Apple 没能杀死的公司｜Spotify 联席 CEO Gustav Söderström

So I texted Daniel Ek this morning. I was like, “Hey, I’m recording with Gustav. You’ve known him for 2 decades. Tell me what I should ask him.” And he goes, “Ask him to tell you how he prepared for the CEO role. We did something quite unusual.” Can you describe what happened?

Daniel is very big on preparing. He’s not very rash in his decisions, and this was one of those decisions that I think grew with him for a long time. Already about 3 years ago, he asked Alex Norström and me to step up and become co-presidents and start to run the day-to-day of Spotify for him. He was still the CEO.

He gradually gave us more and more rope to run the business day-to-day and week-to-week, and then month-to-month. When it actually came to taking over as CEOs, we already knew that part by heart. We had run the full P&L and balance sheet, and so forth, for 3 years.

There was still a lot of new stuff to learn—all the things that were Daniel’s responsibility alone, like PR, the government, and being the public face of the company. But we were very well prepared for taking over the business. I think that’s unique with Daniel.

I worked for Daniel for almost 18 years, and I don’t think I’ll work for anyone except Daniel again. I’ve had both great bosses and not-so-great bosses. Daniel is the great one, and he’s been incredibly delegating from the start.

I remember when I joined Spotify, back in 2008 or 2009, we were going to go to the U.S. Daniel knew Zuck at Meta—then Facebook—and we wanted to do this pretty deep integration with him. I was new on the job at Spotify, and Daniel just said, “Can you just go there and talk to Zuck and Meta, or Facebook at the time, and set this up?” I thought, “That’s a lot of trust for someone who’s new.”

He’s always been super-delegating, and that is also why I’ve stuck around for almost 18 years, because you get so much responsibility.

Mm-hmm.

It’s like you get a new job almost every year. This co-CEO or co-president partnership that he started 3 years ago was one of those journeys where Alex and I got to step up and try taking on the full business. We completely changed how we run the company from the way Daniel runs it.

Say more about that.

When it comes to organization models themselves, this is not something I came up with. I think Steven Sinofsky has said this a bunch: You just can’t win. There is no organizational model. There are many, and they all work. Amazon is organized in a certain way—a trillion-dollar company. Apple is organized in another way, also a trillion-dollar company. Elon does his thing and also produces trillion-dollar companies.

There is no right way. You just have to pick one that fits your personality. I actually think organizations are quite based on personalities, and Daniel has a very specific personality.

He’s not the typical alpha-male founder, which I think is one of the reasons why he’s so successful in this type of business. If you think about what Spotify is, yes, it’s a technology company doing hardcore technology innovation, but it’s also a media company working in an industry with a bunch of first music labels and then book publishers and podcast publishers—some very big personalities in the media business, as you can imagine.

He needed to be able to rally a team and build world-class technology, but also get all of these people with big personalities to work together and do something that they didn’t want to do individually, or even as a group. I still don’t understand exactly how he managed to get all of these people to do what he wanted, but it certainly wasn’t through alpha-male force.

It was through not being threatening and being very logical. He’s very humble, but I think maybe most Americans, specifically, can mistake humbleness for weakness. It’s the opposite. He’s insanely tenacious—insanely tenacious—just never gives up.

He has a very specific leadership style, and that shaped the company. As I said, there are a bunch of incredible advantages to his leadership style. One thing that I do choose to do differently is that Daniel loves to talk in a star pattern, one-on-one with many people.

He would talk to me about something in a separate meeting, then with Alex Norström about the same thing from the business angle, and then maybe with PR and finance. He just talked in a star pattern. He doesn’t like to have everyone in the room, and that can be frustrating at times.

He says something to me, something to Alex, and then Alex and I meet. I’m like, “This is what we’re going to do,” and Alex is like, “Not quite. That’s not what he said to me.” Then we go back and call him out on it. But he likes that star pattern.

Alex and I chose to do something very different. We chose to synchronize the whole company. You can think about Spotify as a two-function organization. I run product and technology, by and large. Alex runs business and content, by and large.

Instead of doing divide-and-conquer, which is a good idea because it’s more effective, we chose to do something I’ve called “synchronized swimming,” where we kind of swim together. Divide-and-conquer has the cost that you’re unsynchronized.

Synchronized swimming is much harder to do than competitive swimming. When you mess it up, it’s ugly to look at. But when you do it well, it’s a beautiful thing to look at.

Instead of having the usual setup where I meet with my direct reports and we talk about product and technology, and he meets with his and talks about business and content, and then our people meet somewhere in the organization and fight it out—which is how most companies work—we chose to say, “We’re not going to have our own leadership meetings. We have a single one with all of our SVPs.”

We have a single meeting every Tuesday called E-Team, for 3 hours, with all the SVPs. The SVPs of all the internal functions, like marketing, ads, and subs, are there, but so are all the product and technology functions.

How many people are in this meeting?

It’s about 14 people.

Okay.

We meet every week to talk through the entire company. We talk through machine-learning problems that are blocking someone, experience problems where we want to ship a music-video feature, and so forth.

Often, that music-video feature is blocked on a licensing discussion that sits in Alex’s organization. The whole reason for the E-Team meeting was that previously, actually under Daniel’s tenure, we were in so many meetings where someone said, “Well, I’m blocked on that person in that organization, and that person is not in the meeting.” So people said, “Let’s take it offline.”

We got so tired of hearing the phrase “Let’s take it offline” that we created the E-Team meeting and said, “You’re never allowed to say ‘Let’s take it offline’ again. Everyone representing all the functions should be in this one meeting, so that when you say, ‘I’m blocked on licensing,’ licensing is right there across the table. Now let’s talk it out in real time.”

We changed how the company operates, and we have this synchronized operating model that is expensive in time. You have 14 or 15 people times 3 hours per week. That’s a lot of leadership time, and the conversations aren’t relevant for everyone at every moment.

Sometimes we talk a lot about content, which may not be that relevant to someone in the personalization organization, or about ad strategy, which may not be that relevant to them. But the cool thing is, we talk about everything. We talk about P&Ls and balance sheets, and we talk about machine-learning problems in there.

So now you have 14 people who have the full CEO perspective.

Yeah, I was going to say, you used the words “not relevant.” I just finished reading Kelly Johnson’s autobiography. He’s the one who did Skunk Works inside Lockheed. His whole thing was that there was no separation between any department: engineering, designing, and manufacturing—it’s all the same thing. We’re all working together. We all want the same context and the same shared base of knowledge.

Yeah, so it is kind of relevant. It’s just a question of timescale. The person in experience understanding a lot about the ad stack won’t seem that relevant right then, but the fact that this person understands how we make money is going to affect their product decisions in the future when they build a product.

Right.

Because guess what? There are ads in the product. Now they’re not going to make decisions that go against our monetization strategy. So it is very relevant; it’s just relevant on a longer time scale.

I think of it as an investment. But it is contrarian. Many people would say you should not sit in a meeting. I hear people saying, “The second you’re in a meeting and you feel it’s not fully relevant, leave.”

Elon says this.

Elon says this, right?

Yeah.

Like I said, he’s not wrong. He’s built some of the most successful companies on Earth. It’s just different approaches.

We’ve chosen this approach. We have a very senior group that has a complete perspective of the company, and I think that’s right for our company because there are so many dependencies between the licensors, the relationships we have, the contracts we have, and how we can build a product. It’s very hard to divide and conquer a product like Spotify.

