The Future of Software & AI | Cognition’s Scott Wu

And so it's, like, a very nice setup where sooner or later you get to kind of meet people who are like you, basically. When I was a kid, doing these competitions, going for that, it was, like, all I really cared about. Those people that I met through these national and international competitions were honestly more, like, they were my childhood friends more than, like, the people around me in Baton Rouge, Louisiana were. And it was like, we would hang out online, we would talk about math, we'd talk about problems. But all the other things, too, I mean, I played basically all the different competitive games.

So, like, I played a lot of Super Smash Brothers. I used to go to tournaments for Super Smash Brothers. It was a lot of fun. I played Melee. And then I played, like, Tetris. I played a lot of poker. I played some chess. I was okay at chess. I wasn't that good. I played some Go. My dad was a competitive Go player. My parents came to the U.S. in some sense because of Go, which was kind of a funny coincidence because my dad was in grad school in China and he had a professor who like really liked him the reason he liked him was because my dad was like a really good Go player like he was like a 7 Don at Go which if you were to call it in chess would be like I don't know 2300 or 2400 rating equivalent or something like that he would play with this professor you know on the weekends and stuff and they're like you know my dad would generally win and they would like talk about the games and stuff and then that professor ended up moving to the US to come and teach And at the time, you know, this was super early on and, you know, immigration from China to the U.S.

And so it was not a very like it wasn't really a path that people knew that you could take. The professor wrote my dad and said, hey, like I came. It's great. Like there's so much more opportunity. It's so much better. Like you should obviously come as well. Like I'll help you with your like visa application. I'll help you like apply to colleges here and everything. And so my dad applied to grad school in the U.S. And that's kind of how we ended up here in the first place. I was born after we moved to the U.S., obviously. So your dad was competitive in Go. What was your mom competitive in, though? Because I think I read that you said that she might have been the most competitive person in your family.

Yeah, no, she was always, she was definitely the most salty, I would say, for sure. I mean, she would. What does salty mean? Salty just means that you take offense to the idea of losing. Okay, I love that. Yeah, she would always be, oh, no, no, I'm better at this. I can beat you at this, you know, and I don't think she, I mean, she played ping pong a bunch growing up, actually. she played on her like school ping pong team obviously she studied some amount of math and so on um but but it was just it was more Or her personality than any one thing that she really put all of her competitive energy into.

I spent a lot of time, obviously, reading the biographies of History's Great Entrepreneurs. Yeah. I was fascinated by, like, there's usually two different kind of archetypes for the parents. One, you have, like, the Larry Ellison and Elon Musk. Their dads would literally tell them, you know, you're worthless. There's stories in Elon's biographies where his dad just gets in his fucking face and yells at him for hours. Larry's adopted father would just tell him you're never going to amount to anything. And so they had this, like, inner fire to disprove, you know, saying that basically, no, fuck you, Dad.

You're wrong about this, right? And then you have, like, the Estee Lauder's who, you know, their uncle or even their father is just like, you're really special. You have a lot of talents. If you put a lot of effort into this, you can do whatever you want. Your mom falls it more into, like, the Estee Lauder category where she would tell you that, like, hey, these people are doing amazing things. You could do even better than them, correct? I think they would have been happy enough if I just got, like, a more traditional, cushy job and did all of that. Like, I don't know that they specifically steered me towards entrepreneurship and being a founder.

But, no, they were always very supportive. But your mom gave you self-confidence? Yeah, I think she always told me that I was the best. And she was always extremely proud of the, you know, it's the, I had these, like, when you go to these math competitions. Hold on. So you said she always told you that you're the best. Did she say that before there was evidence? Yeah, I think so. I think that's right. I think even when I was, like, tiny, she would tell me that I was extremely talented. You know, she was always a huge source of support. And she always obviously believed in whatever I wanted to do.

You know, because you would compete in math competitions, you would get these trophies and stuff. And, like, we didn't have, like, you know, growing up, like, we didn't have, like, pictures of our parents, like, on the walls. You know, we just had old math competition trophies. It was like, my mom was very intentional about like, no, no, the thing that we value in this household. Other people's trophies are the ones you want. Ours, ours. The ones that me and my brother want, of course. We're going to put up pictures of other people's trophies and you'd better damn sure replace them with your own.

