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Varun Mohan: Why Insights Depreciate and Why Evals Compound

Windsurf rebuilt from GPU virtualization to vibe coding in 48 hours; evals and irrational optimism are the moats when every competitive insight depreciates.

Varun MohanguestGarry Tanhost
May 2, 202552mWatch on YouTube ↗

EVERY SPOKEN WORD

  1. 0:00 – 0:53

    Intro

    1. VM

      One of the things that I think is, is true for any startup is you have to keep proving yourself. Every single insight that we have is a depreciating insight. You look at a company like NVIDIA. If NVIDIA doesn't innovate in the next two years, AMD will be on their case. That's why I'm completely okay with a lot of our insights being wrong. Um, if we don't continually have insights that we are executing on, uh, we are just slowly dying. This notion of just a developer is, is probably gonna broaden out to what's called a builder, and, uh, I think everyone is gonna be a builder. I think software is gonna be this very, very democratized thing.

    2. GT

      (Intro music) Welcome back to another episode of The Light Cone. Today, we've got a real treat. We have the co-founder and CEO of Windsurf, one of the people who literally brought Vibe Coding into existence.

    3. VM

      (laughs)

    4. GT

      Varun, thanks for joining us.

    5. VM

      Thanks for having me, you guys.

    6. GT

      Where is

  2. 0:53 – 3:00

    Windsurf - how big is it, where did it start?

    1. GT

      Windsurf now? Like, all of us intuitively know... I mean, well, we use it, but, you know, how big is it now? Where is it?

    2. VM

      Yeah, so the, the product has had well over a million developers kind of use, uh, the product. Um, has, has hundreds of thousands of daily active users right now. It's being used for all sorts of things, from modifying large codebases to building apps extremely quickly, zero to one. Um, and, uh, and we're super excited to see where the technology's going.

    3. GT

      Let's get to the brass tacks. How'd you get started?

    4. VM

      The company actually started, uh, four years ago. Uh, we didn't start as Windsurf. Uh, we actually started as a company called Exafunction. We were a GPU virtualization company at the time. Uh, previously, me and my co-founder had worked on autonomous vehicles and ARVR, and we believed deep learning was gonna transform many, many industries, uh, from financial services to defense to healthcare. Uh, many industries.

    5. GT

      You were right.

    6. VM

      Yeah. Uh, we might have timed it wrong though. Ultimately, we built a system to make it easier to run these deep learning workloads. Uh, and similar to what VMware does for computers and CPUs, we did that for GPUs. Um, the middle of 2022 rolled around though, and what happened at the time was we were managing upwards of 10,000 GPUs for a handful of companies, and we had made it to a couple million in revenue. But the transformer became very popular with these models like Text-Davinci from OpenAI, and we felt that that was gonna fundamentally disrupt the business we had, or that small, small business that we had at the time. Uh, because we felt that everyone was gonna run these transformer-type models, and in a world in which everyone was gonna run one type of model architecture of transformers, we thought if we were a GPU infrastructure provider, we would get commoditized, right? "If everyone's gonna do the same thing, what is our alpha, alpha gonna be?" So at the time, we basically said, "Hey, could we take our technology and wholesale pivot the company to do something else?" And that's-

    7. GT

      That's scary.

    8. VM

      Yeah, that was, that was a, a "bet the company" moment. We did it within a weekend. Uh, so, you know, weekend, me and my co-founder had a conversation along the lines of, "I don't think this is gonna work. We don't think we know how to scale this company." Um, and, uh, at the time, we were early adopters of GitHub Copilot. We told the rest of the company on Monday, and, uh, everyone started working on Codium, which is the extension product, uh, the Monday immediately

  3. 3:00 – 6:20

    The big pivot

    1. VM

      after.

    2. SP

      I'm just curious to, like, dig into this pivot story, because it's, like, pretty rare actually to hear, like, the details of a pivot, especially a late-stage pivot. Like, at the time that you guys decided to pivot to Codium, how far along was the company? How many, how many people?

    3. VM

      One of the things about the company was, I guess, like, we tried to embrace a lot of the YC, uh, sort of analogies here of, you know, ramen profitability, all these other, uh, sort of key insights. We were only a team of eight people at the time, even though we were making a couple million in revenue, so we were kind of like free cash flow positive. It was the peak of zero interest rate, uh, at that time. So the company was a year and a half old. We'd raised, somehow magically, $28 million of, of cash at the time, and, uh, I think the big point here, uh, in our, in our minds was, um, "It doesn't matter if we're doing kind of well now. If we didn't know how to scale it, we kinda need to change things, like, really fast."

    4. GT

      I guess the thing that's remarkable is when you started the company, you had this thesis where you were betting that a lot of companies were going to build on custom deep learning pipelines to train BERTs, right? That was, like, the thing that was working. But in 2022, you saw the hockey stick shift. That suddenly, there would be one model that would rule them all. So you were foreshadowing a lot of the future, and there's a lot of it that came from that conviction. So I'm curious, what were those signs? Because you had to be really embedded into it to... "We're making already seven figures." You could have raised a series A, you were like, "We're gonna throw that, all that away and burn it."

    5. VM

      Yeah, so actually, even crazy enough, we had raised our series A at that time.

    6. GT

      Okay, you had raised it.

    7. VM

      So we had... So, but whether or not we should have been able to is a, is a different question.

    8. GT

      (laughs)

    9. VM

      No, I think you're, you're totally right. I think one of the things that was happening at the time was we were working with, largely speaking, these autonomous vehicle companies, because they had the largest sort of deep learning workloads at the time, and we were sort of seeing, "Hey, that workload is growing and it's large," but we were betting fundamentally that the other workloads, which were these other natural language workloads, uh, kind of like these workloads in these other industries, like financial services, healthcare, would take off. But I think once we saw these, these models, these generative models handle so many of the use cases, right? Uh, maybe an example is in the past, you would train a BERT model, uh, to actually go out and do sentiment classification. But very quickly, when we tried even a bad version of GPT-3, like the very old version, we were like, "This is gonna kill sentiment classification." There was no reason why anyone is gonna train a very custom model anymore for this task. Uh, I think we saw the writing on the wall that our hypothesis was just wrong, right? And, uh, and that's like one of those things, right? You go in with some thesis on, on, uh, on where you believe this space is gonna go, but if your hypothesis is wrong and, and, you know, information on the ground changes, you have to change really fast.

    10. GT

      So then what did you decide to do? So it's like you decided, "Okay, we're gonna pivot," and when we work with founders, that's kind of stage one, so you're not half foot in, half foot out. So you had that conviction, "We need to try something out." How did you figure out what was gonna be the next step?

    11. VM

      I think we needed to pick something that actually everyone at the company was gonna be excited about. I think if we had picked something that...... was, was what we thought could be valuable, but people were not excited about, we would, ultimately, we would fail.

    12. SP

      Hmm.

    13. VM

      We'd fail immediately. We came with an opinion and a stance of we were early adopters of a product called GitHub Copilot. We thought that that was the tip of the iceberg on where the technology could go. Obviously, everyone at the company was a developer. Uh, dev tool companies, generally speaking, usually don't do that well, and, uh, in the past, they have not. But hey, like, when you have no other

  4. 6:20 – 7:52

    Irrational optimism + uncompromising realism

    1. VM

      options, it's a very easy decision, (laughs) right? Like, you're gonna be a zero with a high probability anyways. Uh, you might as well pick something that you think could be valuable and everyone's gonna be motivated to work on.

    2. SP

      I, everyone's forgot this now, it feels like, because GitHub Copilot's in the background, but...

