Speaker 1: I'm Emily Chang, and this is the circuit. On this
Speaker 1: episode of the pod, I'm in Sunny, La to talk
Speaker 1: to Evan Spiegels. He's the co founder and CEO of
Speaker 1: snap known, of course, for Snapchat, the messaging app, famous
Speaker 1: for its disappearing photos and videos. Snapchat burst onto the
Speaker 1: scene in twenty eleven, a heady time for social media startups.
Speaker 1: Facebook had just bought Instagram, Twitter was on the rise,
Speaker 1: and Spiegel had started Snapchat with two college friends at Stanford.
Speaker 1: What was it that made you say I need to
Speaker 1: drop out? I needed to do this.
Speaker 2: We're waiting for our venture investor's light speed to fund
Speaker 2: and I was refreshing the Wells Fargo app. In the
Speaker 2: back of the class saw the four and eighty five
Speaker 2: thousand dollars. Sit walked up to my teacher Craig and
Speaker 2: just said, you know what, I'm so sorry, I'm gonna
Speaker 2: have to drop this class.
Speaker 1: Within a couple of years, Snapchat was rising in popularity,
Speaker 1: stirring up its fair share of controversy and making Spiegel
Speaker 1: the world's youngest billionaire by age twenty five. What was
Speaker 1: her first I made it purchase?
Speaker 2: My first purchase was a pre owned for I went
Speaker 2: to the Ferrari dealership and they must have looked at
Speaker 2: me like, what are you doing.
Speaker 1: Spiegel has also grown up a bit, but is still
Speaker 1: very much in founder mode. Now in his thirties, he's
Speaker 1: running a multi billion dollar company that's locked in competition
Speaker 1: with both trillion dollar rivals and smaller startups. To stay
Speaker 1: in the game, he's betting big on smart glasses and
Speaker 1: the future of augmented reality, even as tech's biggest players
Speaker 1: crowd the field like Meta, Google and Apple. In a
Speaker 1: recent letter to shareholders, Spiegel wrote that Snap is at
Speaker 1: a crucible moment, faced with many obstacles that will define
Speaker 1: its future. We sat down to talk about what it's
Speaker 1: like to fight in a land of giants, how Snap
Speaker 1: navigates the dark side of social media, TikTok and China,
Speaker 1: and why he thinks the screens of today won't look
Speaker 1: anything like the screens of tomorrow. Okay, so it's easy
Speaker 1: to forget because it's been so long now, but Snap
Speaker 1: popularized so many things that are just like a fact
Speaker 1: of social media today. Disappearing messages, stories, filters, and lenses,
Speaker 1: is even vertical video location tags. What was it about you?
Speaker 1: And Snap's culture that enabled that.
Speaker 2: I think one of the things that was really unique
Speaker 2: is that we were mobile first, so we were one
Speaker 2: of the first services to start building mobile only. A
Speaker 2: lot of our competitors actually had started on the desktop
Speaker 2: and were migrating to mobile, but we had grown up
Speaker 2: with smartphones, and everything we were building was mobile first.
Speaker 2: And many of the things that we have built have
Speaker 2: really just been about making computing or making technology more human.
Speaker 2: I mean that's sort of been the key insight time
Speaker 2: and again, even things as simple as back in the
Speaker 2: day when you would open your camera you had to
Speaker 2: choose between photo or videos. Really annoying to set this toggle,
Speaker 2: and we realized, like, it's just a moment. Either it's
Speaker 2: a single moment in time, or it's a longer moment,
Speaker 2: which is a video, And so we invented this button
Speaker 2: where you would tap to take a photo or press
Speaker 2: and hold for video. And it was just all about
Speaker 2: making things much more intuitive for people to use. The
Speaker 2: same of course for stories. For vertical video was so
Speaker 2: obvious to us. I mean, all the video at the
Speaker 2: time cut horizontally. All the social feeds would have these tiny,
Speaker 2: little like postage sam sized videos horizontally on your phone,
Speaker 2: and of course the vision pitched at the time was like, oh,
Speaker 2: you would just turn your phone sideways and watch video
Speaker 2: that way, But it was very uncomfortable to hold your
Speaker 2: phone like that and not very practical, and so we
Speaker 2: just realized people were going to want to create and
Speaker 2: watch video vertically the same way that they held their phones. Now,
Speaker 2: the challenging part about that was because everyone was so
Speaker 2: used to horizontal video, especially our advertisers.
Speaker 3: They were like, this.
Speaker 2: Is totally crazy, We're gonna have to shoot totally new content.
Speaker 2: But at some point we ran a study that the
Speaker 2: completion rates were nine times higher when it's full screen
Speaker 2: vertical video compared to these little horizontal videos, and over
Speaker 2: time folks realized it just made more sense.
Speaker 1: So it was all about making things more human, more intuitive.
Speaker 2: And easier to use, designed around the way that people live,
Speaker 2: instead of forcing people to change the way they live
Speaker 2: to use technology.
Speaker 1: I actually remember the first time I saw Snapchat in
Speaker 1: the wild. We were at an ice cream parlor and
Speaker 1: there was this crowd of kids in front of us,
Speaker 1: and they all had their phones up and I was like, oh,
Speaker 1: they're taking pictures off the ice cream. Husband whispered, there's snapchatting,
Speaker 1: and I was like, oh, this is becoming a thing.
Speaker 1: Like it was really a moment, was there a sort
Speaker 1: of an inflection point where you felt like things really
Speaker 1: took off.
Speaker 2: One of the things that's very special about snapchat is
Speaker 2: it actually changed people's relationship with photography. So I'm dating myself,
Speaker 2: but back in the day, people used to take photos
Speaker 2: to save a moment, and even further back, people would
Speaker 2: like scrapbook, so it's really about recording a moment or
Speaker 2: recording something special. Snapchat changed people's relationship with photos and
Speaker 2: made them about communicating. And it turns out people communicate
Speaker 2: way more than they save things. And so there was
Speaker 2: a moment in time when we realized that the number
Speaker 2: of photos people were taking and sending on Snapchat eclipsed
Speaker 2: the total number of normal photos people were taking out
Speaker 2: in the world with their smartphones. And I think that
Speaker 2: was really the moment that we realized there had been
Speaker 2: this huge shift that like the majority use case or
Speaker 2: the primary use case for cameras was communicating, not saving things,
Speaker 2: and that I think was a pretty meaningful shift.
Speaker 1: Lucky for your server bills, they didn't get saved correct.
Speaker 2: Very unlucky for our server bills, but we were so fortunate.
Speaker 2: We were one of the first companies to build cloud
Speaker 2: first as well, so we were mobile first and cloud first,
Speaker 2: and that's one of the things that allowed us to
Speaker 2: really innovate and spend our time and energy building new
Speaker 2: products instead of racking servers. Most of the companies that
Speaker 2: came before us, a huge scaling problem for them was
Speaker 2: literally server infrastructure, physical infrastructure, and Snapchat built on the cloud.
Speaker 2: So while the bills were aggressive, the scaling was a
Speaker 2: lot easier.
Speaker 1: Elon Musk once said, starting a company is like staring
Speaker 1: into the abyss and eating glass.
Speaker 3: He's got away with word he does.
Speaker 1: If you could go back and talk to college Evan,
Speaker 1: what would you tell him?
Speaker 2: I would tell him, don't worry, It's all going to
Speaker 2: work out in the end. I think it can be
Speaker 2: really challenging starting a business. You know, we had no
Speaker 2: idea what we were doing. We had absolutely no money.
Speaker 2: I had ten thousand dollars my grandfather had left me.
Speaker 2: We maxed out our credit card bills, and we were very,
Speaker 2: very fortunate to get investment from light Speed in those
Speaker 2: early days, kind of just as we were about to
Speaker 2: hit the wall on our own ability of fun the thing,
Speaker 2: and my dad was like, there's no way I'm paying
Speaker 2: for people to send disappearing photos like this makes no sense.
Speaker 2: So we've just been so fortunate to be able to
Speaker 2: build a great team and step by step just grow
Speaker 2: by serving our community.
Speaker 1: My understanding is that you're religious about running a design
Speaker 1: first company. Is that true and how does that work?
