Palantir's Shyam Sankar on enterprise AI autonomy, defense reformation, and why the forward deployed engineer can't be cargo-culted

he's hearing from Palunteer customers mostly. Uh anyway, Sean, welcome to the show. How you doing? Thank you guys for having me. Yeah, thanks for being here. Uh, yeah, I wanted to kick it off with um what is the biggest topic of discussion over the last two weeks? Tariffs, H20s, Nvidia, something else.

Uh, what is driving conversations through the partners that you work with at Palanteer? I think the is enterprise autonomy. You know, it's like there's a normative view of that the most valuable application of AI is is clearly towards autonomy in the enterprise.

Uh, and then you can think about it, you can reason about it by analogy. If you thought about the self-driving car journey, it took us 20 years to get from a prototype that drove through the desert 120 miles, pretty good demo in 2005 to a commercial self-driving car service.

And no one wants to be on that 20-year journey. What What have we really been doing over 20 years? We've been handling edge cases. Yeah. Right. really investing in the tool chain that allows you to get from uh a mandrlic world to one where you have AI agents that are totally automating your business.

Like we've automated sepsis monitoring at at Tampa General where they deaths from sepsis have reduced by half. Uh we've automated how how AIG underwrites insurance. What used to take three weeks and you'd only get to 10 weeks 10% of your submissions. It takes less than an hour and you get to 100%.

So I think and it really is going to feed into this winner take most dynamic. It's not just about cost savings, about your competitive advantage. And you see that play out in very stark and real terms in defense where in some sense there's nothing new under the sun.

There's just John Boyd's udaloop observe, orient, decide, act or as sometimes my favorite admiral says the American udaloop, observe, overreact, destroy, apologize. But how do you how do you bring um lethality to that? It's just doing that much faster. And you're going to do that way faster with AI. That's amazing.

Uh uh Tyler Cowan called uh April 16th yesterday AGI day. He has called it. Uh what was your reaction to the open probably happened internally at Palanteer like you know months ago months ago. Uh but yeah I mean how are you processing this idea of AGI?

Obviously it accelerates everything you're doing but um what is your take on model scaling reasoning uh agentic workflows all these different things like what are you looking for where where are there breakthroughs breakthroughs that remain versus what are we just need to go implement well I think we're well past the threshold where the models are powerful enough that you can be using them to automate massive things I think at this point really incremental improvements to the model changes how you decomp the problem how many agents do you need do you need 80 because you've demped it in a way where it succeeds or do you need eight?

Uh like the coolest stuff that I've been seeing is like multiple teams internally at Palunteer are building AI FTEEs and it's really compelling. It gets really far. It attacks different parts of the stack, you know?

So like if every user could have their own ondemand infinite essentially AI FTE like how much more stuff can you build? How much more quickly can you adapt? What's your udaloop as a company now? So I think we're deep in the the implementation phase.

If AI is electricity, like in electricity, all the value didn't accrete to the people who made the turbine generators. It went to the people who made the tools that ran on electricity. And I think there's just we're just so excited about proliferating and building those tools out. Yeah.

Uh how are you thinking about uh just commoditization of the model layer? Obviously, it's like a horse race. Every different month the different models comes out. Uh how has Palunteer approached integration with different uh foundation models?

And then is that the same as other kind of databases and different tools that might be deeper in the stack or like the even the migration to the cloud? Does this feel like cloud to you? Does this feel like mobile to you uh in terms of like your agnostic approach or is it different in any way?

Um there are parts that definitely rhyme with it. It's more agnostic than not. I said early on in the AI revolution that we thought the right approach was K LLM. Like why would you pick one LLM when you can have K? Um and then you really can start thinking about the tool chain that you need to build around that.

There's numbers there's a number of reasons at first like very clearly you've had model commoditization. If you look at both open and closed models over time you know the ELOs are just up and to the right.

Uh the open ones have converged and even in some cases surpass closed models and at the same time the price of inference has dropped like a rock.

So that's clearly happening and you even see that in the frontier model companies where they're they're expanding further and further into the app stack because they realize that selling you a raw API is probably going to be a raw business. Yeah.

Um so then there's a question of like okay you're just being very pragmatic if you if you're building the machines running on this like what model is right for what job? Uh the models are improving rapidly.

