Evan Spiegel on Snap's first consumer AR glasses launching in 2026 and $3B bet on augmented reality

go for the treat.

Thank you.

Great to have you in this.

Uh, please have a seat.

Scoot it up. Look at this.

You look fantastic. It's uh my wife told me to to wear a suit. Like it's part of the

It is. It is. Uh you know, we put on these suits uh sort of as a joke. It was it was sort of a I mean, you're you're you're one of the you're one of the many tech people who maybe popularized the t-shirt. And I wore the t-shirt for my entire career in technology. And we were like, we want to stand out. Everyone else in tech podcasting wears the t-shirt. Everyone wears the t-shirt. Whether you're CEO of a public company or a podcaster, you wear a t-shirt. We're like, how do we stand out? Let's do the opposite. Let's wear the suit.

It's like instant credibility, too.

Well, the funny So, the funny thing when when some of our uh videos end up going viral in parts of the internet that that aren't kind of familiar with what we're doing, there'll be comments of people like, "Look at these guys in suits. They don't know why. How are they talking about software? They don't know anything about tech. It's like not getting the bit."

Uh, anyway, super super excited to have you on today. There's a so much so much to talk about. Um, and I don't even necessarily know where we should start. I mean, I'd love to start with a demo that we got just an hour or two ago. Spaxs. Um, how are you thinking about hardware these days? What's the state of the organization? How much of your time are you spending on it? Because you have a monster business to manage. You have earnings calls. There's so much going on. How do you how are you splitting your time? What does that team look like? What are your ambitions for hardware these days?

Yeah, I mean, it's a really exciting moment for Snap because in 2026, we're releasing the first consumer version. That's right. uh of our glasses. Obviously back, you know, maybe now more than 10 years ago, we released camera glasses, you know, and we kind of stepped our way into building out.

What was the actual first release of that public release?

Was it probably 2016 broadly to the public

spectacles? Weren't they weren't they yellow?

Uh the original they had a little yellow accent flag the camera back in the day people were, you know, and I think this is still a concern. People were very, you know, worried about privacy. So big, you know, yellow ring around the camera and a light to let people know a bunch of really cool uh like little touches. Like I I remember the ability to to film. It was basically a square sensor so you could film horizontal or vertical. Um and and just those little touches. I'm wondering like do you think those like small little wins are what help us break through to, you know, a world where everyone's daily driving some sort of augmented reality device? Is it a game of of inches on the product feature side or is it just like more deeper in the supply chain? Once they're 50 bucks, everyone's going to be doing it. What do you what do what's critical path to getting to phone level prevalence in face wearables?

Yeah, I I think they're going to have to be major breakthroughs in terms of the utility people get out of the the product. I I think the biggest challenge, and we learned this very early on with camera glasses, it's just not that much better than taking a photo with your phone, right? Maybe you're rock climbing, you're on a jet ski, okay, you want to, you know, make a video handsree. I I think that's a totally reasonable use case, but that's not an everyday all the time use case. And so a lot of what we did, taking those early learnings, we sort of proved out people were willing to wear a camera. They were willing to wear, you know, glasses that had a computer inside, but then we just shifted our focus entirely to the platform and to driving more utility. So I think you know the the latest version we put out in 2024 that you got to try uh for developers which is very focused on all those platform components uh so that developers could build all sorts of amazing now developers built hundreds of these lenses. You probably got to try a couple of them. Um and so I think it's really about driving utility.

Yeah. Yeah, that makes a lot of sense. Uh uh it's it's it's always frustrating when you're in a you know technology you're in like a technological platform shift and I've seen this with with uh with virtual reality where it's like so amazing and then the demo is like well it's really good on a plane and you're like but I'm just not on the plane that much. It's sort of the same thing where like if the demo is

it's really good if you're watching a movie alone.

Ex Yeah. Exactly. And it's like well actually I I I want to watch a movie with people and so the theater does work or the TV works. Um, I'm wondering about um how much AI is an accelerant in delivering value in the wearables context because I imagine it's useful for developers to you know write software faster now but also are you are do you think that that's going to be like a a relevant precursor to you know mass adoption is the AI

like I'll give you an example so like the live translation functionality and and what's very cool about specs is like having having the the basically the the heads up display like centered so I can be talking to you and and be getting like live translation which to me is like the kind of thing that feels very sci-fi and to be able to get it in a demo today that feels like the kind of thing that uh AI is is a is a real accelerant for and you can imagine being in a situation where

you actually have multiple effectively like subtitling happening all the time. M um but maybe on that note I guess uh from from my understanding you guys are not saying we're going to build the hardware platform and we're going to build a foundation model lab and maybe if you could talk more about that because I think that's obviously quite a bit different than some other hardware players. Yeah, so far we just haven't seen a need to to build foundational models outside of the sort of image and video and 3D areas where we think we can really differentiate um and where there aren't as you know as compelling open- source solutions. So uh and we also are very focused on being able to offer our experiences to our entire community. So nearly a billion people around the world. If you do that

