← The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
20Product: Replit CEO on Why Coding Models Are Plateauing | Why the SaaS Apocalypse is Justified: Will Incumbents Be Replaced? | Why IDEs Are Dead and Do PMs Survive the Next 3-5 Years with Amjad Masad
00:46:51
Loading summary
Transcript126 lines
- [00:00]
Amjad Massad
We're approaching a certain plateau in how good coding models could get. Cost question is secondary to the performance question. When you focus on cost is when you reach a certain asymptotic plateau in the S curve. I think for all intents and purposes, IDEs are dead. The name of the game is just staying 1, 2, 3, 410 steps ahead.
- [00:24]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
This is 20 Product, the monthly show where we sit down with the best product minds to unpack the future of product, how the best product manager work and what that looks like In a world of AI. We could not have a more relevant guest than Amjad Massad, Co founder and CEO at replit, joining us in the hot seat. The man is reshaping what it means to be a great product manager, what it means to be a great product leader and replit is one of the leading vibe coding tools alongside the likes of Lovable. This was an incredible discussion with Amjad and I'm really excited for you to hear it. But before we dive into the show today, have you ever felt a little stuck at work? Maybe you're stuck in back to back meetings, stuck without clear feedback or trying to learn a new AI workflow? Well, now you can move work forward with Loom, the AI first video platform from Atlassian.
- [01:10]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Use Loom to simultaneously record both your
- [01:12]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
screen and yourself to share a quick update, provide feedback, train a colleague and everything in between. AI instantly adds a title, a summary and edits to your video so clarity travels with the work. Finally, you'll have more focus, time, fewer unnecessary meetings and more effective ones. It's a real team changer and game changer for personal productivity. Try loom today at L O O M. Once loom gets the message across, Fin keeps the conversation going with customers. As AI agents become more common in customer experience, teams often end up juggling multiple siloed tools for every job. Well, FIN was built to change that. It's a single unified agent that works across your entire customer experience, from service to sales to success and beyond. Fin is the agent making perfect customer experiences possible for thousands of customers. It's powered by custom models trained on years of real customer interactions, so understands the nuance and complexity of customer service better than any other agent. That means faster resolutions, more consistent support and just better experiences for every customer. It's also designed to be fully self manageable so you can easily improve and
- [02:22]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
adapt it as your business evolves.
- [02:24]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
No third parties required. Leading companies like Gamma, Asana, DoorDash and crypto.com already use and love FIN to deliver better customer experiences so see what Fin can do for your team at FIN AI20VC. While FIN helps answer the customer, Framer helps impress the next one. You know that moment when marketing wants a landing page, design mocks it up and engineering says yeah, we'll get to it. Thousands of businesses from early stage startups to Fortune 500s are choosing to build their websites in Framer where changes take minutes instead of days to solve this very problem. Framer is an enterprise grade no code website builder that works like your team's favorite design tool and is used by companies like Perplexity, Miro, Mixpanel to move faster. Designers and market stalkers can fully own the site with real time collaboration, a robust CMS built for SEO, and advanced analytics that include integrated A B testing. So you're not just shipping pages, but you're maximizing what works. And when you're ready to ship, changes go live in seconds with one click. Publish without relying on engineering. Plus Framer is built for scale with premium hosting, enterprise grade security and 99.99% uptime SLAs. Whether you want to launch a new site, test a few landing Pages or mig createyourfull.com Framer has programs for startups, scale ups and large enterprises to make going from idea to live site fast. Learn how you can get more out of your.com from a framer specialist or get started building for free today@framer.com 20VC for 30% off. 30% off a Framer Pro annual plan. That's framer.com 20VC for 30 percent off framer.com 20VC rules and restrictions may apply.
- [04:14]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
You have now arrived at your destination. Amjad Dude, I'm so excited for this.
- [04:19]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
I've wanted to make this one happen for a while. So thank you so much for joining me once again today.
- [04:23]
Amjad Massad
My pleasure. Great to be here.
- [04:25]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
We were just chatting about kind of the desert that rattle it's been through and like the amazing position today.
- [04:30]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
Did it take a long time for
- [04:32]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
the world to see what RAT was or did technology take a long time to catch up to your vision of what it could be?