    3. GT

      Hmm.

    4. SP

      ... at that particular moment, it felt inevitable that Copilot was gonna win, right? Like, it just had everything, like, the GitHub connection, Microsoft distribution, like...

    5. VM

      OpenAI.

    6. SP

      OpenAI, yeah. Like, it, it wa- it seemed like no one could compete. So, how did you have, like, the bravery to be like, "Oh, yeah, we can totally crush-"

    7. VM

      Yeah.

    8. SP

      "... Copilot?"

    9. VM

      Yeah. So, this is where, uh, there's, there's, like, an irrational optimism piece. I've said this before, but, uh, to the company, but I think startups require, like, two distinct beliefs and they're, they actually kind of, like, run counter, uh, to, to each other. You need this irrational optimism because if you don't have the optimism, you just won't do anything. You're just a pessimist and a skeptic, and those people don't really accomplish anything in life. Um, and you need uncompromising realism, which is that when the, when the facts change, you actually change your mind, right? Uh, and that's a very hard thing to do both because the thing that makes you succeed through irrational optimism, like, you know, is exactly opposite of the things that a- allow you to be-

    10. SP

      Yeah.

    11. VM

      ... a very realistic company. So, irrational optimism. We basically said, "Hey, we know how to run and train models ourselves." We actually trained the first autocomplete models ourselves and ran it on our product, gave it out for free. I don't think we had the exact roadmap on where this was going, but we just felt there was a lot more to do here. Um, and if the, if, uh, if we couldn't do it, then I guess we'd die-

    12. SP

      (laughs)

    13. VM

      ... uh, but we might as well bet that we could do it.

  5. 7:52 – 10:26

    Earliest versions shipped

    1. SP

      W- were your early versions better than Copilot, GitHub Copilot at the time?

    2. VM

      So, our earliest version that we shipped out was materially worse than GitHub Copilot. The only difference was it was free. Uh-

    3. GT

      Hmm.

    4. VM

      ... we built a VS Code extension. After pivot, within, I think, two months, we had shipped the product and given it out to Hacker News, uh, like, posted something on Hacker News. Um, and, uh, we, we built that out. It was missing a lot of key features, like the model that we were running was, like, an open source model that was not nearly good as the model that GitHub Copilot was running. Uh, very quickly then, our training infrastructure got better, so we actually went out and trained our own models, uh, based on the task, and then suddenly, it actually got capabilities that even GitHub Copilot didn't within two months, basic capabilities. Now, we find this, like, hilarious that it was even state-of-the-art, but our, our model could actually fill in the middle of code, so when you're writing code, you're not only just adding code at the end of your cursor, but you're filling it in between two parts-

    5. GT

      Hmm.

    6. VM

      ... between two parts of a line, right? And that code is very incomplete and looks nothing like the training data of these original models, right? So, we trained our models to make it actually very, very capable for that use case, and, uh, that actually allowed us to pull ahead in terms of the quality latency, um, we were able to control a lot of details within a couple months. So, the beginning of 2023, I'd say the autocomplete capabilities were much better than what Copilot had.

    7. SP

      Was that a totally new capability for you guys? 'Cause like, well, you guys have been building GPU infrastructure. It sounds like you basically hacked together the first version by taking an off-the-shelf open source model, sticking it into, like, a VS Code extension and just kind of, like, wiring the two to, like, talk to each other, but then right after that, you had to train your own coding model, like, from scratch. And you guys have been, like, following the transformer stuff, but, like, you hadn't built it. Like, in order to do that, I assume you had to, like, download all of GitHub and, like, train a whole model from scratch. So, how did you all figure out how to do that in, like, only two months?

    8. VM

      Yeah, um, it's a, it's a great question. So, first of all, when we ran the model ourselves, the reason why we were able to run it and provide it for free is we actually had our own inference runtime at the time.

    9. GT

      Hmm.

    10. VM

      And that, that obviously came from the fact that we were originally a GPU virtualization company to start with, so that enabled us to actually ship the v0 with an open source product, uh, quite quickly. Immediately after that, you're totally right, we had never trained a model like this in the past, uh, but I think we hired people that were smart, capable, and, and, uh, excited to, to win. Uh, so we needed to figure it out. There was no other option, right? Otherwise, you die.

    11. SP

      (laughs)

    12. VM

      Uh, makes the decision making really, really simple. So yeah, we had to figure out how, how do you get a lot of data, how do you do this at scale, how do you clean this data, how do you make it so that it's actually capable of, of, uh, handling this case where code is very incomplete? And, uh, we shipped, uh, we shipped, uh, a model, like, very, very quickly after that.

    13. SP

      Wow, and you did all of that with, like, eight-ish people-

    14. VM

      Yes.

    15. SP

      ... in two months?

    16. VM

      Yeah. That's

  6. 10:26 – 13:13

    The first customers

    1. VM

      right.

    2. GT

      And then, right after that, because you were running your own models, you started getting interesting customers, right?

    3. VM

      Yeah. So basically, what happened, the product was free at the time, so we ended up getting a lot of developers using the product across all the IDEs. So, VS Code, JetBrains, um, Eclipse, Vim. Companies started reaching out because they not- wanted to not only, I guess, run the product in a secure way, they also wanted to personalize it to all the private data inside the company. So, very quickly afterwards, in the next coming months, companies like Dell, uh, JPMorgan Chase started to become customers of our, of our product. Um, now these companies have, like, tens of thousands of developers on the product internally. But we started actually pa- ma- uh, making a lot of focus of the company making sure that the product works on these very large code bases. Some of these companies have code bases that are well over 100 million lines of code, right? And making sure that the suggestions are, are fast is one thing, but making sure it's actually personalized to the code base and the environment that they have was almost a requirement at the time.

    4. GT

      You did that pivot, you built it in two months, then shipped it, and within a couple of months, you got these big logos.

    5. VM

      Yeah. So, I mean, obviously these companies take some time to, time to close, but pilots were starting, uh, within a, within, like, a couple months or a quarter after that. Uh, you know, obviously, we had no salespeople at the company, so, like, the founding team was just trying to run as many pilots as possible to see what would ultimately work.

    6. SP

      At what point did you expand beyond just the VS Code extension into supporting all these other IDEs?

    7. VM

      That was actually very, very soon afterwards. Um-

    8. SP

      Wh- how did you think about that? Like, uh, you know, there's, like, one argument that you could make, which is, like, there's lots of VS Code developers, you had a tiny team. You could have made the argument that, oh, just focus on building a great experience for VS Code, you'd only captured a tiny percentage of the market of all possible VS, VS, VS Code developers, and that- that's not what you did. You expanded, like, horizontally very quickly and built extensions for all those IDEs, so w- why?

    9. VM

      I think maybe the fundamental reason that w-... that we thought was quite critical is if we were gonna work with companies, companies have developers that write in many languages. Uh, like for instance, uh, like, you know, a company like JPMorgan Chase might have over half of their developers writing in Java. And for those developers, they are going to use JetBrains and IntelliJ. IntelliJ is over 70 to 80% of all Java developers in the world currently use, uh, IntelliJ right now. So, we would just need to turn away a lot of companies. Like, a lot of companies would not be able to use us as the de facto solution. Uh, like, we'd be one of many solutions inside the company. Um, so because of that, we made the decision. But luckily, because we made the decision early enough, it changed the architecture of how we built the product out. Which is to say, we are not, like, building a separate version of the product for every single IDE. We have a lot of shared infrastructure that actually lives on a per editor basis, so it's actually a very, very small amount of code that actually needs to get written to make sure we can support as many IDEs as possible. Um, so this is one of those things that an early decision that we made ended up making it much easier to make this transition.

