Talent density, feeling special as a service, moving past prompts, and product leadership.

As we move past the prompt-era of AI, let’s explore the impact on the talent stack, consumer experiences, and more. Also, some critical insights for product leaders.

Edition #23 of Implications

• This edition covers (1) why talent density can (and should) be increasing in companies, (2) insights on use cases for decentralized finance and consumer AI among others, (3) transcending prompt-based creativity, and (4) another round of insights from the modern product leader playbook…and some surprises as always.

• If you’re new, here’s the rundown on what to expect. This ~monthly analysis (23 months and counting) is written for founders + investors I work with, colleagues, and a select group of subscribers. We aim for quality and provocation over frequency and trendiness. We don’t cover news; we explore the implications of what’s happening.

• If you’ve missed recent editions of Implications, here are some highlights that got the most engagement from others:

  • Tensions of the creative age, and how to navigate a Cambrian explosion.

  • Future breakthroughs from the devices we wear and our pent-up supply of personalized data and analytics.

  • The AI threat we should be talking about: Scaled socialization as a service.

  • The Era of Scaling Without Growing: Small teams, big businesses.

Assertions & Implications

Lets jump into five assertions with implications worth noting — all around the theme of unexpected implications of new tech and things top of mind for me.

• Talent density will go up.

• Decentralized finance is becoming the perfect payments layer for AI Agents.

• Many AI breakthroughs for builders, fewer for consumers.

• Feeling special, as a service.

• Moving past the prompt-based era of creativity, unleashing creative risk, and creative meritocracy.

Talent density will go up.

There are dozens of AI-assisted management products emerging that ultimately promote transparency, better measurement of talent, better signal for managers when it comes to performance management and efficiency, and enable more “boundaryless” work across functions (we’ve previously discussed how new technology is helping collapse the stack of talent in modern organizations). Over time, the result of better management and measurement tools — and offloading of mundane and repetitive work to AI agents — will increase the density of talent in companies. The people empowered in each function will be more qualified generalists or have deep superpowers that differentiate the business, as opposed to being mediocre middle managers. I anticipate a world where these individuals and small teams will have disproportionately more potential and be able to take on more (more problems to solve, more markets, more aspirations of all kinds) with less bureaucracy and fewer consequences of scale.

Decentralized finance is becoming the perfect payments layer for AI Agents.

The likely abundance of AI Agents over the coming years will make it easy for all of us to conduct research, test marketing ideas, resolve disputes with service providers, and nearly eliminate the friction from our digital lives. Our AI agents will negotiate with dozens of stores on our behalf to get the best price, they will surface deals for us, they will consult consumer reports and feedback to find the best products and services. They’ll have vision through our phone’s camera, and become a filter of advise before we take actions. They’ll work to cater every experience to our preferences, and, when things go bad, they will manage warranties and returns. Whatever requires multiple mundane steps will be accomplished by an AI agent that we task with our intentions. However, one major question remains: how will these agents pay the many intermediary services and other agents they encounter along the way to complete our multi-step and increasingly complicated tasks? Credit cards with their CVC codes, settlement layers, and authorization processes simply weren’t made for this world of instant autonomous micropayments, but decentralized finance certainly is. Companies like Coinbase and Replit are gearing up and already collaborating to make this possible. Perhaps we’ll reflect on the crypto bubble, like bubbles before it, realizing how fundamental the technology was for reasons we didn’t even fully grok at the time? But I firmly believe we will all have countless agent-driven workflows improving our work and lives in just a few years, and I think decentralized finance will play a crucial role.

Many AI breakthroughs for builders, fewer for consumers.

Speaking of AI agents, it is becoming increasingly clear that AI is having a more material impact for builders than consumers. On the consumer front, despite all the glorious use cases of AI making our personal lives more magical, so far we’ve only gotten better search apps, conversational LLMs, better image editing, and incremental improvements in algorithms and voice-based interfaces. Don’t get me wrong: these are all great, but I don’t feel my life has been transformed. However, when it comes to building things, AI is proving to be nothing short of transformative. Just two examples from companies I work with as an investor: A couple weeks ago, network infrastructure startup Meter debuted Command, a product that lets network administrators use natural language to take action and generate real-time dashboards on anything related to their network. And then last week Amjad Masad, CEO/Founder of Replit, debuted an Agent product that creates functional software in minutes - doing anything from setting up a dev environment, configuring the database, installing software, and deploying to production. A bit closer to home, “Project Neo” is a new 3D illustration application we’re building, with powerful AI capabilities inside. It is the fastest growing “private beta” product I’ve ever seen at Adobe, and I’ve been watching illustrators with zero 3D experience create intricate professional-grade 3D vector objects and using GenAI to make them photorealistic. Innovations like these truly transform the areas of network management, software development, and designing 3D objects as we know them. What will it take for consumer experiences to experience a similar degree of transformation? My bet is data and personalization. Long-time Implications readers know my obsession with the coming wave of personalization. I have a growing fascination with apps that privately collect and manage our data, and build interfaces to help us interact with that data and share insights. One such company (and investment of mine) is Fulcra Dynamics, a product that “intelligently unifies your personal data—health, fitness, calendar, locations, and more—into one beautifully designed app, revealing unique insights and perspectives about your life story.” I suspect we’ll see many more emerge.

