Marc Benioff, Salesforce Founder: Why Salesforce Isn't Hiring Software Engineers | E1236

I'm like, I've got my dogs, two golden retrievers under my desk. I'm like, crazy things are happening. And no, I don't know what to do. I don't know how to hang on a podcast. So I've done 3000 and I can give just two bits of advice. The best are art and science. The art is telling a story, making someone feel like they're a part of the journey, bringing them into those early moments of Salesforce magic. And then the science is, and I learned three lessons from that you need the combination of resonance with the consumer and learning and the two together makes for magic fantastic well that must have been an example right there of the made for magic podcast you said that you you know you love other podcasts and shows i saw your tweet last night where you said no mud no lotus with regards to jensen and his talk with patrick collison where he said nothing great is achieved without pain and suffering and so i wish upon you plenty of pain and suffering, wonderfully charming of Jensen. Why did you tweet it and how did you feel when you heard that? Well, that was an inspiring talk from Jensen, which is why I tweeted it and no mud, no lotus. Well, that came from one of my teachers and good friends,

Thich Nhat Hanh. Thich Nhat Hanh was an amazing influence on my life. He is someone who really brought mindfulness to the West and learned really how to meditate from him and what meditation was all about. I learned that I could cultivate my beginner's mind, or what the Japanese called Shoshin. In the beginner's mind, you have every possibility, but in the expert's mind, you have few or none. When I think about Thich Nhat Hanh, he would always say to me, no mud, no lotus. And what he meant by that was, yeah, you have to go through difficulty and you have to go through suffering to get to beauty and love. And this is an incredibly important part of my life and how I think about it. And that's why I meditate every day. We talked about that. The first time we had a podcast, I spend every day in mindfulness and meditation and try to come back to my breath and clear my mind because there's so many difficult things happening all the time. Yesterday, I spent the whole day doing my earnings. So by the time it turns out, you know, for this morning, I need to get a few minutes to clear my head.

When we think about pain and suffering that has led to the greatest lessons, what pain and suffering that you've been through, maybe with the Salesforce journey, has led to the greatest outcomes in terms of learning? I think yesterday is a great example. We had a great quarter, Harry. We delivered clear guidance to $38 billion in revenue this year, $12.9 billion in cash flow, 32.9% margins. This was our guidance. And the numbers were so far ahead, the market advanced our stock today, I think about 9%. It was adding another large tech company onto our company. So we ended up in the mid $300 billion in market cap. You know, when I think back, I think our stock was about one third this value two years ago, one third. What does that say to me? Well, two years ago, we had a really difficult moment. We were like flying an airplane as a good example.

And we found out the two pilots were gone in the front and the one guy with a parachute jumped out the door. And we had these unusual resignations that happened that kind of blindsided us. We had a lot of unusual things. The financials were not what we wanted. And we had to start making changes. We had to make financial changes and technology changes. We had to rewrite our product. We had to create new products. You probably know we've introduced this incredible new platform, Agent Force, that we can talk about. We also rebuilt our financial model and addressed financial issues in the company that we had not been willing to address up to that point. And then what that resulted in was two years of really hard, difficult work, but it resulted in yesterday where after two years, the stock has tripled. We have delivered a financial transformation. We have delivered probably the most exciting new AI product in the history of enterprise software and a level of customer success we just have never seen before. So this is a great example of no mud, no lotus, because if we hadn't gone through that two years ago, we probably would not be where we are today.

So this is our second conversation. And so I feel like I can be more direct. Why, when you look at the guidance that you have, when you look at the results, when you look at the amazing product, why is it that people say, I don't know how Salesforce will fare in a next generation of AI? Do agents really help Salesforce? Yeah, we're in a really competitive industry, number one. And number two, when you think about Salesforce and AI, we are the number one enterprise AI supplier in the world today. We'll do more than 2 trillion enterprise transactions this week. No one is delivering AI at this scale to more companies globally than we are. And now we've delivered the first scaled, secure, trusted enterprise agentic platform, which we call AgentForce.