How are you going to safely be able to evaluate uh the the the relative performance of models as new models come out?

So you need you need that sort of tool chain and even more uh deliberately you know these models get end of life like you can't get the original GPT4 anymore right you have 40 and so if you've built an entire enterprise that runs assuming some model is going to exist in perpetuity that's probably not going to work out that well for you so you're going to have to have this constant ability to evaluate and and run these models in parallel to develop the conviction you need not only for the optimization of what's incrementally better But can I safely migrate in the future?

How are you think about uh integrating robotics?

It feels like AI today is just rapidly transforming the way work is done online specifically knowledge work but how are you thinking about you know what's your vision 20 2030 and kind of beyond about you know how um different robotic systems are are integrating with the palunteer system specifically the example you mentioned earlier around sepsis monitoring is like cool that's one you know sort of hardware integration but it's not its own autonomous you know system uh out in the world.

In many ways, we already do this. You know, we have like more than 300,000 workers, blue collar workers who turn wrenches in our software every day. Everything from the factory floors of Chrysler to every Airbus airframe, every HD Hyundai ship.

If you think about a company like Rio Tinto, so much of the mining operation is actually autonomous. The the railroad cars that that take iron ore from where it's mined to the ports, that's completely autonomous. The the threetory tall dump trucks that are actually trucking out the ore, autonomous.

And so it I don't want to trivialize it, but in some sense to me it's more of like a difference of degree than kind. You're you're you're machine to machine communicating to a system. That system just happens to be smarter and smarter every single day. Huh.

During the metaverse boom, Sachin Nadella was talking about building digital twins.

Is that an unnecessary abstraction or like reference point for humans or is there some actual value in representing all of these real world assets like the Riotinto mining example you gave in some sort of like virtual space or does it not matter and it should all just be weights in a model that we're querying through an LLM or something like that?

Where I think it gets to be really valuable is if you kind of thought about it like a CI check in programming where it's like I'm I'm proposing a change to a system here. How can I understand it? like is that change going to work? What are the unintended consequences of it?

If I make that change, what are the new bottlenecks that different functions have to think about?

The simple example I always use is the procurement guy is really excited because he bought, you know, discount raw material 30% off list price and the production guy is pissed off because this discount material has 40% less yield. Right?

It is at the end of the day one value chain and where the digital twins have been hugely valuable is the ability to integrate the chain and the decision-m across it. So you know when the left hand is is robbing from the right hand. Can you talk about the early days of Palunteer?

Maybe one of the first major wins or setbacks or kind of like what's the story that you tell to new Palunteerians to kind of set them up for maintaining the culture because I feel like Palanteer's done a great job of like maintaining the quality bar.

You haven't become that place where people kind of go and like rest invest basically but you are like kind of a big tech company now. Um, what's the story that you tell to kind of set the culture? I mean, there's so many stories. I really I'll tell you how I set the culture at the end. I promise.

But I think one of one of the things that I felt like we kept getting punched in the face in the early days on is that someone else's execution would end up screwing us.

Like I I remember we had this gatekeeper between us and a government customer and he installed an early version of our software um and he wanted to test it out before he passed it on and it crashed and he blamed us and it and it crashed.

I mean in those days this was a server with two gigs of RAM uh trying to run a 4 gig Java heap and he didn't understand why it crashed right like we just developed this extreme ownership mentality because anytime we outsourced even an iota of responsibility it blew up in our face and that's you can see for deployed engineering as like the extreme manifestation of that that we're going to somehow have total control over the implementation because that's how you get the feedback and the quality and the improvement and you're actually responsible for your own destiny.

Uh but the the the story I tell to kind of spill the beans on. So your your first um AMA with me when if you're on boarding in week one at the I always end the AMA by reminding people that counter is a flat place. What does flatness even mean?

Well, to me it means that every single employee is willing to tell me to [ __ ] off to my face and I them all say [ __ ] off in unison out loud at the very end. I think it's important. I want to institutionalize the notion of rebellion that you know I don't have all the right ideas.

There's so so many things we've done over time I didn't think were going to be right and they were right and you know you got to bet on talent and the people and give them the space to run and really preserving what what's at the core of this is like this is an artist colony not a factory you know I I don't really know what your career pro progression is going to be and if you want certainty on that this is definitely not the right place but I can promise you you'll have access to the most motivating problems and compelling colleagues and I'll give you all the canvas and paint that you need.