- [04:40]
Amjad Massad
It's more the latter. Right. So the core insight that I had even before we started the company maybe at this point 20 years ago, was that software is much more transformative than we actually think it is. You know, Mark Anderson wrote, you know, software is eating the world and all of that, but I thought it's transformative for, for people's lives and for the prospect of wealth creation, wealth distribution, entrepreneurship, all of that. Well, it's it's sort of my story, you know, the impact it had on my life, you know, as a kid growing up in Jordan, coming to the US and now running a multi billion dollar company. And I've seen that even earlier than that. When I was 15, I built a little, a little business. I was making hundreds of dollars and that was amazing amount of money for me. I took my entire class to McDonald's when it, when it, when it opened up in Amman. And that was the kind of the core insight. And initially when I came to the us, I was, I worked at Code Academy and the goal was like, let's teach everyone how to code. Let's make it as simple as possible. And I started seeing the stories back then, even like if a fitness guy learns a little bit of coding, launches an app on the App Store, makes a million bucks, it's like, wow, this is amazing. And so when we started the company replit in 2016, the goal was how do you make programming more accessible? How do you get to a point where there's a billion developers, not just 20 million developers at the time? And so we started solving one problem at a time, right? Solving the development environment, solving the hosting environment, solving the package management, the maintenance, the iteration, the version management, the multiplier. But there's one bottleneck, and that is people don't want to learn how to code. And it took me a long time to really accept that because I became the learn to code guy. And In, I think March 2025 when I was in TPPN and I said, I no longer think you should learn how to code, it went super viral. People were pissed. How could you say that? And it's just a realization that there are people that are now successful. You know, we were talking about Jason Lemkin earlier from Saster. People that are building multimillion dollar businesses solo with no developers, they don't need to learn how to code, they need to learn how to create, they need to learn how to build. And the real unlock wasn't just AI, it was AI that could do actions over long horizon. So we've had AI since 2122 with GPT3. But the unlock in 2024 was Agentic AI. And that was the first glimpse of it. And we had to build a lot of infrastructure around it to make it work.
- [07:07]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Dick comment. How much of the magic is what you build versus the performance of models beneath you?
- [07:13]
Amjad Massad
It is a dance, I would say. Think about Elon Musk when he did self driving 1.0 for version 13 or whatever, where it's end to end, they had to write a lot of software, right? They had to write a lot of classical computer vision type software in order to make it work. But then they went to end to end learning. So there's this thing that happens in AI and as a founder, it's really important to understand this. At any given point, you have to plug in a lot of holes in order to build the most advanced thing that you can build. So September 2024, we had to build a lot of infrastructure, a lot of guardrails in order to make agents work. March 2025, when we released agent V2, we had to delete a lot of the code because the models got a lot better at staying consistent. But then you upgrade your vision, right? And so September 2025 released agent three. And that was the most autonomous agent on the market. It was the first to run for hours on end. And again we had to write a lot of software in order to make it stay on track. And now since Opus 4.6, autonomy is built into the model. And so you have to understand what is the model capability and how much infrastructure you have to build in order to make it perform. And you have to stay ahead of that in order for your product to stay the most innovative on the on the market.
- [08:30]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
When you look at your model usage today, I've heard you say before, when I was obviously listening to your prior shows, that you have a preference for Anthropic. What does the model usage look like across different providers today?
- [08:41]
Amjad Massad
So Anthropic has been the sort of workhorse for over a year right now it's like the core agent loop because it can run for a long time coherently. But a few things have changed. Google's Gemini models are the best at price performance. For example, given their price, where do they sit on the Pareto frontier, right? And so for tasks, for example, like tasks like quote search, we might create a sub agent that is cheaper and has good enough performance and we offload that from the main core loop. So we now we use. And I wrote this thesis back in 22, I call it the Society of Models now we use models from every provider. Actually at some point we were sending more tokens to Google than we were sending Anthropic, despite Anthropic being the kind of the core workers. There's this concept of Agent Labs, right? We talk about AI labs, but there's Agent Labs, you know, us cursor some of these other companies. Our goal is to start with the User problem. What are we trying to fix? What are we trying to build and walk back to the technology and use whatever model we need to use. In some cases we build our own models.
- [09:47]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
That was going to be my question. So amdab, the reason why the shows have become more and more more successful is because I bluntly asked more and more direct questions.
- [09:54]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
Curser decided to build their own model.
- [09:57]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
When we look at other players across different verticals, it's always been a mistake to build own model. Was Cursor's decision to build own model and your decision to in some cases a mistake? Because the equivalent model performance has just always come alongside you.
- [10:11]
Amjad Massad
It ebbs and flows again like AI is such a changing landscape. The answer will change every three or six months.
- [10:19]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
But when you, when you're investing your
- [10:21]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
team and your resources, then in that you have to weigh off. Is it worth that three month advantage? No.
- [10:27]
Amjad Massad
Right? You do. And that's why it makes it so, so freaking hard. And why you have to change your mind all the time. Right? Because there's a lead up time. But the most important thing is optionality. So in 2023 when we're training models, we achieved better coding performance than the state of the art models at the time. GPT 3.5. Right. But then since Sonnet came out or later Opus, the gap has closed by a lot. And they were spending tens of billions of dollars, if not hundreds of billion dollars making agents work. And that would have been a dumb strategy for us to go and try to compete on that. But now I would say the opportunity opened up again for other reasons. The open source models are getting really good and we're approaching a certain plateau in how good coding models could get. And so you can use your data to fine tune a model specifically for your use case. I don't know if you saw, but Intercom talked about their new model that is better at customer support than the Frontier models. And so maybe their model is going to be state of the art for three to six months and maybe six months from now the models will like zoom back ahead.
- [11:35]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
How do you analyze that?
- [11:36]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Is it better to be three months ahead and spend the money like how important is it to be ahead for three months?
