November 25, 2024 • 38 mins
Instacart CEO Fidji Simo is used to beating expectations. Raised in a small fishing village in the South of France, Simo grew up watching her family take big swings at sea to feed her local town. Inspired with entrepreneurial dreams of her own, Simo was the first of her family to hustle her way out of Sète and into an elite business school in Paris. She rose through the ranks at eBay, Facebook, and then nabbed the ultimate job as the CEO of Instacart, all before the age of 40. She’s currently laser focused on transforming Instacart from a grocery delivery company into a grocery technology company, while battling challenges with the gig economy, rising food prices, and competition from Walmart and Amazon. In an international journey from France to San Francisco, Emily Chang speaks with Simo about her roots, her path, and how she’s delivering Instacart’s next chapter.
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Speaker 1 (00:01):
I'm Emily Chang, and this is the Circuit bien Venu,
to the south of France, with its seaside beauty, cobblestone streets,
and world famous cuisine. You're traveling with us along the
coast to visit set, a small fishing village where Fiji Simo,
the CEO of Instacart, grew up. So your family has
been involved here for generations.
Speaker 2 (00:23):
My grandfather has really instilled in all of us so
respect for Lexi's idea of feeding the world, and in
our family, li food is everything. It's love, it's how
we celebrate, it's the center of everything we do.
Speaker 1 (00:37):
Raised by fishingboat captains who instilled a sense of grip
at a young age, Simo catapulted herself out of this
charming Mediterranean harbor and into the sea suite of Silicon Valley.
Speaker 3 (00:48):
She rose through the.
Speaker 1 (00:49):
Ranks at Facebook as one of Mark Zuckerberg's top lieutenants.
Ten years later, she was tapped to become the CEO
of grocery delivery company Instacart, a seemingly perfect union of
her tech child with her foody upbringing. She's also on
the board of Shopify, and more recently joined the new
board of Open Ai. Sam Altman got ousted in this
(01:09):
bizarre cod now he's back. What aren't you advising them on?
What are you advising sam On?
Speaker 2 (01:14):
I spent ten years at the company that was under
very intense scrutiny, where we did a lot of things
right then we also made some mistakes, and so a
big part of what I am advising them on is
how to handle getting to the level of organizational maturity
that they need for the impact that they're having on
the world.
Speaker 1 (01:33):
After visiting Simoon in France, I caught up with her
back in San Francisco to talk about her unlikely path
to Silicon Valley CEO, the bet she's making to deliver
Instacart's next chapter, food Health, and the future of chat
GPT in our kitchens joining me on this edition of
the Circuit. Instacart CEO and chair Figcimo.
Speaker 4 (01:53):
Thank you so much for doing this. It's great to
see you here.
Speaker 3 (01:57):
Thank you for coming, and you're going home.
Speaker 1 (01:58):
After you know, spending time with you and France, so
thank you for having us here today.
Speaker 3 (02:02):
Thank you so much for being here. Guys.
Speaker 1 (02:04):
I want to start with your initial impressions of Silicon
Valley and the gig economy before you started working here. Obviously,
your companies like Uber and Instacart and Airbnb and door
dash were these sort of larger than life companies promising
so much potential for the gig economy. What was your
impression of gig work and what these companies were capable
(02:26):
of before you started working here.
Speaker 2 (02:28):
The thing that was really striking is I had a
lot of friends that had joined these companies, and we're
telling me that the reason they had joined is very
often because in the past they had struggling parents for
whom these gig jobs would have been totally life saving.
And as I dug it more because I joined the
board of insta cut before becoming CEO, as I dug
(02:50):
it more into that, it's definitely true that this is
an economy that has led a lot of people to
makeans meet, to find flexible work. And I talked to
shoppers in my current job about once a month. I
do like a educated call with them, and I hear
incredible stories of people who are prime time caregivers but
need to add a little bit of income, people who
(03:11):
wanted to travel across the US and they have a
job in every city with Instakolt, and so I think
this is an incredible new way of working that these
companies have enabled, and we need to really protect that.
Speaker 1 (03:22):
You joined the board of instacart and then six months
later became CEO.
Speaker 4 (03:26):
Why did it all move so quickly.
Speaker 2 (03:28):
I think it was a confluence of events. Just to
be clear, when I joined the board, I had absolutely
no expectations of becoming CEO. I didn't want to leave
Facebook at the time, but I really fell in love
with the company. And at the same time, you know,
my predecessor, Approva, was really looking to transition and figure
(03:49):
out if he could put his company in the hands
of someone who could get it to scale, who could
get it to be public and really take it to
the next level. And so that ended up being incredibly
good timing for both of us.