I think there’s this truth out there that eventually your org chart shows up in your product.

Yeah.

Because we have a single experience strategy, our strategy is literally a super app. We try to build first music, then podcasts, then books, and more things into a single product. I think our biggest risk is to ship the org chart.

So if we divided it and said, “Everyone just run in parallel,” I think it would feel very good for about 6 months. Then the experience would just start crumbling because you’re externalizing all that complexity to the user instead of taking the fight internally and coming up with a single experience.

So, in terms of organizational models, you have functional orgs, where they have the benefit of clear ownership but are supposedly hard to cooperate in when you want 2 functions to work together. You have the matrix org, which has the benefit that it optimizes for the use case, but it’s unclear even who you’re reporting to. Then you have the division-based org, like Riot Games: you’re organized by game. You break out the technology platform into its own org. Amazon is actually kind of a gaming org, like divisional with a strong platform underneath.

And so, on that scale, I’ve chosen to be actually very close to Apple because I think they cracked the problem of building something that is very, very complex underneath the surface—insanely complex—and it still feels like it was built by a single person for a single person.

So that’s what I want with Spotify.

So tell me how you think Apple is run, then.

What I think is interesting about Apple is, when I look at it from the outside, it’s a functional org, right? I used to work at Yahoo for a while.

Where?

At Yahoo.

Yahoo. I sold one of my companies there.

And I thought I didn’t learn anything there, but I learned a lot about what not to do. It was a completely messed-up company back then as well. I think it had 4 CEOs in 2 and a half years or something. But all the EVPs fought each other to the death and tried to hide information from each other.

So, supposedly, on paper, I think Apple should not be very well positioned to be able to build that kind of product. I always marveled at why those functional leads weren’t just fighting each other. That’s what usually happens. The only answer I’ve come to, as I’ve spoken to people there, is that it actually has to do with tenure of leadership, which is one of the principles I’ve also tried to internalize at Spotify.

So they have very long tenure in the senior leadership, which means that these functional leads have found a way to work together and synchronize. Sometimes it’s the hardware function that innovates and takes the lead, and then software and services follow, and sometimes it’s a software function that takes the lead, and they follow. That only works if you have super-high trust in the leadership, which I think stems all the way back from Steve Jobs, and they managed to keep that. But in theory, I think functional orgs tend to dissolve into politics.

Without the tenure?

Without the tenure.

You think the tenure’s the key.

So at Spotify, most of the people who work for me—many have worked for me for 14 or 15 years. I think the average is maybe 7 or 8 years. And then it works to have a functional org. But if you don’t have trust in the leadership, I think functional orgs just dissolve into politics.

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This speaks to your previous statement that there’s not one right way to do it. There are multiple different ways. I just had this conversation with MrBeast, and we talked about this. I was very curious, especially in media, because your top creative talent is so hard to manage and integrate, and to keep. I was like, “Do you have a lot of turnover among the people on the production?” I mean your actual top 5 most talented people. Are there a lot of turnovers there?

And he’s a huge fan of Founders, so we talk about entrepreneurial history every time we speak. What’s interesting to me is that you take Larry Ellison, who believed that one of the secrets to the success of Oracle was the fact that they kept, I think he said, the core kernel of the product team together for 2 decades or something like that, or maybe a decade and a half.

Yeah.

And you take Elon Musk, whom Larry mentored. Elon says that one of the few people he goes to for advice is actually Larry Ellison, who says the opposite. He’s like, “I want fresh blood. I want to keep turning over people as much as possible.” It’s like, Oracle’s super successful, and Elon’s super successful.

Exactly. I think this is the whole thing. You can’t win. You can only not lose as much. So the way I think about it, you have a bunch of organizational principles, and as I joined Spotify, I had to figure this out. When I was at Yahoo, I said I never wanted to work in a big org.

I joined Spotify when it was 30-something people. I never expected it to get to thousands. Eventually, I had to do the big-org thing, and then I tried to read a lot about organizational principles and models. I think at the time I read a lot of Steven Sinofsky.

The thesis is, you can’t win. There is no right org. Companies sit with one type of org, and then you’re going to be good at something and terrible at something. People look at the terrible thing and say, “Well, if we flipped to a matrix org, we’d be great at this.” They flip, and now they’re great at this and terrible at the old thing. You just have to choose dimensions.

So what we did at Spotify was say, “We have to choose.” The best outcome is that you’re optimized for the thing that is important for the company, and you suck at the thing that is not as important. The worst outcome is that you’re really good at the non-important thing and you suck at the important thing.

Mm-hmm.

So figure out what’s important and then optimize for that, and just accept that you’re going to be average at the others. One thing we chose to optimize for was the single experience. We were really good at building a single experience that actually does a billion different things, and most people don’t even realize that on the back end, it’s even more complicated because you have a music business that is a royalty pool, so it’s percentages out of a fixed pool.

You have a music business that has a very different structure and a podcast business that has ads. So when you click something in Spotify, it triggers all kinds of different business models. On the back end, it’s insanely complicated.

I obviously love to read. I read books professionally for a living, but I also have hundreds of audiobooks on Audible. I remember asking Daniel, “How the hell did you do that on the back end? Why did no one think, ‘Oh, I like this book—just press play and it goes,’ instead of a 5-minute sample?” Audible’s like, “Okay, listen for 5 minutes,” and I have to do the credits, which is awkward.

And I was like, “How the hell did you do that on the back end?” He was explaining the complexity on the back end, too.

Yeah. It’s a very complicated model on the back end.

And especially because you guys are designing this super app, though.

Exactly. If it was 3 different apps, again, you could have had different teams running in parallel.

So you’re optimizing for a single experience.

If you look at what we focus on and what we optimize for, you have a strategic lens, then you have a business lens and an emotional lens. The strategic lens is really that we saw a long time ago that the biggest challenge in the world is going to be distribution.

When the iPhone came out, it felt like distribution was free. People went to the App Store every day and looked for the top-charting free and paid app. That stopped working. There was a lot of distribution through Facebook with all the install ads. That all went away.

So from a strategic point of view, when we were going into podcasts, which was the first or second product we did, we looked at that and said, “Again, it’s all a trade-off.” We could do a separate app. It would be easier for us as an org because we could divide the org and people could run in parallel, and so forth. But is that the biggest problem—to design the experience—or is the biggest problem actually getting distribution?

And then we looked in the App Store, and I think there were maybe—there were probably 10, but at least 7—really good podcast apps in there, like Overcast and all of these apps.

When we looked at their usage, I think Apple Podcasts still had about 98.5% of the usage. The problem wasn't that there wasn't a good enough podcast product. The problem was that they didn't get any distribution.

So we chose to take the pain of doing a single app, with all the complexity that comes with that, for the benefit of reaching what was then already 300-something million users, maybe. But it was much harder. We chose pain and cost somewhere to get a benefit somewhere else, and we said, “It's just software. It should be able to adapt to the use case,” right? Which was contrarian at the time.

With audiobooks, we did the same thing. There was a strategic lens to that. The second thing we care deeply about is that when we have to prioritize, we prioritize the user over ourselves, over publishers and labels. We prioritize the consumer experience.

You saying that you prioritize the user over yourselves is super important. A few months ago, we were racing cars together in Sweden. Then we took a break from racing cars and had lunch. It was me, you, Daniel, and Pia, who works at Prima Materia.