Speaker 2: I wouldn't say design first because a lot of the
Speaker 2: way that we built our company is actually modeled on
Speaker 2: my relationship with Bobby. He is engineering first, but he
Speaker 2: has a real appreciation for design, and I would say
Speaker 2: I'm designed first, but I understand appreciate engineering. And so
Speaker 2: we've been able to build this dialogue over time, and
Speaker 2: especially in the early days where the way that we
Speaker 2: would invent things would take a lot of iteration, both
Speaker 2: on the engineering side and the design side. So, for example,
Speaker 2: one of the first pieces of feedback we got was
Speaker 2: sampshat doesn't work. You can always just take a screenshot,
Speaker 2: and so we did a lot of work to invent
Speaker 2: a new form of screenshot detection, which at the time
Speaker 2: wasn't just an API on iPhone. We had to figure
Speaker 2: out how to determine someone had taken a screenshot and
Speaker 2: then send that note if it came back, and to
Speaker 2: design that both in terms of the user interaction, which
Speaker 2: required people to press and hold on the image while
Speaker 2: they were viewing it, but then also in terms of
Speaker 2: the engineering and what the client had to do to
Speaker 2: detect that a screenshot had occurred was something that would
Speaker 2: only happen with this dialogue and really tight integration between
Speaker 2: design and engineering. And so we've really found that innovation
Speaker 2: lives at kind of the intersection of those disciplines, maybe
Speaker 2: a little bit of art as well, and that's how
Speaker 2: we tried to model the company. So I don't think
Speaker 2: it's design first, it's not engineering first. It's really about
Speaker 2: that relationship between design and engineering that allows us to innovate.
Speaker 1: So is that more important than product or growth? And
Speaker 1: how does that compare then to TikTok or Meta.
Speaker 2: I wouldn't say it one is more important than the other.
Speaker 2: It's really a team based approach. But our general view
Speaker 2: is that growth follows great product and great innovation of
Speaker 2: service that people really love to use. And that's really
Speaker 2: how we focused on building Snapchat, especially because it was
Speaker 2: such a new behavior. If you didn't have a friend
Speaker 2: teach you how to use it, it was really hard to understand.
Speaker 2: And so just by building a product that people love
Speaker 2: having them teach their friends how to use it, Snapchat
Speaker 2: is not a lot of fun if you're just using
Speaker 2: it by yourself. So that is what really drove our
Speaker 2: growth over time.
Speaker 1: How is AI changing snap and what is design in
Speaker 1: an AI world?
Speaker 2: Well, I think AI is an incredible creative tool. That's
Speaker 2: certainly how we're using it as we approach the product,
Speaker 2: and especially because Snapchat is a visual first service, we
Speaker 2: open into the camera. A lot of our AI investments
Speaker 2: on the product experience are focused on image on video,
Speaker 2: on three D asset generation and really enabling people to
Speaker 2: express themselves in new ways. So I think that's really
Speaker 2: been our focus on the product side. Of course, AI
Speaker 2: informs every product surface that we have, whether it's the
Speaker 2: content recommendations you see or the lens recommendations. Of course,
Speaker 2: everything we do to make sure that you're finding friends
Speaker 2: that you know in the real world, all of our
Speaker 2: trust and safety infrastructure increasingly more and more customer service.
Speaker 2: The only way we can serve a community of nearly
Speaker 2: a billion people really well is with the support of
Speaker 2: all of the AI infrastructure we've built over the years.
Speaker 1: Twenty fourteen, you start dabbling in AR. Twenty fifteen, you
Speaker 1: built a research arm to explore AI in deep learning.
Speaker 1: Twenty sixteen you release spectacles. What gave you such conviction
Speaker 1: early on? How did you commit to those things so
Speaker 1: early on? Because there's always a choice, right or resource choice?
Speaker 2: Yeah, I think you know a lot of those ideas
Speaker 2: are the technological or engineering expression of making computing more human.
Speaker 2: So we just talked about a lot of the interesting
Speaker 2: product or user interface examples like stories or vertical video,
Speaker 2: or the ability to tap to take a photo and
Speaker 2: hold to record a video. Those are all elements of
Speaker 2: the user interface that we design. But at the same time,
Speaker 2: we've been making very meaningful investments in the underlying technology
Speaker 2: that we think helps make.
Speaker 3: Computing feel more human.
Speaker 2: I think AI one of the most powerful moments people
Speaker 2: had when they first started using CHATCHBT, for example, was
Speaker 2: feeling like they were sending messages back and forth with
Speaker 2: a person. That's I think epitomizes the notion that technology
Speaker 2: is going to learn how to interface with humans in
Speaker 2: a way that feels much more familiar, and that's really
Speaker 2: been the focus of a lot of these investments.
Speaker 1: What is the vision for spectacles? Do you want it
Speaker 1: to replace phones?
Speaker 3: Initially?
Speaker 2: I don't think it will replace phones, but I think
Speaker 2: over a very long period of time, it will replace
Speaker 2: most of the screens in your life, because if you imagine,
Speaker 2: glasses can provide a display area that's maybe the equivalent
Speaker 2: of four hundred times a smartphone, but at a fraction
Speaker 2: of the weight, and it's not something.
Speaker 3: You have to carry around. You don't have to use
Speaker 3: your hands.
Speaker 2: If you want a big screen on the wall, you
Speaker 2: can just hang it there in space through the glasses.
Speaker 2: So I do think over time people will wonder why
Speaker 2: did I, at one point in time have a tablet,
Speaker 2: a phone, a TV, I guess, watches or screens.
Speaker 3: Now refrigerators or screens.
Speaker 2: Everything's a screen, And I think at some point people
Speaker 2: will wonder, why did we ever do that? When glasses
Speaker 2: allow us to overlay that sort of technology and interface
Speaker 2: on anything in our world?
Speaker 1: Meta, Google, Apple, All of these companies have glasses or
Speaker 1: some form of wearables. Now, how do you compete? These
Speaker 1: are massive companies.
Speaker 3: I think focus is really important. In particular, we've.
Speaker 2: Been so focused on the glasses form factor since twenty fourteen,
Speaker 2: when a lot of people were investing in virtual reality.
Speaker 2: So I think a lot of the investments people have
Speaker 2: made over the last ten or eleven years have been
Speaker 2: much more VR focused, and people felt like that was
Speaker 2: a stepping stone to glasses. But in our view that
Speaker 2: technology stacks are actually quite different, and the notion of
Speaker 2: putting a screen on your face to block out the
Speaker 2: world and enter sort of a different or an alternate
Speaker 2: reality is completely different than the vision for integrating computing
Speaker 2: into your life, into the real world with your friends
Speaker 2: and your family. So I think what we've always found
Speaker 2: is just a singular focus and execution against that over
Speaker 2: a very long period of time helps to compound a
Speaker 2: technological advantage that I think positions us well competitively.
Speaker 1: What does the market look like like? Will every company
Speaker 1: have one and we'll buy one of each or will
Speaker 1: one to two win.
Speaker 2: It's really hard to say now it's still very early
Speaker 2: on and people are playing in different parts of the stack,
Speaker 2: so to say.
Speaker 1: So, we have what's that in human language?
Speaker 2: We have a developer ecosystem, so hundreds of thousands of
Speaker 2: developers who have built millions of lenses on our developer tools.
Speaker 2: When they build those experiences, they run on our rendering engine,
Speaker 2: which is really deeply integrated into our operating system, and
Speaker 2: they see and experience those AR objects through our glasses
Speaker 2: using our own optical engine, meaning the piece of glass
Speaker 2: in the glasses and the little projector we design and
Speaker 2: build ourselves. And so when you look at that full
Speaker 2: stack integration and our ability to control every aspect of
Speaker 2: the experience, we can deliver a singular product experience compared
Speaker 2: to other companies that have various parts of the stack
Speaker 2: but are kind of cobbling together the rest of it.
Speaker 2: It's very hard to create an extraordinary product experience when
Speaker 2: you don't have that sort of vertical control.
Speaker 1: How does AI change AR?
Speaker 2: I think fundamentally, AR is the interface for AI. So
Speaker 2: a lot of people right now are spending time investing
Speaker 2: in building these really big models.
Speaker 3: There's a lot of competition around that.
Speaker 2: You can almost think about that as the back end
Speaker 2: of AI, the infrastruction ructure layer for AI. But where
Speaker 2: we're spending a lot of our time and where we're
Speaker 2: very interested is what is the front end of AI.
Speaker 2: How are people actually going to interact with and engage
Speaker 2: with AI and Certainly the chatbot is not the end
Speaker 2: of the road here for the way that people are
Speaker 2: going to want to engage with and use AI. And
Speaker 2: the reason why we think AR is such a powerful
Speaker 2: interface is because it brings AI into the world with you,
Speaker 2: so it can understand your environment, understand who you're with,
Speaker 2: obviously make the right recommendations in terms of your experience,
Speaker 2: but be very very helpful in the moment as well.
Speaker 1: How do the AI wars play out, what happens, who wins.
Speaker 2: I really wish I could predict the future in that regards.
