In Good Company with Nicolai Tangen - HIGHLIGHTS: Evan Spiegel - CEO of Snap

Starting point is 00:00:00 Hi, everybody. Tune in to this short version of the podcast, which we do every Friday for the long version. Tune in on Wednesdays. Hi, everybody. I'm Nicola Tangen, the CEO of the Norwegian sovereign month fund. And today, I'm really thrilled. I'm here with Evan Spiegel, the co-founder and CEO of Snap, the company behind the very popular Snapchat. Now, it's used by nearly a billion people every day.

Starting point is 00:00:24 He was 22 years old, turned down a $3 billion offer from Mark Zuckerberg, and has continued to build a company, which, by the way, in Norway of all places, was one of your first really, really big market. So fantastic to have you here. Thanks so much, Nicole. It's great to be on the show. And yeah, we now reach more than 3 million Norwegians.

Starting point is 00:00:42 So very proud to serve the Norwegian people. Now, it started as an idea that most people were, thought was like totally ridiculous, a photo that disappears just after you look at it. So where the heck did that idea come from? Well, Bobby and I had grown up with social media. And on social media, everything was saved forever. It was public.

Starting point is 00:01:03 It was like a big competition to see how many friends you had or likes you could get on your photos. And so it meant that people were only posting pretty and perfect moments, not, you know, the full set of emotions or full set of experiences they have that, you know, are really important to relationships. So I think the most important thing Snapchat did was created a new way of communicating with visual messaging. That was really the foundation of the service.

Starting point is 00:01:26 today, it's diversified across a map that lets you see what your friends are up to or augmented reality lenses, of course, content with stories and spotlight. But the core of the service is really visual messaging between friends and family. So where do you go? You're like 22 years old, no money, no app, no nothing. I mean, how do you start? Well, I was in school at the time. And Bobby and I actually lived across the hall from each other. And so we started working on some projects together, one of which was called Future Freshman, which was a service designed to help people get into college. That was a total failure. Only my mom signed up for our service, despite both of our siblings applying for college at the time. So we got some strong customer feedback in the early

Starting point is 00:02:06 days. We ended up shutting down future freshmen, trying a few other things, and ultimately creating Piccaboo, you know, as Snapchat was called at the time, which I presented to my class in junior year. You had a pretty healthy offer to sell the company early on. Now, in Europe, we typically take the money and run. You thought differently. How come? Well, we really loved what we were doing. We saw a huge long-term opportunity.

Starting point is 00:02:36 I mean, now the service reaches nearly a billion people around the world. Back then, it was still very small. And so we believed that, you know, we had a vision that was unique and different than traditional social media that was much more focused on close friends and family, on messaging and self-expression. And so we decided to pursue our own vision. And, you know, I think the thing. that, you know, really, really helped us make the decision was just how much we love what we do.

Starting point is 00:03:02 Now, you've been at the forefront of a lot of innovations, right? Disappearing messages, stories, augmented reality, filters and so on. How do you build a company that comes up with these kind of ideas? Well, I think what's so important is to continue to create a culture where great ideas can come from anywhere, where people put good ideas before hierarchy, One of the challenges with companies as they grow is they become much larger organizations, people become more fixated on promotions or making more money rather than taking risks. And so one of the things that we've done is kept a very, very small design team. It's about nine people.

Starting point is 00:03:39 It's a totally flat structure. So there's no fancy titles or anything like that. And the entire idea is to iterate really quickly to try new things. You know, we look at hundreds of ideas on a weekly basis. And every now and then we have a good idea. But I think, you know, the most important thing is to create a culture that rewards creativity and risk-taking rather than a culture that rewards promotion, for example. Now, the biggest bet now for you seems to be the augmented reality glasses, and I believe you're on

Starting point is 00:04:10 you are on Generation 5. Do you think the world is ready for this now? I think the world is so ready. I think the technology has been trying to catch up to where the world is. I think folks are exhausted by what their computers and their phones demand of them. I mean, people are spending seven or eight hours a day hunched over a screen. They feel like it distracts them from the real world, takes them away from their friends and family. But yet this technology is so useful and so powerful, right, that we don't want to just put our laptops away. We need to fundamentally change what a computer is. And that's really what specs do. They take computing and they actually integrate it in the world around you. They make it something you can share together with your friends. So you and your