with back-end inference, it's just too expensive to be able to offer it. A lot of our innovation starting several years ago was to be able to run models on device or with a hybrid solution where we can do some on the back end, some on the device. Uh, and so that's really where our foundational work has happened. I think, you know, as you look at the glasses near-term, I wouldn't expect AI to be a major accelerant because again, I don't think it's meaningfully better than your phone, right? And I think that's really the the bar that we have to clear. These experiences have to be 10 times better than what's possible on your phone. And and I do think over the long term though, AI will be very very meaningful. and

less because of the you know sort of chatbot style use cases today but more in terms of the way that like we change how we use computers. So if you think about today we're spending what on average seven hours a day in front of screens

we're spending a huge amount of time operating computers to get work done. So like physically getting the work done ourselves and I think

what AI enables is a change in the way we relate to computers where we're going to spend less time operating computers and more time supervising AI. And in that transition, the glasses form factor I think is going to be really compelling because it it essentially gets you away from this operational paradigm into the supervisory.

Yeah. or another I I mean potentially more near-term example is like you're working on your car and you have this like AI assistant running permanently and so you have full ability to use your hands and make changes and it's kind of reasoning on the fly with you in a way that you know everyone's experienced like you know watching a YouTube video and like pausing it and trying to do something and then you know playing it again and and I feel like I feel like there are some very near-term

how is that shift uh like manifesting itself in your daily life as CEO. Like I've found that since the dawn of chatt there's been this like urge for folks to like send chatt written stuff to me and I've always said like just send me the prompt and I can kind of rework it in my brain. Like just send me the bullet points. I don't need to turn it into a paragraph. But I'm wondering if uh if you can give me some uh color on how you're seeing like AI change your your workflow or the folks that you work with on a daily basis.

I think it's a really great thought partner. Like I love to test ideas or try ideas or like I love to run simulated focus groups with AI which is really fun like what do you think different types of people will say or respond to you know in terms of like a product or idea that we're working on. So I I love it as a as a you know of course for all the visual and you know the visual stuff video generation I can test out ideas really really quickly. I

I haven't actually found it yet to be particularly creative but as a creative thought partner it's it's fantastic.

Yeah. Yeah. How do you think about the the instantiation of AI features within the core Snap product? It feels like there's an immense amount of energy all over AI with like super intelligent. It's going to do everything. It's going to make the full video. It's going to make the video and the audio. And then when I see it's like, yeah, you get like one or two viral videos out of one of those generators. But, uh, the much cooler thing is, uh, I think when there's, uh, AI riding alongside the rest of the creative suite. Um, how are you thinking about um, setting up creators for unique experiences that are like AI enabled, but there's still a lot of that creativity that's coming from them?

Yeah, I mean, I think AI has been a core of the Snapchat experience for such a long time, but we've never described it as that, right?

Like the original like actual like location mapping, the AR stuff

and even all the transformations that are happening in our camera, right? A lot of the real time ondevice uh, you know, generative transformations and these sorts of things, people just laugh and have fun with their friends doing it. They're not thinking like, "Oh, this is some, you know, AI."

Yeah. Yeah. AI.

I mean, when face tracking has been in there for so long, and that's always been AI, I'm sure.

Yeah. And I think there there is a lot of opportunity to, you know, rethink uh the way that people build lenses. So, that's been really really powerful. You know, in the past, uh, you know, developer, it would take a really, really long time. You had to build the 3D assets yourself. I think there's a huge democratization that's happening right now because anyone, you know, we have a tool called easy lens. You can with a prompt build all sorts of amazing experiences in AR.

Yeah. What what is the like the economic flywheel there? How do how do you think about allowing folks to monetize that, build businesses like come uh like what is your current uh mental model for the for the economy that's occurring on the platform?

Well, one of the things we've thought a lot about is that there are a ton of models that are being created, but very few people actually have customers.

We have a ton of customers. And so what we've done is created a service called Lens Plus. So if you're a developer, you can publish your lens to Lens Plus. That means it's behind our payw wall. People get free generations. They can use some lenses for free for a certain amount of time and then they convert to paying customers and we revenue share with those developers. So I think interestingly Snapchat's become a bit of a a front door, right, for folks who want to deploy their models or deploy a specific lens or, you know, sometimes people are even building more advanced game experiences inside of Snapchat. And with Lens Plus, they get all that monetization for free essentially. We do that that one for them.

Yeah. How do how do you uh process like the whole the like the metaverse boom and you know bust and maybe it's going to boom again. Um just this idea of like uh just adding more and more functionality until you're effectively in like a game world unlimited uh content. Um do do you think that uh like is that is the primary driver of giving people the ability to make games just better AI tools? Are there other things that you are are are actually thinking about integrating there or um or do you think that uh like like the just partnering with all the models will eventually give people the ability to build whole game experiences?