Yeah. Can you talk about uh what's going on with the cultural transformation in Washington right now? Uh you've written like maybe it's transformation going into founder mode uh but within some of the more nitty-gritty uh maybe swampy institutions.

Uh is is there a need to be able to tell each other to f off or uh just be more confrontational? Uh what should DC learn from Palunteer and maybe even vice versa? Well, I I don't know if DC I would say is it seems like very assump presumptuous for me to say what should DC learn from.

But what me about the present moment is in Palier terms the primacy of winning like you feel that in the people there they understand that they're working backwards from what could actually work instead of some anodine notion of how we wish the world works but doesn't.

Um and that's like allowing us to reexamine a lot of assumptions from first principles. I think founder mode is the best description of it when I talk about so conserved across commercial and government kind of our diagnosis of the current legitimation crisis. Why do doors fall off airplanes?

Why does it seem like these institutions aren't working? Um you have a seauite that is if you steelmand it diligently trying to steer the ship and their steering wheel what they don't realize is a prop from the Jungle Cruise ride in Disneyland. it's not connected to anything.

And then you have people, hardworking people on the metaphorical factory floor who kind of look up and say, "How could they be so disconnected? How could they not understand what's actually happening here?

" Uh, and so much of that is like the levers of orientation are somehow filtered through a lot of people in the middle. Uh, leadership doesn't have access to real-time information.

If you if you couldn't, you know, like if you were navigating a car and the latency of understanding where you are was an hour, you'd crash it. And and so like this sort of manager mode playbook, it works really well for the managers, but it's like a way of having a well-managed company into the ground.

Yeah, we need more like uh individual champions. Peter Teal has that quote about like we need ticker tape parades. Uh Ezra Klein is now talking about with the abundance he's he's uh he's highlighted the failure of the California highspeed rail system.

And what I found interesting about that is that it's very hard to pin down like California highspeed rail. Everyone kind of agrees like the project's not going great, but no one can really say like who is even the champion of that at any point in time? Like no one's really responsible at any point in time.

Um does does the government need more individual accountability or like I don't even like project level CEOs or something? I don't know. Well, yes. The short answer to that is absolutely yes. Like I I think about it in terms of heretics and heroes. You know, it was Somerville who built the Pentagon in 16 months.

You know, it was Jean CR who led the Apollo program. There's something about our kind of Midwestern Calvinist sensibilities as a country where like it's the Apollo program and not Jean CR, it's the F-16 and not John Boyd's plane, you know, it's the nuclear navy, not Hyman Rick Over's Navy. That's great.

I appreciate that sensibility tremendously, but it shouldn't uh obscure the fact that actually these projects working or not come down to a handful of really exceptional individuals being present, taking ownership and and leading the way. Yeah.

Um uh can you give me a little bit uh expanding on that, can you give me a little bit of history on the dollar a year men and that story? Yeah, in in World War II, we actually had a program for uh very skilled people corporate leaders, engineers, they could for a dollar a year because volunteerism was illegal.

You could not volunteer to work for the government. So as we were preparing to go to war, as we went to war, uh they would actually join the government as dollar a year men. they would get one dollar of salary uh and they they would actually be able to be deployed on the nation's most important impactful problems.

Um and uh sometimes they would retain their old job, sometimes they wouldn't. It would really depend. Uh but you could get the right person on the job.

And I I think that's really important because if you think about even World War II, our mobilization came down to one man, William Nudson, a Danish immigr who actually invented mass production. He was the number two at Ford where he invented mass production.

He got in a fight with Henry Ford and went to GM as the number two. And you know FDR asked Bernard Bar, who should I choose to do this? He said, I have three names. William Nudson, William Nudson, William Nudson. It's like it really came down to a counterfactual.

We had like one guy who could actually move all of American industry. And the way that he assessed, you know, he was an engineer himself. He would like meet people and understand like is it believable that you as a steering gear company can start making artillery or not? Are your engineers smart enough?

Do they can they answer my questions? Boom. Here's a contract. Let's get going. Uh, and you know, it wasn't a fiction writing contest. It was really a a pressure test, mind-to- mind. Interesting. Can you talk about the executive order from last week, the defense reformation?