Speaker 3 (04:00):
But certainly a surprise.
Speaker 1 (04:01):
Grocery is the biggest commerce sector in the US.
Speaker 4 (04:05):
But what did you see in terms of potential beyond groceries.
Speaker 2 (04:09):
People really think of instacrat as is like online grocery
delivery up and that's certainly a very big part of
what we do.
Speaker 3 (04:16):
We're on essential service for families.
Speaker 2 (04:18):
But what I saw when I joined the board was
the potential to really be a grocery technology company. The
things that are so special about what we do is
we integrate really deeply with fifteen hundred grocers. We provide
technology for them both in our marketplace but also powering
their own e commerce properties. So I saw the potential
to be the technology ally for the entire industry, including
(04:41):
not just online but also inside the store, and to me,
that's a massive opportunity.
Speaker 1 (04:46):
You worked at Facebook for a decade, you reported directly
to Mark Zuckerberg. What were some of the lessons from
the School of Zuch that shaped your thinking?
Speaker 2 (04:54):
Since the school is Zach was one of the best schools,
I would say the thing that Zach did incredibly well
and I'm really trying to replicate here is always be
focused on a very very long term vision, but also
have perfect execution in the short term, because you never
get to your long term vision if you don't have
perfect execution right now and the ability to combine both,
(05:17):
like I've yourized in the future, but sweat the details
right now is really important and a lot of leaders
don't manage to have both.
Speaker 3 (05:25):
That really showed us how to have both.
Speaker 1 (05:27):
Mark Zuckerberg has gotten so much criticism for so long
faced controversy after controversy.
Speaker 4 (05:32):
What did you learn from that?
Speaker 2 (05:34):
Well, I learned that, you know, when you have such
large impact on the world, it comes with a lot
of responsibility, and you need to get really ahead of
that and understand what your responsibility is and be proactive
about explaining to the world what you're doing, why you're
doing it, and really invest in making sure people understand
(05:55):
what you're doing. And that's something that Facebook ended up doing,
but it kind of and I wish we had done
it sooner.
Speaker 1 (06:02):
You became CEO at the top of the tech bubble,
we were in the middle of a pandemic. Instacart was
worth thirty eight billion dollars. How did you have to
reframe your expectations and your employees expectations of what this
company could be.
Speaker 2 (06:16):
It's interesting because on the one hand we had this
like giant valuation, but on the other hand, when I joined,
we were declining, like gross transaction volume declining double digits
because it was post pandemic. We had grown, you know,
four x, and people were wondering if we were going
to sustain that or if we were going to decline
back to prior levels. And we were kind of the
(06:36):
poster child for an unprofitable company. So really, the way
I reset with the companies to say, let's kind of
forget about, you know what the external world is valuing
us at and thinking, and let's talk about building a
generational company. And that means a company that can grow
sustainably and that is profitable.
Speaker 3 (06:55):
And that's exactly what we did.
Speaker 4 (06:56):
Then the bubble pops. Did you see that coming? Like,
were you kind of preparing for that possibility?
Speaker 2 (07:03):
I wish I could tell you yes, but no, I
think the thing that I was prepared for was that
we needed to build a sustainable company. And so my
philosophy is that you need to have a great company
under any macro ecrodomic environment. And that's exactly what we did.
We set the foundation to thrive under any macroeconomic condition.
(07:25):
But it was certainly a surprise because you know, a
lot of our employees were really expecting to go public
very soon, and we had to reset those expectations, both
because of the market, but also because at the time
I didn't judge as the company was ready to go public,
and we went public at a time where the company
was in a much much better shape to actually take
it public.
Speaker 1 (07:45):
You're technically not a founder of instacart. How is that
an advantage and how is that a disadvantage? Can you
still run the company in founder mode?
Speaker 2 (07:54):
Well, I'm very convinced that we need to have see
non founders acting in founder mode. Everybody is having a
different definition for founder mode, but the way I kind
of define it is like having a very long term vision,
not being swayed by the short term movements, being really
intense and being really in the details of knowing your
(08:16):
business and being really willing to make the very hard
calls to make sure that your company thrives, and that
I believe is something that you know every CEO should
and so for me, I think the advantage is that
I come with a lot of experience having seen scale
at a larger company. The disadvantage is that you don't
have all of the credibility that a founder has from
(08:38):
having created the company. You need to rebuild that and
that takes a little bit of time. I didn't get
that from day one, but I'm getting it by showing
that all of the new bets that have put in
place are now working, and that's you know very much.
Speaker 1 (08:51):
How I judge myself, what's your relationship with a poor
of today?
Speaker 4 (08:55):
How involved is he?