Well, it's the reason why we love games actually the same reasons why we hate VR, right? Which is games actually bring people together in really interesting ways and we see that on Snapchat all the time, right? It can be a conversation starter or a way for, you know, a way for two friends. You know, I play putt putt with my wife on Snapchat, right? and we just send them back and forth. It's fun, right? It's a way to connect. And so I I think for us, games on Snapchat are really about, you know, that that like spark of connection between people. Uh we we've invested zero dollars into VR, right? Because we essentially take think that it takes people out of the real world and away from the the places, the people, you know, everything that they they love. And so our view is that VR has a very very limited uh and low future because people love the real world. And so our bet, you know, for the last 11 years has been exclusively on augmented reality on, you know, and trying to enhance the human experience rather than replace it with VR.

Yeah. Is there any is there anywhere where where you think VR does make sense? Like are are there specific like B2B use cases or like some sort of like I don't know like maybe enterprise is where all the stuff like goes to die. Um, but I I'm wondering if there's any if there's any place

I guess the question is like that I think people assume that VR eventually will

be good enough that a huge swath of the planet will be engaging in it a lot like at least that at least like that that my my personal theory and and maybe you believe differently. It sounds like you're even okay with a scenario where even if it does work you're like other people can kind of play in that and we're happy to kind of exist in this hybrid world. Yeah, just philosophically like that's not a world that we want to support in any way uh shape or form. You know, I think what's really important is actually trying to create products that foster that human connection, right? And in doing so in person, I think we're in a moment where people are really valuing that, right? And they want more of that and they're thinking about how to get get more of that. And I think AR is coming about at at a really important time when people are saying, "Actually, I'm spending a lot of time in front of a screen. I'd like to spend more time together with my friends. I'd love to do that in a way that's more fun or entertaining." our kids even, you know, our kids are

at least uh three of them are still pretty little, but like when I see them playing around with those specs, even though they're clunky and heavy or whatever, they're outside running around playing together and you're like, that's a different vision for computing.

Yeah. You mean you should you should have seen us see us doing the demo this morning. I was running last drawing. I was playing this this drawing game that you guys have where I was drawing uh and and the ability to have this like shared space and have uh like permanence in the kind of uh in the in the different like visuals that you're creating on on a scene was uh is just really cool.

Do do you think uh AR specifically means pass through or can or if I'm doing reprojection, I have cameras on the outside of a VR headset and I'm reproing that and it's indistinguishable for the user. Uh does that count in your mind? Is it a meaningful distinction?

Uh it in our mind it doesn't count. So you're describing pass through on on VR where you know you you the cameras in very high fidelity.

There was this quote from Palmer Lucky where he was saying like why would you ever you know try and like recycle photons just create new photons take a video of the outside world repro it inside. And the benefit of that is that if you're in a very bright world or you're in a bright space, you can dim that and and put something brighter on top of it. And there's certain uh like the additive nature of physics around light make it so that there it does seem like there's limitations to pass through augmented reality even though the latency is zero and it's the real world and there is something that's better. I just know that you might be grappling with it.

Yeah, we we've definitely seen some real challenges there. So the the big difference obviously is between pass through and then see through see-through glasses that that we're working on. You know I think Snapchat's actually a really good example of pass through. So it's a screen, right? And we we do have I think the best pass through AR technology in the world, right? So we are able to realtime render out those experiences through the phone. I think the question is do people really want to wear a screen on their face in front of their eyes? And then you know if you think about the compute that's necessary to repro the world, right? and the power required to uh you know power all of those pixels, right?

And it has to be like real time. It's got to be real time.

You can't have like a half second of lag otherwise you're just stumbling around.

Exactly. So So when you put that all together, you're just stuck in headset lane. And I think it's just very clear that like people don't want to wear giant headsets all day long. I think that's that's

Yeah. in terms of uh stuff that they do want to wear. Obviously, like everyone wants something light, but uh in a world where field of view is somewhat restricted in the short term, I'm sure it'll get better, wider and wider. Uh what's the trade-off between center of field center view versus like Call of Duty mini map like locked in the corner?

Well, I think what's really important is that you're actually able to control where objects are showing up in the world around you. So, the big problem with the sort of heads-up display style products, I mean, I I don't love that if you're looking at the screen, you're looking at somebody's crotch, too. Doesn't make any sense. Um, you know, but but the exciting thing about specs and as it sounds like you saw earlier today, is you can decide where where to place things in the world, where you want to draw. And I think that that's a a very big difference from these heads-up display products.

That makes sense. How do you think about um uh like when the iPhone came out, there was there's sort of I mean, it was a little bit expensive. We were talking about this 700 bucks. Uh you could compare it to the price of a phone. You could compare it to the price of an iPod. You could they Steve Jobs called it internet communicator, right? So you kind of bundle these few different products together. You're like, well, I'm getting $700 worth of value or later $400 worth of value. Uh do you think that there's a there's an important sort of anchoring point for for augmented reality glasses where c consumers need to underwrite it against an external monitor for their computer or or a TV at home? Is there some sort of like economic tradeoff point where, hey, I'm going to college and instead of getting a 42-in TV and a and an external uh, you know, Mac uh, you know, Apple display for my MacBook that I'm going to plug in, I'm just going to go with augmented reality glasses because it just makes more sense economically. Is that an important point?