- [11:44]
Amjad Massad
It's very important. It's a matter of closing a large enterprise deal. We're constantly getting baked off against everything under the sun. Right? And we're winning most of our enterprise deals because our product is, is ahead of the market consistently.
- [11:58]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
The thing that I always hear is that we're using Frontier models To basically set benchmarks. We're seeing where those benchmarks lie, and then we're switching to open source to get as close to them as possible with much more efficiency. In terms of cost, is that the future?
- [12:11]
Amjad Massad
It depends. Right? So cost question is secondary to the performance question, especially in a time when it's flush with capital. When you focus on cost is when you reach a certain asymptotic plateau in the S curve, you don't foresee a massive improvement. Specifically in your domain. Intercom might say, we don't predict that models are going to get that much better on customer support for the foreseeable future. Therefore, we can focus on building our own, or there's like a data flywheel that we can get, or there's a cost advantage that we get. But if you focus on cost at the expense of performance, you're going to lose. It's similar to any era in tech, right? Like it's cloud, it's mobile, it's SaaS, whatever it is, there are moments of time where the goal is growth and performance and being at the edge. And then when things kind of rationalize or uber lift. When things rationalize, you kind of focus on your gross margins.
- [13:12]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
I think there's this idea in all transparency that your rat plates, your base 44s, your lovables, and you might kill me for putting you in that bucket, but is it bluntly, of $100 that you make, 80 bucks goes to the model providers.
- [13:26]
Amjad Massad
For us, it's not 80, it's way less than that. But it is a significant portion. Like anyone, like, even anthropic, every hundred dollars they make, 60 goes to Nvidia. Like, you know, their, their margins are public. It's 40%, right? I mean, so they're also massively subsidizing their service.
- [13:42]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Can I be blunt? What are your margins and how they changed over time?
- [13:46]
Amjad Massad
They change quite a bit. I said last year, like, we were close to profitability in programming. There's like this old saying, premature optimization is the root of all evil. Because as a programmer, if you think about performance and optimization early on, you're going to make the wrong decisions. So the reason margins keep moving around is like we're trying to build the best product, and then after we build the best product possible, then we look around, we're like, okay, there's so many ways we can optimize. Then we go into an optimization period.
- [14:15]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
When we think about price sensitivity, how do you think about essentially routing different behaviors where some models are actually okay for certain things and Some need the frontier. How do you think about intelligent model selection for different functions?
- [14:31]
Amjad Massad
I would say that is the core competency IP of an agent lab. If you think of yourself as an agent lab, you have this tacit knowledge first evaluating models. I think about our AI engineers. It's kind of psychologists in many ways. When a model comes out, the first thing they do, they sit down with it for a day or two, they play around with it, they plug it in, they're like, okay, what are the limits? What can I do? And that's more like the tacit aspect of it. Right? Which is very easy to underestimate. But the reason replit when a new model comes out, we're able to build state of the art performance even better than the lab itself. Like we're big partners with Google and Gemini is one of the best models at design. I would say our products are better at design using Gemini than Google's products. It's because we know how to evaluate these models, how to get the best performance out of them and then we have a bunch of proprietary benchmarks that we use and finally we do a lot of AB testing as well. So that's really what you're doing as a company that is building on top of foundation models.
- [15:34]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
How concerned should we be about the proliferation of Chinese models in Silicon Valley companies?
- [15:40]
Amjad Massad
I'm not sure about this question. Like, you know, is their intention to actually innovate and play in the market fairly? Is their intention to destabilize? Is there an intention to destroy the value of of us AI labs? I don't know. There are reasons to be careful and there are reasons to be optimistic about the progress. Like what I see.
- [16:00]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Would you have a moral issue with using a Chinese model?
- [16:03]
Amjad Massad
I don't think there's a moral issue per se. Like I don't think they're using slave labor or anything like that. I would have a security issue, especially since we have enterprise customers that depend on us for sensitive data and things like that. So we haven't taken the step yet. I wouldn't preclude it from taking it in the future. I would love to see a US corporation investing in open source. It looks like Nvidia is making moves in that regard. But open source is going to be very important for us to actually have a free market around AI because if we're going to end up in an oligopoly of AI companies, there's actually an economic theory of how they'll naturally collude on price and prices will not go down as Fast as possible. They'll also control how we use these AIs. They'll also not provide everything through the API and keep some of the models for themselves. And so I think that it would be bad if we're in a situation where AGI or AI is only controlled by a few corporations. So open source is going to be very, very important. I would venture to say maybe the US government should start a consortium of companies that are creating the best national open source model so that the market stays competitive.
- [17:12]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
We mentioned Jason Lamkin earlier. He said something brilliant to me, which is he said inferences to new sales and marketing. Obviously free is a large part of your business and many others in the space. Do you agree with Jason on inferences in new sales and marketing and how do we think about that?