Speaker 1 (08:57):
Like, do you ever have disagreements and how do you
work through those?
Speaker 2 (08:59):
Yes, So it was on the board for quite a
period of time and then stepped down from the board.
So now it's a little bit different because I can't
really share with them private information but the company, so
we do talk at a very high level, and you know,
given our well in knowess the company is always good advice,
but it's less involved by definition.
Speaker 1 (09:17):
You did take instacart public, you push through. How big
of a milestone was that for you? I mean this
is when companies weren't going public yet.
Speaker 2 (09:27):
Yeah, being one of the first one, not the first
one was a little you know, stress in using But
I would say the IPO was just a moment in time.
Employees that worked really hard for that milestone. So I
wanted to celebrate that, but also not to lose sight
of the fact that the real goal is realizing this
(09:47):
long term vision, becoming a generational company. The IPO is
a means to an end, it's not the end in itself.
Speaker 1 (09:53):
It's been a year since the IPO. Instacart's now valued
at nine ish billion dollars. Wall Street's still skeptical. They's
skeptic of the growth potential. It doesn't compare to some
of the bigger gig economy players.
Speaker 4 (10:03):
What's your response to that.
Speaker 2 (10:05):
Yeah, I think we are still misunderstood, and for the
first year as a public company, that's not uncommon. But
I see my job as making sure that the market
understands how incredibly hard and complex grocery is. And I
think a big part of why there is a bit
of overhang on the stock is because people believe that
this is such a big market. We have a very
(10:27):
clear category leadership position, but that's going to be a
lot of competition coming up. And the thing that I
think the market underestimates is how hard it is to
sell customers and deliver groceries with accuracy, with speed, with selection,
with affordability.
Speaker 3 (10:41):
We've been at it for twelve years.
Speaker 2 (10:43):
And so even if we have new entrants coming into
the market, they are not able to do that at
the scale and at the level of quality that we're doing.
And I think the market is going to end up
realizing that while there will be intensified competition, we have
a very deep competitive advantage.
Speaker 1 (10:59):
Is it frustrating when the market is not where you
think it should be.
Speaker 3 (11:02):
You know, I tend to not focus on that.
Speaker 2 (11:04):
My philosophy is that when you focus on the obstacles,
they grow bigger. I tried to focus on the destination instead.
And so the thing that I really want is to
first build this incredible company, and then I think the
market takes care of itself once it becomes obvious. And
I think we're still at a time where, you know,
the new bets that I've put in place are just
(11:25):
starting to work. We talked about Keeper, we talked about restaurants.
They are just starting to take off, and the market
will end up realizing the strength of what we're building
over time.
Speaker 4 (11:35):
What were you right about and what were you wrong about?
Speaker 3 (11:39):
Great question.
Speaker 2 (11:41):
I think I assumed when I joined and it would
be much easier to move the market online because grocery
is a trillion dollar category but only thirteen percent penetrated online,
and that's lower than any other category of commerce. And
I think I was a bit naive in thinking like, oh,
of course, it's such a good service. We can accelerate
(12:03):
on an adoption much faster. And that has been harder
than I thought. But At the same time, the flip
side to that is that because it is so hard,
it's also a huge competitive advantage when you're a category leader,
because competitors have had a much harder time than I
thought entering this market, and so it's a double edged
sword how complex and hard grocery is.
Speaker 1 (12:25):
You have millions of data points on how people shop,
what sort of general trends are you seeing, what's working,
what's not working, what do people want?
Speaker 2 (12:34):
I think people value convenience enormously, so number one reason
why people come to instacart is convenience, and our entire
goal is to help families get life done, and they
are coming to instacott to save time. We are continuously
adding new services like restaurants so that they can save
more time, and that is something that's working really well.
(12:55):
We have twenty five million people who have used this
in the last year. I think that to get to
the next twenty five million people, we also need to
have a service for people who value price over convenience,
and that's why you're seeing as being very focused on
affordability and access, so that we're not just serving the
convenience buyer, but also serving the more price and site biers.
Speaker 1 (13:17):
You're hoping to be the premier technology provider for all
groceries and grocery store so that I might be able
to order directly from safewire, Albertson's or wherever.
Speaker 4 (13:28):
How do you make this bigger?
Speaker 2 (13:29):
First off, this is already very big. It's worth remembering
that the entire grocery industry is a trillion dollar market,
and our technologies don't just apply online, they apply inside
the store. So thirteen percent of the market is online,
eighty seven percent is in the store, and with skateboard cards,
we have the technologies to tackle that eighty seven percent.
Speaker 3 (13:49):
And then beyond that. I actually believe.