This is the way that so many companies right now are deploying agents. One great example is, your favorite airport there, Heathrow, is one of our launch customers. One of the busiest airports in the world where customers really have a lot of complex issues happening all the time where they've evolved into really starting to focus more on customer success at Heathrow because people have had so many challenging situations. And we're building an agentic layer completely around the airport with Heathrow so that from the beginning of your journey to your end, you're going to be partnered with an agent to make sure you have an absolutely great experience at Heathrow. I think this is going to be pretty awesome.

Do you have to own that agentic layer? Because if you don't own that agentic layer, don't agents just pull and summarize data and Salesforce becomes a database? And is that a bad thing? Well, let's talk about what we're doing and what we can do that others cannot do because of the nature of our platform, which we've now delivered this platform to 135,000 customers. The next version of AgentForce is coming. We're going to announce that December 17th. I hope you could come to San Francisco and we can talk about it then. We have an incredible new Agent Force 2.0 about to ship. On Agent Force 1.0, the first thing to know is that we automate every customer touch.

point. This is one thing that's really unique about Salesforce. So for Heathrow, of course, we have our sales cloud and they're selling B2B to all these companies. Number two is customer service and support, our service cloud, our marketing cloud, we're the most scaled enterprise email system in the world, our commerce cloud, our analytics, Tableau, Slack, Mule software integration. All of these key components together is the Salesforce platform. This is what we've for the last 25 years. And for the last two years or so, we've been focused on building our data cloud, which is the amalgamation of all of our customers' data so they can take all of their Salesforce implementations and all of their data and bring it all together. And then the third layer is the agentic layer on top of that. And those three things are not three products. It's actually one piece of code, one integrated piece of code. And why that's important, Harry, is this.

for AI to work really well and to get the level of accuracy and low hallucinogenics that you need in enterprise AI today, you have to have as much access to the data and metadata and workflow as possible. And we have over 230 petabytes of that data in our platform. That makes it very unique. And it's not just the data, it has to be the metadata as well. That's how you get the real accuracy. What is the biggest challenge that Salesforce will have to overcome to achieve the dominance in the next generation of AI as you outlined there? This idea that we are going to build not just a sales force and a service force or a marketing force, but an agent force for our customers, we shipped it October 25th.

In the quarter, which closed at the end of October, we already sold 200 deals. We'll do thousands of agent force deals this quarter. And what we have to do is really show each and every customer what the magic of agent force is and how it can provide tremendous value to them. And as an example is Salesforce. This week, I think I already told you, we turned on help.salesforce.com. I stripped out my previous support infrastructure. I've plugged in a new support infrastructure. It's all 100% agent-based. And we're going to be able to rebalance our headcount based on that we have a digital workforce and a human workforce now.

We have digital labor in our company and human labor now. I need to bring that to every single company. And to explain that is extremely difficult because this is a new horizon for business. This is the most exciting thing that's ever happened for business because we are going to start to bring in digital labor into business for the first time. You said there about kind of digital labor and human labor. Will Salesforce have more employees or less employees in five years time? I think we'll probably be larger. It's a good question. Number one, we're doing our business plan for next year for 2025 right now. We're not adding any more software engineers next year. We have increased the productivity this year with AgentForce and with other AI technology that we're using for our engineering teams by more than 30% to the point where our engineering velocity is incredible.

And then we will have less support engineers next year because we have an agentic layer. We'll have more salespeople next year because we need to really explain to everybody exactly the value that we can achieve with AI. So we will add another probably 1,000 to 2,000 salespeople in the short term. Mark, you're the master of sales. When you think about this agentic layer and what you're serving, digital and human workers, how does pricing in SaaS change when you are pricing digital labor? do we sell by seat or does that change agent force is consumption pricing so you're being charging per conversation the starting price is about two bucks per conversation and then it's negotiated based on volumes for customers it's basically per user for humans and it's per conversation for agents i was surprised when i heard you say though that we're near the upper limits in llm use when i heard that i was like huh what made him say that so i will just say that we look at what's happening with LLMs, that...

