Inside Spotify: Building Recommendation Systems

Erik Bernhardsson is the Co-founder and CEO of Modal, building high-performance AI infrastructure.

We talk about building what is essentially a new cloud provider, created from the ground up, optimized for AI. We also talk about what actually happened with the great GPU shortage, how Modal fixes the inference problem in AI, and why he thinks AI will lead to 10x more developers.

He also shares lessons on culture from joining Spotify as the 40th employee, treating hiring like a prediction problem, what most people get wrong working with early customers, why more people should start companies in their 30’s and 40’s, and reflections on fundraising in a hot market.

Thank you to Tim Chen at Essence Venture Capital and Erik’s Co-founder Akshat for their help brainstorming topics for this conversation.

Thank you to Meow and Hanover Park for supporting this episode.

Meow: Get free bookkeeping for your startup at https://www.meow.com

Hanover Park: Modern, AI-native fund admin at https://www.hanoverpark.com/Turner

Timestamps:

(4:26) Modal: AI-native infrastructure

(9:02) Why its so hard to get GPU’s

(15:00) Hitting PMF with AI generated media

(20:37) Competing in IOI competitions

(23:09) 40th employee at Spotify

(27:17) Lessons from Spotify

(31:17) Starting Better[dot]com

(34:05) Treating hiring like a prediction problem

(36:12) Erik’s favorite interview question

(39:07) Sales + common design partner mistakes

(42:02) Startups should solve hard problems

(44:05) Evolution of Modal’s product over time

(50:15) Rise in importance of inference in AI

(52:07) AI development post-GPU scarcity

(58:51) Building a brand in dev tools

(1:04:31) Fundraising from Seed to Series B

(1:07:42) More 30+ year old’s should start companies

(1:10:00) Reducing developer tax, increasing productivity

(1:20:37) Why Erik’s bullish and bearish on AI

(1:26:17) Bubbles, downsides to inappropriate valuations

(1:34:58) High CO2 levels make you dumb

(1:37:38) Difference between US and European startups

Referenced

Modal: https://modal.com

Careers at Modal: https://jobs.ashbyhq.com/modal

Suno: https://suno.com

Planet Scale: https://planetscale.com

How to hire smarter than the market: https://erikbern.com/2020/01/13/how-to-hire-smarter-than-the-market-a-toy-model

Interviewing is a noisy prediction problem: https://erikbern.com/2018/05/02/interviewing-is-a-noisy-prediction-problem

Cloud in 2030: https://erikbern.com/2021/11/30/storm-in-the-stratosphere-how-the-cloud-will-be-reshuffled

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