User workarounds reveal what product to build next

Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

1. 47:26

   the single most important principle and product. Can you talk about that actually? Because I was going to go there, explain what this principle is and just what happens when you unlock this latent demand. Latent demand is this idea that if you build a product in a way that can be hacked or can be kind of misused by people in a way it wasn't really designed for to do kind of something that they want to do, then this helps you as the product builder learn where to take the product next. So an example of this is Facebook Marketplace. So the manager for the team, Fiona, she was actually the founding manager for the Marketplace team, and she talks about this a lot. Facebook Marketplace, it started based on the observation back in, this must have been like 2016 or something like this, that 40% of posts in Facebook groups are buying and selling stuff.

2. 48:17

   So this is crazy. It's like people are abusing the Facebook group's product to buy and sell. And it's not abuse in kind of like a security sense. It's abuse in that no one designed the product for this, but they're kind of figuring it out because it's just so useful for this. And so it was pretty obvious if you build a better product to let people buy and sell, they're going to like it. And it was just very obvious that Marketplace would be a hit from And so the first thing was buy and sell groups, so kind of special purpose groups to let people do that.

3. 48:42

   And the second product was marketplace. Facebook dating, I think, started in a pretty similar place. And I think that the observation was if you look at people looking at, if you look at profile views, so people looking at each other's profiles on Facebook, 60% of profile views were people that are not friends with each other that are opposite gender. And so this is this kind of like, you know, like traditional kind of dating setup.

4. 49:04

   But, you know, people are just like creeping on each other. So maybe if you can build a product for this, it might work. And so this idea of latent demand, I think it's just so powerful. And for example, this is also where Cowork came from. We saw that for the last six months or so, a lot of people using quad code were not using it to code. There was someone on Twitter that was using it to grow tomato plants.

5. 49:27

   There was someone else using it to analyze their genome. Someone was using it to recover photos from a corrupted hard drive. It was like wedding photos. There was someone that was using it for, I think, like, they were using it to analyze an MRI. So there's just all these different use cases that are not technical at all. And it was just really obvious, like, people are jumping through hoops to use a terminal to do this thing.

6. 49:53

   Maybe we should just build a product for them. And we saw this actually pretty early. Back in maybe May of last year, I remember walking into the office and our data scientist, Brendan, had a quad code on his computer. He just had a terminal up. And I was shocked. I was like, Brendan, what are you doing? You figured out how to open the terminal, which is a very engineering product. Even a lot of engineers don't want to use a terminal.

7. 50:17

   It's just the lowest level way to do your work. Just really, really kind of in the weeds of the computer. And so he figured out how to use the terminal. He downloaded Node.js. He downloaded QuadCode. And he was doing SQL analysis in the terminal. It was crazy. And then the next week, all the data scientists were doing the same thing. So when you see people abusing the product in this way, using it in a way that it wasn't designed in order to do something that is useful for them, it's just such a strong indicator that you should just build a product and people are going to like that.

8. 50:48

   It's something that's special purpose for that. I think now there's also this kind of interesting second dimension to latent demand. This is sort of the traditional framing is look at what people are doing, make that a little bit easier, empower them. The modern framing that I've been seeing in the last six months is a little bit different. And it's look at what the model is trying to do and make that a little bit easier.

9. 51:10

   And so when we first started building quad code, I think a lot of the way that people approached designing things with LLMs is they kind of put the model in a box. And they were like, here's this application that I want to build. Here's the thing that I wanted to do a model. You're going to do this one component of it. Here's the way that you're going to interact with these tools and APIs and whatever.

10. 51:27

    And for quad code, we inverted that. We said the product is the model. We want to expose it. We want to put the minimal scaffolding around it, give it the minimal set of tools. So it can do the things. It can decide which tools to run. It can decide in what order to run them in and so on. And I think a lot of this was just based on kind of latent demand of what the model wanted to do. And so in research, we call this being on distribution.

11. 51:48

    You want to see like what the model is trying to do in product terms. Latent demand is just the same exact concept, but applied to a model. You talked about co-work. something that I saw you talk about when you launched that initially is your team built that