Speaker 2: I'd probably make a lot of money and it'd be
Speaker 2: fascinating to see where this is all headed. I think
Speaker 2: one of the things that we have found that's happened
Speaker 2: very very rapidly is the commodification of this technology, and
Speaker 2: so I think there's been a huge proliferation of these
Speaker 2: foundational models, a lot of progress and open source, and
Speaker 2: so I think people are thinking a lot about how
Speaker 2: to differentiate on top of these models, and so I
Speaker 2: think a lot of the winners down the road will
Speaker 2: be people who figure out how to do personalization very well.
Speaker 2: So I feel like only one model really knows me
Speaker 2: better than another one. Or people who are really thinking
Speaker 2: about how to integrate these models with other tools so
Speaker 2: they become a lot more useful than just a chatbot.
Speaker 2: And certainly the business models are going to matter a lot, right,
Speaker 2: And what is the customer relationship and customer expectation around AI?
Speaker 2: Especially with a technology that's so personal? I mean people
Speaker 2: are having very very personal conversations with AI about therapy
Speaker 2: or about their health. These are really serious topics and
Speaker 2: I think that needs to be treated with just the
Speaker 2: utmost care. So the companies that do that well and
Speaker 2: who are able to build that trust with their community,
Speaker 2: I think that's going to be a huge predictor of
Speaker 2: success down the road.
Speaker 1: All of the top AI talent is going to all
Speaker 1: these other companies. Does that put you at a disadvantage?
Speaker 2: We actually do build our own models, especially in image
Speaker 2: and video and three D. We're an industry leader and
Speaker 2: one of the reasons why people really like coming to
Speaker 2: Snap is because rather just trying to build the biggest model,
Speaker 2: we try to build models that a huge number of
Speaker 2: people can use. So what does that mean for us?
Speaker 2: We take really advanced image in video models and we
Speaker 2: distill them to run on your device for free.
Speaker 3: And that allows hundreds.
Speaker 2: Of millions of people that use Snapchat to use these
Speaker 2: incredibly advanced AI tools that they would have to pay
Speaker 2: ten dollars a month, twenty dollars a month or more
Speaker 2: to use on other platforms. And so as we think
Speaker 2: about our responsibility to our community, you know, nearly a
Speaker 2: billion people, how can we bring these tools to them
Speaker 2: as quickly as possible in a way that they can
Speaker 2: really use and benefit from Because I think, you know,
Speaker 2: it's certainly one goal to build the perfect largest video model,
Speaker 2: but if it's super slow, if it's really expensive, if
Speaker 2: you can't run it on device, it's going to be
Speaker 2: hard for the broader world to benefit from that.
Speaker 1: And how do you get the talent right, because I
Speaker 1: mean it's like a war for talent for all of
Speaker 1: these top AI people.
Speaker 2: I think we have a reputation in the industry for
Speaker 2: being an incredibly innovative company. We certainly have the resources
Speaker 2: to invest behind the talent that we have here and
Speaker 2: to really help them continue to innovate. And I think,
Speaker 2: especially as it pertains to images, videos, augmented reality, these
Speaker 2: are areas where people who are in the industry see
Speaker 2: how far ahead we are, see the boundaries that we're pushing.
Speaker 2: And so if your life goal is to contribute to
Speaker 2: this mission to make computing more human, to bring computing
Speaker 2: into the world so we can stop spending seven hours
Speaker 2: a day looking down at screens, I think Snap is
Speaker 2: the best place to do that, and it's certainly a
Speaker 2: differentiated place to do that compared to other companies that
Speaker 2: I think are pursuing a relatively similar strategy in terms
Speaker 2: of the models they're building.
Speaker 1: What do you think of Mark Zuckerberg's AI strategy in particular,
Speaker 1: It's very ambitious, but also there are a lot of skeptics.
Speaker 2: I think he's just illustrating how expensive it is to
Speaker 2: play catch up, especially with advanced technology. I think today,
Speaker 2: as we look at the areas where folks are trying
Speaker 2: to invest things like augmented reality, things like AI, these
Speaker 2: technical stacks are very very difficult to build. They require
Speaker 2: highly specialized talent, and as I mentioned, I think that
Speaker 2: the benefits compound over time, and so to be a
Speaker 2: late entrant into the these areas ends up being very expensive.
Speaker 3: And so we'll see how it plays out.
Speaker 1: Can he catch up.
Speaker 2: He's certainly done a hell of a job building his
Speaker 2: business and I'm on the edge of my seat.
Speaker 1: Well, on that note, your LinkedIn says you're the VP
Speaker 1: of product at Meta. How do you really feel?
Speaker 2: I wish that was my joke, because I get so
Speaker 2: much positive feedback on that. One one of the fun
Speaker 2: parts of being a designer is building stuff that lots
Speaker 2: of people use, and so it's very gratifying from the
Speaker 2: design perspective that so many of the things we've invented
Speaker 2: here at snap are so widely used across the industry.
Speaker 2: I mean, I think even LinkedIn has stories at this point.
Speaker 2: So I think it's been really fun to see the
Speaker 2: adoption of all this technology across the industry. But it's
Speaker 2: also meant that from the very early days, you know,
Speaker 2: as we saw how the competitive landscape would play out,
Speaker 2: that we invested in technology that was highly differentiated, that
Speaker 2: was very very difficult to copy, and that has platform characteristics.
Speaker 2: So I think you see that today with our augmented
Speaker 2: reality platform, that's the leading our platform in the world.
Speaker 2: We have people use lenses just inside Snapchat and the
Speaker 2: camera eight billion times a day. Google Search I think
Speaker 2: they do fourteen billion searches a day. So just to
Speaker 2: give you a sense of the scale and engagement around
Speaker 2: AR on Snapchat. Then you add in all the amazing
Speaker 2: creators who are building lenses, the monetization features we have
Speaker 2: around augmented reality, and we have an ecosystem that's very.
Speaker 3: Hard to copy. So a lot of our efforts and.
Speaker 2: The progress we've made in our business have been investing
Speaker 2: in these highly differentiated, very advanced technologies that have platform
Speaker 2: or ecosystem characteristics, and that's how we managed to keep
Speaker 2: growing nearly to a billion monthly active users.
Speaker 3: At this point.
Speaker 1: But all the things that might have been easier to copy,
Speaker 1: I mean, that has to be frustrating, I think.
Speaker 2: From a business perspective, explaining to investors why we think
Speaker 2: we can still win when people can copy our innovations,
Speaker 2: that has been one of the more frustrating aspects for sure,
Speaker 2: because I think I really believe in our team's ability
Speaker 2: to continue to innovate, to continue to serve our community,
Speaker 2: to continue to invent new things. But it's hard for
Speaker 2: investors to imagine things they haven't yet seen, and so
Speaker 2: to sit with an event and say, what are you
Speaker 2: going to do if somebody copies stories or vertical video?
Speaker 2: We can't just show them our whole roadmap. But I'm
Speaker 2: so excited about all the innovations that our team continues
Speaker 2: to deliver and in the technology industry, as we continue
Speaker 2: to see innovation is the only path for long term success.
Speaker 1: Absolutely, this is legend. But I want to hear it
Speaker 1: from you. Mark Zuckerberg famously offered three billion dollars to
Speaker 1: buy you back in the day. Tell me about the
Speaker 1: journey of emotions there and what gave you the courage
Speaker 1: to say no.
Speaker 2: I can say now publicly it was a hell of
Speaker 2: a lot more than that, which is pretty wild.
Speaker 3: So I think for us there was.
Speaker 1: It was more than three you're saying.
Speaker 2: A lot more than three ish, Yeah, I think, Okay.
Speaker 2: I think for us there were a couple of things.
Speaker 2: The first one was that we saw a much bigger
Speaker 2: opportunity for Snapchat. A lot of that was informed by
Speaker 2: having the experience of watching Instagram, which sold very very
Speaker 2: early in their life, is a company ultimately has become
Speaker 2: a huge driver of growth for Meta, an incredible business,
Speaker 2: and I think watching that and learning from that sort
Speaker 2: of story and the feeling we had that wow, they
Speaker 2: had sold way too early definitely informed some of our thinking.
Speaker 2: But more importantly, we saw so much potential for Snapchat.
Speaker 2: I mean, Snapchat was still very small at the time.
Speaker 2: We had a whole pipeline of new products that we
Speaker 2: were really excited to deliver, and so we thought that
Speaker 2: we could build a really big business on our own.
Speaker 2: And we also had built a lot of the original
Speaker 2: products and ideas around Snapchat on a foundation that was
Speaker 2: fundamentally different. So thirteen years ago we were talking a
Speaker 2: lot about privacy. People thought we were totally nuts. I mean,
Speaker 2: we had to explain to people. You know, if you
Speaker 2: look at the history of computing, a lot of computing
Speaker 2: was built on.
