Hello. I think a lot of people here are early stage startup people. Who works in a startup that's seed stage, pre-seed, that sort of thing?
Is this on by the way? Test.
It is now. Cool. So I thought before we kick off, I want to ask you tons of questions about what's happening now because it seems super exciting. Before we get into that, imagine all the way back in time and you're in the shoes of someone here who is at seed stage or pre-seed. What did you get right about Replit in the early days that other people could learn from? What did you get wrong?
I think we got the trends right. I think we got that the world just needs way more software, way more software engineers, way more people making software than we currently had. There were all these attempts at creating more software engineers, boot camps, all these things, but it wasn't really satisfying the insatiable need for more software. So that's one. I think we got the shift to the cloud. I'm kind of dating myself, but starting in 2016 it wasn't really clear that everything was going to be cloud-based, but cloud-based was going to be very important. And then AI. People forget, but in 2015-16 there was a language model hype period as well where people were starting to build language models that were performing reasonably well and they could code reasonably well. I've been writing compilers and doing programming language stuff for so many years, and I thought the way we write parsers, the way we handle programming was very manual, and I thought it's going to get automated. All these three things were in my deck in my Series C deck. So I think we got the trends right. But the timing was just going to take a lot longer than I expected for all these technologies to mature, including the cloud. Right now it's so easy to create a sandbox in the cloud. We have microVMs. We didn't have microVMs at the time. Containers barely worked at the time. So that had to get better. Web browsers had to get better. AI had to get massively better. The principles were right. The timing was a little early, but I think it gave us a lot of benefits, starting early.
It strikes me that because you did YC in 2016-2018, one of the things I found there was they're very focused on solving right now. But it's interesting to hear you talk about feeling the trend that the world needed more software. Is that truly something you felt back then, or has it become more obvious as you were building?
No, I felt it even before that. I wrote the open source version of Replit back in 2010, which was just an in-browser REPL. It was the first way you could run a lot of different programming languages in the browser. I worked at Codecademy. I was the first engineer there in 2011. It was a massively viral product. The amount of interest in coding and the stories we hear every day with tools like Replit, where someone learned a little bit of how to make software and went on to create a million dollar business. We wouldn't hear the same thing. We would hear someone learned to code, made a fitness app, made $5,000, and it was amazing. And we'd hear it once a year. So you could tell there's a lot more entrepreneurship to be created. A lawyer learned a little bit of coding and automated a big part of their boring job. You would hear the stories, but they were so limited because if you ever look at retention curves of education companies, they go all the way to 1% in like two weeks. No one likes learning to code; it's just really hard. So the few people that make it all the way, the really motivated people, would get tremendous value. So it was obvious that that was the right thing. Then at Facebook I had a similar experience. I went in at Facebook really inspired by Zuckerberg's vision with internet.org. There was a huge effort to connect everyone to the internet. Google had these blimps flying around trying to beam internet down. Elon had just started working with Starlink. Zuckerberg's idea was that the rise of the Android platform was very important, and we're going to go do deals with all these telcos and fund internet for people. I thought the Android platform was a very important platform. So I went in to do Android, and I thought that was the worst programming environment ever. It was Java. You change a line of code, you wait 15 minutes for it to compile. I'm a web programmer. I built REPLs. I'm really into interactive programming. I can't wait. If the compile takes 15 minutes, I'm going to go to Twitter and forget what I'm doing. So I was like, okay, we need to make it better. We ended up inventing React Native. I was one of the founding engineers on that. We increased the population of mobile developers by multiples. Everything that I worked on had this exponential, super linear relationship between how easy you make programming and how many more people would want to do it. So it was pretty obvious to me that this thing needed to exist.
Yeah, it's super interesting to hear. I think it's one of the things we actually got wrong was the opposite. We're a little bit too tactical thinking. Because the rate of building has sped up so much, you have to be willing to look further forward than before.
I think it's a balance. You don't want to be too big-brained and think like an investor with all these trends. What Mark Andreessen calls maxing is an approach. I wouldn't go full that or full big brain. Find somewhere in the middle. Have basic assumptions about the world, but in the day-to-day, don't overthink it. Action is important.
How did you do a lot of customer maxing? Very simplistically, how did you get the first five paying customers for your product?
If you get a lot of users, you can monetize some of them. We had the benefit of getting a lot of users early on at Replit. The way we did it was by promoting the product as much as we could. At the time it was Hacker News, Reddit, Twitter. Today you would do it via influencers and Instagram and TikTok. I see a lot of founders today hiring a chief influencing officer instead of a CTO, which arguably you might not need these days, but you definitely need someone who's going to get you initial distribution because it's so hard to get any attention. So that was the thing at the time. We always wanted the product to be naturally viral, very easy to adopt. Today we just announced our self-service enterprise, which is kind of an oxymoron, but basically you don't have to talk to our sales team to adopt the enterprise product. You can do it all automatically, consumer grade. We always had that mindset of building a viral product. That helped. The harder thing was getting enterprise customers. We failed. Our first enterprise deal was going to be Block back in 2023. The wrong thing we did was try to adapt our product too much to what they needed. Ultimately, once you have true product-market fit, the market really drags you, and that's what you need to be focused on.