    10. GT

      How about

  7. 13:13 – 19:45

    The transition from Codeium to Windsurf

    1. GT

      the transition from Codium to Windsurf?

    2. VM

      At the time, we, you know, now- now we're probably going to middle of 2023. We start working with some very large enterprises. Within the next year, like, the business has gone well over sort of eight figures in- in- in revenue, um, just from these enterprises using the product, and we have this, like, free individual product. But I think one of the things about this industry that we all kind of know is the space moves really, really fast. And, uh, we basically are always making bets on things that are not working, right? Actually, most of the bets we make in the company don't work, and I'm excited, uh, when... I'm, like, happy when we're- when we're- let's say only 50% of the things we're doing are actually working. Because I think when- if 100% of the things we're doing, uh, are working, um, I think, like, it's a very bad sign for us because it's probably like one of- one of maybe three things. Um, the first thing it- it- it is, is like, hey, we're not trying hard enough, uh, right? That's- that's probably what it means. The second thing is, we somehow have a lot of hubris, right? And the hubris is like, we believe everything we do is right, even despite-

    3. GT

      Mm-hmm.

    4. VM

      ... the facts that are- that are sort of on the ground. And then, um, the- the sort of third key pieces here is, we're not actually testing our hypotheses in a way that, like, tells us where the future is going. W- we're not actually at the frontier of what the capabilities and technology, um, ultimately is. So, we believed actually in the very beginning of last year that agents were gonna be extremely huge, and we had prototypes of this in the beginning of last year, and- and they just didn't work. But there were different pieces we were building that we felt were going to be important to making agents work, which is understanding large code bases, understanding the intent of developers, making edits on the code base really, really quickly. And we had all these pieces. The thing we didn't have is a model that was capable of calling these tools efficiently enough. And then obviously in the middle of last year, that completely changed with the advent of, like, Sonnet, um, 3.5, right? And with that, we basically said, "Okay, we now have these agented capabilities," but the ceiling of what is- we can show to our developers on VSCode was limited. We were not able to provide a good enough experience and we thought what was going to happen is developers would spend way more time not writing software, but reviewing software that the AI was gonna put out. We're, I think, a technology company at heart, and I- you know, I- I think we are a- we are a product company, but I think the product serves the technology. Which is to say, we want to make the product as good as possible to make it so that people can experience the technology, right? And we felt that we were... you know, with VSCode we were not able to do that. So the middle of last year we decided, hey, like, we need to actually go out and actually have our own IDE out there. Um, so that's what- that's what triggered actually creating Windsurf.

    5. GT

      The way that you did that was you forked VSCode-

    6. VM

      We forked to VSCode.

    7. GT

      ... was code. Was that a whole new set of capabilities that you guys had to learn, like basically how to, like, develop on this VSCode code base that I'm sure (laughs) is super complicated?

    8. VM

      Yeah, we needed to figure that out. Uh, that was one- once again, another thing where, uh, we ended up shipping Windsurf out in, uh, within, uh, less than three months of starting the project. Uh, that's when we- we shipped it out across all operating systems.

    9. GT

      Wow.

    10. VM

      Yeah.

    11. GT

      And what- what happened? Like, was- did it, like, take off immediately or was it unnoticed for- for a long time?

    12. VM

      It took off pretty quickly, I would say. Um, I think the speed at which it took off among early adopters was- was quite high. There were obviously some very rough edges, and this is like one of those things where, you know, because of the rough edges, obviously people started coming and leaving the platform fairly quickly. But what we saw was, like, as we improved the capabilities of the agent, as we improved the capabilities of the passive experience, even the passive tab experience has made massive leaps in, um, in the last, like, couple months. We started realizing that not only were people talking about the product more and more, uh, people were also staying on the product, uh, more and more at a higher rate.

    13. GT

      How many people worked on shipping Windsurf? And it was done in a period of one or two months?

    14. VM

      Uh, a couple months, so yeah.

    15. GT

      Yeah.

    16. VM

      Like, less than three months. Um, this was another... I wouldn't say it's a bet-the-company moment because it's not a fundamentally different, uh, sort of paradigm compared to, like, moving from a GPU virtualization product to a- to an- uh, like, an- an AI code product. But yeah, it was, uh, anyone that could work on it needed to kind of like drop what they were working on in the past and work on it immediately.

    17. GT

      And at that time, how- how big, uh, were you guys?

    18. VM

      The engineering team was probably still less than 25 people.

    19. GT

      Wow.

    20. GT

      This is crazy.

    21. VM

      Interestingly, our company actually, from an employee h- uh, standpoint, actually didn't have that few people. We actually had a fairly large go-to-market team because it's-

    22. GT

      Mm-hmm.

    23. VM

      ... in the AI space, one thing that's, like, a little bit weird about our company compared to most other companies is we have a fairly large go-to-market team. Like, we were selling our product to the largest Fortune 500 companies.

    24. GT

      Mm-hmm.

    25. VM

      It's very hard to do that purely by letting them swipe a credit card. Uh, you need a lot of support, you need to make sure that the- that the technology is, like, getting adopted properly, um, which is very different than just give the people the product and see it grow, um, effectively. So, from an engineering standpoint, we've always run fairly lean. Uh, but because of the market interest, we've always had a lot of people in go-to-market, actually.

    26. GT

      Who are the, like, sort of the ideal people to go into that function? Is it, you know, really good engineers who want to be forward deployed?

    27. VM

      Yeah. We- so we have two components of it. We have account executives. So, these are folks that, um... uh, in general, we- we try to find people that are very curious and excited about the capabilities. In fact, people that would use Windsurf in their free time because they're- they're providing the product to leaders who also love software and technology, right? So if they're- if they're just completely just unaware of the technology, they're not going to be helpful. And then we also have these deployed engineer, uh, like, sort of roles, uh, similar to what you said, uh, that get their hands really dirty with the technology and make sure that our customers get the most value from the- from the technology.

    28. GT

      I mean, the wild thing is, uh, because everyone uses Windsurf, it sounded like, um, you're having even these AEs who are non-technical become, like, just vibe coding champions.

    29. VM

      Yeah. No, one of our biggest users of Windsurf at the company is a- is a non-technical person who leads, uh, uh, like, partnerships, uh, at the company. Uh, he's actually replaced-... buying a bunch of sales tools, uh, inside the company, uh, and, uh, this is one of those things where I think Windsurf is giving power back to the domain experts, right? In the past, what would happen in an organization is, he would need to talk to s- a product manager who would talk to an engineer who... And the engineer would have a large backlog because they're... This clearly doesn't immediately make the product better, right? So this has to be a lower priority. But now he is actually kind of, uh, empowered to actually go and build these apps.

    30. GT

      Did he have any programming background at all?

  8. 19:45 – 23:15

    Going up against Github Copilot

    1. GT

      launch you went head-on against, like, Microsoft and GitHub and, like, you know, these incom- huge incumbents. With the IDE launch you went sort of head-on against Cursor, like the hot startup of the moment. And like, um, I don't know, again, how was, how did you all think about that internally?

    2. VM

      This might be a weird thing about our company, but our company just doesn't have, like, uh, like... Morale is not really affected by what-

    3. GT

      It does seem (laughs) to be coming across.