So like, you know, when I was pretty, my brother as well, you know, we both really liked these competitions. And so, like, you know, like, like, accumulate these trophies and she would always like every time we got one, she would hang it up and we're like put it up on the on the on the like the mantelpiece and everything. And no, it's like it's always I think what she really valued. I think I think education was really important to her. And I think being the best was very important to her as well. I want to tell you about the presenting sponsor of this podcast, Ramp. I have been reading a lot about SpaceX lately. SpaceX is one of the most valuable private businesses in the world. And one of the main themes in the history of SpaceX is constantly attacking and questioning your cost. Ramp helps many of the most innovative businesses in the world do exactly that. The median company running on Ramp cuts their expenses by 5%. And one thing SpaceX has demonstrated is that a religious dedication to controlling costs can help actually increase revenue because you can pursue opportunities.

you couldn't otherwise and we see that in the ramp data to the median company running on ramp also grows their revenue by 16% so when you're running your business on ramp and your competitors are not you have a massive competitive advantage that compounds over time ramp is the only platform designed to make your finance team faster and happier many of the top founders and CEOs I know run their business on ramp I run my business on ramp and you should to go to ramp.com to learn how that can help your business save time, save money and grow revenue. That is ramp.com. What matters to you more? Like what is a, is it the, the pain of losing is like losing is worse than the love, like the thrill of winning. Cause that's how you started it. You're just like, I could not stand losing. Let me back up. I was reading another Larry Ellison biography.

He says this, he's just like, listen, I'm addicted to winning, but I fear losing more than I love winning. And I actually talked to Michael Dell about it. And he's like, yeah, it's just the fear of losing is the pain of losing is way worse than the good feeling of winning. So I think that's definitely true in terms of how it feels. In order to get anywhere, you got to lose a lot. If anything, almost like a lot of, you know, I mean, a lot of the guys are talking about, if anything, like the way they got to where they are is by losing a lot and having their share of wins along with that. But like, you just have to put yourself out there and do a lot. So it's kind of an interesting thing to your point of like, I definitely feel the same way that yeah like losing feels way worse than winning feels good but not by enough that it makes me want to stop trying if that makes sense yeah no i think it's possible i have i know your personality type like there's just impossible for you not to do this yeah what is like let's get into devon yeah what is like winning with devon look like to you so again you know we're hyper competitive but also you know the other thing about us is like we all had kind of started

our own companies before this so our founding team is a pretty big founding team is nine people and most of us had already founded our own companies before. We had done different things. It was true for a lot of the early team and we've always thought about this as like, this is a big one. And so like we- We want to go for it all. You know, we want to be a generational business. Like, we want to build a hyperscaler, and we want to go and do that. And, like, maybe we'll succeed, maybe we won't, I don't know. But, like, that's what we're going after. And I think, to me, what that means in our field in building software is, like, you know, people sometimes use the term, like, coding agents or, like, you know, like, AI programming or something.

I always, like, you know, I always hear that, I think, a little bit about, like, well, we're not always, I mean, we're not going to be interacting with code for that much longer, you know. Our programs might not be the right level of abstraction, but I think what is always true probably is that it will be the human computer interface. And so what I mean by that is like, like the way that we think about Devon, if we're successful, is Devon is the way that humans can tell their computers what to do. Because that was the whole point of software engineering anyway, right? It's just to be able to work with your computer and tell it what you want it to do.

I mean, I think doing that for the world is like a massive opportunity. and that's what we're really excited to go after. Why is that interesting to you? You just said we all did different things. We came together and we're like, no, this is the big one. Yeah. I mean, the simple answer is, you know, we're a bunch of nerds who were all programmers and built software and so on before and now this is the idea of teaching AI how to go do that. Wait, say more about that. What you just said, we're all nerds. This is the big one because we can actually teach AI how to program. We're all nerds who've spent the last, you know, I don't know, 20 years of our lives just coding and making little things for the world And the idea that you could teach AI how to go make things and have everybody have an AI that can help them make things and feel the wonder of that, I mean, it's pretty sick.

Is that the idea, the single idea in the world that animates you the most, that gets you the most excited? I think it is incredible, yeah. I mean, well, I would go further, too, and just say, like, at a zoomed-out level, it's – I honestly think that – because, you know, everyone talks about AGI, everyone talks about what is the future going to be like? Like, what are human lives going to be, you know, once AI can do everything? And, I mean, to some extent, I think the thing that is most human, obviously, is self-expression, creativity, like having things that you want to make happen in the world and being able to go do those things, right?