It's very exciting. We've all had these great experiences with LLMs and what's happened, but we've had a lot of great experience with artificial intelligence in the last 60 years. And in the last 60 years, the history of AI is a new model or a new technology will come along and a bunch of folks will kind of get to the point where it becomes a commodity and then we kind of hold until we wait to the next one and then it goes on. And we've moved from machine intelligence and machine learning to deep learning to the advanced aspects of AI to where we are today. And we're kind of waiting for even some of the new models to emerge after this generative AI models. But these current large language models, there's a lot of folks building those today, and they're rapidly becoming a commodity and they're rapidly maturing, they're cresting. That's not unusual in AI. AI kind of, you get a model and then you start to hit the upper limits of what's possible in that model. We have some of the best people in the industry working on these LLMs. But you can see that the growth rate and the maturation rate of those models has slowed because we're starting to commoditize them.

Can you take me inside the internal discussion that you had at Salesforce of whether you should really invest in building out your own LLMs versus leveraging others in the commoditization of LLMs that we're seeing now? Well, two out of the top five models in the industry are Salesforce models. We also use a lot of other models. We change that on a regular basis, and we've invested in a lot of model companies, including Amthropic and Mistral and Cohere and many, many of them. Even personally, I've invested in many amazing models. I've invested in an incredible new next-gen model company from Fei-Fei Li, who ran AI at Stanford. Her husband runs research for me at Salesforce. He's amazing. We have really a selection of capabilities today. So really it's really fit for purpose what the model is that you want for the tasks that you're trying to accomplish. Do you think that will continue to be the same future that we look at, which is a world of many models and you simply go to different models for the different use cases that you need? Yes. And that is a great place to be. I'm going to ask a really unfair question, but as I said, I can just phrase everything as a second. There's no unfair

questions okay you've got open ai at 160 anthropic at 40 or x.com at 50 which one would you rather invest in i don't know if i'd really want to invest in any of them right now in those cases we're seeing all of them to being about the same kind of product a lot of them are really becoming the same technology so this is the moment where each of them needs to kind of pick their poison and go out and become their own company i don't think being just a generic company is the right move anymore. You need to decide what vertical you're going to be in or what your best specialty is. And I think we're starting to see that. Like, for example, we saw perplexity go off and try to be something truly unique in financial services. This idea that different models are going to really operate for different industries differently is where the models are going to start to really

come from it. I do want to discuss two amazing decisions and two tough decisions or plenty mistakes. If I would ask you, what are the two most strategic decisions you made with Salesforce that worked out and what did you learn from them? What would be the first that come to mind?

Well, I think something I just did is very important. I had a great relationship with Steve Jobs. I worked for him in 1984 in the Macintosh division when I was writing assembly language code. And later, when I started Salesforce, he was very generous and would say, hey, come down and see me. And we would have talks about different moments or challenges that I was going through. And one time I got a call and said, hey, just come down. I want to show you something. And I went down and he was working on the iPad. And he's like, here's two iPads. And I'm like, wow, I love both these sizes. He goes, no, we're only going to do one size.

And then I'm like, well, this is really awesome that you can work on the iPhone and the iPad and you got your Mac and you have all these products you're working on. Your day is probably really full. No, Mark, that's not how I do things at Apple. What do you do, Steve? I only do one thing one time. I have the A-team at Apple. We only focus on one thing. So I'm just going to focus on the iPad. And that was a very impactful meeting for me because up to that point, I think I was doing too many different things. and so when i just rolled out agent force you'll notice that we're not going to talk a lot about all of salesforce's products which are amazing you know on the podcast i'm going to keep coming back to agent force because that's all i'm focused on right now that's his advice to me focus on that put your best people on that make that happen is that difficult as a leader to not make other divisions feel less Thank you.

important if you're just pumping one. Absolutely. And you have to find ways to be able to constantly bring it back around to everybody. Even like we reviewed our marketing cloud and our commerce cloud yesterday, both amazing products that we have. We just went through Black Friday and Cyber Monday. We delivered more emails and more transactions and more GMV than I've ever seen in my career to our customers. We did it with 24-7 perfect accuracy. But a lot of the conversations that I have with those two organizations is what is your agent first future? What is your agentic layer? How are you going to make your products even better through the power of AI and agents now? When we look at, and we have, you know, we have our examples and we're showing customers today, the future of an agent first marketing cloud or an agent first commerce cloud, how will that transform you? How is that going to transform your customers? Everything needs to be about agent force at Salesforce. This is the only thing that really matters today. All of our 75,000 employees, our tens of thousands of salespeople, and our 135,000 customers, we need to really boot them into the present moment of what is possible with this incredible breakthrough.