- [17:28]
Amjad Massad
Yeah, if you think about the hype period that we got with like Claude Code and Kodaks towards the end of 2025, early 26, a lot of it was driven by how much free tokens they were given out, how much, you know, every other day they're like, oh, it's 50% more tokens or less rate limits and things like that. So. So it's clear that companies are using inference as a way to loop people in. And I think agentic development is addictive. I think the better kind of addiction than social media or passive consumption, it's like creative addiction, which is kind of good. But I think companies are realizing that a way to kind of rope people in is through a lot of free tokens. Now there's a question about retention, but I don't disagree fundamentally with the statement that you can use free tokens to acquire users.
- [18:16]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Enterprises will kind of try things in certain respects. I was shouting to Jason Lemkin before and he said you're number one. ICP is product teams. As product teams kind of code or vibe more. What do they do okay, in two to three years, how do they think about those functions?
- [18:33]
Amjad Massad
There's a big question about how product teams will look in the future. If I were to make a prediction, I would say that we'll still have engineers inside the organizations. Those engineers are responsible for more infrastructure, AI, ML, embedded systems, you know, more low level engineering. And then you have product organizations. And product organizations will have people that are like, tilt a little more technical and have people tilt a little more design, have people tilt a little more product. But you're not really calling them anything different. They're product builders and their responsibility is to figure out what to build next. I agree with Jason that A lot of the ICP right now is product. But one thing I'm really excited about is operations teams and they're kind of underserved. Operations teams are sitting at the nexus of a lot of data flow. Typically they'll buy a lot of SaaS software. They're typically not happy with it because there's all these SaaS softwares like siling the data. They try a lot of automation software that doesn't work very well. They have a lot of Excel sheets, a lot of manual work. And so we see a lot of our customers are building quote configurators for their sales team, automating their deal desk, you know, automating support operations. When they use repl dot, the return on investment is as good if not greater than product teams. With product teams you're cutting down product development lifecycle which is hugely valuable. With operations teams you're actually being more efficient, you're selling more, you reduce headcount or you need less people.
- [20:00]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
You said ops have a lot of
- [20:01]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
tools that they're not happy with.
- [20:03]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
That has led to the SaaS apocalypse
- [20:05]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
and a lot of people believing kind of deterioration of value in a lot of these public companies. Is that over exaggerated or is it a just cause for concern that they have lost the market caps they have?
- [20:17]
Amjad Massad
I'll tell you what we're seeing in enterprise. We're not seeing people rip out Salesforce workday or like really fundamental. I think they, the hype term is system of record type SaaS tools and instead they're building on their APIs and we're creating MCPs and hooks into the hotspots of the world and Salesforce and all of that. But there's also another side where we have this great partnership with databricks and people are skipping the SaaS tools entirely and like building on top of their data warehouse. So there's another view on this where the system of record is actually your data warehouse and this is like a way to be bullish on databricks and companies in that space.
- [20:55]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Well that goes to a statement though that Jason has said though, which is like then it is justified because what you're seeing is like the maiming of SaaS company growth. If you have 20, 30% of customers or users who are using databricks as their warehouse and that maims that all audience for the corp like SaaS Public Companies, that's enough to cause the growth to decline significantly.
- [21:17]
Amjad Massad
I would agree with that. Now a lot of vertical SaaS is in trouble as well where maybe you don't think of it as a system of record where there's a lot of survey SaaS software and we see that getting replaced wholesale with Replit. And then the other side of this, there's a lot of micro entrepreneurs and it's starting on Replit today and they're undercutting the price of a lot of SaaS companies out there, especially, you know, kind of vertical point solutions. And then there's another pricing pressure there as well.
- [21:50]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
What about the traditional incumbents in our space? Who is thinking of Squarespace? Wix? What happens to them?
- [21:58]
Amjad Massad
I mean if you look at the behavior of wix that they look like they're like they're pouring everything into base 44.
- [22:03]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
So it seems is Wix now base 44? Basically.
- [22:07]
Amjad Massad
I don't know much about their company but it looks like they're spending a lot of ads definitely behind base 44.
- [22:13]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
What did you think of the Super Bowl?
- [22:14]
Amjad Massad
You know, I haven't heard that many people talk about it. I think it's good that people are getting Vibe coding out there and more people are talking about it, but I don't think it's still in the public consciousness.
- [22:25]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
How do you think about maintenance in this case? You have ops teams building tools, you have entrepreneurs building tools.
- [22:32]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
You got to maintain these fuckers.
- [22:33]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
It's hard enough running a business.
- [22:35]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
I got to maintain this.
- [22:36]
Amjad Massad
Now this is where Replit shines. And if you talk to Jason or some of our other customers, Replit goes way further than any other Vibe coding product on creating more maintainable software. And part of the reason Replit has been slightly more expensive than others is that we do a code review for every code change that we make. So we spend a lot of tokens on maintenance as much as we spend on creating that software. Replit also has a built in tester. So if you enable all the power features, whenever the agent writes code, goes into a testing phase, spins up a browser, tests everything in the in the app, goes into a code review session, reviews that, kicks it back to the coding agent, gives it feedback, you know, the test failed here. The code review is not good. And people enjoy looking at the code review agent because it's kind of a dick. It's like this looks like AI generated slop. It'll actually see that and then it goes back. We're also building agents that are sitting in production software. So we already have security agents right now that are sitting in enterprise deployments and are monitoring activity and they're monitoring packages, monitoring for supply chain attacks. The thing about AI Any problem AI creates, there's more AI that you can build to solve that problem.