And so, I mean, a lot of how I think about this is basically we want to build the tool that gives everybody the power to go and make things that they want to make in the world. My co-founder has this line, which I've always loved, which is, you know, we've been spending all this time living in survival mode as a species, you know, and now we're going to be living in creative mode. And I think that's right. I think, you know, Minecraft survival mode is where you're like, you know, you're growing food, you're like making sure you're safe from the monsters at night and whatever. And like creative mode is just like, everything's up to you.

You know, you have all the resources at your disposal. If you want something to happen, it'll happen. And the only question for you is like what you want to make happen. I think it's going to be amazing. And I mean, I think that is like the world that we're going towards. And like, we want to be the ones building that. Okay. So talk about what Devin does today. Yeah. And then I want you to flesh out that idea of, like, where you see it in the future. It's just the interface between humans and computers. Sure. Yeah, so Devon is today, you know, what folks know as an AI software engineer. And basically what that means is that Devon is a tool that anyone can use that will work with them end-to-end on building out software.

And so we work with a lot of the biggest companies across the world. You know, we work with Goldman Sachs. We work with Mercedes. We work with, you know, a lot of areas of the U.S. government at this point and so on. And we work with their software teams to just help them build more and do much more. And, you know, the thing about it is in the last 20, 30 years, obviously, I mean, software is eating the world is the famous line. I think it's very much true. It's still like, it's still got a couple order magnitudes to go. And in practice, what it looks like is that teams use Devon to ship 10 times faster and to do 10 times more.

Okay, so that's where it's at today. Yeah. How do you get to where you're saying, you're just the interface between humans and computers? So now we're going to get into a philosophical discussion of what it means to be a programmer or a software engineer, right? And I think if you go all the way back, there was a time where programming was like using the vacuum tubes, plugging all those in and having the machine do the arithmetic, right? Like the ENIAC was, in some sense, the first computer out there, although it was obviously very different. Or it would have been like, you know, filling out the punch cards and like setting up the or writing, you know, the like putting down assembly, you know, or writing in basic or something.

Right. So we've gone through a lot of generations already is my point. And what does it look like, you know, going forward when you talk about programming, all it really comes down to is like, how do you tell your computer what to do? And like every single piece of software that you use, if you're using, you know, Instagram or TikTok or YouTube or whatever, like that's a piece of software that somebody or like some, you know, in these cases, to some pretty big teams of engineers came together and thought through all these details of, okay, here's what I want it to do. Here's how I want it to look.

Here's what I want this button to do. Here's how I want to architect it. Every single little decision. obviously was made by somebody, but the computer itself is then executing it accordingly to what the wishes of its creators was, right? And I think what we'll start to see is that abstraction will continue to climb, right? And like, you know, we kind of see this already. Like at this point, you don't need to know a programming language. It's like, you don't need to know Python or Java or something like that in order to build your own software, right? And you can just say, hey, here's what I want. I want to make a cool website that does this, this, and that. Or, For example, you know, in my existing product, you know, here's what we have today and I want to change this thing or add this new plan or add this new feature and just have the agent go and do that for you, right?

I think we're going to continue to go further down that axis.

So this is kind of related to something I heard you say, where you're saying that humans just have a really hard time understanding exponential curves. It's totally true. I mean, you see this in the progress itself. You see this in the scaling laws with the data. You see this in the revenue curves of the companies that are building an AI. Including your own. And it's a very, you know, it's like humans aren't really wired for this, right?

Like all of our like inherent like fight or flight response are kind of like our ability to kind of like measure things to vastly oversimplify. If you're just, you know, fighting out there, you know, foraging for food or whatever it is, like, you know, a good hunt will bring you, you know, a couple days worth of food or something. But obviously, with the kind of exponential curves that we deal with, you know, the equivalent of a good hunt here could be a thousand years worth of food. And we don't have that intuitive signal in our brains to really understand that, right, at a really deep, like, native level.

People often understand, I think, how fast things can change and how fast the world can change. I mean, my parents even, like, drilled this into me because they grew up in, you know, in communist China. And they came to the U.S. And, you know, even that, like we're talking about what are what we're ultimately even like much slower scales of progress in some sense relative to, I think, what we're seeing today. But even that. was like, as you can imagine, it was incredibly jarring to them. You know, the idea that, like, you come to the U.S. and everybody has a car and all of these different, you know, it's like everyone has all these household appliances and has all, you know, it was a very different life when they grew up in, like, you know, the 60s in China.