Feeling special, as a service.

Another opportunity for consumer AI is scaling things that were previously never scalable. I recall a debate with Garrett Camp, co-founder of Uber, in the very early days of branding decisions for what was then called “UberCab.” At the time I was a seed investor and early product advisor, and we were debating two alternative approaches to the brand’s narrative: (1) making it seemingly ubiquitous and for everyone, or (2) making it feel exclusive along the lines of “Everyone’s personal driver.” Ultimately, the decision was made to make the product feel aspirational, and this influenced the brand decisions, user experience, and copy. Today, many AI-powered consumer products face the same decision. Do you aspire to be “luxury software,” offering a service or superpower once out of reach to most people? Or do you leverage AI to make something ubiquitous and feel accessible to all from the start? AI also unlocks another possibility: leveraging the excess human capacity freed up by AI to scale human interactions that make people feel special. My bet is that our future in-store experiences will have more and better human interaction than ever before. Brands will also leverage data in remarkable ways to personalize experiences to make people feel special either through (1) knowing their preferences (imagine every retailer knowing your shoe size, and every restaurant knowing your favorite drink and your allergies), and (2) situational awareness (imagine every product knowing your skill level during onboarding). No doubt, the consumer experiences that win in the age of AI will make people feel special.

Moving past the prompt-based era of creativity, unleashing creative risk, and creative meritocracy.

I find myself squarely in the middle of a heated debate between traditional creative professionals who either dislike or all-out deplore the usage of AI in their industry and the cohort of creatives who are either curious or all-out embrace this technology in thier everyday workflows. We have discussed some of these creative tensions in previous editions of Implications. I really try to empathize with concerns on both sides of the spectrum and, in my capacity leading emerging products and design for Adobe, have hosted numerous private “listening sessions” with people I admire with varying viewpoints. I have come to believe a few things:

• Transcending the prompt-based era of creativity: I totally understand the distaste for prompt-driven image or illustration creation, and can imagine how insulting and pathetic this must feel to a professional photographer or illustrator. Creating whole works with a prompt is a boon for people with ideas who lack the skills to bring those ideas to life. But it’s easy to see why many professional creative feel the emphasis on prompt-based creativity cheapens and undermines the work they do. It is basically the next era of template-based creativity, and creating with templates has always been frowned upon by professionals. But dismissing or deploring the entire field of AI because of this non-pro use case is foolish in my opinion. In just a year or so, we’ll look back and realize that the early text-to-image “prompt-based” era of Generative AI was merely a distraction for professional creativity, while the emerging “controls” era unleashed human creativity in unimaginable ways. The “controls” are the equivalent of the digital paint brush that threatened the physical paint brush. Yes, Photoshop was a very disruptive technology for many artists, but it ultimately unleashed a new era of craft, precision, skills, taste, and creative expression. The controls era of creativity in the age of AI will allow people to use new and increasingly sophisticated tools to explore 100x the terrain of possibility, to modify aspects of work in very specific ways, to work across and adapt work for different mediums, and most importantly: to take more creative risk.

• What is creative risk, why is it so hard, and how is this changing? I define “creative risk” as the wild ideas in our mind’s eye that we would love to pursue, but don’t because the cost (time, money, reputation…) is too much to bear. As a result, we play it safe in the form of making sequels in Hollywood, emulating successful campaigns in advertising, and “staying in our lane” or what we’re comfortable with in our art and careers. In the era ahead, it will cost drastically less to explore and test the far edges of imagination in all sorts of environments (not just variation creation, reducing mundane and repetitive work, and prototyping any concept in rapid succession, but also using AI to get more diverse angles of feedback or suggestions to further explore). Despite many uncertainties around AI, I’m increasingly confident that we will take the reigns of this new technology to help us take more creative risk. This technology is not without its thorns (easier to copy someone’s work, deep fakes, IP theft, etc), but - when trained and used responsibly - the technology raises the ceiling of what’s possible by building our conviction in bold ideas that were once too risky/crazy to explore. No doubt, the humanity of the work (and the artifacts of humanity that reflect the process taken to make the work) will continue to distinguish creativity as it always has — the human story behind the work, the originality, the stuff the makes us feel… But I am increasingly confident that new technology will continue to elevate creativity when used to encourage risk taking, and will ultimately help more of the best ideas see the light of day (aka creative meritocracy).