I love that story of Steve and the lessons there. On the flip side of the worst decision or the worst mistake, when I asked that, what's the time that comes to mind? And what did you learn from that? Well, I think that what I've really learned over 25 years of leading Salesforce is, I think that when you look at agent force, when you look at everything that we've just gone through, I think that for CEOs, the most important thing, and this is what I try to remind myself constantly, is you've got to cultivate your beginner's mind. You have to be ready in today's day where everything is changing by the minute, whether it's technology or political or economic, you've got to be ready to cultivate your beginner's mind where you have every possibility and in the expert's mind, there is few.

The Japanese word is Shoshin. Shoshin, beginner's mind. That idea, how do I get back to clearing my mind so I can really see what the possibility is? Let me tell you a story. I was getting ready for Dreamforce and we just had 50,000 people to San Francisco in September. What I do for two months beforehand is I go on the road and I do all these focus groups and meeting with all these customers the big demo that we were doing was not for louis vuitton it was for gucci and we run a lot of work for caring and we even met with francois the ceo of caring and it was an awesome meeting and i the whole demo for dreamforce everything was gucci and we were so excited about gucci and what we had done with our new point of sale system harry which is amazing all the changes we've made at the customer touchpoint layer the data cloud was incredible and things were going along. I was very satiated with how the Gucci demo looked. I felt it was very visionary. Gucci loved it. They even came to our headquarters and saw it. And then about a week or two before Dreamforce, I got the first customer feedback on Agent Force. We had delivered it to the first five customers, which included companies like Wiley, the bookseller, OpenTable, the

restaurant, company, ADP, Disney, et cetera. And when I was reading through the feedback from the customers, I'm like, wow, this product is a lot farther along than I realized. And I don't think anything is more significant for Salesforce than AgentForce. And I hit my Steve Jobs button and I pivoted the entire company over a period of two weeks, brought everybody in and said, everything and all the messaging for Dreamforce is now officially going to change. We are going 100% on AgentForce. And the question at that point was, what is AgentForce? And a lot of employees had not been brought into what we had been building. We had an incredible effort underway to deliver this agentic layer. It just happened a lot faster than we expected. And then we delivered at production October 24th. So we pivoted the company. We launched it at Dreamforce. We delivered it on October.

24th. And in that first last five days of the quarter, we closed about 200 agent force deals. We'll do thousands more this quarter. That was the moment where I was like, yes, you have to cultivate your beginner's mind. And then you have to do one more thing. You have to trust yourself. You have to trust yourself to know you have to hit that Steve Jobs button and go and say, no, this is now I'm only going to focus on the one thing. And this is my one thing. So all of a sudden Astro, you can see him behind me here, went from being regular old Astro to agent astro here we are today talking about this mark are you knackered at the end of dream force or agent force it is an intense period for you you are on stage we see you crush it are you knackered at the end well i would just say it's exhaustive i mean yesterday was also exhaustive earnings is exhaustive dream force is exhaustive when you're the ceo of a large company you better be ready to have a lot of exhaustive moments you've got to leave it all in the field you know you've got to be ready to do everything to make it totally successful. I'm constantly asking myself this question. Am I doing everything? Do I have all the ideas, concepts, notions, people?

Do I have everything necessary to make Agent Force totally successful right now? I ask myself that question every single day. Is everything happening correctly? Am I doing everything. It has to be exhaustive. And there are moments like Dreamforce or earnings or product launches or, you know, international travel is one, you know, where you do, you have to leave it all in the field. And that's an important part of success. After 25 years of being the CEO of Salesforce, from growing it from an idea, like you see with a lot of the venture capitalists that you do or entrepreneurship that you do, you know, I was right there at ground zero to growing it as the singular ceo all the way to today at 38 billion in revenue whoa you have to be ready to leave it on the field each and every moment or you're not going to get to where you're where you want to go so yeah you got to put it behind you really go jensen huang said if he'd known how hard it was going to be he wouldn't have done it you look at 38 billion in revenue mark If I asked you the same, would you have done it?