Have you always been a super engineering-y kind of company? If I went back in time to when you were 10 people, would I have found 10 engineers?
Definitely not. There wasn't a sales bone in our body. Marketing was always me liking to talk about what we're doing, so we always got some attention. But I think engineering and design, because my co-founder is a designer.
How far did you get before you had a professional salesperson? What kind of run rate were you at?
Probably $20 million ARR before we got our first salesperson. That was last year. Our enterprise product is about a year old.
That's pretty wild. Let's talk about fundraising for a minute. What's the silliest stupid question you get when you're fundraising, and what should they be asking instead?
Every cycle there's a different company that's going to kill you. In 2016, Google was going to kill you at any moment. In 2022, OpenAI was going to kill you at any moment. In 2026, Anthropic is going to kill you at any moment. You're always going to get asked, 'How come Anthropic is not going to drop this?' Those are definitely stupid questions. I think VCs think too much in a zero-sum mindset, which is surprising because their reason to exist is to create new wealth, new products, net new value in the world, but most venture capitalists don't think that way.
How do you think about your attitude towards competition? You're in a busy but extremely large space. Is your attitude that you don't really care, competition helps educate the market, and you focus on a particular segment? How much do you care about competition?
No, because we have the benefit of being around for so long. We've had competition come and go. You just learn not to stress too much about it and focus on the next big innovation. Replit was the first coding agent on the market, before Cloud Code, before anything like that. Even within the agent paradigm, Agent 3 was before people really realized that agents are truly autonomous. Agent 3 was October last year, and it could run for 10 hours. Over the next three months, we're going to have another big leap that will show what's really possible. If you build a culture focused on competition, you end up in a mimetic closed loop where you're copying each other and it's all incremental. Some parts of the company need to be hyperfocused on competition: your sales people, go-to-market people, some PMs. But if everyone is so focused on competition, you lose the forest for the trees.
One way to sum this up is you've been very innovative, ahead of people in a space that is nuts. What do the nuts and bolts of that actually look like? Say I'm an engineer who works there. Is it free reign? Are you driving product? How have you been able to build ahead of the market?
I try to drive vision. I make predictions about where the future is headed. It's an underrated skill, and you can develop it. Write some predictions down about what LLMs are going to be doing in three to six months or a year, and back-propagate on that. Test yourself whether you're right or wrong. You can develop a skill to predict where it's headed. Being a student of history, I really like computing history, reading about past innovations and innovators and biographies. You learn a lot about how technologies develop. One thing you learn is to never underestimate shitty technology. GPT-2 sucked, but it was very interesting. You could tell it was going to be amazing. Since GPT-2, we've been really focused on LLMs. Anything that looks exponential, like scaling laws, the moment you look at them you should realize this is going to be insane. We have this machine where you put in more capital and get better performance. It's obviously going to take over the world. Having certain principles helps, and having enough freedom in the company for people to experiment. In March 2024, one of our lead agent engineers, Zen Lee, showed me a demo on his computer. It was the first time I saw an agent that was actually working. It was based on GPT-4.5, and it would work for 30 seconds to a minute and a half, then totally go off the rails. But you could tell it was doing the right tool calls, writing code, running it, looping and debugging. It was working. Vision alone would not have helped, but vision plus enough freedom inside the company for people to innovate.
I'd love to hear more about the huge inflection you've gone through, from good growth to outrageous growth. How do I do that if I'm listening? What happened there? Was it a product change, or something else?
Because we're based on the right assumptions about the world, we built the right things. We built this great cloud development environment, great sandbox environment. Now everyone's building sandboxes. We built this really great file system for collaboration, which turned out to be very useful because anytime you're working with an AI, you're collaborating with it. We built a great deployment environment and a bunch of cloud services around that. The big unlock was that we're making programming easier by reducing all these barriers. The ultimate barrier is coding. If you remove coding, you're going to get an explosion of growth and activity. It's the same principle I've seen over and over in my career. The moment we put Replit Agent and hooked it into all these different services, we took our IDE team, which was responsible for building the interface for people coding, and said your user is no longer humans. You are now building interfaces for the AI. We took our cloud services team building databases, object storage, and said you're no longer building ways for humans to provision them; agents will be provisioning them. We did that reorg, but it was kind of a reshuffle because we didn't move any teams around. We just created this interaction where the user is no longer the human, it's the agents. Once we released the product, it was an immediate hit because it was the first time people could try an agent that could work.
I remember people saying you should build for agents a long time ago, and I didn't really know what they meant. One piece of advice that has done extremely well for us is switching the persona. We thought our onboarding process for our product is actually for an agent to do. It led to us literally doubling our conversion rate by building this onboarding wizard that a human doesn't do anything. The human just runs a command.
What percentage of your users are now agents?