    4. VM

      ... what other companies do, right? Uh, it's not possible if, uh... Like y- Our company has gone through a lot of basically very turbulent times. The fact that we needed to pivot at ten, uh, ten, ten employees and just completely kill our idea-

    5. GT

      Okay.

    6. VM

      ... uh, is like a normal thing for the company. And then second of all, kind of like the companies that are relevant in our space has always been a fluctuating, uh, set of companies. Like, you know, I, I, I really respect all the companies in our space but, yeah, Copilot at... If you were to go to the beginning of 2023, everyone would have thought GitHub Copilot was the com- was the product that everyone would be, would use and there was no point in building. And then the middle, uh, kind of Devin came out and like everyone was like, "Hey, like, Devin is gonna solve everything," right? Um, and, and I'm sure they're doing good work now, uh, but... And then after that obviously Cursor is, is doing a really great job. So I think what really matters to us most is, are we actually... Do we have a good long-term strategy and are we executing in a way where we're getting towards that long-term strategy while being flexible with the details? Right? And as long as we're doing that, I think we'll, we have a fighter's chance, right? Uh, and that's like the way we've always operated.

    7. GT

      (laughs) D- do you educate yourself at all on the competitors' products, though?

    8. VM

      Yes. Yeah, yeah. I think we don't want to put our heads in the sand and kind of tell ourselves our product is awesome, um, and, uh, and, and just kind of... Because it's very easy to do that, um, especially given the fact that before we worked on Windsurf the company was also growing very, very quickly, uh, from like a revenue standpoint.

    9. GT

      What sort of opinions did you have or what taste or opinions did you have for the full IDE, um, that was sort of maybe different to Cursor?

    10. VM

      Yeah.

    11. GT

      What I'm actually just asking is Cursor's a very well-liked product, obviously.

    12. VM

      Yeah.

    13. GT

      And so at a product level, why were you like, "Oh, yeah, like actually we want to build it this way"?

    14. VM

      Yeah. No, I think it's a great question. Uh, so maybe the first point is, at the time actually when we started working on Windsurf, all the products were basically chat and this autocomplete, uh, capability. I think that's basically what, uh, GitHub Copilot was, what Cursor was at the time. I think we took a very opinionated stance that we thought agents were, were, uh, where the technology was actually going. We were the first agentic editor that was out there, um, and, uh, I think the biggest sort of takeaway was, we didn't believe in this kind of paradigm where everyone would be @mentioning everything.

    15. GT

      Yup.

    16. VM

      Right? This almost reminded us of like the anti-pattern of what Google and, and these search engines were before like Googles improved their product a lot, uh, which was kind of like these landing pages that had like every distinct kind of like bucket of things you could search for, but Google came out with this very clean search box. Even Google at the time, you would need... You would get better answers if you wrote "and" or, uh, like "sitelink," um, and now it's gotten way better, right? And I guess we had a belief that the, the software would get more and more easy to build, right? And we would build from that starting point. When we saw all the other players in the space making their product so configurable in a way that we thought was, I think, good for users now for where the technology was-

    17. GT

      Mm-hmm.

    18. VM

      ... but something that would be unnecessary down the line. So we invested in capabilities like, how do you deeply understand the code base to understand the intent of the developer? How do you, how do you actually go out and, uh, and, and make changes in a way that's like very quick, um, to the code base? So we took the approach of, "Hey, instead of having this read-only system where you tag everything, what happens if you could make changes very quickly?" And that's why like at the time we, we were kind of the first to do that. Now, if you were to ask like, is that a very obvious decision now? I think it's very obvious now. It looks very obvious. And this is

  9. 23:15 – 26:50

    All insights depreciate; you need to keep proving yourself

    1. VM

      where like one of the things that I think is, is true for any startup is you have to keep proving yourself, right? Like every single insight that we have is a depreciating insight, is a very, very depreciating insight. Like technology... The reason why companies win, um, at any given point is not like they had a tech- they had a tech insight like one year ago, right? Actually if a company wins, um, other than the fact that they have, you know, a monopoly, uh, you know, it's, it's, uh, it's actually like a compounding tech advantage that keeps sort of existing over and over again, and I think the example of this that I find most e- most exciting is you look at a company like NVIDIA. If NVIDIA doesn't innovate in the next two years, AMD will be on their case, right? And NVIDIA will not be able to make 60%, 70% gross margins at that point, right? Um, even though it's like one of the largest companies in existence, uh, right now. By basically having good insights to start with, you are able to learn from the market and maybe compound that advantage with time.

    2. GT

      Yeah. It sounds like a-

    3. VM

      And that's like the only thing that, that is, uh, that could be persistent.

    4. GT

      It sounds like a moat is, uh, you know, we think of it as a noun, but it's actually a verb.

    5. VM

      Yeah, something that could change with time, right? I, I also think for us, and I tell the company this, if we're not continuing to have insights... And s- that's why I'm completely okay with a lot of our insights being wrong. Um, if we don't continually have insights that we are executing on, uh, we are just slowly dying, um, that's like what's actually happening.

    6. GT

      I think the interesting thing is that it's easier now looking back and connecting the dots on your journey how a lot of these technology bets you took actually did end up compounding what Windsurf ended up becoming, right? Like it was happenstance and you being really good at GPU deployment VMware optimization ended up being the thing to be really good at you at being s- blazingly fast autocomplete because it's faster than other products, right? So that kind of compounded there. There's the aspect of you building all these, uh, plug-ins for enterprises and being so good at reading large code bases, and you did something that was contrarian. There was a lot of products when we work with IC companies, a lot of, uh-... code gen tools use, uh, vector databases because we work with a lot of companies and that's, was the standard approach how a lot of folks were building. But you guys did something very different, right?

    7. VM

      Yeah. So one of the things that sort of, uh, I think got really popular is this term RAG got very popular.

    8. GT

      Yeah. You've heard anti-RAG.

    9. SP

      Mm-hmm.

    10. VM

      Yeah. I don't know for anti- anti-RAG. RAG obviously makes sense. You do wanna retrieve some stuff and based on the retrieval, you wanna generate some stuff. So I guess the idea is, is correct that, you know, everything is retrieval augmented generation. But I think what people got maybe a little too opinionated about was, like, the way RAG is implemented. It has to be a vector database that you go out and search. I think a vector database is a tool in the toolkit, right? If you were to think about what users ultimately want, they want great answers and they want, uh, great agents. That's what they actually want. And how do you end up doing that? You need to make sure that what's in the context is as relevant as possible. So what we ended up doing is having a series of systems that enable us to pack the context with the most relevant snippets of code. And the way we ultimately did that was it was a combination of keyword search, RAG, abstract syntax free parsing, and then on top of that using, as you mentioned, all the GPU infrastructure we have to take large chunks of the code base and in real time re-rank it-

    11. SP

      Mm-hmm.

    12. VM

      ... right as the query is coming in, right? And we found that that is, like, the best way for us to find the best context for the user. And the, kind of the motivation for this is because people have kind of weird questions. They might have a question for a large code base of upgrade all versions of, of, uh, of this API to this API. And if embedding search only finds five of them, it's not, of the 10, it's not a very useful fea- a useful feature at that point. So we needed to make sure the precision recall was as high as possible, which meant that we used a series of technologies to actually get to the, get to the, the best solution.

  10. 26:50 – 30:15

    Strong evals go a long way

    1. GT

      There's a bit of a thing going on with a lot of S- AI startups getting built, taking too much of a sh- intellectual shortcut with what's, what works for the problem domain in space. But you took it from first principle, right? So you built like a way more complex system that did a ST parsing, ???

    2. SP

      Yeah.