You know, it's funny. My neighbor here is David Kirk, who led the creation of the GPU for Jensen, probably the most important piece of technology that he has at NVIDIA. As the chief scientist, he led the group and the team. And at the end of the effort, he had built the best chip that they had ever seen. It became the heart of the game machines that became the heart of AI. And then he retired and said, I did it. And he said, but I'm not going to keep doing it. And instead, he became the chairman of his kid's school and he invested in this community and incredible person. I have a huge amount of respect for David Kirk and Jensen, who I also have a huge amount of respect for, then had that technology.

It was going into these game machines and incredible things were happening. And a few years later, he was at Stanford and he saw this incredible innovation with deep learning. And he was the only large company CEO in tech who said, you know what? deep learning is such a big idea. And this technology is pretty darn close, the GPU to what you need. I'm going to pivot my whole company and I'm just going to be about deep learning. And he did that in 2013, right when it came, he saw the vision models. He saw all these incredible models. I saw all those models too. And while I added it into Salesforce, I didn't pivot Salesforce entirely around deep learning. He was the only one in our industry to do that. He deserves a lot of credit for having the vision and the insight, but also hitting his own Steve Jobs button to pivot his company, because he did a hard pivot at that point.

And he said, no, I'm just about AI. That's why a couple of years later, when OpenAI started, he was ready to bring them those boards and say, hey, build OpenAI using this, not the CPU, the GPU. And that, again, was a bow to David Kirk, but also a bow to his focus. focus on artificial intelligence. This idea that you have to be ready to pivot, to put it all behind you, to go, to leave it all in the field, but ultimately it only works if you have a beginner's mind. In all of those cases, those pivots are only working if you're ready to really go. And you might not know that you're at that moment if you're not in that flow. And I think sometimes CEOs are so in that cycle, they're going like this, they're going like this, that they don't have the opportunity to slow stop break split and just get back into the present moment right now breathe realize what it is that you need to achieve right now to achieve your greatest most amazing success what are those values that will guide you this is something we all need to kind of take a thought about final one before we do a quick fire you tweeted that you love the mark andresen conversation with joe rogan i really did yeah and there was one element in there that i was

really intrigued to hear your thoughts on, where he said tech companies didn't just cave to censorship, they were coerced, especially big tech. Did you agree with that statement? Well, I was shocked by a lot of the relevations that have come that the government has been so involved in some of these social media companies and their operations. And he revealed a lot of that in that podcast. I think a lot of people should listen to it. And a lot of things I had never heard before, whether it was involving banking or social media, I thought that's one reason i should actually retweet it i was surprised how viral that went do you think that's true though in terms of big tech being censored and coerced in the way that it was i haven't seen it in my own company that's why i've been so surprised uh that but i don't run a social media company so i don't really know what the government does with these big consumer platforms we almost bought one you probably remember we almost bought twitter i guess there's been a lot of moments now where i Do you think about what would have happened if you had have bought Twitter?

I think about that a lot. And I guess in a lot of ways, I'm happy I didn't because I don't think I would have enjoyed that part of it at all. Why? Because that's not kind of exactly the reason that I was buying it. I was buying it because I thought Twitter, and this is kind of a funny thing, because I thought Twitter is like one of the greatest vehicles for distributing not just content, but also applications. I, as you know, Harry, we've talked about this several times. I worked at Apple in 1984, and when we had the Macintosh, we had this great app dev system called HyperCard. And HyperCard is an incredible technology model.

When I look at those little frames or those little photos inside those Twitter feeds, they look like this. Sometimes they're filled with a video. Sometimes they're filled with a photo. But for me, what I saw in my mind's eye was an app. And I thought it was a card, actually. And a card and an app were the same thing in HyperCard. And I thought we could build a kind of a WYSIWYG tool to build apps and run them in those card frames and that you could have photos, you could have videos, but you could have apps. And I was going to build an app store and an Aptiv tool, and I was going to deliver apps in frame.