I know you're super competitive. How did you feel about losing the race to a girl, by the way?

I felt great about losing to Pia. She's an awesome driver, and it was very well deserved.

She's one of my favorite people. I'd do anything for Prima Materia. I love the entire team there.

This is where I understood your philosophy, because I had previously had multiple conversations with you, and we had this really long lunch one time. This is what I think makes you guys special in the technology industry, and why I like spending time with you. Whatever your favorite AI chatbot or chat app is, what are the best apps on your phone? Spotify's in the top 2 for anybody who uses it.

We talked at lunch. You knew there were dark engagement patterns you could put into Spotify right now that would make people use the app more, have more retention, and maybe bring in more users, but it's not good for them.

This is our guiding principle. What does it mean to care about the user? You can care about the user experience, but if you really care about the user in some deeper way, it would be how they feel about what you do.

What happened with Spotify is that you can say we lucked into it, because we started in music. Music is, by most people, considered almost an unequivocal good. Maybe there's bad music somewhere, but very few people feel that music is a bad thing for the world. It also happens to have a very large TAM. There's almost no one who doesn't listen to music.

It's bigger than social networking, right?

Yeah.

Not everyone does social networking, but everyone does music. So we started in this space, which was very positive for the world, and I think that was a deliberate decision from Daniel. He was passionate about music. He wanted to do something that was meaningful.

I don't think it was luck, because if you look at the things he's doing now, they're in that same space of being good for the world and for Europe, et cetera, rather than just making more money.

Yeah.

Still, you could say we lucked into it. Then we realized that this is important: we're bringing a lot of joy.

When we looked at what to do next, we looked at podcasts. We saw that the pattern on the internet already back then was shorter and shorter-form content and shorter and shorter attention spans, and it looked like the world was lost. It looked like it was just going to go to hell.

But then you looked at podcasts and said, “No, at the same time, there are these very long, deep discussions where people speak in full sentences and get to explain full ideas. They don't necessarily get attacked. They get to retort, and so forth.” We said that we thought this was actually good for the world.

We didn't know how big it was going to be, so we had to take a chance on it. But we thought it was a business opportunity and good for the world. That's our lens. So we went into that and built podcasts into Spotify.

It was the same thing with audiobooks. We think that books are one of the most important things that happen in the world, and I'm very passionate about books, but it's also a good business opportunity. We were fortunate to be in Sweden, which, for some reason, tends to be pretty advanced in its media habits. In Sweden, audiobooks are already a very big thing, so we had quite high conviction about the market.

We've kept going into these things that are considered, by ourselves and users, to be time well spent. But we never fully articulated that as a strategy externally. We've only recently started talking about it.

Did you articulate it as a strategy internally, though?

For a long time, we've had a strategy called No Regrets, but we largely haven't said that externally. I don't know if No Regrets is the best branding.

I think “time well spent” is better, though.

That's a low bar. But we've said it again and again: is this really no regrets?

What that comes from is interesting. We surveyed our users through a third party, anonymously. We do that all the time. Someone comes and asks you, “What do you think of these media services?” without saying who they represent, so you give them the truth. That's how we understand how we're doing versus competitors and so forth.

We had them survey across all the big media platforms. This is where No Regrets comes from. We asked the question, “How do you feel about the time you spent?”

Using Spotify?

All of them—the time you spend on Spotify, YouTube—

Okay.

Apple Music, Amazon, TikTok, all of them. We just wanted to understand how you felt about it. But then we also asked the opposite question: “How much of your time did you regret afterward?”

When we got that survey back, there were 2 things that surprised me. One didn't surprise me as much. We were actually the lowest-regret content on the internet, in terms of the platforms we asked about—or, if you flip it around, some of the time most well spent on the internet. Gen Z said that they value almost 90% of the time they spend, and they feel very good about it afterward.

So that was good. But what surprised me was the opposite, without naming which ones. On many of the big platforms, people regretted almost 60% or more of the time they spent, and these were young people.

What shocked me was that before I saw that survey, I knew these were insanely high-engagement platforms, but I mistakenly thought they were there because they wanted to be there. I'm like, “They're probably enjoying it.” It turns out, when you ask them, they're like, “No, I'm trapped. I feel horrible about the time I spent.”

So I was mistaken in thinking that they were there because they loved the time. It's just very, very captivating.

Then we decided, “Okay, we've had this as a saying internally for some time. Let's make it an actual strategy: to be among the most time-well-spent experiences on the internet.”

When we look at something—we're talking about fitness now, for example—why? Because we think very few people regret doing a workout or being fit.

What do you mean, you're talking about fitness?

We just announced some partnerships with a bunch of companies, and we're investing more in fitness. Almost 70% of people on Spotify work out with Spotify, so we're investing more into fitness and becoming an even better fitness app. This is 1 area, kind of like music, podcasts, and books. We're just investing more in it.

What would that look like? My partner, Rob, was running through Central Park this morning, listening to Spotify, so he was exercising while using your app.

Okay, so this is going to come out in a few weeks. I'll tell you what we're going to talk about at—

Okay.

Investor Day.

I'm a runner. I'm passionate about running, and we see a lot of people running with Spotify and making their own playlists. One of the things I want to be possible—and that is going to be possible very soon—is that you go into Spotify and just tell Spotify, “This is one of the good use cases of AI, I think. I want running playlists for an 8-minute mile, and I want it to be in my taste, but I want it to be on the downbeat, either on both my feet or just 1 of my feet.” Right? “And I want you to update it weekly.”

This is a pretty complicated task. What we want to be able to do is first calculate what an 8-minute mile means. Roughly, if you're of average height, maybe 165 steps per minute or something like that. Now we've got to go and find music at either 160 or half of that, 80, so it's either on every downstep or every other downstep.

You're going to find some music there, but not a lot. So now you want to look a bit broader, and then you want to speed the music up or slow it down to exactly 160 or exactly 80. Then you want to mix it together with perfect beat-match transitions.

You also want to overlay commentary on top of it, saying, “Now you're going to go into the interval part, and now you're going to slow down,” and so forth. These are the kinds of experiences we're building. This is what I mean by going deeper into fitness. That's one of those No Regrets areas, or time-well-spent areas.

Yeah, no one spends an hour in the gym or an hour running and says, “Oh, fuck.”

No, you come out and feel like, “Oh my God, I regret 70% of that.”

No.

You don't. So it's been our guiding principle.

What I think is interesting about it is that I'm 50, and I've done a lot of interesting things in my life. You've got to figure out what you actually want to spend your life on, right? I want to spend my life doing something that I feel good about personally and that I feel proud of.

You feel good, but the way a human is going to feel good is if what they're doing is actually in service of other people.

I know you're into philosophy. Humans figured this out thousands of years ago. This is not a new idea. It's something that was true thousands of years ago, and it's true today. Everyone discovers it.

Milan, who's sitting over there, and I were talking about it. He works at Spotify. Right before you came, I was talking to him about this, because he's just like, "You have 2 different podcasts on the business charts right now." And I was like, "Listen, this new show, I'm addicted to doing it. I can't sleep. I get wired from these conversations. I'm doing it selfishly. It's another form of education, but I really feel that Founders podcast is my life's work. And the way I feel when I put that out, I know it's good for the world. I know these conversations—

Exactly.