Speaker 3: Top of physical hard drives.
Speaker 2: So because computers stored data on physical hard drives, it
Speaker 2: was actually more expensive to delete data because you would
Speaker 2: have to overwrite the hard drive that would wear out
Speaker 2: the disc that people just said, we'll just save everything forever,
Speaker 2: it'll actually be cheaper than trying to overwrite the hard
Speaker 2: drives to delete the data. And so the notion that
Speaker 2: we would have a platform that really protected people's privacy,
Speaker 2: that would actually delete their content was so knew at
Speaker 2: the time and so different than what the Internet was
Speaker 2: focused on. The notion that we would have a platform
Speaker 2: where people would share in stories with no public likes
Speaker 2: and comments. This was directionally completely different. I mean, I
Speaker 2: remember designers would come interview and they'd be like, we've
Speaker 2: got an idea for you. You should add likes. Why have
Speaker 2: you not added likes? You know, it'll be a huge
Speaker 2: growth driver for the business. And we had just a
Speaker 2: very different vision for what we were trying to accomplish.
Speaker 2: So we saw a big opportunity. We had a very
Speaker 2: different vision.
Speaker 3: And then Bobby and I were just having a lot
Speaker 3: of fun.
Speaker 2: You know, we really love working together and we didn't
Speaker 2: want to give that up, so, you know, we decided
Speaker 2: to stay independent.
Speaker 1: Google reportedly tried to buy you for thirty billion dollars.
Speaker 1: Did that happen?
Speaker 3: I don't. I don't know about that one.
Speaker 1: I don't know where do you get your conviction?
Speaker 3: What a great question.
Speaker 2: I grew up with two parents who were both lawyers.
Speaker 2: My mother was a tax lawyer, my dad does business litigation.
Speaker 2: So our dining table conversations were energetic, to say the least.
Speaker 2: And I think my parents always really instilled in me
Speaker 2: or helped me develop an ability to defend my point
Speaker 2: of view. And I've always really enjoyed debating that's the
Speaker 2: primary format actually of our design meetings. We spend you know,
Speaker 2: three or four hours a week just looking at work
Speaker 2: and debating it and really developing that confidence in the
Speaker 2: underlying perspective or point of view. So I think conviction
Speaker 2: is something you build over time by really trying to
Speaker 2: understand an idea, by approaching it from different directions, by
Speaker 2: debating it. And so I think I ended up developing
Speaker 2: a bunch of tools that helped me build conviction and
Speaker 2: something over time.
Speaker 1: These are trillion dollar companies, though, and Snap is a
Speaker 1: multi billion.
Speaker 3: Dollar company, a baby company.
Speaker 1: A baby company. All crazy is that? Zach recently said,
Speaker 1: I think if we would have bought them, we would
Speaker 1: have accelerated their growth. What's your response to that.
Speaker 3: I think that's probably true.
Speaker 2: I think that's certainly what they've done with other services
Speaker 2: like Instagram, because they had so much distribution, they were
Speaker 2: always a much larger company, and Snap was a very
Speaker 2: late entrant. Facebook had come first, Instagram came first, Twitter
Speaker 2: came first, WhatsApp came first, all of these other services
Speaker 2: came first. And one of the big pieces of pushback
Speaker 2: we heard from investors was, you know, you have no
Speaker 2: chance of succeeding because network effects everybody believed in work
Speaker 2: effects at the time mean that there's just no way
Speaker 2: you're going to grow, and we actually developed a very
Speaker 2: different growth strategy to address that. So the traditional model
Speaker 2: that people had in their heads of social networks was
Speaker 2: that every incremental node or person you add to the
Speaker 2: service or add to the graph exponentially increases its value.
Speaker 2: So the more people you have, the more valuable the
Speaker 2: network has, and it becomes so valuable that no one
Speaker 2: can ever compete with it. What we had learned and
Speaker 2: what we saw was that even if you have a
Speaker 2: very very large network, you only really talk to or
Speaker 2: care about a very small number of people in that network.
Speaker 2: So I would bet that certainly this is the case
Speaker 2: for me. I'd bet this is the case for you.
Speaker 2: You spend most of your time talking to a pretty
Speaker 2: small group of people. And I think what we learned
Speaker 2: very early on was that if you focus on building
Speaker 2: those strong relationships with the people you really care about,
Speaker 2: you actually don't need this huge graph to build a
Speaker 2: competitive business. If you just have one friend you really
Speaker 2: care about and talk to every day, that's enough to compete.
Speaker 2: And so we ended up taking a very different path
Speaker 2: from a growth perspective that's proven very resilient and continue
Speaker 2: to allow to grow. But it's true that just plugging
Speaker 2: into a giant, dominant social network would have probably accelerated
Speaker 2: the growth of the company.
Speaker 1: But still no regrets, Like do you ever think what if?
Speaker 2: No? I mean, I'd be more concerned, frankly if Snapchat
Speaker 2: didn't exist, because all of these innovations that we've continued
Speaker 2: to create have really contributed to the industry, and I
Speaker 2: think we've helped shape the conversation around things like privacy.
Speaker 2: We've helped shape the conversation around things like moderation, trust
Speaker 2: and safety, these things that are really really important to
Speaker 2: people as well being that I think ultimately may have
Speaker 2: not ever been talked about if Snap hadn't been a
Speaker 2: proponent of a lot of these really important ideas.
Speaker 1: Yeah, ten cents still has a big stake in Snap.
Speaker 1: They're your biggest investor, I believe, one of the biggest,
Speaker 1: one of the biggest investors. Okay, they're one of the
Speaker 1: biggest investors. And I've always found that so fascinating. Because
Speaker 1: US social media is banned in China. What's your relationship
Speaker 1: with them?
Speaker 3: They are an incredible investor.
Speaker 2: I think it's important to understand ten cents business, So
Speaker 2: ten cents fundamential messaging service. I think people today are
Speaker 2: familiar with we chat or QQ. So back in the day,
Speaker 2: the way they were able to build their business they
Speaker 2: had a desktop messaging client. They found that people were
Speaker 2: messaging each other, but then they would leave the messaging
Speaker 2: client and they were like, gosh, why is everyone leaving
Speaker 2: our messaging client. They realized everyone is going to play
Speaker 2: games with their friends. So they figured out if we
Speaker 2: helped through our messaging client, people go and play games together,
Speaker 2: and then we monetized through those games, we could build
Speaker 2: a really big business around messaging.
Speaker 3: So they were one of the.
Speaker 2: First people, maybe the first to figure out how to
Speaker 2: build a very big business around messaging, which people historically
Speaker 2: thought was not a very good.
Speaker 3: Business to be in.
Speaker 2: So they were also the first to really see the
Speaker 2: value in snapchat. I remember they visited the blue house
Speaker 2: that we just saw this morning, the very early days
Speaker 2: of the company, and they were like, we're not sure
Speaker 2: you understand you have the potential to build a huge
Speaker 2: business around messaging, and we'd love to show you how
Speaker 2: we did it. We'd love to show you how we
Speaker 2: built all these different services. So I got to learn
Speaker 2: from them how they built out a social networking service,
Speaker 2: how they built out a gaming business, how they built
Speaker 2: out an avatar business. And they really showed us how
Speaker 2: powerful messaging could be as a business at a time
Speaker 2: when in the United States people thought of messaging services
Speaker 2: as actually not very valuable.
Speaker 1: You met President she in twenty fifteen. Do you get
Speaker 1: any inspiration from China and the broader social products that
Speaker 1: they're building.
Speaker 2: I think there are incredible entrepreneurs in China. I think
Speaker 2: that there's an amazing amount of entrepreneurial energy. I had
Speaker 2: the great fortune of meeting Yiming way back in the day.
Speaker 2: I think this was like, what was this the Totiao days.
Speaker 3: This was before Douien.
Speaker 2: So they had just a little newsreader app that was
Speaker 2: driven by AI. That helped inform some of our thinking
Speaker 2: about how we were doing AI driven content distribution at
Speaker 2: the time, because we were expanding our Discover product. In
Speaker 2: the beginning, we only had nine publishers on Discover, which
Speaker 2: was our media platform, and we had grown that to
Speaker 2: have a lot more publishers, but we needed to provide
Speaker 2: the right recommendations to our community. So we definitely learned
Speaker 2: a lot about content recommendation from them and so many
Speaker 2: other really talented entrepreneurs in China.