Speaker 2 (13:51):
That all the technologies that we've built for retailers are
technologies that can expand to the entire food supply chain.
They can expend to distributors, they can expend tos to farmers,
and you could imagine that if the entire food system
was technology enabled, was running with artificial intelligence, we would
have a food system that would be much less wasteful,
(14:12):
much more optimized, and everybody would benefit.
Speaker 4 (14:15):
You mentioned Caper.
Speaker 1 (14:16):
You bought Caper, maker of these AI powered smart carts,
saw this really cute video of you shopping with a
smart cart with your daughter.
Speaker 4 (14:24):
How many people are actually using this?
Speaker 2 (14:26):
So right now we have hundreds of colts deployed and
in the next several months we're going two thousands of courts,
but were really already in deployment with a lot of
retailers as at Koger wakefern Schnarks, like lots of different
ones even Aldi internationally, And really the feedback we're hearing
is that consumers absolutely love the experience, not just because
(14:48):
they can skip checkout, which is great, but because there's
a screen on keeper cards that follows you around the
worst restore and can recommend things based on what's in
your basket based on the location you're at in the store,
and that makes for a much more fun experience, So
consumers love it. That results in higher basket size for retailers,
and therefore retailers are now starting to see the real
(15:10):
business case behind it. And as you can imagine, there's
a great advertising model that you can build on top
of that, and we would you know, share revenue with
retailers as part of that as well.
Speaker 1 (15:20):
Also only really nice to know how much you're spending
before you actually go to check out.
Speaker 4 (15:24):
There are so many times I'm like, ouch.
Speaker 1 (15:26):
Maybe I would have put a few things back.
Speaker 3 (15:28):
And you know, that's a great point.
Speaker 2 (15:29):
And initially I was worried that if we showed the totals,
that would just reduce your spend, and that's not the
case because there's a lot of people who are on
a budget and when they see their total, they're actually
maximizing getting to their budget. Whereas if they have to
go through a normal checkout, they never want to be
embarrassed to have to put items back and so they
end up buying a lot less to avoid the embarrassment
(15:51):
of putting items back at checkout. And so it has
actually provided a real deep service for people both on
the affluent side as well as people on a budget.
Speaker 1 (16:00):
There are now giants in this business, Amazon, Walmart. How
can instacart compete? Where will you win and where will
they So?
Speaker 2 (16:09):
First off, both Amazon and Walmart partners on our marketplace,
so we also sell them and we also help them
gain access to incremental customers. But I would say, you know,
the weak customers shop is very different when you look
at instagrat on average, instagoult customer shops at five retailers
and instacolt plus members shop at twice the number of
(16:32):
retailers as non instacout members, and that means selection is critical.
So the Amazon and Walmarts of the world might get
a fair share of people who love these particular banners,
but we cover fifteen hundred banners. And so if you
want to shop at multiple retailers, if your favorite retailer
op choice is a public so Kroger and al tho cents,
(16:52):
we really are the best place for that.
Speaker 4 (16:54):
You have a partnership with Uber, how's that going.
Speaker 2 (16:57):
It's been a fantastic partnership with them. We have been
able to really enter restaurant delivery overnight and help families
not just get groceries for the week, but also dinner
for tonight.
Speaker 4 (17:08):
How much revenue is it driving, how much business is
it driving?
Speaker 2 (17:11):
Well, well, not sharing that quite yet, but I would
say it has exceeded our expectations. And when you look
at the numbers, we are driving penetration of restaurants among
our grocery user base faster than the restaurant delivery platforms
are driving penetration of grocery amongst.
Speaker 3 (17:27):
Our user based.
Speaker 2 (17:28):
So we're really pleased with the results we're attracting new
customers to instagrat order frequencies up and our membership became
twice as valuable over night.
Speaker 3 (17:37):
So very excited about it.
Speaker 1 (17:38):
Could there be consolidation in the future, Could Uber buy Instacart.
Speaker 3 (17:43):
Well, you know, we don't.
Speaker 2 (17:44):
We don't comment on any of any rumor or speculation
in general. But what I'll tell you is we're very
excited about our independent paths. We have a really great
strategy and a lot of long term initiatives that are working,
and so we're very community to that path.
Speaker 4 (17:59):
Now.
Speaker 1 (17:59):
Bigger picture, groceries are so expensive.
Speaker 4 (18:04):
Everyone is feeling it. What's happening here? Why is everyone
hurting so much?
Speaker 2 (18:09):
I think there's been, as you know, just an increase
in prices over throughout the supply chain that ends up
hurting the end customer. The role that we play is
really trying to get savings for customers wherever they exist.