—are good for the world. I was like, "I'm not going to make f***ing podcast slop. I want it to be entertaining, but at the core, I want you to be inspired and educated by these people that have accomplished great things. And then the point was just knowing that you can do it too."

Yeah.

That is good for the world. I feel good doing that, and it's not like, "I need to make certain..." It's not tied to anything else. It's not like, "Oh, I wouldn't do this unless I can make X dollars." I don't give a shit about that. The money will take care of itself. I care about putting out good things for the world.

And I think, to your point, everyone gets there, and every philosopher in history got there. The question is just how late in life do you get there? I think you got there a lot earlier than me. And some people never get there.

It took me 32 years to find my path and another 5 and a half of f***ing struggling—

Yeah.

—until it actually could sustain me.

Yeah.

And then now it's just like I wake up every day, and I have no doubts about what I'm doing.

Yeah.

It's like I'm going to build again. I'm mining these old books of somebody who did something amazing for ideas and insights that we can push down to the next generation of entrepreneurs.

Yeah.

And we're having a conversation just like this, where we talked before. Everybody's like, "Oh, you ask this perfect question for your audience." I'm having this conversation selfishly, because I just know there's 10 million Davids listening to this—

Yeah.

—that have the same interests, that want to know what is in you. You just said you're 50. You sold your first startup, then you worked at a big company for 18 years, then became CEO. You have such a singular life experience. This is what Daniel and I were talking about earlier: Who the hell sells their startup, works at a big company for 18 years, then becomes CEO? It's a different path.

It's a very different path.

It's an unusual path.

I want to talk about AI, but can I say something on the previous thing first?

Go for it. You're where I want to go.

What I think is interesting about this time well spent is that these things are sort of easy to say. I think everyone convinces themselves that they're doing good for the world, even the ones who don't, because I think it's very hard to be honest with yourself—totally honest—and say, "I'm not actually doing anything good for the world." Very few people do that. They convince themselves.

Oh, I have an example of this—

Yeah.

—that I want to talk about. We get, obviously, all these pitches.

No, no. Go for it.

But listen, no disrespect. One of my favorite movies is The Godfather. And one of my favorite scenes is where Sollozzo goes to meet Marlon Brando. Marlon's like, "Hey, it's none of my business how another man makes his living, but I can't get involved in that because you're dealing drugs to kids, and it's just not interesting to me."

And so I feel the same way. One of my principles I teach my kids is, rule number 2 is mind your own business. But I had somebody pitch me. They're like, "We want to do a deep partnership with one of the prediction markets." And I'm on the phone with them, and I didn't know anything about them. But the way they describe themselves, they're like, "We're building a maximum truth-seeking machine."

And I pull up my phone. I'm not going to say the company. I type it in, and I go, "Dude, the first thing I see on your website is who's going to win the coin flip for the New England Patriots game. If you're just saying, 'We want to f***ing gamble and make a ton of money,' I respect that. But don't give me this other bullshit that you're building maximum truth-seeking machines."

Yeah, but that's my point. I think almost everyone has to convince themselves of that. So, to kind of call bullshit on us, does it actually mean anything to do this? Well, it means that you have to stay away from some things.

One decision that we made recently was—you know how all podcasts are turning into video podcasts, and so we followed that.

The only reason I do video is because you guys harass me.

Exactly. So they are very popular. But there was a problem, which was that a lot of people, specifically parents, who felt that they had this time well spent, now started seeing these videos in there that they didn't want to see there, right? So they felt that their time well spent was going down.

And then you're faced with a decision: video is good for engagement, but these people feel that it's not good for their time well spent. So we made the decision—the anti-engagement decision—to allow people, anyone, to turn off video if they want to, and just listen, not just for the kids, but for themselves. That may mean that we take an engagement hit on that person.

So if you're going to have these principles, you kind of have to live with them, and they're going to have consequences. Now, we still think this is very good business, because most of our revenue comes from subscribers paying for their experience—almost 90% of the revenue. And I think that what you pay for when you vote with your wallet every month, you're not going to pay for your engagement or time spent. You're going to pay for the value you feel, right? If you feel that this was time well spent, if you feel that this was high value, you're going to say, "I want to pay for this."

So I think when you pay with your own money, that is very, very well aligned with optimizing for what is good for the user. Whereas, in a pure advertising-based model, your incentives are clearly to maximize time spent at any cost. So I think it's a luxury for us, because most of our revenue comes from subscriptions, not to have that pressure. Maybe we lucked into that business model. Maybe it was semi-deliberate.

That's what I was going to ask you. There's no way you could have predicted that when you chose the subscription model, but it had to be a subscription model based on your very first product, which is music.

Yes. So now that we see it, we're doubling down on it. And I think it's going to be the right bet for Spotify. I think people are getting more and more aware of how their time is getting captured and how they have less and less control over their life.

This, by the way, leads us into AI, which everyone is talking about. And there's a lot of negativity around AI now, which I understand, and for good reasons. There is a promise for generative AI to be the most addictive algorithm you have ever heard of, because now it can understand you so deeply. There is potential for darkness over there, right?

But what I'm trying to say—what we're trying to say—is that there is, but it's a dual-use technology. You could choose to do something else with generative AI. And so what we're choosing to do, for example, is to give users back control over the algorithm.

The other thing you can do, which we're doing, is that you can say, "Hey, David, here's who we think you are, using LLMs. And based on all your listening, this is who we think you are musically. This is the podcast we think you're interested in. These are the audiobooks that we think you're interested in."

Then we can put a box where you can say, "No, you're wrong. Maybe that's what I do, but it's not what I want to be. I want even more biographies. I want to get back into classical music," which is something I've tried, but because I listen to mostly EDM... So now I can go in and say, "Now I want to have classical music," and now I get classical music.

The best way I think to describe generative AI is that, finally, computers understand English. It used to be a small population of about 1 million developers on GitHub who could talk to computers. Now we all can. And so I think consumer companies could and should give everyone access to talk to them in plain English.

It means that at Spotify, we used to have these user research teams that sat with 10 users trying to understand deeply what they felt and what they did. Then we took those 10 users and tried to apply that to 761 million users. What if you could do that deep user research with every single user—all 761 million of them—all the time? Because you talk to them, and they talk back in English, high fidelity, and the experience just adapts to what they want.

So my mission now is to sort of give back control to consumers over these algorithms. It's contrarian, but I think it's the right bet.

But you have 700 million users. What percentage of them do you actually think want more control? I feel like people just want you to do it for them.

No, you're not wrong. I think everything in the world is sort of a power law, right? Whether it's music listening—some people listen a little, and then some people listen extremely much. Everything is a power law.

But I think what is interesting, if you look at playlisting, for example, some people playlist a lot. Most people have 1 playlist, maybe their Liked Songs, maybe 2 playlists—some indie favorites. Some people have hundreds of playlists.

So, sort of, the story of Spotify and why we got good at personalization and recommendation in the first place was that we had, I don't know, 10 billion user playlists, which is people carefully saying, "This track goes well with this track, goes well with this track." It's an incredibly valuable data set.

But to your point, it was heavily skewed. It was a few users—not a few, millions, but not hundreds of millions—who did a lot of work that benefited the others. Those people saying, “These tracks go well together,” meant that the others who weren’t that into music—they didn’t keep up with the new releases of the back catalog—got amazing recommendations from the work of these people.