    3. GT

      ... all this stuff, which is like, cool.

    4. VM

      Yeah. I think maybe one of the things that I, that is potentially interesting to discuss there is, is, uh, we started off, a lot of the companies started off working on autonomous vehicles.

    5. GT

      Mm-hmm.

    6. VM

      And the reason why that's kind of important is these are systems where you can't just YOLO these systems, which is to say you build the software and then you kind of like let it run. Uh, you need really good evaluation. I think at the company, we don't strive for complexity. We strive for what works. Uh, and then the question then is like, why is the system so much more complex now? It was because we built really good evaluation systems.

    7. SP

      Oh, interesting. How do the evals work?

    8. VM

      Yeah. So the evals for code are actually really cool. Uh, basically the idea is code... You can leverage a property of code, which it can be run.

    9. GT

      Mm.

    10. VM

      Right? Uh, and, uh, we not only have real-time user data, uh, we can put that aside for now, but we can take a lot of open source projects and find, I guess, commits in these open source projects, uh, with tests attached to them.

    11. GT

      Mm.

    12. VM

      So you can imagine a lot of cool things we can do based on that. You can take the intent of a commit, delete all the code that is not the unit test, right? And then you can see, Hey, are you able to retrieve the parts where the change needs to get made? Do you have a good high level intent to make those changes? And then after making the changes, does the test pass? You can do that task. You can mask the task. And by masking the task, it's, it's more like, uh, more like the, the Google task. And what I mean by the Google task is, it's trying to predict your intent, which is to say-

    13. SP

      Mm-hmm.

    14. VM

      ... let's say you only put in a third of the change-

    15. SP

      Mm-hmm.

    16. VM

      ... but you don't get the intent. Can you then fill out the rest to make the test pass?

    17. SP

      Mm-hmm.

    18. VM

      So there's so many ways you can slice this.

    19. SP

      Mm-hmm.

    20. VM

      And each of them, you can break it down into so much granularity. You can be like, "What is my retrieval accuracy? What is my intent accuracy? What is my, um, what is my passing? What is my test passing accuracy?" You can do that and then now you have a hill to climb. And I think that's actually important. Before you add a lot of complexity for any of these AI apps, I think you need to like make a rigorous hill that you can actually climb, right? Otherwise you're just shooting in the dark, right? Why would we add the ASD parsing if it's unnecessary? Actually, it's awesome if it was unnecessary. Um, right? I don't want to add a lot of complex stuff to our code. In fact, I want the, I want the simplest-

    21. GT

      Mm-hmm.

    22. VM

      ... code that ends up doing the, uh, having the most impact. So the evals were actually really, really critical for us to make a lot of these investments at the company.

    23. SP

      How much of the development that you do is like basically driven by improving the scores on the evals versus like basically vibes ba- based? Like you guys are all using Windsurf yourself. You're getting feedback from users all the time. And then you have just like a sense that this thing is going to work better, and then the evals are just sort of like a check that you didn't screw up something else.

    24. VM

      It's a little bit of both, but obviously for some kinds of systems, I think evals are more important than vi- but, like, more easy than vibes. Uh, just because for the system that basically takes a large chunk of the code, chunks it up and passes it to hundreds of GPUs in parallel, giving you a result in one second. It's very hard to have an intuition of like, "Is this way better?"

    25. SP

      Mm-hmm.

    26. GT

      Mm-hmm.

    27. VM

      Because that's a very complex sort of retrieval question. Um, but on the other hand, there are much easier things that from a vibe perspective are valuable. What if we looked at the open files in a code base? This is actually a harder thing to eval because-

    28. SP

      Mm-hmm.

    29. VM

      ... when you're evaling-

    30. SP

      Ah.

  11. 30:15 – 31:55

    Windsurf for hardcore engineering

    1. GT

      lot of, um, there's been a lot of chatter on the internet about vibes code is only for toy apps. Windsurf is actually being used for real production large code bases. Can you tell us about how the power users use it for, like, more hardcore engineering?

    2. VM

      So this is an interesting thing where a lot of us at the company... I- I'm not saying that this is, this is common... didn't get a tremendous value from ChatGBT in the way that probably a lot of the rest of the world did. Um, and that's not because ChatGBT is not a useful product. I think ChatGBT is an incredibly useful product. It's actually because a lot of them had already used things like, like StackOverflow at the time. And StackOverflow is a worse version than ChatGBT for-

    3. GT

      Mm-hmm.

    4. VM

      ... the kinds of questions you want. But that was just a thing that they already knew how to use, right? Um, and so they were able to get away with not using or relying on chat nearly as much. But basically what happened is very recently with agents, the agent is making larger and larger scale changes, uh, with time. And I think what developers now at our company do is they have felt the hills and valleys of this product, which is to say if you don't provide enough intent, it actually goes out and changes way more of the code than you actually need, right? Um, and this is like a real problem with, with the, with the tool right now. But they understand the hills and valleys and now the very first time they have a task, they are putting it into Windsurf. They're not... Their first thing is not to actually go out and type in-

    5. SP

      Mm-hmm.

    6. VM

      ... in the actual editor. It's to actually put the intent and actually, uh, and actually make those changes. Um, and, uh, they're doing kind of very interesting things now, like deploying our, our software, uh, to our servers actually now gets done with the workflows that are entirely built, um, inside Windsurf. Uh, so just a lot of boilerplate and repetitive tasks have been completely repe- uh, like sort of eliminated inside our company. But the reason why this is possible is kind of because we're able to operate over a code base that has many millions of lines of code, uh, really, really effectively.

  12. 31:55 – 35:15

    Tips to get more precise changes when vibe coding

    1. GT

      So if you were to give some tips to the audience, uh-How should a user that uses Windsurf properly provide this intent so that the changes are more surgical? Because what you're saying with the agents creating all these broad changes, I've seen that happen, but how, how do you get those precise changes? What, what do you do? How, how do you feed the system? How do you become a-

    2. SP

      Shouted it with all caps, right? (laughs)

    3. VM

      (laughs) Yeah. Um, no, so I, I think this is one of those things where, uh, I think you kind of need to, need to have a little bit of faith in the system and let it kind of mess up a little bit.

    4. GT

      Mm-hmm.

    5. VM

      Uh, which is, which is kind of scary, because I think a lot of people, for the most part, they will write off these tools really quickly. Obviously, no one at our company would write off the tool because they're building the tools themselves. I think people's expectations are very high, and maybe that's like the, the main piece of feedback I'd give, which is that, you know, our product actually for these larger and larger changes, it might make 90% of the changes correctly, but if 10% is wrong, people will just write off the entire tool. And I think at that point, actually, probably the right thing to do is either revert the change, we have an ability to actually revert the change, or just keep going-

    6. GT

      Mm-hmm.

    7. VM

      ... and see where, see where it ultimately can go. Uh, and, and maybe the most important aspect is commit your code, like, as frequently as possible. I think that may be that's, like, the big, big sort of, uh, tip there, which is that, uh, you know, you don't want to get in a situation where you've made 20 changes and on top of that made some changes yourselves, and you can't, like, revert it, and then you get, like, very frustrated at the end of it.

    8. SP

      And one thing I wondered, like, in that vein, is whether we need to change the way Git works with this AI coding paradigm. Have you thought at all about whether doing Git commit all the time is the right move or whether there needs to be, like, a deeper infrastructure change?

    9. VM

      Yeah, I think we have. So, you know, one of the things that, that we always think of is in the future, you're gonna have many, many agents running in parallel on your code base. That has some, some trade-offs, right? If you have two agents that kind of modify the same piece of code at the same time, it's hard to actually know what's going on.