Speaker 1: Just how big a threat is TikTok. I mean, they
Speaker 1: seem to be setting the trends that you set in
Speaker 1: the early days.
Speaker 2: I think they've done an incredible job growing their business.
Speaker 2: They have some real advantages that make them a tough competitor.
Speaker 2: One of course, is that they're allowed to operate in
Speaker 2: China and we're not. They have a very very large
Speaker 2: and profitable business in China that they can use to
Speaker 2: fund their growth outside of China, and so especially as
Speaker 2: they've been competing with us in the early days, it's
Speaker 2: not like competing with the normal startup. It's like competing
Speaker 2: with a giant, really conglomerate because they have so many
Speaker 2: different services that's able to spend tens of billions of
Speaker 2: dollars to grow. And so it's been an unbelievably formative
Speaker 2: journey for Snap to try to figure out how to
Speaker 2: compete with them, in addition to the really big players
Speaker 2: here you know in the US, like Meta. But I
Speaker 2: think we have a lot of experience now competing with
Speaker 2: very very large and powerful companies who can spend a
Speaker 2: nearly infinite amount of money. And we've just found that
Speaker 2: if we stay focused on our community, if we continue
Speaker 2: to innovate, that that's how we can drive value and grow.
Speaker 1: It's a race for creators. Why should they come to you?
Speaker 2: What we always hear from creators is they deeply value
Speaker 2: their relationship with their audience on Snapchat and they feel
Speaker 2: like they're able to build a loyal relationship on Snapchat
Speaker 2: compared to a platform. So now most creator platforms basically
Speaker 2: resemble TikTok, So whether it's Instagram or YouTube TikTok, of
Speaker 2: course they have short video distribution.
Speaker 3: It's very hard to.
Speaker 2: Build a durable, loyal and valuable relationship with your audience
Speaker 2: when your distribution is so varied. So you could have
Speaker 2: one video that gets ten views or one thousand, and
Speaker 2: another that gets millions. It's very hard to create sustained
Speaker 2: success and then a business out of that as a
Speaker 2: creator when your distribution so varied.
Speaker 3: So one of the reasons why creators love Snapchat.
Speaker 2: Is they get that distribution through Spotlight if they want
Speaker 2: to acquire a new audience, but ultimately they deepen the
Speaker 2: relationship through stories and we provide monetization through stories through
Speaker 2: shared advertising revenue. We're actually experimenting right now with a
Speaker 2: lot of really cool monetization tools for creators because we've
Speaker 2: had a lot of success with direct revenue. We have
Speaker 2: a big subscription business now, so I think there's a
Speaker 2: lot of opportunity to help creators continue to deepen that
Speaker 2: relationship with their fans.
Speaker 1: Snap is currently sitting below its IPO price. Earnings can
Speaker 1: be notoriously brutal. How do you manage what the pressure
Speaker 1: of running a public company? Does that get to you?
Speaker 2: I think what's so important is that we just continue
Speaker 2: to stay focused on our vision and that we clearly
Speaker 2: communicate that to our team. So one of the reasons
Speaker 2: why our earnings reports are challenge is because we're investing
Speaker 2: so much in the future of augmented reality in our glasses,
Speaker 2: and we've been doing that for a really long period
Speaker 2: of time, and because investors haven't seen a lot of
Speaker 2: revenue from that or a lot of unit sales from that,
Speaker 2: they're skeptical, right and so until we're able to show
Speaker 2: that our glasses can become a really big business, that
Speaker 2: we can win this future of augmented reality and really
Speaker 2: reinvent computing. They're going to view that as a drag
Speaker 2: on our stock, and there's going to be volatility. I mean,
Speaker 2: I had such an inspiring conversation with Jensen because for
Speaker 2: a very long time he had a really strong Kudah business, right,
Speaker 2: and then they were trying to grow this GPU business.
Speaker 2: People didn't think they could win in GPUs. They were
Speaker 2: taking a lot of the revenue from the Couda business
Speaker 2: reinvesting it to grow the GPU business, And he mentioned me,
Speaker 2: you know, it just felt like I never had a
Speaker 2: clean quarter, right, because I was really trying to invest
Speaker 2: in this business where I saw so much opportunity, and
Speaker 2: it was really really hard to do that. Here at Snapchat,
Speaker 2: we take the cash flows that we're generating from the
Speaker 2: Snapchat business and we reinvest that in the future of
Speaker 2: AR and our glasses. And because we don't provide a
Speaker 2: lot of financial disclosure around that, it's hard for investors
Speaker 2: sometimes to understand what's the scale of that investment, what's
Speaker 2: the return profile going to look like? And for competitive reasons,
Speaker 2: it's not very smart for us to share that information
Speaker 2: because we have a track record of being right consistently
Speaker 2: and inventing these new products, and we don't want people
Speaker 2: to follow us quickly on this one. So I think
Speaker 2: over time, as people start seeing the value of our
Speaker 2: augmented reality platform, as they see our advantages in that space,
Speaker 2: and it turns into a real business, that that story
Speaker 2: will evolve. But until then, we have a business where
Speaker 2: we're really taking the strong financial performance of Snapchat and
Speaker 2: reinvesting it.
Speaker 3: In the future.
Speaker 1: So what was Jensen's advice?
Speaker 3: Just knuckle down.
Speaker 2: You know, it's funny too because at the time he
Speaker 2: had young kids, you know, and he was joking around.
Speaker 2: He's like, you couldn't work from home back then, so
Speaker 2: I'd like bring my kids to work in a basket
Speaker 2: and would be at the office seven days a week
Speaker 2: to try to win that future and stay focused on
Speaker 2: your vision. Knuckle down, And I think ultimately the ability
Speaker 2: to invest so consistently over a long timeframe at this
Speaker 2: scale is such an advantage. Be very very hard for
Speaker 2: a startup to follow that pass. Certainly it's hard for
Speaker 2: bigger companies to do that with the amount of focus
Speaker 2: that we have, so we have such an incredible competitive advantage,
Speaker 2: but you know, sometimes it means we don't have a
Speaker 2: clean quarter.
Speaker 1: So what do you want the market to know, Like,
Speaker 1: what are the new revenue streams of the future.
Speaker 3: I think there are a couple.
Speaker 2: So, first of all, we continue to have a huge
Speaker 2: opportunity in our advertising business, and specifically, we spend a
Speaker 2: lot of time over the last couple of years building
Speaker 2: out our lower funnel business. So I think Snapchat's early
Speaker 2: growth in advertising was a really around video. Very simple, right,
Speaker 2: people were spending a lot of money on television advertising.
Speaker 2: Young people don't watch television. They watch video on their phones.
Speaker 2: They watch vertical video on their phones. We've got a
Speaker 2: lot of that video inventory, and that's been meaningful for
Speaker 2: our business and meaningful for our advertising partners. Over the
Speaker 2: last couple of years, we built out a very advanced
Speaker 2: advertising platform that delivers lower funnel goals. So think download
Speaker 2: an app and make a purchase or complete a level,
Speaker 2: buy a new product that's dynamically served to you from
Speaker 2: a hug product catalog. Those are the sorts of things
Speaker 2: that we've been able to deliver with our advertising platform,
Speaker 2: and those sorts of goals are very valuable to small
Speaker 2: and medium sized customers. So small and medium sized customers
Speaker 2: are the majority of Google or metas revenue, they are
Speaker 2: the minority of our revenue. And so if we look
Speaker 2: at where our growth is going to come from on
Speaker 2: the advertising side in the future, it's going to be
Speaker 2: from continuing to grow our small, medium customer business, while
Speaker 2: of course serving our large brand advertisers as well. Then
Speaker 2: we've had quite a bit of success with Snapchat Plus,
Speaker 2: which is our subscription service. I don't remember what we
Speaker 2: last disclosed it earnings, but I think it's run rating
Speaker 2: north of half a billion dollars now.
Speaker 3: I think it's about two years old, and we see
Speaker 3: a lot.
Speaker 2: Of opportunity in the direct revenue space, not just with subscriptions,
Speaker 2: but other forms of added value like what we're doing
Speaker 2: with creators as well. And then I think longer term,
Speaker 2: if you look at our progress on the hardware side,
Speaker 2: it's not impossible to imagine a future where let's say,
Speaker 2: you know, we were to sell twenty five million units
Speaker 2: a year of glasses at one thousand dollars unit with
Speaker 2: a thirty percent gross margin. I think that's like seven
Speaker 2: billion of gross profit, and that would be ten percent
Speaker 2: of iPhone volumes, two percent of total smartphone volumes, and
Speaker 2: that doesn't include televisions and desktops and all the other
Speaker 2: screens people are.
Speaker 3: Spending their money on.