So I think that’s going to be true here as well. In fact, I know it is true. We see some people engaging a lot, talking to Spotify all the time, saying, “No, that’s wrong, that’s bad. It should be like this.” They’re doing a lot of work. They’re making their Spotify better for themselves. But then we know that someone else who looks very similar to that, but doesn’t have the time or knowledge to do all of that, actually probably wants the same thing. They can benefit from the others.

The analogy I had is that everybody’s like, “Oh, everybody’s going to be building everything they want.” And I was thinking, “I don’t think they’re going to build it all.” Tell me if this is a stupid analogy. I’m curious about your personal opinion on this. But if you even look at how easy it is to post to social media, you put up a picture, press 2 buttons, and you’re done.

Incredibly.

And it’s something like 90% of it coming from 1 person—

It’s a power law.

—and then you have the next 10% done by others, and then 85% or 90% just lurk. They do nothing, but I feel like that’s—

Exactly.

—a good representation of humanity, where—

Yeah.

—90% are not going to build anything.

Yeah. There is this famous 1/9/90, right? 1% creates, 9% curates, and 90% consumes.

Okay.

Right? Something like that. And I think that’s largely true. That’s what I mean by the power law. But as I said, that 1% that creates and that 9% that curates can be incredibly valuable for the other 90% that consumes.

And then that allows you to do it for them, which I think is what most humans want.

Yes.

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There’s some context I think people need here. The 4th most-listened-to podcast on my Spotify Wrapped for podcasts was Spotify: A Product Story, which you narrated.

Oh, really?

That came out in 2021, ’23, you remember?

Yeah, something like that. It came out over a couple of years.

Long time ago. And it tells the history, which I think more companies should do. I talk to founders about this all the time, because you essentially wonder, “Why don’t we just tell our own company history?” Then you interview the people who were there at the time. Sean Parker is in there, Daniel Ek is there—

Yeah.

—people who played a role, even if they only played a role for a few years.

Yeah.

But the crazy thing is that you have entire episodes, I think from 2021 or 2022, dedicated to how you were using AI at Spotify way before. People have been talking about AI for 60 years, but even back then, far fewer people were talking about it than now. Tell me the difference in how you viewed AI back then, in 2021 and 2022, at Spotify, compared to today.

My interest in AI, as for many people, started when I was young. I was always interested in it growing up, and then I became an engineer and so on. At university, which was in the late 1990s, I was interested in it. There were neural networks back then, but you couldn’t do anything because computers were not powerful enough.

Then I went into what was called IT, and I started my own companies and started Spotify. When I came to Spotify, we already had one of these large datasets of music playlists. There were some very talented people there, specifically a guy named Erik Bernhardsson, who, at the time—this was 2009—was doing machine learning, something called collaborative filtering, on what was then the world’s largest Hadoop clusters. I thought, “This is super cool.” This scale of data and these algorithms—I hadn’t been thinking about it for a long time. So I got very inspired by that and kind of got back into it.

Then what happened was that DeepMind started doing these reinforcement-learning-based things. They had this thing called the Deep Q-Network that started beating Atari games, if you remember that.

Mm-hmm.

It looked like a toy back then, like everything does. But I was already so focused on the idea of how we actually work as humans from a philosophical point of view, and I didn’t have a good answer. No one did. But I had this idea that maybe it is computational, because it was the model of the artificial neuron. It was hard to believe in the 1990s.

With these Deep Q-Networks from Demis Hassabis and David Silver, and the whole DeepMind team, you could see the scaling. It was handling more and more complex problems. So I got very deep into that. I went home, started coding again, and did my own recurrent neural networks, LSTMs, GRUs, and stuff, just for fun during my vacations and evenings and nights.

We kept working on our recommendation problem, which was sort of old-school AI called ML, or machine learning. But then, when what is called the Transformer paper came out in, I think, June of 2017—it was a paper called “Attention Is All You Need”—I think I read it in the first few days and was completely blown away by it. I started talking to anyone who wanted to listen. I was just primed for that happening.

So then we started investing quite aggressively toward this. I think if you extrapolate it out, if you really believe in that exponential curve, which I’ve tested a few times, then eventually computers would be able to start talking to you and reasoning, and you would be able to talk to computers. We started preparing for that quite early.

We bought this company called Sonantic to be able to produce voice. You can buy voice anywhere on the internet today, but it’s quite expensive per minute. So if you want to serve 700 million users with a few minutes of voice per day, you’re going to go bankrupt. We bought this company producing voice very, very cheaply with a different technology, even before the LLMs were smart enough to produce the script for that voice, because we just bet on intercepting that curve instead of waiting for it and then building for it.

I think it comes from a personal interest in AI, and then a bit of luck being at a place like Spotify that had access to lots of data. When you see it, you just have to bet on it. I think the interest is a personal interest. Spotify is my excuse to get as close as possible to the philosophical side of AI and what it means to be human.

Say more about that.

Well, I think you go through life, and as a kid I thought about things a lot. There were a few problems that really dumbfounded me when I learned about them. One was this notion—I don’t remember exactly when, but someone told me that all the atoms in your body, or 99% of them, get switched out every 7 years.

I was like, “Yeah. Wait, what? Every 7 years? What do you mean?” They were like, “Yeah, every 7 years, they’re all switched out.” But that means I’m not the same person. If I thought I was my atoms, if I thought I was my body—clearly this is me, and you’re telling me that when I see you in 7 years, I’m someone else—then what am I? If I’m not my atoms, what am I?

If you look at a rock, it is its atoms. You look at it, you come back 7 years later, and it has the same atoms. But in you and me, most atoms are never destroyed or created. They’re largely the same, so you may have a bunch of Napoleon atoms in your body or something, and when you die, they’re going to go to someone else.

So it’s just the construction of those atoms that is you for a very brief time. I got to the realization that you’re not your atoms; you’re the structure of your atoms. Another word for structure is information.

Then I was like, “Okay, so it’s the DNA.” DNA is the blueprint: you arrange the atoms in a certain way, and that’s you. Then someone said, “No, that’s not really it either,” because if you think about something for a long time, or play the piano for a long time, and think in certain patterns, your brain will grow. You’re going to get an overdeveloped musical center. If you’re good at languages, your language center develops.

The most famous example is cabbies in the UK. They have to learn all of London by heart, and when you brain-scan them, they have a very overdeveloped center for 3-dimensional thinking. So clearly, it’s not static. What you think about moves those atoms around in new patterns, and it’s not even the same atoms. The atoms get switched out over time.

So now, you're not your atoms. You're not even the structure of the atoms. You literally are your thoughts—literally, not as an analogy. The only thing that is constant is the information-processing pattern, right? The atoms that do the processing get switched out.

So now I'm like, “Okay, shit, I'm information processing.” That was kind of a mind f***. Then I got comfortable with it because I'm like, “Well, now I can live forever because, if I'm information processing, I'm thinking in certain ways. That's really what I am.”

You could have instantiated me with some other atoms, et cetera. Then, if I bring some of that into my kids—if they're thinking a little bit the same way—like 32% of me is still living in them because I am my thoughts, and then I transfer my thoughts.

And if you're Ray Kurzweil, you say, “Well, now transfer them to a computer, and you get to live forever because you are your thoughts. If that information processing lives there, that was really you. You were not your atoms.”

This whole idea that we probably are computational beings—information processing—I think is what got me into AI in the first place. But then, at university—

Almost 2 decades ago.