    10. SP

      That's another thing is that, like, it's hard to have multiple branches checked out at the same time-

    11. VM

      Yeah.

    12. SP

      ... with different agents working on them independently.

    13. VM

      That's right.

    14. GT

      Oh, the merge conflicts. Oh, God.

    15. SP

      Yeah.

    16. VM

      There's a lot of that.

    17. SP

      Yeah.

    18. VM

      But hey, like, you know, that's how, that's how real software development works too. When you have a lot of engineers that operate on a code base, they're all, like, kind of mucking around with the code base at the same time, so that's not a very unique thing. I think Git is a great tool. I think it's maybe a question of, like, how, how can you skin Git to work in a way that is, that is, uh, that works for this, for this product surface? An example is Git has these things called work trees, which is like-

    19. SP

      Mm-hmm.

    20. VM

      ... you can have many work trees and versions of the repository all in your, uh, all in the same directory. Um, and, and, you know, perhaps you can have many of these agents working on different work trees. Um, or instead of exposing the branch concept to you, you actually can maintain a branch yourself that you can apply to the, to the main branch of the user, um, kind of repeatedly. One of the things that we think about at the company in terms of why we think our agent is really good is, like, we try to have a unified timeline on everything that happened. The unified timeline is not just what the developer did, but actually what the developer did in addition to what the agent did.

    21. SP

      Mm-hmm.

    22. VM

      So actually, our product, if you end up doing things, uh, in the editor, if you end up doing things in the terminal, right, all of those things are captured and the intent is, is actually kind of tracked in such a way where when you use the AI, the AI knows, right, in, in that situation. So in some ways, we'd like this thing where the agent is not operating on a completely different timeline, but it's like something that's kind of getting merged in, um, you know, at a fairly high cadence. Um, so I think this is, like, an open problem. I don't, I don't think we have, like, the exact right answer for this.

    23. SP

      What

  13. 35:15 – 38:00

    How will Windsurf evolve

    1. SP

      are other things that you envision changing about Windsurf in the future? How, how is it gonna evolve?

    2. VM

      There's probably a lot of people that think the vibe coding is kind of a, kind of a fad, but I think that's gonna get more and more capable with time. I think, you know, whenever I hear someone saying, "Hey, this is not gonna work for this complex use case," it's, it's like, it feels like a Luddite saying something.

    3. SP

      (laughs)

    4. VM

      It's like if you look at the way these, these, uh, these AIs have gotten better sort of year over year, it's, it's actually-

    5. SP

      Astonishing.

    6. VM

      ... it's, it's astonishing. Like, I'll give you an example of, of something that I held, like, kind of near and dear to my heart, which is, you know, there's this math Olympiad called the AMI.

    7. GT

      Mm-hmm.

    8. VM

      And, uh, I used to do that, uh, do that in, in high school. Um, and, you know, I was very excited about, about how well I would do. I... My high score was somewhere close to 14, and, uh-

    9. SP

      Nice.

    10. VM

      ... and, uh-

    11. SP

      That's a very high score. (laughs)

    12. GT

      (laughs)

    13. VM

      Yeah, but, but the, but the, the crazy thing is that was one of those things that I thought, "Oh, wow, like, the AI systems, they're, they're not gonna get anywhere near, um, as good." And beginning of the year last year, it was probably, like, well under five maybe.

    14. SP

      Mm-hmm.

    15. VM

      Um, and now they're, you know, the average that OpenAI has put out is, like, it's getting 14 and a half to 15, right, uh, for o4-mini. Uh, so it's almost like you have to keep projecting this out, right?

    16. SP

      Yeah.

    17. VM

      It's gonna get crazy. And basically, every part of the software development life cycle, whether it be writing code, reviewing code, testing code, debugging code, designing code, AI is gonna be adding ten times the amount of leverage, uh, very shortly. It's gonna happen, like, much qui- much more quickly than people imagine.

    18. GT

      Going back to your current engineering team, I'm just curious, like, if they have all this time freed up from, you know, not having to deal with, like, version upgrades and, you know, boring boilerplate stuff, like, what do they spend the extra time on?

    19. VM

      One of the things about our company and probably every startup, uh, that, that is building in this space is the ceiling of where the technology can go is so high. It's so high. So it's, it's actually that, you know, if developers can spend less time doing boilerplate, they can spend more time testing hypotheses for things that they're not sure work, right? In some ways, engineering becomes a lot more of, like, a research kind of-

    20. GT

      Mm-hmm.

    21. VM

      ... kind of culture, right, where you're testing hypotheses really, really quickly. Um, and that has some high cycle time attached to it, right? You need to go out and implement things. You need to build the evaluation. You need to test it out with our users. But that's, like, the things that actually make the product way better.

    22. GT

      Does that mean you're gonna hire a different type of engineer going forward? Are you looking for different things?

    23. VM

      Yeah, I think for engineers that we hire, we want to look for people with really high agency that are willing to be wrong, uh, and bold. But you know, weirdly, I don't know if that's, that's changed for a startup. Right, startups should never be hiring people that, uh, the reason why they're joining a company is to, to very quickly write, like, boilerplate code, right? 'Cause in some sense, and I don't want... Like, you know, this is not the goal, but a startup can succeed even if they have extremely kind of ugly code, right? That's not usually the reason why a startup fails.

    24. SP

      That sounds like my startup. (laughs)

    25. VM

      Uh, yeah, yeah, exactly. That's not usually the reason why a startup fails. The reason why a startup fails is they didn't build a product that was differentially good, uh, for their users. That's why they ultimately fail.

    26. GT

      This is all true, but also,

  14. 38:00 – 38:48

    Will AI become the infinite workhorse?

    1. GT

      like, in reality, you always need some sort of, like, workhorses to just kinda get certain things done. I feel like in the old days this was like building Android apps, um, it's like you'd do it, so you'd hire someone to do it because there are very few people who would just be willing to do it.

    2. VM

      Yeah. (laughs)

    3. GT

      Like, maybe in your vision for engineering, like, you don't need those peop- like, that's not actually a useful skill to have in an organization anymore 'cause the AI is just like your infinite workhorse? Is that fair?

    4. VM

      Yeah. Maybe the, the, the sort of aspects of software that are really niche, that are undesirable for a lot of people to do except a handful of people, those things kind of get democratized a lot more. Unless that has, like, a lot of depth attached to it, right? Uh, at least for the time being. Um, yeah, if something is like, hey, like, you know, we need to r- change the system to use a new version, um, and there is someone that deeply always got in the weeds with version changes, I don't think you have people that are just focused on that, right, inside companies.

  15. 38:48 – 42:48

    How does Windsurf interview candidates?

    1. VM

      How 'bout how you interview people? Yeah, I think, I think we have a fairly rigorous and high technical bar, and that has a, that's a combination of we give interviews that actually allow people to use the AI to kind of solve a problem, because we wanna validate if people, uh, like, kind of hate these tools or not.

    2. GT

      (laughs)

    3. VM

      There are still some developers that do.

    4. GT

      Mm-hmm.

    5. VM

      And obviously if you do, we're probably the wrong company to kind of work at. But also at the same time, we do have t- uh, sort of interviews in person where, uh, kind of on site, where, uh, w- we don't give them the AI and we wanna see them think, right?