Starting point is 00:04:51 friends can participate in the same computing experience in the same place at the same time, that's really, really powerful. And it represents a whole new direction for computing that I think the world has wanted for a long time, but the technology hasn't been ready. Why will AI reduce hierarchy in an organization? I think ultimately AI creates a huge amount of leverage for managers to take on a lot of the managerial work that they used to have to do in the past. So, for example, in the past, as a manager, you had to spend a lot of time staying very close to what your team members were doing, working to provide very actionable feedback, gathering all that feedback from their peers. Today, you know, I can use our systems at SNAP to see everything

Starting point is 00:05:36 they're actually doing without them having to, you know, report anything. I can just understand based on the work product they've actually contributed, whether or not they're meeting their goals. I can easily gather peer feedback, right, from their interactions with their peers and feedback. from their peers and ultimately turn that into very, very actionable feedback without having to do much managerial work to get that outcome. So I think if you look at a lot of the, you know, things like career planning, career conversations, feedback, a lot of the day-to-day work required of management, most of that, I think, is going to be automated in the not too distant future. And that's going to free up managers to lead. What do you think is going to happen

Starting point is 00:06:14 to the number of reports that a manager have? I think it could very meaningfully increase. And I think, you know, that's certainly a benefit that, you know, rather than maybe a more traditional seven to ten directs or something like that, you could even see that number double, you know, over time as more that managerial work is automated. How do you make sure that young people stay on the platform when they grow up? I think it really comes down to providing utility around those close, friends and friend and family relationships. One of the things that's fascinating, you know, when we get older, our friend groups actually get smaller. And so Snapchat's really well positioned for that because it's built around this close friends and family dynamic. And so as you go from caring about,

Starting point is 00:07:01 you know, staying in touch with maybe hundreds of people when you're in college to staying just close to your, you know, few best friends or your family or, you know, the grandparents, I think Snapchat's a really, really useful tool as we all grow older and ultimately, you know, choose to stay in touch with that small group of close friends that really, matter. And what's the tradeoff between keeping it small and authentic versus becoming very big and like Instagram and TikTok? I think there are lots of tradeoffs. I mean, the first thing is that communication services just grow slower than social media because social media is broadcast based and, you know, Snapchat is based on communication. And so that does mean there are some tradeoffs

Starting point is 00:07:40 and, you know, we've seen historically in terms of our rate of growth because it's dependent on people communicating with a smaller group of friends rather than blasting out contact. content to thousands of folks or people they may not know. And so I do think that, you know, ultimately that tradeoffs is balanced with the resilience of building a communication service because the durability of communication services and the importance of that in people's lives is something that's helped us build long-term value. We'll work on that. Now, you've been CEO since you were 21.

Starting point is 00:08:09 It's pretty amazing. And now you are 30, what is it, 34? 35. Wow. How have you changed as a leader? It's so interesting. In the early days, right, I had to wear so many different hats, whether it was answering customer support emails or getting the legal work done, the financing. So much of my growth has been about leading people and the evolution necessary to primarily focus on making

Starting point is 00:08:37 sure we have the right folks in the right roles and that I'm helping them grow and develop. And that being much more important than, you know, any individual task or function we have here at our company. So I think so much of the job really becomes, you know, about people. And that is certainly the most important thing to me. I think, you know, the one thing that's been really helpful through all of this is because we started the company when we're so young, we've been able to really think long term. I mean, I'm sure you're aware the tenure of public company CEOs is incredibly short today. And it's very hard to do anything of real significance in such. a short period of time. If that's four years or seven years, anything that requires real

Starting point is 00:09:16 technical development and research and development happens over very, very long periods of time. And so I think, you know, as I've gotten older, I've been able to better appreciate what a strategic advantage that is to really be able to invest consistently over a long period of time.

In Good Company with Nicolai Tangen - HIGHLIGHTS: Evan Spiegel - CEO of Snap

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