- [23:52]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Have you been surprised by how price sensitive people are around security and code reviews?
- [23:58]
Amjad Massad
Not in our segment. I would say in the engineering segment and we have some engineers use Replit, but 75% are non engineers. Engineers are more price sensitive because they have a lot of options. They can use a lot of different products on the market. Now when you're an operations manager using Replit and you just saved $10,000 on a SaaS software, you've saved another $200,000 on headcount and you're spending an additional thousand dollars to just make sure that the software is more secure. That's like a no brainer. The ROI has been 100 fold for companies we work with. On the consumer side, there's more price sensitivity, especially if I'm an entrepreneur just dipping my toes, which is why we reduce the price on our core plan. So I think there's going to be, and you hinted at that earlier, there's going to be this. Different models for different use cases or different parts of your journey. If you're just starting out, you want to be hit with a thousand dollar bill, you want to be able to play around with 20, $30 before you commit.
- [25:01]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Is Core a loss leader? Are you like, hey, I'm willing to lose money on Core for the conversion to Pro?
- [25:07]
Amjad Massad
Yeah, it's sort of like become kind of a bit of the new freemium because you can't totally run like an amazing free tier because tokens are still very, very expensive. So you want people to pay something to recoup some of the losses. But as the percentage of our revenue becomes more enterprise, more pro, then we're willing to subsidize the cost of Core.
- [25:31]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
A little more token costs today. How do they change over the next three years? Is it like they get 50% cheaper or 10 times cheaper?
- [25:41]
Amjad Massad
It's an interesting question because there's different ways to slice it. You can look at the price of intelligence. The price of intelligence have gone down tremendously. It's really hard to quantify it, but like everyone's spending way more on Opens than they were spending on GPT4, but they're getting way more intelligence, way more productivity out of that Pure unit price is not going down as much as people expected it to go. And I think part of it is we're living in a world where the true frontier models is actually just between GPT5 and Claude. And so there's not a lot of pricing pressure now. We're seeing Gemini catch up, we're seeing the open source models catch up. And so maybe as there gets more pricing pressure, we'll see unit token prices go down also. The other thing is, I don't think these companies are all that profitable, partly because the underlying chips are not all that cheap and there isn't a lot of competition. We have sort of at bottom, everyone's running an Nvidia and there's not much competition there. And Nvidia has amazing margins, especially for hardware company. What is it, 80%?
- [26:44]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Yeah, it's pretty phenomenal. What is the world's most valuable company? I'm confused with something. I'm confused with Cursor. Can you help me? And this is Jason's question, so you can blame him. All the shit, hard questions, just blame Jason.
- [26:57]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
Twitter says Cursor is completely dead.
- [26:59]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
I don't have a single portfolio company that uses Cursor, but they hit 2 billion in revenue. Is Cursor dead or is this narrative completely bullshit?
- [27:08]
Amjad Massad
I'll tell you, I'll tell you a few principles. One is the market is so large, the market for software. It's not just the market for SaaS, although it's part of that. It is an expanding market. There's no existing tam. You can say this is the TAM we're going after. Some people will say, I think Sequoia at some point said it's like the labor tam, right, the knowledge worker labor tam. That could be that. But it's not like we're displacing labor, we're actually supercharging labor. So companies are becoming more productive. And so it's like an ever expanding tam and it's going to be perhaps as big as the Internet, if not more. And that's like, I'm talking about just software generation. Broadly. It's Vibe coding, it's AI powered coding is fully agentic coding, coding generation in general. I think it's a hugely valuable market and the world is large and a lot of different companies will prefer different products. There are people at Replit today that still prefer to review every piece of code. And something like Cursor is good for that because it's still sitting in the idea. So there's a portion of the market that still really likes that. And the other thing is, I think Cursor has done well at enterprise sales. And enterprise is a very sticky customer. And once they adopt something, it has to really fall tremendously behind, perhaps like GitHub Copilot, in order for people to replace it and I don't think cursor fell that that far behind. Right. They still use the latest agents. They have like a good agent harness. I think Twitter is a distortion machine and Twitter is like the inside of inside of inside baseball. It is the people at the edge of the adoption of AI. So I think if you're constantly on Twitter, which why I think VCs don't have the best information landscape because a lot of them just live on Twitter. But the world is much larger than that.
- [28:56]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
Are IDEs dead?
- [28:57]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Will we have IDEs in tiers?
- [29:00]
Amjad Massad
I think for all intents and purposes IDEs are dead. I think they'll limp along because again some engineers just love that control. But there's no future in them in that there's no one's going to be asking for the latest feature of IntelliSense or what were IDEs? IDEs, one part were like the code intelligence. We called it intelligence. It wasn't very intelligent. And so all of that is irrelevant. The autocomplete, the click to symbol, all of that stuff is irrelevant. So in that sense ideas are dead because AI has eaten all of that. But in terms of people who want to see the code, I think there's still a population of users that want that. I think there's still engineers that are working with software that they want to actually verify that it works. For example, life or death software. If I'm writing mission critical software for self driving cars or a NASA or SpaceX mission, I think there's always going to be a need for some kind of ide.