I think that's one way to think about it. Um, for sure. And you know, the iPhone when you add in the the carrier subscription was way more than that. So I think, you know, they were able to sort of have a $700 sticker price, but then at you know, I think some of the initial plans were like $50 a month and that kind of thing. Two or three years, I'm not sure. Uh you know, that's that's a that was a really meaningful outlay for that for that product. I I to me I think, you know, the iPhone is maybe not the best uh reference point here. I I think this feels to me a lot more like the Macintosh or like early computers with the smartphone. you know, Steve essentially said, "Hey, everyone else is doing the phone wrong, right? You had a Blackberry already or you had a flip phone or this kind of thing." And Steve was like, "Hey, y'all are doing it wrong. This is like what a phone should look like." And

I think glasses are a little bit different. Um because, you know, we we have some similarities in the sense that like on one hand you have these VR headsets, right, that are very capable but that are essentially unwarable. And then you have the, you know, really lightweight glasses that are very wearable but do nothing. And you know, our vision with specs is to have a very lightweight uh pair of glasses that's incredibly capable, right? So VR sort of, you know, level of immersion and and capability, but but in a see-through lightweight pair of glasses. So I I think this is a little bit more of a Macintosh style moment where it's it's a new way to look at computing rather than, you know, a a better version of something people are already familiar with. And that's a bigger challenge. Totally. Um, so I do think to to your point, you know, anchoring to, you know, hey, a a giant flat screen display costs 2500 cost $2,500 or a laptop costs, you know, 1,500 bucks or whatever it is is an interesting way to think about it, but I think actually describing the utility of the product will be the biggest challenge.

Interesting. Uh

yeah, there's some there's something to be said for if you just create a product that is incredibly fun and entertaining. Like people consumers will find like they're not saying like, "Oh, I'm not going to get the the laptop anymore because I can type on this thing." It's like I'm going to I have a device that is

creating value in my life purely through fun and function and it's doesn't need to like replace anything.

Who do you think the the earliest adopters will be? Do you think young people will drive the ultimate breakthrough adoption of augmented reality?

I think the earliest adopters will be our developer community. So we already have hundreds of thou hundreds of thousands of developers who are building you know lenses for uh for our platform. There are already tons of developers using specs today building all these sorts of building all these sorts of experiences. And so our strategy is actually to start with that core of folks who are super passionate about this product. And I think, you know, they'll be able to tell stories about all the amazing things that they're building, which can then help us, you know, transition to more like mass market style adoption. So, when a developer is building a lens, you can, you know, pop these on and stargaze or hey, you can pop these on and, you know, play lawn games with your kids, uh, you know, or hey, pop them on and and watch, you know, streaming streaming video on a giant screen while you're playing or whatever you want to do without having to shut out the world. I think those sorts of stories are really important. Yeah, I feel like Snap has been able to be remarkably resilient with young people in a way that a lot of other platforms, they just kind of like they get their initial bucket of users, then they grow at them forever, and then they're monetizing when they get older. Uh, is that do you think that there's some sort of benefit of having a a young cohort that potentially could drive just the product being seen as cool? Like,

you know, I joke around with my my wife all the time. You know, it's cool to be uncool. Like, we're not aiming for cool. We're really aiming for value, right? And I think ultimately like that value cuts across all sorts of demographics. So, I actually think

Yeah. Look at AirPods, I think, are a perfect example of this. They were mocked early on. It was like, "Oh, look at look at this guy with his little earbuds in. What a what a bozo." And then all of a sudden, it was like $20 billion a year, you know, revenue line. And it just becomes totally normalized and it was just because the the function was there.

Yeah.

Yeah. And I think being unapologetic about the value is what's so important. And so that's why again starting with our community that loves it, believes in it, you know, and has wanted a product like this now for decades. I mean some of the folks on our team have been working on glasses based augmented reality for 25 years. We've only been working on it for 11 years. So the community of people who have wanted this product for a super long time are going to be the most excited about it. And that's really how do you and the team think about timing timing out these bets because obviously you've been at you've been at it for 11 years

and to me it seems from the outside that it's it's like trying to pull the future into the present but at the same time being like patient and not betting the company on like hey we need to make you know 10x the progress in the next 12 months otherwise we're killing this product. like it feels like more quite a bit more like steady and being being open to uh again like not being being impatient but patient at the same time. Is that accurate?

I really love that question because I think that is exactly what has killed a lot of Glass's efforts to date, right?

Like we're going to raise $200 million, spend it all in two years, and then you're sitting there and being like, okay, we made progress, but it's not commercial. Okay, it feels like we're in an age of research for vision broadly, VR, AR, the entire category. There's just a lot of there's a lot of experiments that need to be run and there's no guarantee that it's going to be, oh, next year's the year or five years. We don't know.