    6. GT

      Gotcha. Mm-hmm. (laughs)

    7. VM

      It would be a bad thing if ultimately when someone needs to write a nested four loop, they need to go to ChatGPT, right? And, and I'm not s- like, that's fundamentally because, because, uh, it just, it just feels like that is a pr- good proxy for problem-solving skills, and I think problem-solving skills are just at a high level, still should go at a premium. That is, that is the valuable skill that humans have. Yeah, a challenge that a, a lot of companies we've talked to have had, and that, that, that we've even had ourselves, is that Windsurf has gotten so good that if you give people Windsurf, it's difficult to even come up with an interview question- ... that Windsurf can't just one-shot, where, you know- Yeah. ... anyone can do it because you literally just copy and paste the question into Windsurf and hit enter. I- And so, you're not really evaluating anything at that point. Yes. Y- So. (laughs) I actually think that's true, and it's, it's, it's, you're totally right. There's very few problems now that something like an O4 Mini is not able to solve now, um, right? I mean, if you look at competitive programming, it's just, it's just in a league of its own already at this point. The crazy thing is, interviews by nature are gonna be kind of isolated problems, right? They are by nature, because if the problem actually required so much i- uh, understanding to do, you wouldn't be able to explain the problem, so that's like perfect for the LMs, where you give them an isolated problem where you can test and run code extremely quickly. So yeah, you're totally right. Like, I think if you tell, if you only have algorithmic interviews and you let people use the AI, uh, yeah, I don't know, the- you're not really testing anything at that point. (laughs) Does that mean that you've gone away from just algorithmic questions and you ask different, like, much harder questions that are actually well-suited to be able, well, being able to use an AI? Yeah, we, we have questions obviously where, uh, that are, that are both system design-y plus algorithms, algorithms related, but these are questions that are fairly open-ended, right? Uh, there may not be a correct answer. There are, there are trade-offs that you can ultimately make, and I think what we wanna do is just see how people think, right? Mm-hmm. Given different trade-offs and different constraints, right? Uh, and, and we're trying to validate for, like, intellectual curiosity, right? And if someone ultimately says, "I don't know, why, why, why?" That's totally fine as long as, like, they've gone to a depth that we feel, um, kind of shows, you know, kind of interest, um, interest and, like, good problem-solving skills, if that makes sense. Like, you can tell when someone is curious, right? And wants to learn things. It's like very obvious.

    8. GT

      The next thought after this, which might be counterintuitive, you're at the forefront of building all these AI coding tools, it hasn't affected at all your hiring plans. On the contrary, you actually need way more engineers to execute. Tell us more about that.

    9. VM

      So I think, I think that just boils down to I think the problem has a very high ceiling, right? There's so many more things that we really want to do. The mission of the company is to reduce the time it takes to build technology and apps by 99%. It's gonna take a lot of work to go out and do that. Now granted, each person at our company is way more productive than they were a year ago, uh, but I think for us to go out and a- accomplish that, I think it's, you know, it's a Herculean task. We need to start targeting more of the development experience, right? Right now, we've helped a lot with the w- code-writing process, um, and, uh, and maybe the, the navigation of code process, but we have not touched much on the, on the design process, on the deploying process, the debugging process is fairly rudimentary right now. There's just so many different pieces if I was to look at it. Like, you know, if you say you have 100 units of time, uh, you know, we have an ax. We've cut off maybe like 40 or 50 in that- Wow. ... in that, in that time, but there's just a lot more snippets that we need to cut out basically at this point. It does feel like when I'm using Windsurf, like, I am often the extremely slow bridge between different pieces of technology, copying and pasting data back and forth from my... (laughs) Yeah, that's probably actually still a large chunk of your time. All the pieces have gotten so fast that now it's like the glue between them but, like, I'm the glue, but I'm, like, much slower. (laughs)

    10. GT

      Can

  16. 42:48 – 44:46

    What happens if we get “just in time” software?

    1. GT

      I go off the reservation and ask a weird question?

    2. VM

      Go for it.

    3. GT

      Okay. Uh, one of the things that, I mean, I think Pete on our team, he just released a great essay about, you know, prompting and you should let users have access to system prompts. The other thing that he came up with that we've been using all at YC internally is a new agent infrastructure that has direct access, read access to our system of record, our Postgres database, and in the process of using this, we're starting to realize, like, if CodeGen gets a lot better, which it, you know, I... based on this conversation, I think we can count on that getting, like, 10X, 100X better from here. Uh, what if instead of, you know, building packaged software, (laughs) there's, like, just-in-time software that the agent basically just builds for you as you need it? Does that change the nature of software and SASS and, you know, what happens to all of us and Windsurf? I don't know.

    4. VM

      I think this notion of just a developer is, is probably gonna broaden out to what's called a builder, and, uh, I think everyone is gonna be a builder. And they can decide, like, you know, how deep they wanna go and build things. Uh, maybe, maybe the, our current version of developers can go deep enough that they can build more complex things, right? Um, in, in the, in the shorter term. But yeah, I think software is gonna be this very, very demo- democratized thing, right? Uh, I, I imagine a future in which, you know, w-What actually happens when you ask an AI assistant, "Hey, build me something that, like, tracks the amount of calories I have," why would you have a very custom app that goes out and, and does this? It's probably something that takes, like, all the inputs from your AR glasses and everything, and has a custom piece of software that kind of comes out, and, like, an app that is there. And, like, it has tasks that go and tell you, uh, you know, "Are you on track with, with all the calories you're, you're sort of consuming here?" Um, and I think that's a very, very custom piece of software that you have for yourself that you can keep tweaking. I can imagine a future like that, where effectively everyone is building, but people don't know what they're building as software. They just, they're kind of just building, uh, just capabilities and technology that they have for themselves.

  17. 44:46 – 47:28

    How many non-developers use Windsurf?

    1. SP

      Do many people use Windsurf who don't know how to write code at all?

    2. VM

      It's actually a large, a large number of our users. Yeah.

    3. SP

      Interesting.

    4. VM

      Yeah.

    5. SP

      How did they end up getting into Windsurf? Like, uh, do they work at some company, where, like, some programmer showed them how to use it? Like, I, I, I tend to think of Windsurf as targeting more, like, the professional developer market that's, like, using this as a new superpower, versus the, like, non-technical user market that's doing, like, what Gary was talking about.

    6. VM

      We were shocked by this too, because we were like, "Hey, our product is an IDE." But there's actually a non-trivial chunk of our developers that have never opened the editor up (laughs) -

    7. SP

      (laughs)

    8. VM

      ... and they just... You know, our agent is called Cascade, right? And, uh, just to live in Cascade, we have browser preview. So, they just open up-

    9. SP

      Yeah.

    10. VM

      ... the browser pre- preview. They can click on things and, and sort of, uh, make changes. The benefit is because, because we kind of understand the code, when they come back to the repository, and the code has actually gotten, like, quite gnarly, we're actually able to pick up from where the developer left off or the, the, the, the kind of builder left off and, and keep going from where they were. Um, I will say, we have not optimized tremendously for that use case, but it's actually kind of crazy-

    11. SP

      Yeah.

    12. VM

      ... how mu- how, how much is actually happening there.

    13. SP

      Do you think in the long term that this ends up being one product that targets, like, both of these audiences? Or do you think actually there's, like, different products for different audiences? There's, like, a Windsurf which is, like, focused on, like, serious developers who wanna see the code and be in the details, and then there's maybe other products for, for folks who are totally non-tech people who don't, who don't even wanna see the code?