More than that. In university, in the late 1990s, you couldn't do anything with it. The computers were not powerful enough. When you tried to instantiate those ideas, you built a neural network with a few nodes, and it slowed to a crawl. It was unimpressive, and you're like, “Nah, that can't be it.”

Okay, so this is interesting. You've been thinking about this for multiple decades. You had to have this favorable occurrence of events that now lead you to have—I think you guys are the 2nd-largest subscriber base in the world behind Netflix. Am I correct?

Yes.

And you have this huge data set. Now the technology can catch up with the thing you've been thinking about since you were in college.

Yeah. It's a good excuse to spend all day thinking about and learning about these things and working with the best people in the business. I have the fortune of meeting all of these people who are changing the world. I get to meet them, talk to them, and ask my interesting, stupid questions about things.

It's just a fortunate position to be in, to get to do something that you're passionate about. But I feel very lucky because I can do that in an area where I think it's still good for the world, and I can steer this toward what I think is a good outcome of AI, like giving back user control, for example.

I don't want to skip over that because I truly believe—we've had enough private conversations, and I know you talk to all the other people designing products with all the big companies—that some of them have made decisions where they know what they've optimized for. They're like, “Hey, we ran this test. This is great for engagement. It's terrible for mental health,” and they're pushing it. That's insane to me. That is insane.

This is what we were talking about before we started recording. I told you, it sounds silly, but I deeply desire a world in which Steve Jobs is still alive because I obviously love technology. But I want the people building the technology that we all use, on the scale that we all use it, to build tools—and that's all technology is—that enhance humanity instead of trying to replace it, make you dumber or fatter, or just suck you into your phone and leave you depressed, which I feel is a lot of what's going on now.

Yeah.

Which is, I think, what you said earlier: Podcasts are growing massively, and that's good for the world, assuming you're listening to the right podcast. At the same time, people are destroying their brains with 15-, 20-, 5-, and 1-second scrolling.

It reminded me, when you said that earlier, that if you go back and read Jeff Bezos's shareholder letters, he talks about why he invented the Kindle. He said the Kindle was an antidote to short attention spans. He was worried that people weren't going to read anymore.

Yeah. I'm deeply impressed by the Kindle, by the way, as a product. It's not just the technology, like the passive screens and so forth. What people miss is the business-model innovation they did.

Whispersync silently updates in the background because they bought a certain amount of mobile data. It's a great product.

Explain the business-model innovation on the Kindle.

Normally, you would have to pay for data. If you had been lazy—which they weren't—you would have said, “Here's a Kindle. Now go and buy a monthly mobile subscription for the books to update.”

What they did was sign deals with these carriers. They calculated the average book size, and they made a fixed-cost deal where all the data, essentially forever, was included in the price of the hardware. You bought this thing for a one-time cost, and it just magically updated. At the time, that was magic.

There was good business-model innovation on top of all the product innovation, which is something I'm very passionate about. I believe that technology is a necessary ingredient for change, but not sufficient.

I think you can cause havoc with technology, like piracy, but things really change when you take a new technology and marry it with a new, often contrarian, business model. This is the Spotify story of access versus ownership, for example, which is also why I would love Steve Jobs to be around—but also not, because he tried to kill us many times.

It's funny. We had this conversation, and we had Jimmy Iovine on the show earlier. Jimmy was in the top 3 people I wanted to meet of all time because I love “The Defiant Ones,” the documentary about him and Dr. Dre.

I've watched it—I don't know—10 times now or something. It's weird because Jimmy and I are friends, and we live close to each other. He swears up and down. He's like, “I was going to kill him. Apple held me back.”

And I was like, “Jimmy, there's just no way. You're a small part of a huge company that built the most successful consumer product of all time.”

These were small guys in a tiny... There’s like 5 million people in Sweden, something like that? They only had one thing. I always love this idea—it was Josh Kushner's quote—that if you had to pick between the person who's the most experienced, the smartest, or wants it the most, you always bet on the person who wants it the most.

If they didn't succeed, they would've died. If Apple Music didn't work out, they would've been fine. I think he said that when he started the fight with you guys, you only had—I don't know—3 million, 10 million, or 15 million subscribers.

And then you just smoked them.

A lot of people were very, very scared at the time.

Because he was a legend, and he still is. He's a killer.

He was a legend.

I mean, dude, to this day, even though he's retired—

He's the best.

Daniel and I talk about this all the time because it's hilarious. They're obviously close friends, too. And, yeah, he's a formidable individual.

But again, I think being up against a bigger company—

Yeah.

—and again, it was just very fascinating.

But imagine that you're a fairly small Swedish startup, and you think you're good at product. Then the biggest, most respected product company in the world—and the person you look up to the most, Steve Jobs—says that he's coming after you.

Not only that, he goes and buys Beats Music and brings in Dr. Dre and Jimmy Iovine. It's like, “We're going to kill you.” That's what they literally said in their internal meetings. “They gave us 6 months.”

Those were hard times.

Yeah.

We worked very hard, but it worked out. There have been a few of those moments.

There's a great line about this because, if you think about it, Jimmy is experienced in the music industry. It's just fascinating. They tell the story in the documentary, obviously, starting out sweeping the floor in the Record Plant, then becoming an engineer, then a producer, then one of the most successful creators of a new record company, and then building products.

The reason I recommend people study his story is that people who can succeed in so many different domains over multiple decades—that's not luck. There's something going on that they know.

100%. Yeah, you don't get that lucky that many times.

Yeah, for sure. So it had to be terrifying from your end. But the one thing—I think there's a great maxim from “Game of Thrones,” which I'm obsessed with—and it says, “Those on the margins often come to control the center.”

And if you think about it, it couldn't have been more marginal than this group of Swedish guys in this tiny country trying to take over and build the company you guys built.

There were some good, hard reasons why we didn't get crushed then.

What do you think they were?

Well, I think the content side of the business was incredibly worried because, if it was only about content and only about musicians, you had hip-hop, which has the largest appeal in the US, and all these powerful people.

But there were some structural reasons. When we created our strategy, we bet on 3 things, and they were all basically counterpositions to Apple, deliberately.

One was freemium. We believed that Apple would, if they even did a free product, struggle to do advertising.

They just hated ads?

They tried iAd, but they wanted so much control that it didn't work. So we bet that they wouldn't do a good free tier, and we focused a lot on freemium and a really good free tier.

The 2nd was personalization. Because Apple was, I would almost say, against data at the time, we bet that they would never get good at personalization and recommendation.

And we believed that was the future. The third was ubiquity. We bet that Apple was going to prefer its own products and never be good on a Samsung TV or an Android phone. So, these were our 3 bets: freemium, personalization, and ubiquity. I have to say, they panned out really well.

They’re still struggling on that. They had a free tier for a while with radio, but they pulled it back. On ubiquity, I think they still struggle to be good on non-Apple hardware. And with personalization, I want to say we’re better. So, there were real strategic reasons, and still are, for why I think we held out. But it was also, to your point, that for us, this was not optional. We either died or we did this.

You’re burning the boats. Your back is against the wall. What are you going to do?

Or, I think, to your point, I don’t know what the priority of Apple Music was at the time, but it was not more important than the iPhone, for sure.

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Everybody’s going to know what Spotify is. I don’t think many people know who you are. You’ve only done a few podcasts. The one you did with Patrick, I thought, was excellent. But I want to go into some of the things that I know about you that I think are very unusual.