So we integrate with retailer's loyalty system. We help them
optimize their prices with our algorithms called eversight. We digitize
(18:33):
the circulars, you know, the weekly circulars with coupons. We
put that online so that people could get deals. So
we're doing a lot of these things, and in total,
we are actually saving people four dollars and seventy five
cents per order through all of these initiatives, because every
dollar counts when go through is are that expensive and
so we're very proud of that. And again that's something
(18:56):
that competition hasn't really done because it takes deep into
with grocers to be able to pass on all of
these like self pricing.
Speaker 1 (19:04):
That's that, and you can correct me if I'm wrong here,
but using instacar, my understanding is it makes everything more expensive.
It still seems like a luxury and not a necessity.
Why do you think people will continue to pay a
premium when they're already paying a lot?
Speaker 2 (19:22):
Well, first off, like when you look at the delivery
issues that you get to pay off your seep to
have the service. A lot of people tell us that
when you start factoring in the cost of gas to
go to the grocery store, the loss of time for
people who may be packing two jobs in one day,
and all of these factors, it's actually a.
Speaker 3 (19:42):
Really really good deal.
Speaker 2 (19:43):
And you know, we are at the point where forty
five percent of fur orders are picked by shoppers that
already at the store. Within the middle of the store,
so that means you have someone picking your orders by
the time it would take you to get to the
front door. That's extreme convenience, and so what we're seeing
is people are willing to pay for this time saving
because time is money, and that's the critical thing. One
(20:06):
thing that I'm really proud of is that when you
look at the split of demographics of instacart, they actually
closely mirror US population in terms of income.
Speaker 3 (20:14):
And that wasn't the case four years ago.
Speaker 2 (20:16):
Four years ago, You're absolutely right, it used to be
a luxury, but with all of the things that we've
put in place, we actually mirror US population much more
closely now, and we hear from people that are more
in the lower income buckets how critical instacut is because
these people might need money, but they are also time starved,
and if we can help them save time, that saves
(20:38):
them money.
Speaker 4 (20:39):
High level.
Speaker 1 (20:40):
Do you see consolidation coming in the grocery business and
what would that do to prices?
Speaker 2 (20:45):
I think the US grocery landscape is interesting because customers really.
Speaker 3 (20:50):
Love their local grocer.
Speaker 2 (20:52):
So you are seeing some consolidation happen with the big guys,
but there are still a lot of space for regional
players could favorites, and that's why you know, selection matters
so much.
Speaker 3 (21:04):
The rother markets.
Speaker 2 (21:05):
You know, Europe is a good example where there's like
two to three big players and that's it. In the US,
if you don't have the full selection of fifteen hundred grosses,
you can't really self customer needs.
Speaker 1 (21:17):
More broadly, gigwork for so many people has provide an
extra income flexibility.
Speaker 4 (21:24):
But there are still a.
Speaker 1 (21:25):
Lot of complaints and I'm just going to read some
to you.
Speaker 4 (21:29):
You know, this is a really hard job. There's people
that are complaining.
Speaker 1 (21:32):
Sometimes the item requested isn't there, they don't get enough orders,
people don't tip, they're going to strangers homes. They're complaining
about customer service, and then in the end they say
they don't make that much money. How do you respond
to all that? How do you address all of that?
Speaker 2 (21:45):
So that will always be complaints, but we really look
at the numbers to figure out if you're doing a
good job, and then we can always improved. You know,
being a shopper is a tough job. You are in
the store trying to figure out how to find twenty
plus items going on a customer chat and helping the
customers figure out if something is missing.
Speaker 3 (22:04):
On the shelves.
Speaker 2 (22:05):
So are truths and our technology are things that we
always invest in so that the jobs becomes as easy
as possible. And what we hear from more shoppers is
that the ones who decide to be shoppers on instacot
are very different than the ones who peak restaurant delivery.
Speaker 3 (22:20):
Or right sharing.
Speaker 2 (22:21):
There are people who are more customer service oriented, who
want to spend more time in the store interacting with customers.
Speaker 3 (22:27):
So there is also a lot of self selection happening.
Speaker 1 (22:30):
I know you've been a shopper yourself, and you go
back every so often to see what the experience is like.
Speaker 4 (22:35):
You're also a mom. More shopping falls to moms.
Speaker 1 (22:37):
What are the things that aren't perfect yet or that
you want to get better personally?
Speaker 4 (22:41):
Like, what are the things where you're like, oh.
Speaker 2 (22:43):
I think we have made a ton of progress on
like making the up just much more easy to use.
I think the number one thing they want is access
more earning opportunities.
Speaker 3 (22:53):
They want more.