You had a great post on it, but I'd love for you to kind of break it down live uh for the audience. I think it is the single biggest change that could prepare us to avoid World War II here.

uh you know if you look at um you know what has happened to the US since we won the cold war we've really had the rise and empowerment of this monopsiny a single buyer that is the government and an addiction to uh that monopsiny telling us what to build at what price and how it's all going to work that's very different than the free market you know at some fundamental level you either believe in the free market or you don't and I like to quip that you know everyone including the Chinese and the Russians had given up on communism except for Cuba and the DoD we still have five-year plans, you know, and and this this luxury of having the monopsy grow to the scale it has is a consequence of having no peer competitor.

But that, you know, that world really went away arguably in 2014, the militarization of the Spratley Islands, the annexation of Crimea, uh Iran's pursuit of the bomb, like deterrence is lost and we need to rise to that. And I think this is a clear acknowledgement of of very much that in this administration.

But the EEO says, uh, we prefer to buy commercial items.

We we prefer to buy items that have been proven in the market that have that have to withstand brutal competition that happens out there every day that, uh, reward entrepreneurs for what they're building rather than custom building and developing things on our own. And we have a we have a long history.

You know, a monopony is always going to desire control, but it goes all the way back to Andrew Higgins and the boat that won the war in World War II. Andrew Higgins uh was a guy from Louisiana.

He spent some time in China and he was inspired by bootleggers in China and the sort of boats they had for amphibious landing to quickly land, get goods off, get goods on and then scurry away. Uh and at his own expense, he built the Higgins boat. Um and he he showed up he showed it to the Navy.

The Navy wouldn't even let him compete. They kind of dismissed him. Then a young marine who became very famous, Kwick, he later he got him into the competition.

he won the competition and then instead of buying the boat, the Navy stole the uh sold the plans and tried to build the Higgins boat themselves, which they failed to do. Um and then finally, you know, at the at the 11th hour, of course, we do the right thing. That's classic American trait.

And uh and Eisenhower said, "That's the boat that won the war. " And so you you know, the Predator was developed as a commercial item. It was not developmentally done inside of the government. It was a Kareem built it. Um General Atomics picked it up. They financed all the R&D themselves.

You know, the Air Force of course hated it because it was unmanned. It was kind of emasculating and uh you know, when 911 happened, it was the thing that met its moment in a in a massive way here. Uh and there's so many examples like now we have whole companies built around this companies like Androl.

The entire approach is commercial first, investing private taxpayer capital into R&D, absorbing putting the pebble in the right shoe, you know, putting the pebble in the entrepreneurial shoe rather than in the taxpayer shoe.

So this EO it's actually this law in 1994 we passed the law called the the FASA the federal acquisition streamlining act that said it is the law that if a commercial item exists you must buy it. Yeah. Uh it's actually a very stringent test three-part test.

So if a commercial item exists that meets your requirements you must buy it. If it doesn't you must see if you can change your requirement to meet the existing commercial items that do exist. And if that's not possible you must see if you can ask the company to change their product to meet your requirement.

and only then are you allowed to go custom developmental. So, this is the most violated law in the land. And I think having the administration say, "Look, this is statute and we agree with it and we're going to enforce it is is how we're going to field a huge amount of deterrence between now and 2027.

" You know, there's not a lot of developmental things you can do between now and then. There's a huge amount that you can do with the innovation of entrepreneurs and the commercial industry. That's amazing. Um, do you feel like uh cyber warfare has been too normalized on uh on this planet?

It feels like, you know, you have a major cyber attack and maybe you hear about it on X because somebody says they can't log in to Zoom or something like that, but it doesn't even make the mainstream news. Meanwhile, there's any type of sort of kinetic conflict globally.

It's like immediately front page or it's on CNN, things like that. Um, and do you think there's ever a point in the future where people start to view them and and and countries truly view them with the same level of significance as everything sort of continuously sort of comes online.

I think you're spot on that some there's something very strange in how little we talk about it and they don't photograph well. Yeah, it doesn't photograph well. It doesn't photograph well. What picture?

My concern is that in the future if we have a 100,000 humanoids, you know, roll, you know, going around a single city and suddenly they all are stopped, that will start to photograph pretty well.