And they were much, much poorer and it was very, very different, right? And it's like, I mean, funnily enough, people got used to all these things pretty quickly and now we can't live without them. But I think we'll kind of undergo the same period with AI, where five years from now, it's going to be insane to think about all these things that we're going to have.

So I think you've even taken this further where you're like, well, what happens when they can work for a year unassisted? Yeah, yeah. And I think that's true, and I think we will get there.

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So wait, what percentage of your revenue is coming from enterprise then? Today, around 75, 80%. What are people using on the self-serve? Like, what are examples of? Yeah. So, we have a lot of teams who use it in self-serve. I mean, that's grown, actually. You know, that's grown quite a bit as well lately. But, you know, we have startups who, you know, we have Exa, who uses it a ton, or Open Router. You know, I ran into someone in my apartment in the elevator the other day. Oh, you're the Devon guy. Like, we use Devon. Are you Devon? I've gotten that as well. Hey, are you Devon? And I was like, you know, I'm actually not, but that's okay.

Why didn't we call it Scott? You know, there's kind of both self-serve and enterprise. With that said, it is entirely in both sides. It is still like actual engineering teams building real output. And so we don't. We don't focus at all on like, you know, individual hobbyists who are just like trying to make a cool thing or something like that. We focus on like real teams who are building real products that they want people to use and getting output out of that. Okay. Can you walk us through? I'm very curious. Like I'm a big enterprise. I contact you.

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incentives between your company and then your customers. Yeah, so a couple of things here,

Yeah, I mean, I think it's like, for better or for worse, after the last couple months of news, you know, cognition, I think, has been a bit more of the like.

We've become a bit. more known as the folks betting on independence in some sense because obviously there have been some high-profile acquisitions. It's funny you said that because I wanted one of the questions I'm going to ask you, which you probably won't answer. It's like, how many different acquisition offers have you had? I will not answer that question. Dozens? More? Dozens is a lot, dude. I don't know about dozens. Good time. It's probably only a handful that could actually afford to buy you if you would sell, but the amount of times they keep coming back. Oh, I see. Well, yeah. Anyway, this independence part is really interesting to me.

We were on the phone, me, you, and a mutual friend on three-way, like, I don't know. I think it was actually last summer. And we're not going to say the company. But I was like, Scott, what do you think about, you know, an acquisition with X, not X the platform, X the blank company? And you're like, I don't know how we'd be able to afford them. You just assumed I meant you buying them. And I just fucking cracked up laughing. I was like, it's hilarious. No, so I think like, yeah, yeah. And it's like folks, like there are folks taking acquisitions and doing things. There's some big high profile ones.

I think those are great to be clear. And I think it's a very reasonable path for exit. As I mentioned for us, it's like we've all come into this, like we want to build a generational business. That's what we're really excited about. And I think people, I think today sometimes, I've seen some more of this nihilism where they say, oh, like, yeah, yeah, maybe it's just, maybe it's too late. Maybe it's not possible anymore. And like. What does that mean? What's not possible? Like maybe it's not possible to build a new independent business because everything else, you know, it's like. Because the labs are going to do everything.

Because all the opportunities take it, you know. And it's like, guys. Those people aren't founders. Founders are rationally optimistic. Yeah. They're just not founders. Yeah. They believe even there's no evidence that they should succeed. Yeah. That they will succeed. Yeah. So people like that just need to get a job. Dude, I'd say this even with Devin. But if you think that going onto the Devon web app or any other coding product out there today and giving the instructions the way that you do right now and then you get the pull request out and then that's how you review it and that's how you build software, if you think that that's going to be the way that software is built forever, then yeah, then nothing will change.

But I think we have 10 more generations of these different product experiences to come, right? And building those and doing those, it's like that is what innovation is. And that's what's going to happen. The advantage I have of reading for the last decade of all these biographies of physicists of entrepreneurs. You're studying somebody's life, but in many cases, if you were so successful, they wrote a book about your life. You usually, it's almost like It's like you get a minor in like new industry creation every single time. It's just like, we're too late. It's over. There's no more opportunity.