Speaker 2 (22:54):
Orders, they want more taks to complete, and so there
are some things that we're looking at, like if they
are already at the store, other things that they can
do while they wait for an order inside the store,
and so things like that that really help them earn
while they're waiting for an order.
Speaker 3 (23:11):
That's the biggest thing that we keep hearing about.
Speaker 4 (23:14):
From the financial perspective.
Speaker 1 (23:15):
You know, back in the day, there was this vision
that you could make a living doing gig work, and
that sounded amazing, but now it seems like it's really
more just side hustle money or supplemental income at best.
Speaker 4 (23:25):
What do you think.
Speaker 2 (23:26):
I think we have a very small number of shoppers
who really want to do that full time, but nine
out of ten or work shoppers actually have other sources
of income. And the majority of work shoppers shop less
than ten hours a week with Instagram. So the average
use case really is supplemental income.
Speaker 3 (23:46):
And that's why the flexibility is so critical.
Speaker 2 (23:49):
These people are not looking for a nine to five jobs.
They are looking for something that fits within their complex
lives and that they can do on the go in
a very modular way.
Speaker 1 (24:01):
These workers don't have the same protections that you or
I do.
Speaker 4 (24:04):
Should they.
Speaker 2 (24:05):
I think there's a lot of protections they should have,
and in fact, when you look at the systems that
are put in place in a lot of regions, including
Prop twenty two in California. It's a way to balance
the need for flexibility, which is absolutely critical, with also
giving these workhouse of protection that they so deserve. And
so when you look at kind of policy agenda, it's
(24:26):
really about maintaining that flexibility, protecting the independent contractor status
that's so important to what they want, but giving them
the protection they so deserve.
Speaker 1 (24:36):
Instac Cart spend spending time at the White House time
in DC.
Speaker 4 (24:40):
What are you advocating for.
Speaker 2 (24:42):
The main thing that we are very focused on is
food access, and we have done a lot of work
with that, in particular by bringing the SNAP programs through
the Systems Program online and we are the first platform
that has allowed SNAP in all fifty states. This other
has required a lot of collaboration with the White House
(25:02):
on really modernizing this program to bring it online, doing
that with other programs in the future, and making sure
that we can maximize food access.
Speaker 4 (25:12):
How do you think about the global food system?
Speaker 1 (25:14):
So many people in the world don't have access to
enough They don't have enough food, they don't have access
to quality food, let alone have access to instacart. How
does that shape your thinking and your strategy.
Speaker 2 (25:25):
It's a very big part for strategy because we think
fundamentally the food system is completely suboptimized, it creates a
lot of waste.
Speaker 3 (25:34):
Therefore, it also creates the opposite.
Speaker 2 (25:36):
Sometimes to avoid waste, you end up not having products
on the shelf, and everyone loses when that's the case.
And when you think of all the technologies that can
be built and optimized through machine learning, through artificial intelligence,
we could have a food system that is fundamentally less
wasteful if all of the actors of the supply chain
were all connected, all optimized, and if some one was
(26:00):
collecting consumer data that feeds the entire system so that
the right things could be produced at the right volume.
Speaker 3 (26:07):
And we think we can be that player.
Speaker 2 (26:09):
We think that we have built the technologies for retailers,
for brands, and now we can extend them to the
rest of the food system. That's a big opportunity for
the company, but also a big problem to solve.
Speaker 1 (26:19):
You're offering instagrat benefits for people on food stamps through
the US Department of Health and Human Services. You're expanding
these food as medicine initiatives.
Speaker 4 (26:28):
How does this play out how does this work.
Speaker 3 (26:32):
Food as medicine is a great example.
Speaker 2 (26:34):
We as a country are spending about a trillion dollars
on healthcare costs for diect really disease. A trillion is
the same amount as the entire country spends on food.
That's pretty crazy when you think about it. That means
that there's a lot of money that's very poorly spent
and would be better spent helping people buy nutritious food.
(26:55):
And that is fundamentally an economic problem, but also a
technology problem because to scale those food as many in
program and distribute nutritious food to people all across the US,
you need a technology platform that can do that. And
we reach all of the US with fresh food in
under two hours.
Speaker 3 (27:11):
So that's why we took on the very.
Speaker 2 (27:14):
Big initiative of partnering with government, parnering with nonprofits, parnering
with our systems to really be the rails by which
this can happen. It's pretty crazy that today it is
easier for a doctor to prescribe medication than it is
to prescribe food, when we know food is such a
big driver of the condition. So again, we can solve
(27:34):
that to technology by making it as easy to do
one versus the other, and instagrat can fulfill that.
Speaker 1 (27:41):
Speaking of food as medicine, you co founded a health
clinic and research institute.