Insights from The Modern Product Leader Playbook, Part 2

Continuing this monthly collection of insights I share with or learn from modern product leaders I admire. I’m pulling out 3-5 of these from my collection for each edition of Implications, given many of you are founders or leaders of various functions or teams across the creative and technology industry. Pretty sure I’m done writing books, so figured this was an optimal place and audience to share these insights…

• Those who really win (an industry, or in a career) did so by delaying gratification. One of the greatest competitive advantages in a startup team — or any bold new project or turnaround — is simply sticking together long enough to figure it out. This is hard because our natural human tendency is to crave short-term rewards and seek short-cuts to safety and success. But if you can use obsession and curiosity to suppress your natural tendencies with obsession and curiosity and gain fulfillment from the people you work with and the knowledge you gain, it becomes easier to wait for the gratification of winning. Paul Graham called this “parlaying gratification” and I liked that. An incredible culture and a genuine love for the topic are the ultimate hacks for delaying the need for gratification. Especially if you’re prioritizing the gratification of your customers and employees above yours.

• Be optimistic about the future, pessimistic about the present. Meaningful change starts with candid reflection and absorbing the lessons while keeping a team positive. This was a sentiment I learned from one of my first bosses, Rob Kaplan who was Vice Chairman of Goldman Sachs. Great leaders exude confidence and optimism about the potential, paired with concern about today’s progress. As an entrepreneur, this translates to how you tell your story and lead your team. For instance, along with selling the dream, you need a “what could go wrong” slide in your deck that outlines the most significant points of potential failure and how you will approach each. Such grounding and pragmatic insight is its own rare superpower, and smart investors and talent look for it. We all naturally focus on what could go right. You must make a willful attempt to be creative about what could go wrong, too. Doing so will show a willingness to consider all circumstances and a confidence to address them directly. My common feedback for first time founders: be optimistic and passionate, but don’t promote. Founders who overstate progress or glorify traction in a pitch will do the same thing to their boards, their employees, and themselves. Own what you haven’t figured out yet, if only to demonstrate that you engage with facts and hard truths.

• Get customers to talk about their problems, not your product. First off, everyone talks about the importance of “empathy” when building products. Easy to say, hard to feel. No setup outperforms building a product to solve your own problem, since the shortest path to empathy is building for yourself, or someone you love. Sure, you may have the right plan, but if you miss the thousands of tiny, two-degree course corrections along the way, you will land you somewhere completely different. The only way to pick up on these often indescribable nuances is to BE THE USER or LOVE THE USER. But when you do engage with customers, be obsessively curious about their struggles. Rather than asking them questions about features or showing things while asking “do you like this?”, seek to understand what makes them frustrated. What do they worry about daily at work? Those who have worked with me know my strong skepticism for customer research where prototypes are shared and reactions are recorded. All you’re testing for is familiarity, and nothing inhibits innovation more than optimizing for familiarity. Instead, seek to REALLY FEEL what your customer feels, and then you’ll be set in the right direction.

Ideas, Missives & Mentions

A couple quick shout-outs worth a click:

• Loved this description featured in ActionDigest from investor Chris Paik re: navigating a major innovation period in tech, “each time a new shift occurs, it is analogous to the formation of an unstable radioactive isotope. The radioactivity throws off a huge amount of energy in the form of capturable enterprise value, but is subject to half-life decay. Over time, the isotope decays and eventually becomes lead, at which point no new companies can generate enterprise value from the shift.” 

• Just cracked open a new Action Book Mini. First time I’m using this miniaturized model of the product line Matias and I designed back in 2006 before getting Behance off the ground. Nice to see this in circulation among creative leaders I admire almost two decades later, and fun to try out a more recent variation in my daily productivity.

  

Finally, below is a private section of ideas and worthwhile mentions (and stuff I want to keep out of web-scraper reach) intended for those I work with (free for founders in my portfolio, Adobe folks…ping me!) and a smaller group of subscribers. We’ll cover a few things that caught my eye and have stayed on my mind, including some data provocations covering global AI investment trends, who lived when, and tennis court density, as well as commentary on skepticism vs. curiosity as an angel investor and AI naming tools. Subscriptions go toward organizations I support, including the Museum of Modern Art. Thanks again for following along, and to those who have reached out with ideas and feedback.