Speaker 2: So I think if we have even just a modest
Speaker 2: amount of success in the device business, and that's before
Speaker 2: advertising and digital services and this sort of thing, if
Speaker 2: we have some modest success on the hardware side as well,
Speaker 2: I think that can be a very large driver of
Speaker 2: our growth in the future.
Speaker 1: What are you doing to make sure Snap keeps winning
Speaker 1: younger users like I can't read my kids' minds, So
Speaker 1: how do you do it?
Speaker 2: I think for us, it's really about just being responsive
Speaker 2: to how people feel when they're using our product and
Speaker 2: the needs that they have. So let's take, for example,
Speaker 2: the Snap map. I think it's one of the largest
Speaker 2: maps on mobile now. The reason why we built that
Speaker 2: map is people were saying, gosh, I'm spending so much
Speaker 2: time asking my friends where they are, what they're doing,
Speaker 2: who they're with. I'm waiting for a response. I don't
Speaker 2: know when they're going to get here, or when is
Speaker 2: my partner going to make it home from work, And gosh,
Speaker 2: it would be so great to just have an easy
Speaker 2: way to know that. And so I think just by listening,
Speaker 2: being responsive to our commune unity, their desires and their needs.
Speaker 2: That prompts so much innovation and creativity from us and
Speaker 2: will allow us to continue to evolve the product.
Speaker 1: You do have obviously a lot of younger users, and
Speaker 1: they're using snap at an incredibly formative time in life,
Speaker 1: when they're more susceptible to pressure and anxiety and addiction.
Speaker 1: How do you look at the products and features you're
Speaker 1: designing in terms of encouraging good behavior and discouraging bad behavior,
Speaker 1: and how can design really play a role in that?
Speaker 2: I think for us, as we look at our role
Speaker 2: in young people's lives, but people's lives more broadly, one
Speaker 2: of the things that we find is so incredibly important
Speaker 2: is their relationships with their friends and their family. In fact,
Speaker 2: relationships with just one friend can dramatically improve mental health outcomes.
Speaker 2: And so if Snapchat can play a role in connecting
Speaker 2: people with their close friends and family, I think it
Speaker 2: can make an extraordinary difference in the world. So how
Speaker 2: do we do that that's different than what other services
Speaker 2: are doing today today? If your team is using text messaging,
Speaker 2: anyone can text them that has their number, right, no screening,
Speaker 2: no vetting.
Speaker 3: Anybody in the world. I don't know if you this experience,
Speaker 3: I get a ton of spam messages. Yes too. It's
Speaker 3: super annoying.
Speaker 2: And one of the things I don't think people realize
Speaker 2: about Snapchat is both people have to opt in and
Speaker 2: add each other to communicate, and that's incredibly important for
Speaker 2: forming close friendships and for communicating in an environment that's safer.
Speaker 2: So I think the most important thing for young people
Speaker 2: is to make sure they're adding their real friends out
Speaker 2: in the world, and I think Snapchat can become an
Speaker 2: incredibly powerful vehicle to strengthen those relationships and to help
Speaker 2: reduce the barrier to that sort of communication. Things like,
Speaker 2: you know, using silly ar effects or lenses help reduce
Speaker 2: that pressure of communicating. It's not about taking a pretty
Speaker 2: or perfect photo. It's about you know, silly you know,
Speaker 2: dog ears or something and sending that to your friend.
Speaker 2: And I think those sort of points of connection aren't
Speaker 2: really valuable. And then we invest a huge amount of time, money,
Speaker 2: our engineering resources, talent into our trust and safety teams
Speaker 2: because it's really important that. Of course, in addition to
Speaker 2: building a platform that's built around your close friends and family,
Speaker 2: that there are options and ways for you to get
Speaker 2: help if you need it. And that's everything like our
Speaker 2: proactive detection to understand if people are misusing the platform
Speaker 2: so we can invest to gate lock their account remove
Speaker 2: them from the platform, but also tools allowing people to
Speaker 2: get help in app. If they're having a conversation that
Speaker 2: feels inappropriate or it's going sideway, they can just press
Speaker 2: and hold and report that message. Again, not a feature
Speaker 2: that's available on text messaging, but that's available on Snapchat.
Speaker 1: Maybe I'm just a geriatric millennial. But some of the
Speaker 1: things you know, snap streaks, snap credit, snap maps, some
Speaker 1: of those things actually seem like they might not be
Speaker 1: good for kids and make you feel left out if
Speaker 1: you're not on the map with your friends, or make
Speaker 1: you feel like you have to keep snapping to keep
Speaker 1: that streak going. How do you think about those things.
Speaker 2: We've thought a lot over the years about how to
Speaker 2: do things like reduce the pressure of streaks. A streak
Speaker 2: is only something that can increase once a day, So
Speaker 2: the idea that people would constantly be coming into our
Speaker 2: service or feel a pressure to communicate all day long
Speaker 2: with their friends. A streak only increases once a day,
Speaker 2: with one snap back and forth from your friends, So
Speaker 2: it's a once a day behavior if you want to
Speaker 2: check in with your friends. And we've heard constantly and
Speaker 2: consistently from our community how meaningful it is to have
Speaker 2: that daily point of connection and that excuse to stay
Speaker 2: in touch. So we hear from families or you know,
Speaker 2: I get these beautiful notes from people who say, I've
Speaker 2: been through so many life changes. I moved halfway around
Speaker 2: the world, I got divorced, I am dealing with working
Speaker 2: on managing the relationship with my kids, and through it all,
Speaker 2: every single day I snapped with my best friend and
Speaker 2: it made such a difference in my life and created
Speaker 2: that connection point. So I think streaks can have a
Speaker 2: really positive impact in people's lives. That's certainly what we've
Speaker 2: heard from our community. As it pertains to the snap map,
Speaker 2: I would argue that it's very, very important at this
Speaker 2: moment in time to encourage people to be together with
Speaker 2: their friends in person, and I think the snap map
Speaker 2: actually creates a lot of those opportunities. So the snap
Speaker 2: map is not about driving more engagement Snapchat. It's actually
Speaker 2: about enouraging people to hang out with their friends and
Speaker 2: something that's incredibly encouraging to meet. We perhaps foolishly hosted
Speaker 2: the eighth grade graduation party at our house this year
Speaker 2: with one hundred and fifty eighth graders, and it was
Speaker 2: really inspiring to see because if you read the news,
Speaker 2: you would think that everyone would be sitting there on
Speaker 2: their phone the whole night, and that just wasn't the
Speaker 2: case at all.
Speaker 3: I mean, I saw maybe.
Speaker 2: One teenager use their phone, maybe someone else called their
Speaker 2: parents to get picked up, but everyone was hanging out,
Speaker 2: having a good time, dancing and having a cheeseburger. And
Speaker 2: I think it's just so important, especially for young people
Speaker 2: in this how we think about an our house to
Speaker 2: create all of the alternatives, whether that's sports or art
Speaker 2: or other extracurriculars, or just hanging out with your friends
Speaker 2: at the park. All those are things that our fourteen
Speaker 2: year old would vastly prefer to sitting there using his phone.
Speaker 2: But it's really important that those alternatives are available.
Speaker 1: There's major concerns about kids getting access to drugs on
Speaker 1: snap You apologized to parents before Congress this has led
Speaker 1: to some really tragic situations. What specific improvements have you
Speaker 1: made since then to get better?
Speaker 2: Yeah, Because Snapchat's a messaging service, very often times we're
Speaker 2: on the forefront of some of these emerging challenges. In
Speaker 2: this particular case, I think you're referring to ventanyl laced
Speaker 2: pills or counterfeit prescription pills, and these are very, very
Speaker 2: dangerous because young people might believe they're buying a percoset
Speaker 2: or something for their friend, but actually it's laced with
Speaker 2: ventyl or it was made with ventanyl, and it can
Speaker 2: kill them. And unfortunately, far too many young people have
Speaker 2: died taking these ventanyl laced pills. If you look at
Speaker 2: our response after we heard from families who had experienced this,
Speaker 2: we continue to aggressively ramp up our proactive detection to
Speaker 2: remove dealers from our platform. So understanding, if people are
Speaker 2: trying to market drugs to a friend or sell drugs
Speaker 2: to a friend, we can proactively detect that and remove
Speaker 2: it from our platform, preserve all that information and refer
Speaker 2: it to law enforcement. I think we can be a
Speaker 2: really helpful partner to law enforcement in that regard in
Speaker 2: terms of actually getting these folks off the streets and
Speaker 2: stopping the distribution of illegal drugs. Another thing we've invested really,
Speaker 2: really heavily in is education because one of the first
Speaker 2: things we found, especially in those early days of the
Speaker 2: fentanyl crisis was that people just didn't know that they
Speaker 2: could die from taking these counterfeit pills. There wasn't a
Speaker 2: level of awareness of fentanyl, and so we helped support
Speaker 2: the largest ever campaign, One Pill Can Kill to educate
Speaker 2: young people, because we are a platform with an enormous
Speaker 2: amount of reach, and I think that's another area that
Speaker 2: we think is so important, and we work together with
Speaker 2: nonprofits and other folks who are really committed to education
Speaker 2: so that people know there's the tremendous risks that exist
Speaker 2: from fentanyl. And then lastly, we've really worked proactively with
Speaker 2: law enforcement. So long before the DA issued their first
Speaker 2: ever warning about fentanyl, we've been collaborating with the DA,
Speaker 2: with other law enforcement agencies of course, you know, working
Speaker 2: on our proactive detection to help them respond as well,
Speaker 2: and be a supportive partner to make sure we're responsive
Speaker 2: in a timely manner, to make sure that we can
Speaker 2: work on some of these really tough cases together to
Speaker 2: help protect our community.