- [29:59]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
I'd be pretty pissed if my autopilot on my plane had problems because of a Vibe coded with no ide.
- [30:08]
Amjad Massad
Yeah, that would be pretty sad. I mean even in planes, those kind of software that we're talking about, they never adopted JavaScript. And the reason they never adopted JavaScript is because JavaScript is the original sort of vibe language because JavaScript didn't have types you could like run into errors. But the reason why we adopted JavaScript is because web software was not going to kill anyone. Your Gmail. If someone pushes a bug to Gmail, you're not going to die. Maybe it'll be down for an hour and that's fine. So there's different risk appetites and I think vibe coding follows the same thing where it's on the sort of less risky type of software.
- [30:41]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
So if you're a student listening to this, should you not study engineering at university? Should you not study cs? How does this inform how you think about advising young people.
- [30:51]
Amjad Massad
So before 2005. Right. Let's say, which is when I went to school, people who went into computer science were very intrinsically motivated in understanding computer science and understanding exactly how computers work. And there were like hackers and really interested in programming. Right. And then after that, computer science became a hyped up field because it's the easiest place to make money. And we had the boot camps and we had this whole thing and computer science departments exploded because of that. Now if you're not into computer science, if you don't feel like you're drawn to it like a fly drawn to a light, then don't go into it because someone told you you're going to make a boatload of money working for Google. That's gone. So it's pretty dumb to tell people to go into computer science if they're not really intrinsically interested in it. Now if you're interested in it, I think there's still ways to contribute. You could get into ML and AI and go work at like the big labs or a company like ours. You can do it.
- [31:54]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
But if you're, if you're thinking about university, the curriculums are not able to move at the pace of model progression. What would you advise me as a student?
- [32:02]
Amjad Massad
Well, I will say the field of computer science, where you're like learning about, you know, data structures and algorithms, that's not going to change. And there's always going to be need for people to understand the underpinnings of computer science because we still need kind of those people.
- [32:20]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
And do you think universities are the best place to learn?
- [32:22]
Amjad Massad
That depends on the person. I think there are people who are autodidact. I would consider myself someone who is very good at teaching myself. And so it depends on you. If you're really good and you can learn on the job and you can open the textbooks and you have the discipline to do that, you don't have to go to university. But if you're someone who likes the structure, who likes to meet other students and work with them, and likes the discipline of the university forces on you, then I think there's still a place for a university.
- [32:51]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Our company is going to be so much smaller in the future. When you look at the capabilities of individual people, do you buy the ideological Silicon Valley? We're just going to do more and we're going to be so much more capable. Or are we actually like. No, we will have dramatically smaller engineering teams.
- [33:07]
Amjad Massad
I see both. So Jason is someone who wants to work with a very lean team, is Doing better, more than when he had people on staff. Yesterday I met an entrepreneur at a conference in D.C. that's using Replit. I think he sells board games online and he says it's been so transformative on my business. We've saved so much money on SaaS, we're selling more, that I decided to use the increased revenue and efficiency to hire more people. He hired eight more people. There's a customer case study we actually published on our site, Firecrown media. Like a $60 million media company that owns magazines, different properties. They've been so successful using Greplet for marketing automations and all sorts of things like that that decided to hire more people that know how to do vibe coding in order to sell more and do more and build more. So it depends really on the kind of company. But we see companies that were like, we want to get leaner and we want less people. I think it'll come down to the entrepreneur, the level of ambition, how they want to run their company. For us at replit, I think what we want to try to eliminate or reduce is a lot of supporting roles. We want builders, right? We want builders and we want salespeople. Because I think salespeople, it's like people just really want to talk to someone, to sell them software and to teach them how to use it. And also the sales role is changing in that salespeople are becoming more like educators and transformation sort of consultants. They go into companies, tell them how to use the product and what's the best way to leverage this technology with
- [34:36]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
the removal of other parts or with less engineers or with removal of other parts of the org, reducing headcount cost in those areas. Are you able to justify sales REPs moving down ACV categories or ranges because you don't have the cost elsewhere in the business?
- [34:54]
Amjad Massad
It depends. There's a lot of companies that now have self serve enterprise, right? Especially in AI because there's so much demand that you can sort of justify that. But let's say traditional SMBs still need some hand holding and typically the cost of sale is higher because you have so much supporting staff. But if you can have a commercial AE that is, you know, you're willing to spend like an hour or two talking to a customer and onboarding them and perhaps a few few hours, you know, for the rest of the year supporting them and the contract size is like 10,000, $15,000. I think you're right. It's possible that becomes more of a thing.
- [35:37]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
What worries you today? Are you positive about the future Are you negative and just not just about software development, about life. I know it sounds weird and macro.