This is one of the reasons why we thought it was so interesting to play in this space because we have this huge advantage of being able to invest consistently over the long term, right? And and that's that is a unique advantage, especially when we're talking about this amount of capital, right? We've invested more than $3 billion in glasses over 11 years and we've been able to do that very very consistently. And so at the same time we've seen companies both large and small, you know, start a glass initiative, shut it down, start a new one, fire the team, hire a new team and just the whole time we have built a team of incredibly talented folks with a very very singular and focused vision. And we've done that over the

Is that part of the pitch? I mean over the summer we saw insane talent wars. SNAP is in a unique position like somewhat isolated down here in Southern California which which I think helps but uh is part of your pitch to talent like hey this is not a program that we're we just started up and we're going to you know work on for three years and then the budget might get cut by XYZ is is like durability and longevity a part of a part of your pitch

I think that's definitely a part of it but the most talented folks like they want to create the future not copy the the future right and I You know we have a reputation now for leading in terms of innovation in the space and you know the folks who are really deeply in this space and who are experts in this space know that what we're doing is leading right I mean what you experience with specs today there's no other product that you can that a developer can just sign up for today and have that type of experience doesn't exist so I think folks who are really deep in this space understand our our leadership here and that's really helped

yeah the pure the pure depth of of different experiences in the product too I mean we we didn't we only had you 20 minutes or so, but there were like so many different pages that we didn't even get to and experiences, which was very cool.

We we got to talk about copying because um uh I mean we've we didn't invent this in we but but we've had a lot of success with it this year.

You clearly been part of this. Thank you. Yeah, exactly. There's like a little bit of innovation here. Uh and then there's been a lot of copying and it's driven us various levels of uh insane. It drives me more insane. it drives him more insane than it drives me. Uh but uh at the same time like there's no law that someone's breaking if they want to just like you know do exactly what we do. Uh that's the way it works. So how how do you stay sane when people are copying what you're doing?

Yeah. Well, you know in the early days we had no choice but to just innovate as quickly as humanly possible because we were late to the social space, right? And Snapchat is not social media. We literally built the business as a response to social media. Facebook came first and Instagram came first and Twitter came first and we were using all these products and we were like these are not very fun, right? Like this is not actually a great way to communicate with your friends. It's awesome if you're into like status and building your profile and collecting followers. It's not a great way to just have fun with your friends. And so we started building uh Snapchat and and I think you know there was just really a gravitation towards a service that is actually fun to to use with your with your real uh with your real friends. But as part of that, you know, because we're competing with such giant companies, we just had to innovate as fast as we possibly could in a category that is essentially owned by other players, right? Essentially owned by by Meta. Um, and and I think, you know, part of that is is understanding that, you know, one of the most important things you can do in that position is go and build a new category that's outside of the one that you're currently in. And that's what we identified with glasses 11 years ago that like we wanted to help power this this massive transformation in the way that people use computing. And then that if we invested over a very long period of time in very very difficult things and things that are incredibly challenging technically and then built a platform as you as you saw with lenses all those different lens experiences that those sorts of things are incredibly difficult to replicate. And so while I think you know app features uh are easy to replicate, the work that we've been doing over the last 11 years and where we're going with glasses is incredible.

The example Yeah. The example for us is like people see the overlay. So they'll copy the overlay and not realize that like it's not that's not what you know overlays have existed for decades, right? So like you I find often times when people copy, they don't actually fully understand what they're copying. So they take an element out of it

not realizing that it's not necessarily that element that makes the other platform

uh successful. How how have you uh thought about partnering uh with different AI companies and labs? You recently announced the Perplexity uh uh partnership which is uh which I thought people were excited about. Uh and then I feel like all this year people have been as as some of the labs have have added uh hundreds of billions of dollars of value. There's been speculation on uh saw people speculating on you know you could imagine Sam Alman trying to buy Snapchat because he sees your user base. Um and I can see a lot of reasons why uh why why there's no price uh that would that would make that appealing. But how have you thought about uh partnerships with different AI providers broadly?

Yeah. Yeah. Well, I think one of the things that's been really interesting, obviously, Snapchat is so focused on messaging. And right now, the primary way people are interacting with AI is is messaging. And so, we saw a huge opportunity to help bring, you know, more of these AI uh services into Snapchat, into our messaging platform because, you know, as I mentioned, whether it's the foundation companies or tons of businesses have built agents now have built chat bots, but they don't have any distribution for them.

And earlier this year, we launched sponsored snaps, which is a a killer ad product for us. it shows up in the in the chat inbox, highly effective. But the vision is to transition the sponsored snap from being something that you know you just view to now something you you can interact with and chat with. And so part of that was opening up uh the platform starting with you know Perplexity with an exclusive deal with them but you know then over time adding more businesses who are bringing their chop chat bots and their services to to Snapchat.

