What Happens When a Public Company Goes All In on AI
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The biggest moat is going to be which companies understand something that's super hard for other people to understand. And if your answer to that is, I don't know, then
you maybe could get vibe coded away. Block was one of the first to make a pretty drastic decision in cutting 40% of the workforce. What led up to that decision?
There's been this correlation between the number of folks at a company and the output from the company for decades and decades. I think that basically broke. And what we were seeing is that one or two engineers who was on the tools is able to be ten, twenty, 100x more productive. Over time, it's pretty obvious that these systems are just going to be so much better than having a thousand humans who are doing that work. I do believe that fundamentally for a given product or for a given roadmap, you're gonna need fewer engineers, fewer designers, fewer PMs. I think it's like very, very clear.
So you show up on Monday, 40% of the company's gone. What's the most meaningful difference in how you're operating?
I think the biggest thing is
For most of the history of software, building faster meant hiring more people. The relationship was so consistent, it became a law of the industry. Headcount equals output. Block, the parent company of Square, Cash App, and Afterpay, decided to test what happens when that equation breaks. In early twenty twenty six, they restructured more than 40% of the company and rebuilt around small squads of one to six people working alongside AI agents. Teams that once had 14 engineers now run with three. Their internal tool, BuilderBot, autonomously ships features to production. Designers and PMs write
What does it actually look like for a large public company to restructure itself around AI? Owen Jennings is the business lead at Block where he oversees product, operations, and customer support across Square, Cash App, and Afterpay. Before this role, was the CEO of Cash App during its critical scaling period. And recently, Block executed a roughly 40% reduction in force. And they've been pretty candid about AI being a critical component of that decision. Owen has gone through the AI transformation at scale across product lines and business units, and so we're going to dig into that decision
Puff.
Jonathan, I think, did an amazing job kind of setting the stage for this conversation, talking about how important it is to be founder led. Block was one of the first to make a pretty drastic decision in cutting 40% of the workforce. Maybe walk us through what led up to that decision and how you thought about it.
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