Speaker 1: Would you say that safety and enforcement are treated with
Speaker 1: the same urgency inside the company as design and engineering
Speaker 1: and growth and product and what would prove that to
Speaker 1: an outside viewer?
Speaker 2: I would say at many points in time, it's had
Speaker 2: more urgency because unless people can feel safe using our products,
Speaker 2: they're not going to feel comfortable expressing themselves or communicating
Speaker 2: with their friends. And I think fundamentally for Snapchat to
Speaker 2: be a successful service and to continue to grow, we
Speaker 2: have to make sure our community feel safe when they're
Speaker 2: communicating using our products. So it's hard obviously outside a
Speaker 2: Snap to understand the credible amount of effort and work
Speaker 2: we put into the space. But I think whether it's
Speaker 2: some recent Senate hearings or some of the cases and
Speaker 2: a legal discovery that's on going to understand what is
Speaker 2: Snap done right and wrong to respond to these crises.
Speaker 2: I think over time the public will build a lot
Speaker 2: of confidence in our response.
Speaker 1: And none of this is happening just on Snap, of course,
Speaker 1: but this is something that I'm worried about. Kids are
Speaker 1: using Snap and other apps to send nude photos of
Speaker 1: themselves to other kids. AI is like gasoline on the fire.
Speaker 1: Where does this go?
Speaker 3: Well?
Speaker 2: I think it's really important for people to understand that's
Speaker 2: a crime, and I think there's been some really powerful
Speaker 2: legislation pass recently that Take It Down Act, which helps
Speaker 2: protect people from being revictimized by that sort of content,
Speaker 2: and there are tools available for young people. And if
Speaker 2: you are being victimized in that way, if you have
Speaker 2: had private images that have been exposed, there are tools
Speaker 2: you can use online to create a hash of that image,
Speaker 2: upload it and take it down from all of the
Speaker 2: various platforms Snap included, who have integrated with that service.
Speaker 1: What if you've sent it yourself, because that's what kids
Speaker 1: are doing.
Speaker 2: You can take that image that you've sent yourself if
Speaker 2: you're being revictimized or somebody's threatening, you upload that image
Speaker 2: to these services and it will take it down from
Speaker 2: those platforms. And so sometimes folks reach out to get
Speaker 2: advice on these topics. They're just not aware that these
Speaker 2: tools exist today. So there are some really powerful tools
Speaker 2: to help young people if they have made a mistake
Speaker 2: in the heat of the moment or shared something they
Speaker 2: didn't want to, to pull that down from online platforms.
Speaker 3: And obviously it's a serious crime.
Speaker 1: Do you think these things get better? Like do kids learn?
Speaker 1: Do we get used to using all these tools?
Speaker 2: I think maybe that more optimistic view here would be
Speaker 2: younger generations are not engaging in risk taking behaviors at
Speaker 2: the rate that they're older generations were.
Speaker 3: In fact overall.
Speaker 2: If you look at drug use, if you look at
Speaker 2: sexual behavior for teenagers and these sorts of things, they've
Speaker 2: declined dramatically. And I think there's reason to be optimistic
Speaker 2: that education people's awareness of the risks of these sorts
Speaker 2: of behaviors have changed the way they act out in
Speaker 2: the world.
Speaker 1: I know, but is that a good thing, because aren't
Speaker 1: they just spending more time on screens then taking risks outside?
Speaker 1: You know, I don't know, you're I don't know, you've
Speaker 1: got kids.
Speaker 2: My general view is that people are spending time on
Speaker 2: screens that could be spent in maybe different or more
Speaker 2: productive ways. That's certainly one of the reasons why we've
Speaker 2: invested so heavily inspects, because we believe, instead of a
Speaker 2: classroom where everyone's sitting behind the laptop, what if you
Speaker 2: could all get together look at the same thing, do
Speaker 2: simulated chemical reactions in your chemistry lab without making a mess.
Speaker 2: I think, all of a sudden, you have education that's interactive,
Speaker 2: that's shared in the real world, that's a lot more
Speaker 2: fun and doesn't evolve just sitting behind hunched over a screen.
Speaker 1: What's the social media policy in the Spiegel household, do
Speaker 1: you let your kids use Snap or TikTok or Instagram
Speaker 1: or are those forbidden?
Speaker 3: Those are absolutely forbidden.
Speaker 2: We cannot have competitive social services in our house. Flynn
Speaker 2: is absolutely allowed to use Snapchat. We have a great
Speaker 2: tool called Family Center that allows you to link your
Speaker 2: account with your team's account to see the people that
Speaker 2: they're communicating with, not the content of the messages, but
Speaker 2: who they're communicating with and other important information, so you
Speaker 2: can get confident with the way they're using the service.
Speaker 2: And we also find families really love it as a
Speaker 2: way to connect. Certainly our family does in our family group.
Speaker 1: Chat Snap has done a lot to rock the vote
Speaker 1: vote with kids. Politics is a huge part of the platform.
Speaker 1: What is the next iteration?
Speaker 2: I think for us, we definitely find that our community
Speaker 2: is engaged in the political process. I'm so excited that
Speaker 2: Millennials and Gen Z are now the largest generations. I
Speaker 2: think millennials are the largest adult generation. So I do
Speaker 2: think you are seeing a dramatic change in politics. Part
Speaker 2: of that's also I think being motivated by what people
Speaker 2: are experiencing in the economy. We have had an inflationary
Speaker 2: economy for quite some time. If you look at the
Speaker 2: political candidates that are resonating the most, they are talking
Speaker 2: directly about the cost of living crisis. That's something that
Speaker 2: young people are really feeling, right. The cost of housing
Speaker 2: is too high, the cost of groceries is too high.
Speaker 2: And I think what we're finding on snapchat is that
Speaker 2: the creators or the politicians that are responding to that issue,
Speaker 2: discussing that issue, and connecting on that certainly are finding
Speaker 2: an opportunity to rally young people who want to see
Speaker 2: real change.
Speaker 1: What do you make of tech's right turn?
Speaker 3: How do you mean all of.
Speaker 1: Those big tech CEOs sitting there at the inauguration.
Speaker 2: I wouldn't misinterpret that as a right turn. I think
Speaker 2: if you look at the tech industry as a whole,
Speaker 2: across many different administrations, the technology industry continues to engage
Speaker 2: very heavily with whatever administration is currently serving the American people.
Speaker 2: I don't think that's different in this regard. I think
Speaker 2: these technology companies are hugely influential in the lives of
Speaker 2: the American people. I think they're dealing with a huge
Speaker 2: number of regulatory and other challenges, and no matter what
Speaker 2: administration it is, folks are going to engage as as
Speaker 2: they can because it's so important to American long term
Speaker 2: success but also important to their business.
Speaker 1: Other platforms Meta notoriously have rolled back some fact checking
Speaker 1: and misinformation tools how to snaps policies compare.
Speaker 2: We think it's really important to make sure that our
Speaker 2: content is safe, especially because we serve young people, as
Speaker 2: you mentioned, and so we continue to moderate our content.
Speaker 2: We don't think things like extreme violence, for example, are
Speaker 2: appropriate on our service. There are other technology platforms that
Speaker 2: allow that sort of content. So we're going to continue
Speaker 2: to make sure that we have an environment where people
Speaker 2: feel comfortable expressing them so elves because one of the
Speaker 2: things that we found over time and as we listen
Speaker 2: to how people experienced other technology platforms, they felt like
Speaker 2: if they were seeing lots of shocking or inappropriate content,
Speaker 2: that they didn't feel comfortable participating. And we want our
Speaker 2: community to feel comfortable participating with one another, and that means,
Speaker 2: from our point of view, having a safer content environment
Speaker 2: because we don't allow some of that kind of content.
