, back to the affirmations and sort of the brain sort of self-gymnastics. Going to my team and just saying look, you know, just tell me what you will talk about on stage is bad. It's like afterwards you need to internalize this as something that you have committed to me as imagining I imagine that's something they care about, they care about reconciling and so they have to do it, you know, because otherwise they, you know, said something untrue to me, right? And like they don't see themselves as someone who says untrue things and therefore, you know, you can actually make the reconciliation work for your own benefit in this kind of way. It also just means like it emphasizes like difference. Like difference is so important. It's so like orthodoxy just really needs to be off the table from the beginning of a project or like from the beginning of decision-making.

Not if I could only recommend one book ever, it's his first autobiography. But one of, he has a crazy line about this. So this is also very common with great entrepreneurs and you hit on other talks like, 'Well if you want to, I'm trying to chase excellence, trying to be the best in the world or make the best tools possible, like therefore that demands difference. That path, that mission I'm on, I can't do it. Literally, it can't be the best if it's the same.' Yeah.

And so like Edwin Land who Steve Jobs hero and the founder of Polaroid, he had a personal motto. He says, 'My personal motto is very personal and it may not work for you,' but he said it is, 'Don't do anything that somebody else can do.' He just would not, he, 'I'm not making a me-too product.' But the reason I bring up Dyson because now he owns one of the most valuable privately held companies in the world, right? But he's writing that book when the business was fine, but he had one product in like one or two markets. He was doing like 300 million a year of revenue, not a bad business, but a very small business compared to the size that it compounded to over the next like four decades or three decades. And he says in that book, even at that time, he's like, 'Differentiation and retention of total control.' And he goes, 'You make it different even if it's worse.'

That's one of the craziest sentences I've ever read.

Completely agree. I see it all the time because again it gets back into the copying of a painting problem. Like you can make a seven out of ten solution to everything by copying the seven out of ten that's already out there in the market. But if you make from first principles your own version of it, you have mastery over it. Even if this is a six out of ten, you can iterate on this. You can take this past the seven afterwards. Like so very often especially in technology, the world belongs to the fast, the people who iterate, the people who like adjust, the people who understand what's costly and what's unnecessary and will prune away the rest. And I find actually probably net like pixel for pixel the most inspiring picture that I think exists that I've ever come across is the SpaceX Raptor rocket evolution. Like have you, do you know...

That's perfect, exactly, it's perfect, right? Like you look at this and like yeah, that's today's Picasso, right? Like it's just like this is it. Like we're not in a point of time where the great works and the masterpieces are being done by one person, they are done by teams. Very few teams can move forward by subtraction. That does not exist in industry usually, very, very, very rare. So it's beautiful in that way. You have to do things different, you have to make them your own and you have to have mastery over the first version if you want to take this further. I mean this is, we talked earlier about the podcast I do inside of a company called Context and it's about that. It's like how did we make the decision? It's like everything around a decision is more interesting than a decision.

God damn it, only for Shopify.

It's called Spotify, a Product Story. And it's because, you know, everybody else I think...

I didn't know about this. I love that. You should listen to it because it's narrated by Gustaf who was head of product who's now COO.

Executives and founders but not only what they did, why they did it.

When I said exactly? You change your mind all the time.

Yeah. Yeah. It's like taking people back to major decisions.

No. Like initially it went through phases. There was a sort of for the first maybe 50 episodes we said like we have to mix it down to 23 minutes because we calculated that that was the average commute in Shopify. Like so we checked where everyone lived compared to offices. We ran the data and it was 23 minutes. And so we made it 20 minutes because that seemed like as good, like we needed a reason.

Exactly. So you know just like I also just don't like picking 20 minutes because it sounds good. Like I want, like I need a better reason. So I might say I want something to be like 20 minutes sounds right but let's find an actual good reason why it's 20 minutes and then we found a 23-minute reason. So sometimes you're allowed to like just parallel construct the thing you want to do anyway. Then at some point we abandoned it because just like you know the nice thing with podcasts is like people can skip, move, it doesn't matter. Like you can just keep going for hours and hours and...