We talked about the dangers of some of these social apps, and you have built your own AI agent. Can you explain how you consume X, for example, and what you’ve built?

This is something I’m working on at Spotify, and we released it just a few weeks ago: something called Save to Spotify. When you’re in Claude Code or Codex or something, you can ask these agents to go out and look at information for you, write your podcast script, and then generate a podcast. Then we allow you to upload that to Spotify, but privately, because you may put private information in there.

Maybe you want to prep for your interview, as I did today. I don’t want that to be all over Spotify. So, we now support private podcasts, or personal podcasts. What I do is use these agents and take a combination of my personal information—documents I have and things I want to prepare for—and what I’m interested in across my different services and interests.

Spotify knows my interests pretty well from all my listening. It goes out and looks up what’s happening in the world, and then it gives me this deeply personal update about what’s happening in the world that I might be interested in. It’s kind of like a personal algorithm that filters out a lot of the noise and the craziness that I don’t want to hear and just gives me the stuff that I want to hear.

This is the kind of user control that I would like to give every user, but it’s the kind of user control that you can have now if you’re prepared to put in the work. What’s interesting is, I didn’t expect this, but I found so much music and so many podcasts through it. Then it’s filtered to the people that I’m interested in, that I follow on different social media, and so forth. So, it’s the thing being talked about among the people I care about.

For example, your episode with Evan Spiegel came up again and again, with lots of commentary in my personal podcast saying, “This stuff is really interesting for you. You should listen to this, because there’s product wisdom in there,” and so forth. I listened to the whole episode, which I really liked, by the way. I’m thinking about stealing his framing: We used to have all the ideas but limited resources. Now we have all the ideas and all the resources. I really like that.

The thing about Evan is, people give me shit. They’re like, “Yeah, but look at his market cap.” I don’t care about his market cap.

No.

I care about the fact that you think he is truly differentiated.

He is different.

I spent a bunch of time with him. At the end, I thought, “I just want him to win.” I don’t care about his market cap. We can figure it out. Then everybody’s like, “Oh, but his stock’s down 80%,” or something like that. So, I went to ChatGPT and asked, “How many times did Steve Jobs suffer a 75% decline?”

Mm-hmm.

It was like 4 times. This happens in everybody’s career.

Yeah.

The kid is young. He’s not a kid.

Yeah.

The guy is young.

Yeah.

Let’s see what happens over the next decade.

Yeah. But the fact is, he’s got a lot of very, very interesting ideas that no one else has. And he invented a pattern on social media that a billion people use every day.

He invented several of them, right?

Yes.

The disappearing image, the Stories, all these things.

You think that guy’s not interesting to hear talk for an hour? You’re f***ing crazy.

Of course. No, I like him. Maybe it’s because I’m a product guy. Design guys are close, but I like him for sure.

This is one of the most fascinating things about you, and I think it’s really, really important to drill down on. It’s really dangerous for people not to do this. You are constantly trying to eliminate noise. Even before you turned this into audio, you were essentially taking text and turning it into audio with the feature you just talked about.

But when we talked about this—or maybe I heard you talk about it on a podcast—you could read it before, right? It was like stripping out all the crazy shit that happens on X, the people fighting over politics. It’s just like that: What are the people I care about? What are they talking about?

Exactly.

That’s not going to induce me. It’s not going to raise my cortisol levels or make me sad.

I literally ask my agent to filter for rage bait, clickbait, and politics. This is the kind of user control that you can have now, but very few people understand that you can have it yet. It’s too complicated, but you can have all that control.

What I think is that most people know what they want, but you get captured in the moment. It’s like you want something, and then someone puts candy in front of you—you’re going to take that candy. So, what’s interesting is, can you give people the chance to decide their own future ahead of time? This is the idea behind the taste profile and behind these agents.

I’m not better than anyone else. I get captured all the time. My specific pet peeve is road rage. I’m so fascinated by it. I just go down dark holes of road rage because it’s the weirdest thing. These supposedly fully normal, smart people waste their entire lives and go to jail.

They shoot into cars and kill kids.

Yes.

It’s disgusting.

And then afterward, you realize that they were pretty normal people. It’s just that somehow, inside your car, you lose it. So, I go down that rabbit hole, and I watch hours of road rage.

But what I can do now is say, “Don’t show me road rage,” because I know what’s going to happen. So, what do you call it? Ahead of time, premeditated.

Yeah, premeditated.

Premeditated media is something that I think everyone should at least have access to if they want to. It works for me, and I think it will work for a lot of people. That need is not going to get less. It’s not going to get smaller. It’s going to get bigger. So, I happen to think it’s also good business.

Something just popped into my mind when you were speaking just now. I’m very curious who influenced you.

We’re talking about essentially your information diet, right? What you’re letting into your mind. You talked about how we literally are our thoughts. You’re crazy to let people get into your brain and affect you.

I was talking to MrBeast about this yesterday, and he was like, “I don’t think people should have Instagram,” because it’s making all these young kids compare themselves. Comparison is the thief of joy, and all they’re doing all day long is comparing somebody else’s highlight reel to themselves. It’s very, very bad for you to let that into your brain.

One of my favorite things—I think Daniel said it on this podcast last year—is that I’m always curious when I meet people, especially insanely successful people. I always ask, “Who tells you the truth?” because very few people can answer that. A lot of them have this almost cloud of sycophants around them that filters the knowledge getting to them.

Yeah.

What they’ll do is seek out people they can trust, who will tell them the truth. And I think he told the story of you being one of those people for Daniel, because you pulled him aside and said, “Hey, you’re running product, and you’re not good at it. You’re kind of f***ing this up.”

His response was that he went home—I think he told his wife—“Oh my God, I have to fire this guy.” It was you. Then he thought about it and said, “Oh, he’s right. It’s like he just did me a service.”

Very few people are that strong and can take that kind of...

But that's why he's successful, right?

Yes.

And so I think this is really important: who does that for you?

So I do a version of the same thing. This goes back to the importance of long tenure. I have people who are long-tenured, and I've had huge disagreements with them. They've realized that when they talk back to me or get upset with me, there are no consequences, right? But that comfort takes a long while to build.

You can't expect someone to come in, especially if they've come from corporate America, and expect them to stand up to you, because usually there are consequences. You just get fired. So, I've built—

Oh yeah, but people don't know: you're a brown belt?

No, I'm a blue belt.

Oh, a blue belt in jiu-jitsu, so you could also choke them.

There are many people who could choke me out, so that's a risky path to take.

Yeah.

It's the tenure. I have a bunch of people around me who I think and hope feel comfortable saying, “No, you're wrong. I think you're just not understanding this.” And I know that because they do. They've learned that I can't always control myself. I'm very passionate about something, and I'm like, “No, you're wrong. That's stupid,” and so on. Then they know there aren't going to be consequences, so they say it anyway.

I try to do that more in one-on-ones or small groups. Sometimes there's a big meeting, and someone who has worked with me for a long time feels very comfortable and just says, “No, I think that's a stupid idea.” And I'm like, “No, your idea is stupid.” Everyone around us is like, “Oh, shit. Now everyone is going to get fired.” So, you have to build that trust over time. I have a version of the same thing.