Speaker 1: I heard you still love reading physical newspapers.
Speaker 3: Physical newspapers, physical books like you name it?
Speaker 1: That expected?
Speaker 3: Is it? I don't know. I love paper. I also
Speaker 3: love writing on paper.
Speaker 2: That's definitely how I think it's probably goes back to
Speaker 2: some of my early days in graphic design and the
Speaker 2: way that I like to think is really writing things
Speaker 2: out and drawing, and it just helps me process information.
Speaker 3: I guess, well, a.
Speaker 1: Lot of people are getting their news these days from
Speaker 1: social media and the lines there are becoming increasingly blurred.
Speaker 1: Does that keep happening and is that a good thing?
Speaker 1: Snap has its own news shows.
Speaker 2: Yeah, I think that it's going to for sure continue
Speaker 2: to happen. I think part of that is because a
Speaker 2: lot of traditional media put us up a lot of
Speaker 2: walls in terms of accessing their content, so it's harder
Speaker 2: for young people to access the media today and instead
Speaker 2: they're finding it on social media. So I do think
Speaker 2: that will continue, and I think, you know, it's going
Speaker 2: to be very important for some of the more traditional
Speaker 2: outlets to think about how to translate their stories into
Speaker 2: video and into ways that really resonate with young people.
Speaker 2: But as I mentioned, I think that's going to have
Speaker 2: to really come with a narrative framing that resonates with
Speaker 2: what young people are experiencing today.
Speaker 1: And then what's the point of a new subscription. I
Speaker 1: guess if it's all going back on social.
Speaker 2: Well, I think the way to think about it over
Speaker 2: time is that people's ability and their willingness to pay
Speaker 2: increases as they get older, and I think the concern
Speaker 2: for traditional outlets is that they're not engaging young people
Speaker 2: early on and helping them get to know their platform,
Speaker 2: their service, or the quality of their reporting. It can
Speaker 2: be very hard to build that relationship later.
Speaker 1: I guess. I wonder, though, are we in a post
Speaker 1: truth world? It feels like there is increasingly no shared
Speaker 1: understanding of reality.
Speaker 2: I would caution against thinking about the world that way,
Speaker 2: especially because we've lived through so many different periods of
Speaker 2: time with the news media, where I think people have
Speaker 2: shared vastly different perspectives and aren't always anchored in reality.
Speaker 2: And I think in fact, today we have a lot
Speaker 2: more tools than we ever did, especially when you think
Speaker 2: about the advent of AI for people to access information.
Speaker 2: So what has absolutely happened is that information access has
Speaker 2: become democratized. I think that's made it harder to control
Speaker 2: what people see and what they read, but I wouldn't
Speaker 2: interpret that as a collapse in terms of the truth.
Speaker 1: How have you evolved as a CEO. How are you
Speaker 1: different today than when you started?
Speaker 2: In nearly every single possible way. I mean, it's just
Speaker 2: been an extreme, extreme growth and learning journey. I've enjoyed
Speaker 2: almost every moment.
Speaker 3: I would say.
Speaker 2: I think I've gotten more comfortable in developing my own style.
Speaker 2: And the early days, especially because I didn't know anything
Speaker 2: about running a business, I spent a lot of time
Speaker 2: learning about what other CEOs did and what worked for them,
Speaker 2: and I think over the years, I've tried to figure
Speaker 2: out really what works for me, what brings out the
Speaker 2: best in our team and our business in terms of
Speaker 2: my own unique leadership style, And I think that's been
Speaker 2: a really important part of the journey and not something
Speaker 2: you can read about.
Speaker 3: It's something you got to trial and error.
Speaker 1: Tech CEOs sort of have become their own mythic class
Speaker 1: of celebrity. Are you really all that special or are
Speaker 1: you human just like the rest of us.
Speaker 2: I think thinking your special is a pretty dangerous thing
Speaker 2: to do. One of the reasons why it's so dangerous
Speaker 2: in business is it can put a lot of distance
Speaker 2: between you and your customer, and so for us, we
Speaker 2: try to just stay grounded as the team and stay
Speaker 2: close to our customers, hear their feedback. Certainly with a
Speaker 2: fourteen year old and all his friends in our house,
Speaker 2: we get a lot of candid feedback, unfiltered feedback, and
Speaker 2: I think that's so important to building a service that
Speaker 2: people love, because if you think you're special, you start
Speaker 2: putting distance between yourself and other people. It's hard to empathize,
Speaker 2: it's hard to connect, and then it's hard to innovate.
Speaker 3: Well.
Speaker 1: Speaking of candid feedback and speaking of growing up really,
Speaker 1: because this was a big story when I started covering you.
Speaker 1: Your emails from Stanford re leaked, and my husband was
Speaker 1: a frat boy at Stanford, and when that happened, I
Speaker 1: remember sending them to him and being like, w tf
Speaker 1: is this what life was like at Stanford? And he said,
Speaker 1: not necessarily my finest hour, but look at me now
Speaker 1: I turned out. Okay, how do you look back on those?
Speaker 2: That's obviously extremely embarrassing. I sent stupid emails, you know,
Speaker 2: as a college student. But I think people are also
Speaker 2: capable of extraordinary change, and I often think we sometimes
Speaker 2: forget that, you know, in the world or in our society,
Speaker 2: so hopefully at a bare minimum, some other fraternity kids
Speaker 2: somewhere can be inspired that they too can grow and
Speaker 2: change and evolve. And I've learned a lot over the years,
Speaker 2: and those emails obviously don't reflect how I feel today.
Speaker 2: They really didn't reflect how I felt that either I
Speaker 2: was just trying to get our frat rallied up for
Speaker 2: some event, but nevertheless unacceptable, inappropriate, and not an email
Speaker 2: I should have sent or it would send today.
Speaker 1: So what's next for SNAP and what's next for you
Speaker 1: as a leader?
Speaker 2: I think for us, it's really about this transition from
Speaker 2: a screen based way of interacting with computers to interacting
Speaker 2: with computers in the real world through augmented reality. That
Speaker 2: this is going to be one of the biggest and
Speaker 2: most profound shifts in computing. That We've gone through some
Speaker 2: shifts before, from the mainframe to the desktop, to the
Speaker 2: laptop to the smartphone. We've changed the size of the screens,
Speaker 2: but we haven't really meaningfully changed the way that we
Speaker 2: interact with computers. And we're now at a point where
Speaker 2: computing is so important to our lives, so important to
Speaker 2: everything we do, that if we don't radically change computers
Speaker 2: and the way that we interact with them, I think
Speaker 2: we run the risk of spending the rest of our
Speaker 2: lives hunched over, looking down, instead of connecting with the world,
Speaker 2: connecting with our friends, and using computing in a healthier
Speaker 2: and more supportive way.
Speaker 1: So what's your advice to the next generation founding tech companies.
Speaker 2: Oh, my gosh, you know, I think there's so many
Speaker 2: opportunities to apply technology to new frontiers in a way
Speaker 2: that wasn't necessarily available when I was just getting started.
Speaker 2: And I think a lot of the technology focus today
Speaker 2: is going to be oriented around helping the United States
Speaker 2: win the massive global competition that we are in. And
Speaker 2: so for founders today who are positioning their work they're doing,
Speaker 2: whether it's in the health sciences, whether it's a lot
Speaker 2: of the important work happening into young people today, and
Speaker 2: technologists today are going to play an incredibly important role
Speaker 2: in defining the next one hundred years certainly of American success,
Speaker 2: but also global success.
Speaker 3: And I think that's a.
Speaker 2: Huge responsibility, but incredibly inspiring, and I know they're up
Speaker 2: for it.
Speaker 1: Thanks so much for listening to this episode of the Circuit.
Speaker 1: Please check out the full episode to see our conversation
Speaker 1: in la with Evan Spiegel you'll get to see us
Speaker 1: playing around with smart glasses and so much more. I'm
Speaker 1: Emily Chang. You can follow me on Twitter and Instagram
Speaker 1: at Emily Chang TV. You can watch new episodes of
Speaker 1: the Circuit on Bloomberg Television, on YouTube or on demand
Speaker 1: by downloading the Bloomberg app to your smart tv, and
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Speaker 1: hearing your reviews, so please let us know what you think.
Speaker 1: I'm your host and executive producer. Our senior producer is
Speaker 1: Lauren Ellis. Our episode producer is Laura Hines. Our editor
Speaker 1: is Grammercy Post. Thanks so much for listening.