Yeah. C can you give me a little bit more of an example of that? Like if I'm Diet Coke and I uh and I want to advertise there's a sponsor snap but then you can chat with it. And so is it more like Q&A on an FAQ, you could ask questions about the product or is there something more gamified than that? Like what does that

Yeah, if you think about someone like, you know, Walmart, they've spent a lot of time building out uh a service called Sparky, right? Uh that you can use to learn about products or or buy products. So, what they could do is send you an offer directly to your inbox, ideally highly relevant to something you've already been looking for at Walmart or based on how you've been engaging with Walmart, and then you can follow up, have a conversation, uh, you know, potentially even convert in the chat. And

oh, and that's like uniquely good in a chat app like because you're in you're used to that functionality, I suppose, as opposed to just kicking out to some web page where the UI is a little bit uh more foreign or like abstract to you.

Yeah, exactly. I mean Snapchat's one of the largest me after iMessage probably the largest messenger certainly bigger than WhatsApp for example in the United States. So I I think you know in terms of people who are familiar with uh you know our messaging interface that's where they go to have their conversations being able to have those conversations not just with your best friend but also with uh you know agents like Sparky I think is an interesting opportunity.

That's very cool. Um there's a whole bunch of news uh OpenAI today shortened their vesting period. Um, how do you think about aligning talent, aligning incentives for talent? Um, you've, you know, this transition now you're a public company. Uh, how do you think about whether or not a vesting cliff makes sense? We were going back and forth on it. I was saying that I'm so used to a one-year cliff growing up

coming from the private markets.

The private markets uh at the same time there's a lot of people that show up and on day one they're creating a lot of value. So, how have you thought about uh incentivizing employees with stock? Our perspective on this has like really evolved over the years and we learned a ton. Actually in the early days we did something really different. We had a 10 20 30 40 vesting schedule. So you would only vest 10% of your grant the first year, 20% the second, 30% 40%. And the idea and and we were in LA at the time. The idea was to really make sure if you were joining SNAP that you were joining it because you loved it. You wanted to be there for the long term. It was very popular at the time. I think it's still very popular in in the valley to kind of hop, you know, spend one year at a

Yeah. Why do four years when you can build a basket of

Exactly. Yeah. And and I think um you know I think that can be really that that can put a lot of pressure on the culture especially in a startup where you really you know I think it's so important that the team is all in on on what you're what you're building. Um but you know I think over the time our our view has just been like to take as much friction out of the compensation conversation you know as as possible. I think like a lot of this stuff is really frankly frankly like irrelevant, right? Like what really matters obviously if you look at retention and building a team, it's your your leader, right? The people that you're working with, obviously

what you're working on, the culture, you know, and and that long-term orientation. So, I think a lot of this compensation stuff is sort of like details and the less complicated it is and the less time you spend talking about or thinking about it, the better.

Yeah. What about other just lessons from becoming a public company? Uh we we like to joke with Eric Glimman at Ramp one of our buddies that you know he's maybe about to go out. What is he preparing to do? What re uh what what are your recommendations for uh CEOs that you counsel about the process and the transition that the company goes through in the IPO process just culturally?

I mean the most substantive change is that people's compensation changes on like a minute-by-minute basis, right? And like that can be very distracting for people especially in the early days and when companies are newly public there tends to be a lot of volatility right and so I think it's just really important again to create a company culture that's not focused on that um especially if you want to build something meaningful over the long

I remember hearing a story about Enron putting the stock price in the elevator.

So like the exact opposite of what you said like literally orient the entire company culture around the stock price. So, you come in, stock price is up, everyone's having a good day. Stock price is down.

How did that How did that work out for them?

I I don't think it worked out well. I don't think

What about What about setting What about setting uh You seem like, you know, through this conversation, you seem like very clear on your values, willing to say like, "Yeah, we don't want to do VR specifically. There might be money to be made there, but we don't we wouldn't even do it on a on a principles basis." How do you think about kind of setting vision internally with the team and externally with shareholders? There's been so many companies this year that uh specifically in AI that kind of like to talk about a vision around let's say like curing cancer but then you look at what they're actually doing in practice and there's not always incredible there's can there can be like kind of a disconnect between those two things and I feel like that that uh you know it's confusing for people that are just users spectators shareholders and then team as well um so how do you find that kind of alignment in in um vision What a great question. I so I think for us like one of the things we always you know remind our team is that as we look at leadership at Snap you know a lot of people think about leadership in this like traditional hierarchy right where you have like leaders and then the team and so we have at snap inverted that right so if you're a leader at Snap you're at the bottom of the pyramid in an upside down pyramid right and then you have the team that you're responsible for and then you have our community more broadly right and that includes our partners and so that's also how we think a lot about communication so when we're communicating to the world when we're communicating to investors we always try to remind our team that like our investors are a subset of our community right and so it's really really important that we speak in you know language that people actually understand right and instead of talking about you know we can talk all day in fancy AI terms right but that doesn't really matter when it comes to communicating to your customer and the customer experience that they're having and in fact sometimes it can be more uh confusing so I think as long as we put everything through that lens of comm you know putting our community first and foremost and then communicating you know making sure that we're always talking to our community first, even if it's some investor update or, you know, uh something like that.