And so I imagine in the future it won't be uh just kind of brushed under the rug and and yeah, of course, you know, companies have to respond to it and the government responds to it, but I just imagine at some point it will start to really be news.

One of the most devastating consequences of it being so kind of below the waterline, something we don't want to talk about is the normalization of like what can you do about it?

a sort of nealism and acceptance, a pessimism that anything can be done about it, which is obviously not the necessary precondition to like rising to the occasion and we should have very high standards for what could be done about it and not this.

Of course, this company got breached or this thing happened and all these people have my information all the way to, you know, sure our water systems are compromised and, you know, we'll be brought to our knees within the first few days of conflict.

like we should just we're not able to hold ourselves to the high bar that we ought to because it's it's not popular and we're not popularizing it as a concept. I mean speaking of popularizing just general shifts in uh in thought about defense and the importance of like uh public private partnerships in the government.

Uh can you talk can you take us through the defense reformation 18 thesis the your thesis there uh and then kind of the impact and uh is is it a jobs not finished situation or uh has has defense tech become enough of a meme now?

It seems like Silicon Valley is like fully on board in my opinion but uh at the same time there's a lot more that we could do. Yeah, I think we we've earned the right to uh to to have an at that, you know, so like we got to perform now for sure.

Um I I'd say the fuller di I've touched on some of the themes but the fuller diagnostic is um the government has kind of historically made it a bad business to work with the government you know and you think about like our examples from the past like at Intel Bob noise would not let more than 4% of his R&D budget come from the government because he as the inventor of the trans transistor wanted engineering control over the road map and what he was going to build he always had in mind a broader commercial market that was going to drive the price performance that was needed even though in 1969 something like 96% of his revenue came from the Apollo program and DoD you at that point they looked like a government contractor but that was not his aspiration was bigger in the same way that Elon Musk's aspiration for SpaceX has always been to get to Mars and to make us an interplanetary species you know it's not just about launching rockets and satellites into orbit here um and we really lost you know so much of defense innovation you know Kelly Johnson who built 40 plus airframes in his career including the U2 2 which we still fly and the SR71.

Uh he is this heroic figure. So much of this innovation has come from these legendary engineers, these heretics as I call it today. You think about it as Northup Grumman, but it was Jack Northrup and Leroy Grumman. You know, it was not Lockheed Martin, it was the Lockheed brothers and it was Glenn Martin.

Uh and it was really so founder driven. The aerospace industry subsidized its own existence in the inner war period between World War I and World War II because the government didn't think it needed it.

So you know but for private industry being willing to lose money for a decade plus World War II we would have been in a very very bad place.

Uh and what excites so I think the last supper people look at the last supper which is this dinner at the Pentagon in 1993 where they said hey look we have 51 primes today you guys are not all going to survive today we have five.

Um for every dollar we were spending in defense we started spending only 33 cents overnight. It was it was a huge cut the peace dividend as it's called. Yeah. Consequence that conventional people take away from this is, oh, that's when we lost competition. We went from 51 down to five.

I don't think that was the the actual issue. The real issue is that consolidation bred conformity. And the conformity pushed out all the heretics. It pushed out all the founder personalities that you need to make this stuff really work. My reason for immense optimism in this moment is that the founders are back.

You know, more than hundred billion dollars have been deployed in the national interest. You have Palmer Lucky. You have the Sang brothers at Shield AI. You have Dino and Seronic. You have all these crews of really, really compelling humans, really, really compelling founders working in the national interest.

Again, pursuing heretical ideas, will waking up every day, banging their head against the wall, you know, fighting the bureaucracy to do what's right for the men and women in uniform and for the nation more broadly.

Can you talk a little bit about the startups that are building on top of Palunteer and take us through AIP? Yeah. So, we've always it's a little abstract, but I I've always felt like the ontology, which is our secret sauce, is it's it's really you can think about it as like a declarative backend.

It's a way of saying, look, this is the shape of not only my data, but the logic of my enterprise, and that's all you have to do, as opposed to the imperative approach of having to actually go create and wire this up and do it together and figure out how to get it to scale.

And so, if you if you had this declarative back end, if you could just say, look, this is what I need to exist in the world. Now I can build applications on top of that that manage and all of the entropy that usually sits behind it and it gives you a radical speed advantage uh for these companies.

So these these companies are building everything from like the European Cricut network to people who are building uh pharma companies, hospital operations companies.