    14. VM

      I don't know what the long term is gonna look like. Something tells me it's gonna become more unified. But one of the things that I will just say is, like, as a startup for us, even though we do have, you know, uh, like, a, a good number of people, there's a limit to what we can focus on internally as well. Uh, so for us, like, we're not gonna be focused on, how do we build the best possible experience for, uh, the developer as well as build the experience where we have so many things for the, the non-developer. But I, I have to imagine that this idea of building technology, if you... As you get better and better at understanding code, um, you're gonna be able to deliver a great experience for non-developers, um, as well. But, uh, I don't know what the path dependence is. I assume, like, a bunch of companies in this space will go from non-developers to then supporting an ability to edit the code-

    15. SP

      (laughs)

    16. VM

      ... right? And I think we're starting to see this already, where, you know, the, the lines are sort of getting blurred right now.

    17. GT

      You probably care about it for your evals at least.

    18. VM

      Yeah. No, you need to. You need to care about it for your evals. That... Maybe that's, like, the hard part for me, uh, that, uh... To, to imagine for the pure non-developer product. What is the hill you're climbing if you're not, like, kind of understanding the code? How do you know your product is getting better and better, um, is, like, an open question. Are you completely reliant on the base model's getting better? Which is fine, but then you should imagine then your product is an extremely light layer on top of the base model, which is a scary place to be, right? That means you're gonna get competed across all different axes.

  18. 47:28 – 49:17

    Thoughts on the GPT wrapper meme

    1. GT

      How do you think about that in general, I guess? Like, the... It's something we've talked about a lot on this podcast, is just the GPT wrapper meme-

    2. VM

      Yeah.

    3. GT

      ... um, has completely gone away, I feel-

    4. SP

      (laughs)

    5. GT

      ... um, though every big release from one of the labs sort of brings it back a little bit, and everyone's a little bit scared that, like-

    6. SP

      (laughs)

    7. GT

      ... you know, OpenAI is just gonna eat everything. Um, how do you think about that?

    8. VM

      I think the way we... I, I think about this is like, yeah, the company, as I mentioned before, it's a moving goal post, which is to say, today, if we're generating sort of 80-90% of all committed software, uh, yeah, I think, I think when the new model comes out, uh, we're going to need to up our game.

    9. GT

      Mm-hmm.

    10. VM

      We can't just be at the same, uh, same stage. Maybe we need to be generating 95% of all committed code. And I think our opportunity is the gap between where the foundation model is and what the b- what, what 100% is, right? And as long as we can continue to deliver an experience where there is a gap between the two, which I think there is. As long as there's any human in the loop at all, um, in the experience, uh, there's a gap, uh, we'll be able to go out and build things. But that is a constantly transforming sort of, uh, goalpost for us, right? So, you can imagine when a new model comes out, maybe the baseline on what the foundation model by itself provides has doubled. The alpha we provide on top of what the base model provides needs to double as well. It feels very... Like, for me, the reason why this is not the most concerning is, let's suppose that you were to take the foundation model and it's providing 90%. It's reducing the time it takes by 90%. That actually means if we can deliver one or 2% more percentage points, that's a 20% gain on top of what the b- new baseline is, right? Um, like, I guess 90... If 90 becomes 92 or 93, um, which, which, which is still-

    11. GT

      (laughs) .

    12. VM

      ... very, very valuable, right, at that point. Because effectively, the 90 becomes the new baseline, uh, for everyone. So, I, I think basically the way we sort of operate is, how can we provide as much additional value as possible? And as long as we have our eye on that, I think we're gonna do, we're gonna do fine.

    13. SP

      What advice would you have for our startups that are working in the, like, AI coding space? We have a ton of them.

  19. 49:17 – 51:39

    Advice for new AI startups

    1. SP

      What are, what are the opportunities that, like, you think are gonna be open to new startups?

    2. VM

      I've seen a lot of things that I, I, I think could be, like, particularly interesting. I, I don't think any of these technologies we've really adopted, but there's so many different pieces of how people build software. And, uh, so... And I'm not gonna say niche, but there are so many different types of workloads out there. I've not really seen a lot of startups in the space that are just like, "We do this one thing really, really well."

    3. GT

      Mm-hmm.

    4. VM

      Um, like, I'll give you an example. Like, we do these kind of, like, Java migrations really, really well. Uh, c- crazily enough, if you look at this category, the amount that people spend on this is probably maybe billions, if not tens of billions of dollars doing these migrations-

    5. GT

      Actually-

    6. VM

      ... every year. It's a, it's a massive category. Um, that's an example-

    7. SP

      Migrations from what to what?

    8. VM

      So, uh, example, this is, like, actually kind of crazy.

    9. GT

      Oh, it's JVM 7 to 8 or-

    10. VM

      Yeah, yeah, JVM so-

    11. GT

      ... something like that.

    12. VM

      But-

    13. GT

      Rails versions? (laughs)

    14. SP

      Rail, yeah. (laughs) Yeah.

    15. VM

      Even, even more than that, actually.

    16. SP

      Yeah.

    17. VM

      It's like, a lot of, a lot of companies write COBOL-... have COBOL. And crazily enough, most of the IRS software is written in COBOL.

    18. GT

      Hmm.

    19. VM

      Apparently, in the early 2000s they tried to migrate from COBOL to Java. Uh, I think it was a five-plus billion dollar project. Uh, surprise, surprise, it didn't happen. And, uh...

    20. GT

      You think they could one-shot it now? (laughs)

    21. VM

      Y- I don't, I don't know if they can one-shot it. But... (laughs)

    22. GT

      I'm just kidding. (laughs)

    23. VM

      But, uh, but no, but it's, imagine, imagine if you could do those tasks very well. It's such an economically valuable sort of task. I think we obviously don't have the ability to focus on these kinds of things inside the company. That's a very exciting space, if you could do a really good job there. The second key piece is there are so many things that developers do that are also not making the product better. Uh, but important. Like automatic resolution of like, you know, kind of, uh, alerts, and, and, and, uh, and bugs in the... in, in software. Um, that's also a huge, huge amount of, amount of spend, um, out there. And I'd be curious to see, like, what a best-in-class product in that category actually looks like. I'm sure someone that if they got truly in the weeds on that, they could build an awesome product. Um, but, but I think... I, I've not heard of one that has, like, tremendously taken off.

    24. SP

      I think those are actually both really great insights. And one thing I like about them is that there's like... it's not just an opportunity for like two startups. Like, each one of those is like a bucket that could have like a hundred large companies in. We actually do have a company from, from S21 called Bloop that does these COBOL to Java-

    25. VM

      (laughs)

    26. SP

      ... migrations with, with agents.

    27. VM

      That's awesome. Yeah.

    28. SP

      Um, yeah. I-

    29. VM

      It's a gnarly problem. It's a very gnarly problem.

    30. SP

      Ye- yeah.

  20. 51:39 – 52:35

    Outro

    1. GT

      So, reflecting on this journey, I mean, we're all really thankful for you creating Windsurf. It's, uh, you know, supercharging all of society right now. Uh, what would you say to the person who... you know, basically the you from five years ago before you started this whole thing?

    2. VM

      The biggest thing I would say is change your mind much, much faster than you believe is reasonable, right? It's very easy to kind of fall in love with your ideas, um, over and over again. And y- you do need to, otherwise you won't really do anything. Uh, but, but pivot as quickly as possible, and treat pivots as a badge of honor. Most people don't have the courage to change their mind on things, and they would rather kind of fail doing the thing that they told everyone they were doing than, uh, change their mind, uh, take a bold step, and succeed.

    3. GT

      Varun, thank you so much for joining us today. We'll catch you guys next time. (instrumental music)

Episode duration: 52:35

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