Yeah.

Yeah. Um Yeah, it's interesting. Um do you have any book recommendations? Did you read any good books this year?

Oh my gosh. Uh

Christmas gifts for people.

What's there like

I know it's a really wild question throw at you.

Well, what's highly relevant I think for for this form. There's like a there's a great book that I read on I'll have to find the name for you, but it's something about like,

you know, it's it's very academic, but it's sort of like the economic impacts of techn technological disruption.

And it really and but textbooks, yeah, like textbook style. Um, but what's great is that it just shows like, you know, from the railroads to semiconductors, etc., like the patterns that emerged through these sorts of large technological changes. And I think it's so important because I think we just need to be reminding folks that like these sorts of changes have happened before. Yeah. It there's actually quite a consistent rhyme and reason to what happens and that means that all of us should be able to kind of think ahead and manage ahead you know through some of the consequences of I think what's going to happen through uh you know what will be quite a disruptive period of time. Do you think do you think it's underrated that AI can potentially really help with moderation on big platforms like scale platforms where uh for the first time you might be able to effectively like review every message that's going everywhere or is that is that a negative thing? Is that a positive thing? We were just talking to uh Dave Bazooki at Roblox and obviously uh the the potential of like screening every message seems like a really great opportunity for him and I'm just wondering if like there's so many like opportunities but also like risks with this stuff like how have you processed this idea of like AI as a moderation tool sort of under the hood? So, so first of all, I I do think AI moderation is already like very widespread. Like I think that's already best practice. I think virtually everyone's already doing that. Um, uh, at least obviously we're we've embraced that, uh, at Snap. I think it's very important and I also think it's a really powerful tool again for customers if they want to fact check something even if their friend told them, right? The ability to fact check using AI uh, today is is pretty compelling compared to what it was in the past. So when people are talking about concerns about misinformation and this sort of thing, I think AI is a pretty powerful like counterbalance to that. What I'm more interested in though is the use of sequence models to find bad actors and to stop them before something bad happens. So that to me is what I think the frontier of like internet safety is, you know, currently it's certainly an area of research for us um and something that we're really excited about because

we have a lot of information about what, you know, bad actors try to do on our platform. We catch a lot of them, right? But with almost a billion people, it's hard to catch all of them, but we're trying. But what's really interesting is, you know, we can train sequence models based on those patterns. What sequence of events are bad actors engaging in? How are they using the platform so that we can predict, you know, when someone is about to do something that is against our our terms? And so to me, I think that's a lot of like the the paradigm that we're going to see in in internet safety over the next couple years. I think right now there's a big focus on, you know, features and trying to tease apart what sort of different features different platforms have. I think there's just going to be a massive shift to being able to identify bad actors even before bad things happen using tools like sequence models.

Yeah. Yeah. Are are you seeing like the level of like bot activity or at least people trying stuff increasing? We've been talking to a lot of like cyber security folks and it feels like they, you know, the all the all the the bad guys on the internet, all the black hat hackers have more tools, but then also the white hat hackers have more tools and so it's sort of like a cold war. But I'm wondering if like uh do you feel like you're spending more time f just just more headaches focused on, you know, defending against like endless bot armies or has that just been like a drone throughout the entire process, the entire career? I I think for us like if if you look at cyber security right some of the like most significant threats are actually you know are human vulnerabilities and I think that's where AI actually is is almost the most

dangerous because today right our team members can get phone calls from Evan Yep

hey I really need your help I got to investigate this thing wire me 200 bucks or buy some gift cards really quickly for this creator event we're doing right That's like and and I think like the ability for for bad actors to use AI to exploit our human vulnerabilities is something that we really worry about and think a lot.

Yeah. I mean there were so many times when like the fishing email was clockable just by bad grammar or you know spelling mistakes and it was like that was enough of a tell and like one pass through any LLM and you get rid of all of those. I I I think another thing that's going to become increasingly important um you know as we look at cyber security is the interconnectedness of all these services right like a lot of companies today especially young companies who aren't investing a ton in cyber security are using a huge number of vendors and what's really interesting is you know today compromising a vendor and then using that vendor to compromise the the you know core business that that's the sort of stuff that's really concerning especially with fishing right so we saw an interesting one recently where one of our vendors was compromised. I received an email that looked like it was from the vendor, right? But it was actually a fishing email. And you know, it's again very hard to tease apart. So I think the interconnectedness in terms of cyber security is something that folks just don't talk about as much as maybe we we need to.