Yeah. And the way I thought about this was like the best definition of a business I ever heard actually came from Richard Branson, which says all businesses and idea that makes somebody else's life better. And if that's true, which I believe it is, then that means there's infinite opportunity in the future now and in the future, because there's infinite ways to make somebody else's life better. And that's all a business is. So this idea that's like we got to the end of history is just bullshit. Yeah. And, you know, I don't mean to push you on this, but, like, I am personally curious, though, because, like, I know you're already rich.

I don't think money is your North Star based on the conversations we've had in the past. But, like, there's got to be some crazy number somebody can throw at you where you're just like, fuck, I have to take this. Not really. I mean, it's, like, the, you know, people have asked me sometimes before. they've asked me like um okay but like really though would you guys like this is what i'm doing right now yeah and the way that i say it sometimes um is like we would sell if we thought it was the most ambitious thing to do it's kind of an oxymoron because obviously but but but you know it's like my genuine answer in the sense that like that's like what we care we care about you know it's it's like the i mean it's funny you talk about money like i i mean i don't even Dude, I don't have, like, I don't have a car.

You live in an apartment, I just realized. I have a restaurant apartment. Yeah, it's like, I don't know. I think, I like eating sushi. That's fun. Sushi doesn't cost that much. You can do that off of an engineer's salary as well. Just so you know, if this is true, like, then you are the type of entrepreneur that I find the most fascinating in the world. Because, like, when startup founders come to talk to me, it's just like, I don't give a shit about your startup. I, like, I ask the same question. It's like, is this your last business? Yeah. I asked Kareem from Ramp, that's before we did this deep partnership.

And it's just like, okay, you could sell it. Like the Zuck example, where they're like, why didn't you take a billion dollars? I think you own 25% of the company. You would have made $250 million. You're like 22. He's like, well, what would I do with the money? I would just start another social network. I kind of like the one I have. I just want to build shit anyways. So what do I do? And then the other element of this, which I think is almost tied into you, where it's like, I feel like you're just having a lot of fun. Like, even being around here, it's just like, there's, your company's weirder in the composition of the people because it's literally just all nerds.

Like, and I think you like, you know, and I mean, well, like, you know, like, there's usually a mixture of obviously the nerds and some of the other people. And like, you kind of built this like, almost like. Your social network is like now and— You're not allowed here if you're not a nerd, yeah. Yeah, it's like a physical manifestation of your social network, but like the way I would describe this is like— Okay, cool, cool. No, so my friends are also nerds. Yeah, I agree, I agree. I mean that in an obviously enduring way. No, no, that's great. I love that, yeah. But the people I'm most interested in is just like, there's no price, right?

Yeah. Like the example I use is, go ask Steve Jobs. I'll give you $2 trillion, but you can't work on Apple. Yeah. What the fuck do you think he would have said? Yeah, I agree. No! He's like, well, I want to work on Apple. That's what I want to do. There's a funny thing that I wanted to tie together, which I didn't find the opportunity until now, is you are currently the second wealthiest entrepreneur from Baton Rouge, Louisiana. I don't know if you remember. We've talked about this. We've talked about this. Yeah, yeah. The first one. Chicken finger is a great business, but I'm a customer of that business as well.

The first one is Todd Graves. Yeah. Owns Raising Cane's. Yeah. I talked to him. He was on the show. Yeah. You tell him, you'll give $100 billion for your chicken finger empire. No, he's turned down, and I know this for a fact because I've talked about it, he's turned down crazy acquisitions offers. He's like, I don't care about, it's not the money. Yeah. No, I mean, for us, it's very like, again, it's not rational, but the way that I would describe it, it's like, I feel, and I think all of us do, like that it'd be one thing if we tried and we gave it our all and we just weren't good enough that'd be fine like it wouldn't be that dude I'd be I'd be salty with hell you know it wouldn't be fine but like but like it would be like it would be an outcome it would be like an outcome that I could live with you know but if we felt like you know we could have gone for it all we could have pushed harder and we did it like that I think it's like I just I don't think we would like live with ourselves in that outcome.

And that's like the, if you have me explain it, it's kind of circular, I don't know, but it's like, why are we so excited to do this? Why do we do, you know, it's like we want to achieve our potential and build what we were meant to build, you know? And maybe that's something and maybe that's nothing, but like you'd rather find out and see, you know? I think this idea of you have one life, go. Yeah. Is a perfect place to stand. Thanks for the time, Scott. Yeah, thanks for having me. 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.