- [35:46]
Amjad Massad
Well, actually, let me tell you about Replit first. And like, what worries me there, we've gone through this. You know, first they laugh at you and then they. I forgot the quote. Exactly. But we're at the point where like, then they attack you. Right where it's now been publicly reported that Apple is sort of blocking the Replit app. Repl. It has been on the app store since 2022 doing exactly the same thing, allowing people to generate or write code and running it in a browser window. Suddenly they're saying that we are not complying with their guidelines and we've been stuck in app review for now three months. We haven't been able to push an update. And again, we've been there for four years. We passed 100 Apple App Store reviews and suddenly Apple has decided that they don't want other apps in the category are also or getting affected.
- [36:36]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
I'm sorry, the reasoning behind that is. Sorry, I'm being disrespectful to you here. They think that your apps are not as high quality in their AI slop and that they're making discovery harder than that.
- [36:45]
Amjad Massad
They're telling us we're not in compliance with our guidelines and we show them
- [36:48]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
repeatedly peeling that back one layer more. It's like they're fearful that it's going to.
- [36:53]
Amjad Massad
I don't know. Because they're accepting apps made on Replit. They're accepting them into the App Store. I tweeted about one yesterday. The acceptance rate is very high. If they think that what we're generating a slope, they could have said that second, they wouldn't have accepted the apps that are being made with Replit. So it doesn't seem so.
- [37:10]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Then what is the reason? I'm like, you're a smart dude. I'm a hopefully relatively smart dude. There is a reason behind that.
- [37:16]
Amjad Massad
I want to give them the benefit of the doubt and I want to say that perhaps they're trying to figure out what is their posture here and perhaps the delays is just because they're trying to figure out. Figure that out.
- [37:28]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Posture with regards to what?
- [37:29]
Amjad Massad
How they got survive coding with regards to vibe coding and how people are going to to be using that on the App Store. Look, maybe they are concerned that people are going to be circumventing the App Store rules. That's not what we do. Maybe there are other apps in the categories that do that and they looked at the category as a whole. It was like, okay, let's put a pause on this. But we're not doing that. We're not building an app store. We are just making it possible for people to make apps. And so if they're concerned, and maybe that's their concern, that people are going to be making apps and getting around the app store, that is not what we do.
- [37:58]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
How detrimental is that to your business?
- [38:01]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
When you think about Apple putting that additional barrier challenge, is that like fuck or is that like, meh, we'll get over it, face money before you know,
- [38:11]
Amjad Massad
look, I've been building this company for a decade and the fact that we're such a important force in the world, in the culture and how the world is like reacting to this technology is a good thing and it means that we are achieving our mission. We're important now. I never thought it was going to be easy and I'm ready for the challenges to come and I actually like challenges. You know, life is much more interesting when there's a little bit of fight into it.
- [38:41]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
I think it's important to have a common enemy in a team. Amjad, you can shoot one. Claude, code lovable or base 44. Which one do you shoot?
- [38:49]
Amjad Massad
I don't really think that way.
- [38:51]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
If it's not a name, I'm gonna go, I'm gonna tell J Jason the next word is a name.
- [38:57]
Amjad Massad
Amjad, I'll tell you that they're all going to copy what Replit does. Replit is setting the roadmap for everyone. That's fine by me. But what I really like is innovation is like building the next thing that can really change how people think about software. And I feel very proud that this agentic revolution was really kickstarted by replit agents in 2024. The name of the game is just staying 1, 2, 3, 4, 10 steps ahead.
- [39:24]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Right? Dude, we're gonna do a quick fire round. I say a short statement, you give me your immediate thoughts. Does that sound okay?
- [39:29]
Amjad Massad
Yep.
- [39:29]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
What have you changed your mind on most in the last 12 months?
- [39:33]
Amjad Massad
How fast to scale our sales organization? I always wanted to build like a hyper efficient company. Replit is extremely efficient for our size and valuation, but given how much interest we have in the market, I think we should hire as many salespeople as we can to go sell these deals. These people.
- [39:49]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
Who would you most like to have
- [39:51]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
on the board who you don't have on it yet?
- [39:53]
Amjad Massad
I would like to have an operator that's two decades ahead of me or something like that, like a CEO that's Been in the weeds and building a company from scratch. But reached went public and reached way past what I've done because we have a lot of VCs and they're amazing. But no one who's actually an operator.
- [40:13]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
Tell me, when I say high performance,
- [40:16]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
who do you think of first and why them?
- [40:18]
Amjad Massad
I mean, it's such a cliche, but like obviously Elon. And the reason is like the amount of things that you can do at the same time, like the number of things. And before that, Steve Jobs running Pixar on Apple. I am like dead by the end of the week. Running one company, how can you do two? That is an enigma to me. How can you do five?
- [40:43]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
What do you invest in for yourself? That has been a game changer. I hope it's not too personal, but
- [40:49]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
you've lost a lot of weight.
- [40:50]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
You look fantastic, dude. Tell me about that.