We we joked about uh uh some news organization acquiring paperless post and then just understanding where all the different people going to events powerful people. Um, I do have uh one uh kind of uh more uh broad question uh and then I know you you got to jump, but uh Snapchat I think of as like country scale or it's it's the size of a nation state. You're basically the governor of a basically the governor of a state or or or a country and and California specifically has gone through

a really wild year. You grew up in the in the Palisades. I'm wondering if you were uh if you were uh like what would you do like how do you kind of like how do you feel California is today as a state even Southern California more specifically? Uh I think you know we I live in Malibu and John lives in Pasadena. We weren't affected by the fires but there was this like extreme frustration uh during that moment because it felt like uh in many ways the government had had kind of failed the citizens. So, I'm curious if there's anything that uh like how you're thinking about the future of the state and and how we can make positive change.

Okay. Well, we could spend another another hour on this. I So, I I love California so much. Obviously, I was born born and raised here. I think it's an incredible state and it's so important to the future of US competitiveness, right? So, I think people talk a lot about the competition between US and China. I don't think people talk enough about the competition between China and California, right? which is a really really interesting relationship because both China and California are deeply interconnected at the same time that that we're competing a ton. So I think California is just unbelievably important to the future trajectory of the United States.

I I think if you look at California today, I mean, you know, you you obviously know all the stats, but like highest unemployment rate, highest poverty rate, most homelessness,

housing housing crisis, massive housing,

people moving saying, "I'm moving to Austin for quality of life. I love Texas. Texas is amazing." But it can be like well it can be like I mean it's very cold in the winter. It's very hot in the summer if you're moving somewhere like that for quality of life. It just means that housing is I mean housing affordability is like top of mind for a huge percentage of people. And uh of course here that's uh you know most elevated.

Yeah. I think the affordability crisis here is is incredibly concerning. Uh I think one of the things if we look historically at you know the way that our government has operated we kind of we we tend to fall in this pattern it seems like of you know very heavily regulating our industries which you know by the way to some degree is important one of the reasons why we love California it's beautiful right it's clean all these sorts of things we really love about California but at the same time we also then layer a ton of subsidy on top of that so you dramatically restrict supply with very very heavy regulation and then you know we we've got a a very large economy. We've got the highest one of the highest tax rates here in California. We put a ton of subsidy into that economy after dramatically restricting supply. And as a result in all these areas, you know, especially things uh like housing, I think you have massive increases uh in in pricing. And and I I am optimistic in the sense that I think the legislature this year is really starting to pay attention to it, right? There's some progress on SQL reform, for example. there's more attention being paid to, you know, how expensive it is to building affordable housing here. When the government pays for affordable housing, it's about 30 or 40% more expensive than just market rate affordable housing. And so,

I think, you know, people are starting to pay attention to it. But the another thing that's fascinating is I'm just not sure Californians are aware of how problematic things are right now, especially because our politics are so partisan that I think if you look at the California voter base, they're saying, "Oh, well, at least it it doesn't look like the federal government, so we're doing better here uh than, you know, than they're doing in DC, so I'm okay with that." Right? But so so I think to me part of the you know the journey over the next couple years are is is California is really Californians really waking up to the fact that we can do a lot better here in our state and in fact we we've got to do a lot better you know the US wants to continue to compete.

No and I I went growing up in in uh the Bay Area and living in Southern California my adult life I went through a brief moment during 2020 where I started looking on Zillow outside of the state because it was like they shut down the beach. I was like, "Yeah, I'm living like half a mile from the beach and I can't I can't go there." And uh I made the very uh specific decision.

I was like, "No, I'm not going to I'm not going to leave this. This place is too beautiful. I've had family roots here going back to the early 1900s. We need to stay and people need to focus on making it better. It's the greatest place on earth that I've been to and and it's worth uh it's worth continuing to invest in and and steward." And uh I I felt like the fires were so symbolic too at the Palisades of like the you know everything burning to the ground except Rick Caruso, the guy we couldn't elect as mayor. Uh even though I believe you know again I believe he genuinely loves this city and and wants to see it shine. So

anyways we should

because we could talk about politics for the rest of the show. Uh what is in here? We don't talk about We don't talk about uh

Oh, is this an ornament for the tree?

No way.

This is incredible. Ooh, I think this is going to be a new new tradition. I like this.

Yeah, we we Oh, this is amazing. There we go. Close up. Well, how perfect.

Thank you.

Uh this is remarkable.

Would you mind signing this? We love We love collecting autographs. We love We're building a uh a museum of business. And then uh I think you got a chance to hang out.

We're putting we got to put that up at the very top

for sure. So uh for sure.

So thank you so much. My pleasure. Fantastic. We'll let that look fantastic. Um congratulations. Thanks so much for having one one almost one billion global Snapchatters. Can we have you hit the gong to hit the gong?

You got to hit the gong. If you come to the If you come to the ultra dome, please uh pick up this mallet here.

Hit it as hard as you want.

As hard as you want. I'm

glad you labeled it too. Just in case you fantastic love to have you back on any

I I I really love the ornaments. I didn't even realize that that would be something that could happen given that we have a tree. Like this is going to be