Speaker 4 (27:46):
This is personal for you.
Speaker 1 (27:47):
I mean you've been very public about your own struggles
with health.
Speaker 3 (27:50):
Yeah. Absolutely, I think you know.
Speaker 2 (27:52):
The plague of chronic illness in the US and worldwide
is a very very important problem, and while not in
particular in the US tackling it the right way, there's
not enough focus on preventative care. There's not enough focus
on the things that work, like diet, and while not
making it easy for people to actually adopt a better diets,
(28:13):
that end up changing their habits.
Speaker 3 (28:15):
So that's really what we're trying to solve.
Speaker 1 (28:18):
You also do many other things outside of your own instacart.
Speaker 4 (28:21):
You're on a new board of open Ai. Who approached too.
How did that happen?
Speaker 2 (28:26):
I was serving on the board of Shopify with Brett Taylor,
with the chairman of open Ai, so he's so many
action there and approached me to join the board of
open Ai. And it's been just a real privilege and
huge responsibility to be part of that journey.
Speaker 1 (28:41):
You joined during a very critical time. Sam Martman got
ousted in this bizarre coon Now he's back. What are
you advising them on? What are you advising Salmon?
Speaker 3 (28:52):
Well?
Speaker 2 (28:53):
I spent ten years at the company that was under
very intense scrutiny, where we did a lot of things right,
and we also made some mistakes. And so a big
part of, you know, what I am advising the man
is how to handle getting to the level of organizational
maturity that they need for the impact that they're having
on the world. But I have been really positively surprised
(29:15):
by how seriously they takes a responsibility, how they put
safety above everything else, And so as a board, it's
really odd job to really help them build all of
the infrastructure that they need for the massive impact.
Speaker 3 (29:29):
They are having but also well have in the future.
Speaker 4 (29:32):
How about them personally? Like, what's your impression of him
as a leader?
Speaker 2 (29:35):
Is an incredible visionary and I think we're talking about
founder mode earlier. Like the reason I was excited to join,
even though you know it's a board that requires quite
a bit of work, is because I love seeing founders
in action, and I love seeing someone who has an
incredibly long television who is really motivated by doing good
for the world and really helping him because there's going
(29:57):
to be a lot of bumps along that journey. This
is the first company is that's doing something really unprecedented
with a lot of challenges ahead, and so I don't.
Speaker 3 (30:06):
Think it's going to be an easy journey.
Speaker 2 (30:08):
But I think having someone that's a helm has so
much dedication to the mission is really critical.
Speaker 1 (30:14):
I think people look at him and see kind of
an enigma, and even he said you shouldn't trust me,
you know, how do we make sense of that?
Speaker 3 (30:22):
Well?
Speaker 2 (30:23):
First off, I think that kind of sounds familiar, right,
Like all of these very powerful people, we always feel
like they're enigmas. We always feel like they are quite
a bit of power, and therefore we want to understand
more about them. The same thing kind of happens tomorrow,
and I think with Sam, I think it's not just
about trusting one man. I think it's about trusting an
(30:44):
entire system, whether that's the board, whether that's how the
entire company works, whether that's the transparency of their processes
that they are releasing publicly. So I think while understanding
sam psychology mode is always great, I think the much
more important thing is really looking at what the entire
organization is producing what they're releasing publicly so that we
(31:05):
can understand their processes and the impacts are going to have.
Speaker 4 (31:08):
You know, that's from your earliers of Facebook.
Speaker 1 (31:10):
When there's this explosion in technology or an explosion of
a platform, there's so many different companies now trying to
do this. There's talent moving all over the place. Like,
what should we make of all these people living open
ai are getting reported.
Speaker 4 (31:21):
On leaving open ai? Why shouldn't we be worried?
Speaker 2 (31:24):
I think, you know, every time that all this like
new big technology changes, you see talent moving around. And
the thing that I think we need to look at
is like, look at the talents that's currently at open Air,
and it's just absolutely incredible talents, like just the smartest
people I've worked with, and they are really committed to
(31:44):
the mission and really committed to achieving the mission in
a really, really safe way. And so we need to judge,
I think, based on the outcome. And that's why transparency
is critical, because if we release all of the results
of analysis and are very transparent on what we're seeing
in this model, the public is going to be able
to judge, you know, whether trust us or not.
Speaker 4 (32:05):
Do you think AI will be good or bad for
the world.
Speaker 2 (32:08):
I think it's up to us to make it good.
I think it will be absolutely fantastic for the world,
but I also think that there will be a lot
of risks that we need to actively mitigate. I do
not believe that this is something that happens to us.