And that's why I like it. You know, I'm just an Aptiv person at heart. And I've always loved application development deployment from my very earliest days in software. You know, when I was 15 years old, my first product that I wrote was how to juggle. then i wrote 10 software adventure games but in my heart i just love this idea that you know you could build these things with tools and when i went to work with oracle in 86 that's what i really enjoyed doing was building application development deployment tools and that's what salesforce has become for so many customers the ability to easily build these amazing next generation applications today we call them agents another tweet why are you so excited for elon and doge what would you like to see happen well i think that we kind of it's funny we're hit this point i think quite a few times in the podcast how important is that fiscal responsibility in your company i think it's important to have fiscal responsibility in your country also and i think we've gotten away from that in the united states and i hope it gets back i hope we can back to a balanced budget. I think that should be a bipartisan issue. I think that's probably true in every country that we need to have more fiscal responsibility and that that would be a great

thing for us. We're going to do a quick fire and then I'm going to let you go. So I'm going to ask you five quick questions. What is your favorite consumer brand today and why? Oh, you mentioned Louis Vuitton. I love Louis Vuitton. I just got a windbreaker yesterday. They make my size, size 60. I love Louis Vuitton. I love the experience online. I love it in the store. I love the luxurious. I also love that our Salesforce customers, so I'm constantly testing to make sure my product is working correctly. But I do love Louis Vuitton. What have you changed your mind on in the last 12 months? What I've changed my mind on in the last 12 months is how impactful AI can be for customers. When I saw the breakthrough with AgentForce, I didn't expect it to happen as quickly as it was. I didn't realize the power was at our fingertips. And I did the hard pivot at Dreamforce to make Agentforce something real for all of our customers. And now it has been delivered into all 135,000 customers and it's ready for them to turn it on now.

What do agents not do today that they need to do in the future? Agents need today to be multimodal. They aren't. They're mostly tech space because that's kind of the generation of capability and they need to rapidly become a multimodal experience and that will be extremely important. Penultimate one, what concerns you most in the world today, Mark? I think one thing that does in coming back to the AI theme is that there's a lot of good parts of AI and there's a lot of parts that could become dark. And I think we all need to get educated about AI, all the good parts and all the bad parts. We've seen the movies. We saw Minority Report and we saw War Games and Her and Terminator. But we need to realize AI is not there yet, but it's going to get there and that we need to be spending more time looking at what all of the potential of AI is.

look, technology is not good or bad. It's what we do with it, with technology that matters. You know, we should look at that very closely, that AI is probably the most powerful technology we've ever seen. And how are we going to use it for the betterment of our society? Do you believe, Sam Altman, that we'll hit AGI in 2025? I don't think we are in AGI in 2025. So I think that's an optimistic thought. I think we're going to hit the maturation of the LLM in 2025. So I'll say that. I believe that LLMs are becoming commodities and that we're cresting the llms that they're getting incrementally more successful but not exponentially more successful so we'll see the full maturation and commoditization of the llm capability in 2025 final one for you you are asked so many questions by everyone what question has no one asked you that you lie in bed and go god why does no one ask me this i would say people don't really reflect on a very simple thought about salesforce when salesforce started 25 years ago. We put 1% of our equity, profit, and time into a 501c3 public charity, a foundation here in the United States. It was easy at the time, Harry, because we had no equity. We had no profit.

We had no people. We had no venture capital. So we just carved out a piece of our company. Now, 25 years later, we've given away about a billion dollars. We run 50,000 nonprofits and NGOs for free on our service. We've done over 10 million hours of volunteerism. This is where business is really the greatest platform for change. To see the impact that Salesforce has had, now more than 20,000 companies have also copied us in doing that. We even have a foundation called pledge1percent.org to advocate companies, and it's created billions of dollars of philanthropic aid to local communities. Even Salesforce has been able to give more than $150 million to its local public schools in San Francisco and Oakland. Now, there's no question, Harry, this simple fact, business can be used for good why is it that most more people aren't asking me how can they use their businesses to improve the state of the world that's your pithy statement mark you said at the beginning you need a statement that's the statement i guess i'll need one harry thank you for that i hope it i hope it influences you and your own companies and your investments honestly mark it's such a joy thank you so much for doing this again it's great to be with you always i hope we'll do a third and

fourth and fifth podcast as well i have to say it is shows like that that just make me so thankful to do what i do i mean the man created salesforce 38 billion dollars in revenue next year what an incredible 25 year journey i want to say huge thank you to mark for being such a fantastic guest friend what a fantastic dude if you want to see more you can of course watch it on youtube by searching for 20 vc that's 20 vc now before i leave you we're excited to ignite your curiosity