Uh in defense it's it's very popular because we can give you an SDK that wires you into 20 years of data that has been integrated into the instances of Palunteer that exist in the defense community that your users can authenticate to.

So, it just speeds a lot of the kind of brain damage you would get from having to to deal with the bureaucracy and allows you to compete on the quality of your product rather than your game and getting through the wickets of a Byzantine process that probably needs its own reformation.

Um, but it's really about speed I and that that ability to build on top of the platform. It's not just for thirdparty developers.

When hurricane Helen happened in North Carolina, green suitors like folks in the army in the 101st built their own they built their own hurricane common operating picture on top of the platform. So that ability to respond to the need it's it's our it's the code version of the udaloop. Yeah.

Uh what advice would you give uh somebody maybe graduating college today that's um evaluating joining you know maybe a seedstage company versus a a scaled company like Palanteer or or or something like an Anderoll.

I imagine you at times had a ton of different pressure from VCs being like leave we'll give you 10 million bucks to do whatever you want like don't you want to be a founder yet when I look at opportunities you know in anything defense related it seems like if you have a finder ma founder mindset there's so many great opportunities to just go to a great company and kind of uh take on that sort of like founder level ownership over a specific problem area or product set or things like Yeah.

I mean, I think the of course I'm I'm biased here, but if I if I get would give general advice, the way I would think about it, what I would tell my son is like where can you go that you're going to work with the most compelling people because like your rate of learning is going to be a function of those people and have access to the greatest surface area on problems.

Like my model for growth is not progressive overload. You know, the Incredible Hulk did not become incredible by just lifting a little bit more weight every single day. It's like a near fatal dose of gamma rays that probably has like a 50% chance of killing you.

So which upgrades are going to like throw you off the deep end and give you that opportunity to have like superhuman superhero growth. That's like that's the value maximizing thing. And I would remind my son that like your point of of extreme growth is going to be coincident with your point of maximal pain.

So like your ability like you know it's like it as Greg Lemon says one of my favorite quotes championship cyclist it doesn't get easier you just go faster you know it's just just understanding that like that's what it looks like.

So don't don't sell out for the opioid of a linear career progression with a clearly mapped out path. I'm pretty sure that's retarding. Like that's lead shielding that's preventing the real gamma rays from getting to you here. You know find places you can throw yourself off the deep end.

And I I I bet there are some sestage companies that are perfect for that. I bet there's some CG companies that are horrible at for that. You know, it really is pretty specific. Does that tie to the the primacy of winning mentality? Is is that like all is that essentially like derivative or like the same concept?

Yeah, I think it's it's it very much relates to that and I think I think it's like one of the things that I had to I feel like it's one of the most important things I learned at Palunteer. You know, we're all kind of programmed in our conventional education to feel like there's a process, there's an approach.

if you follow his playbook, you know, you'll win. But it's actually like uh it starts to conform to how you wish the world would work. It becomes hard to decide is that actually the cargo cult or is that how the world does work. Like you can keep marching around these fields in Micronesia, the planes aren't coming back.

You've misunderstood the physics of the universe here. And and just if you just anchor yourself like, but is this working? Like is it winning? And then blow up anything that's not working. Okay, last question on cargo cultting.

uh cargo cultting the forward deployed engineer good or bad when does it work when does it not work who should be doing it well I think all cargo culting is bad so I think that that would be you know it's um I think the for deployed engineering methodology is uh is exceptionally valuable a's description of it is the best one I think it's like solving through back propagation it's very elegant metaphor um but if you just slap a veneer on it where it's like sales engineering done.

My favorite things like ex-punteers will be like people are asking me like what is an echo and I will describe an echo and they'll be like so you mean customer support customer success and it's like wow you've lost the essence of this whole thing this beautiful concept you've you've completely cargo culted away. Oh no.

Uh well thank you so much for stopping by. This is fantastic interview for having me guys. Yeah, this is great. Have a have a great rest of your day and we'll talk to you soon. Cheers. Bye. Fantastic. So many great stories and man like encyclopedic knowledge of American history.

There's so many times we need to have him on for Yeah. Yeah. Of course. Loheed and Martin like I I know their first names. I don't know first names. I need to brush up on their stuff. I need to do some like space repetition, some flashcards or