- [40:52]
Amjad Massad
Losing the weight. It's actually been three years. I decide I always yo yoed my weight depending on my stress level at the company. And I decided in 2023, I'm going to take three years to get healthy. And instead of like sprinting and working out five days a week and then burning out, I'm going to work out one day a week. Week. And I started working out one day a week and then my energy levels improved. I lost some weight. Okay, now I'm gonna add another day a week. And okay, now I'm gonna add another habit. Let's add a walk. Let's add like a bit of a stretching and it's so slow. It's sort of like I don't want to. I want to get healthy over the next five years and that's been a major game changer. So I'll just like add another habit every once in a while. It's like there are simple stuff. Let's add a walk, let's add a sauna once a week. So I really love sauna. And cold, hot and cold. It's like a reset. It forces you. I'm someone who's like constantly thinking and I tried meditation, all that stuff. And it's really hard for me when I go into a sauna and get burnt and then go into like ice cold water. You can't think, your mind freezes. And that forces me into a meditative state for the next hour or so.
- [41:59]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
What's the biggest advice to a new parent given all you know now about parenting?
- [42:06]
Amjad Massad
Don't stress out. You know, I think it's the difference between the first kid and second kid. And every Parent will tell you, let alone the third kid is like, the first kid is like, oh, it's nap time, we gotta go, you know, do the nap thing. We gotta do exactly that. Measure this and that. And you're measuring everything, you're doing everything. Like babies are quite resilient. You know, humans have been around for whatever 100,000 years. You know, we, we know instinctively how to raise a child. And I think taking it a little easy on yourself, probably the best advice,
- [42:37]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
final one for you. What do you know now that you wish you'd known when you started Rattlet.
- [42:41]
Amjad Massad
I mean the feeling of product market fit. You can deceive yourself into thinking you had product market fit. At different points you'll get a few customers like, oh, this product market fit, real product market fit. And like people will say it, you can't really internalize it is the idea that like the product is getting pulled out of your hand. You can't even provide it fast enough. You know, I think if I understood that earlier on, perhaps I would have searched for it faster or harder or things like that. So as an entrepreneur wanting to build not a lifestyle business or small business wanting to build a venture scale business, you have to find that moment. You have to keep pivoting and changing. Perhaps you don't change your vision but, but keep kind of searching until you find that explosive demand.
- [43:23]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Dude, I've so enjoyed this. I so appreciate you letting me go wayward. But you've been fantastic. So thank you so much for joining me.
- [43:30]
Amjad Massad
Appreciate it man, thank you.
- [43:33]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
But before we leave you today, have you ever felt a little stuck at work? Maybe you're stuck in back to back meetings, stuck without clear feedback or trying to learn a new AI workflow. Well, now you can move work forward with Loom, the AI AI first video platform from Atlassian.
- [43:47]
Co-host or interviewer (possibly Jason Lemkin or another guest interviewer)
Use Loom to simultaneously record both your
- [43:49]
Host (likely a 20VC podcast host, possibly Harry Stebbings)
screen and yourself to share a quick update, provide feedback, train a colleague and everything in between. AI instantly adds a title, a summary and edits to your video so clarity travels with the work. Finally, you'll have more focus, time, fewer unnecessary meetings and more effective ones. It's a real team changer and game changer for personal productivity. Try Loom today at Loom. Once Loom gets the message across, Fin keeps the conversation going with customers. As AI agents become more common in customer experience, teams often end up juggling multiple silo tools for every job. Well, Fin was built to change that. It's a single unified agent that works across your entire customer experience from service to sales to success. And beyond. Fin is the agent making perfect customer experiences possible for thousands of customers. It's powered by custom models trained on years of real customer interactions, so it understands the nuance and complexity of customer service better than any other agent. That means faster resolutions, more consistent support and just better experiences for every customer. It's also designed to be fully self manageable so you can easily improve and adapt it as your business evolves. No third party is required. Leading companies like Gamma Asylum, DoorDash and Crypto.com already use and love Fin to deliver better customer experiences. So see what Fin can do for your team at fin AI20VC. While fin helps answer the customer, Framer helps impress the next one. You know that moment when marketing wants a landing page, design mocks it up and engineering says, yeah, we'll get to it. Thousands of businesses from early stage startups to Fortune 500 are choosing to build their websites in Framer, where changes take minutes instead of days to solve this very problem. Framer is an enterprise grade no code website builder that works like your team's favorite design tool and is used by companies like Perplexity, Miro, Mixpanel to move faster. Designers and marketers can fully own the site with real time collaboration, a robust CMS built for SEO, and advanced analytics that include interactive integrated A B testing. So you're not just shipping pages but you're maximizing what works and when you're ready to ship changes go live in seconds with one click. Publish without relying on engineering. Plus Framer is built for scale with premium hosting, enterprise grade security and 99.99% uptime. SLAs whether you want to launch a new site, test a few landing pages or migrateyourfull.com framer has programs for startups, scale ups and large enterprises to make going from idea to live site fast. Learn how you can get more out of your.com from a framer specialist or get started building for free today@framer.com 20VC for 30% off 30% off a Framer Pro annual plan. That's framer.com 20VC for 30 percent off framer.com 20VC rules and restrictions may apply.