Okay, so we talked about tenure at the very beginning of this conversation, when I never finished a thought while asking MrBeast about turnover on his talent team—the most talented people there. He's like, “There's a value here,” because the guy who runs his operations has been there. They used to live together. He's like, “I've spent not 10,000 hours talking to this guy, but 30,000 hours.”

They walk on set, and since he's running his operations, they're running 10 at a time. MrBeast can walk on set, and before he looks up, the guy—his name's Tyler—is like, “I already know about this, and this is why I made this decision. We're doing this. You may not like this shot, but we're doing this shot because it allows us to shoot from this angle.” Literally, nothing even has to come out.

Yeah.

What's the thing from Star Trek with the Vulcan mind meld? I think it was called—

Yeah, exactly.

So, see, that's what happens.

Yeah.

And he said the greatest thing. He goes, “You don't get that in 100 hours.”

One benefit of tenure is trust. People keep you honest, unless you become too full of yourself, which is always a risk with success. But the other benefit is simply efficiency: people know. You don't have to give as much context.

There are some downsides to tenure, which is the opposite of Elon’s. You don't get fresh blood as much, and so you need to be careful. Maybe you're eventually just a group of old people, right? So, you have to control for that. I try to make sure that we also hire some new people, but these are the 2 benefits: efficiency and trust.

The group of old people is something you have to be very, very careful with. Think about the most talented people Walt Disney had. It was these 9 guys, these animators. I think they used to call them the old men after Walt died. I just talked to Ed Catmull, the founder of Pixar.

Mm-hmm.

He's going in there as a young technologist, trying to pitch them a new way to animate. Walt's dead. These guys are old. He's saying, “Here's a new way to animate,” and they're like, “The computers will never be able to do the stuff that you're talking about.” They reject it. It's very human—

Yeah.

—nature to just reject these new ideas.

So, it's back to you to optimize for some things, but then you have to mitigate for the other things. If you're optimized for tenure, you have to mitigate for the risk that you don't get fresh blood and that your career ladder is slow. Maybe people who are talented feel like, “Well, that's going to take 10 years to get up the career ladder.” So then you have to create programs to give them exposure.

It took Gustav 18 years to become CEO.

Yeah, it took 18 years to become CEO. Wow, that's a long time. I finally made it. But it is the same principle.

Well, how do you get new talent, then? What are you guys doing literally at Spotify? Because I know you have the same idea that Tobi from Shopify talked to me about, and my friend Karim from Ramp does.

Yeah, that was another great episode, by the way—the Tobi episode.

Yeah, he's the best. But you guys are fine hiring for spikes.

Yeah.

How are you getting new talent into a huge platform business that's been around for—I think it just celebrated its 20-year anniversary, right?

Yes, exactly.

So, it's a couple of things. One is that you get junior talent, and then we have this Rising Stars program. We literally ask managers to identify rising stars. We have a program for them every year; it's maybe 20 or 30 people.

They get to go on this program, where they go out into different markets, like India, the US, Germany, and so on, and learn about the different problems in different markets. Then they go and sit with Alex and talk to him; then they sit with me. It's literally an internal MBA program where you learn business, technology, and product, and build relationships across the organization.

These people come out 12 months later knowing everyone at Spotify across the world, so they can get anything done. Now they're going to start rising much faster. We have these specific programs to identify talent and help them accelerate, versus the organic path of them doing something, getting noticed, and slowly working their way up. So, that's one thing.

But every now and then, you also just have to hire at the more senior level. If you look at when AI started happening—or it was called machine learning back then—I felt that we just weren't strong enough in deep learning specifically. We knew the old-school matrix factorization stuff. So, we acquired a company called The Echo Nest in Boston, just to get very close to MIT. Then we had a bunch of talent in that field and established ourselves.

Sometimes you have to do acquisitions and get people when it's a completely new skill. If you need to get big in crypto quickly, you can wait for years for the organization to understand crypto and learn. You may have to acquire or hire at a more senior level. You have to mitigate for the problems of tenure.

And if I'm going to make some far-fetched analogies, maybe this is one of the challenges that Apple had with machine learning and AI, on average. They were—

Is that why Siri is so bad?

—slightly too old to see that. Probably, people in their organization knew all about it and were all over it. It was just too late to see it. They should have gotten someone at a more senior level sooner. So, sometimes you have to mitigate the drawbacks of long tenure as well.

What's the thing that keeps you up at night? What do you think is the weakest spot for Spotify right now?

I think the thing that keeps me up at night is not surprising: what AI truly means in the limit. I'm pretty sure that media habits are going to change because of AI, and so I don't think it's an option to just sit still.

But the way I think about it is that the world moves in macro waves. You get some new technology, and it often causes a bunch of havoc. Then there's some new business model that emerges, and things change, right?

This was the original Spotify. We rode on the macro wave of cheap broadband and PCs, right? All of a sudden, they were so ubiquitous and the broadband was so fast that you didn't actually need to own files anymore. You could just stream them, right? We realized that. We built a business model around it. That became very disruptive to the download industry and so forth.

Then you wait a few years, everything looks great, and the smartphone comes along. Now everything changes again. You have people who don't have a computer. We only had a free tier on computers; we had no free tier on mobile. It turns out that while the PC and the internet—the desktop—had such low latency that you could stream, if you tried to stream a song over cellular back in 2008, it wouldn't even start. It took 20 seconds to start, and it would choke.

So, everything changed again, and then we had to adapt to that. We managed to. We came up with the offline-sync business model, the mobile model, and so forth. But then you get these periods of stability.

If I were an analyst and I tried to predict the world from 2015 to 2025—those 10 years—just what would the world be like, I would have done really well to extrapolate: more mobile, more subscriptions, more ads, more of everything. You would have gotten really close to what happened.

But if you had shifted that 10 years earlier, from 2005 to 2015, you would have extrapolated PCs and the internet. You would have missed the smartphone. You would have missed everything. You would have missed Uber. You would have missed the entire world.

So, the question is, which era are we in? Are we in the calm waters of extrapolation, or are we in a period of macro change? I think we're in one of those periods where everything changes. I can't tell you what's going to change, but I'm pretty sure that things are going to change.

The way we think of it as a company is that the scariest periods are the periods of change. Guess when Spotify grew the most?

Periods of change.

When things are stable, market share stays stable.

You don't eat market share. So, when there's change, there's a risk you can lose market share, but that is also when you have the most opportunity to eat market share if you adopt the change. So, my principle is just always be first. Be first and adopt it first. The world is going to change. Just accept that and get ahead of the curve.

So, I think this is a time of great opportunity for us to do new things, but it is also the thing I'm thinking about constantly. What does it actually mean, and what are the right bets? Are the right bets to bet on user control and these things, whereas others are going to bet the complete opposite of us? So, that's what keeps me up at night: we're still in this change. It hasn't finished yet.

No one knows exactly where it's going to end up. They're going to be the Ubers and Airbnbs of this era. And maybe they are OpenAI and Anthropic, but maybe not. Maybe it hasn't even happened yet.

That's a perfect place to end. Gustav, thanks for doing this, man. Always good to talk to you.

Thank you, man.

Appreciate it, man. I hope you enjoyed this episode. Please remember to subscribe wherever you’re listening, and leave a review, and make sure you listen to my other podcast, Founders. For almost a decade, I’ve obsessively read over 400 biographies of history’s greatest entrepreneurs, searching for ideas that you can use in your work. Most of the guests you hear on this show first found me through Founders.