I believe that this is something we get to drive,
and I believe in our ability to maximize the good
and minimize the bad.
Speaker 1 (32:29):
People have been using chat schipit to generate recipes. What's
the potential for AI in the full world.
Speaker 2 (32:35):
There's so much potential, And as I've talked to you about,
I think in SET, I see technology not for technology's sake.
I love technology for like the concrete thing that it enables,
and I think with AI, it's the same in the
food world. To me, it has to solve the problem
of families wondering what to put on the table and
really figuring out what's for dinner. And I think with AI,
(32:58):
we have the opportunity to personalize the experience to such
an extent that someone could be able to come to
instacot and just say, hey, I have a family of
three kids, one of them is lectos intolerant mama's diabetes
or on this budget and really get back a set
of ingredients, a set of recipes that are perfect for
that family and that show up at their doors. So
(33:19):
I see AI as a way to really remove friction
and help people get there on its field in natural
language kind of the way they deal with that in
their head. But now we have computer interfaces that are
able to interpret that and act on their behalf.
Speaker 1 (33:35):
There are so few female taxeos, even fewer French female
text see are going very niche, but really it seems
that the community is getting even smaller. Does it ever
feel to you like we're going backwards?
Speaker 3 (33:53):
It's such a tough topic.
Speaker 2 (33:55):
I think I don't feel it that way because again,
as I told you earlier, I don't tend to focus
on the obstacles.
Speaker 3 (34:03):
I tend to focus on the destination.
Speaker 2 (34:05):
And I think what we're seeing is many more female leaders,
and to their credit, some male leaders as well, really
lifting women up.
Speaker 3 (34:13):
You know.
Speaker 2 (34:14):
Like a good example is like my board is not
majority women, and it's not that I decided that was
the number one party. It just happens that a lot
of women are in my network, and they are all
fantastic and that's why, you know, my end up on
my board, and so I think there's some hope that
you know, the women that are in power now are
actually doing the right things to make sure that they
(34:36):
are role models for the next generation.
Speaker 3 (34:37):
And they leave these women.
Speaker 1 (34:38):
Up well, and what do you know, You have more
women in power and they elevate more women.
Speaker 4 (34:43):
That's how it happenedsolutely. How would you describe your leadership style?
Are you tough as nails? Do you access over the details?
Are you a big picture thinker? Like what's your vibe?
Speaker 2 (34:53):
That's a great question. I definitely obsessed with all the details.
My team would tell you that whenever they send me
period documents, there's like at least one hundred comments in
the details. And I think that's important because I think
if you're not in the details as a CEO, you
lose the grasp of all the things that are going
to make your business tick. And I think customers notice
(35:15):
if you sweat the details or not. And so I
am very into the details, but I think it's important
to combine that with also the long term visions of
like you know, ten twenty years old and it's a
combination of the two that makes for great companies.
Speaker 3 (35:29):
So I think that's one saying.
Speaker 2 (35:31):
And then on the toughest nails, the thing I try
to do is stretch them because I really see the
magic in my team and I want them to fulfill
the around potential, which can sometimes feel extremely hard. But
also I support them in taking risk in doing that.
So I think it is when I talk to them,
(35:51):
they say that it's certainly not a work in the
park work for me, but they know I have their back,
and that's I think that's the right balance to strike because.
Speaker 4 (36:00):
They more of a kill them with kindness.
Speaker 3 (36:03):
I just not kill them but be kind. Yeah.
Speaker 2 (36:09):
Absolutely, I mean to me, it's that's about kindness, of
course kindness, but to me, it's about like having the
back and supporting them to take risks because the best
careers are built on mistaking, are built on stretching yourself.
I believe you're more fulfilled when every year you're a
new version of yourself. And so I want to show
them that I set the bar very high for them
because I see the magic that they could get to,
(36:32):
and I'm here to support them when it gets hard
to get there.
Speaker 4 (36:35):
What about honesty.
Speaker 1 (36:36):
I think we will Heerd is the one who said
honesty is kind.
Speaker 2 (36:40):
Honesty is kind absolutely. I mean we have this value
at instagrat. That's pretty it all on the table. And
I believe you cannot make good decisions, you cannot help
people if you're not absolutely direct with people. And I
totally agree. You know, sugar cutting things has never helped anyone.
It's much better to deliver it straight and then you know,
(37:02):
people get to do what they want with that.
Speaker 4 (37:05):
What's your advice to the next Fiji, Simo.
Speaker 3 (37:08):
I think it's it's the thing I said earlier. Focus
on the destination.
Speaker 2 (37:14):
What you put your attention on grows, and if you
focus on the obstacles, the obstacles will grow. If you
focus on the destination, the destination will get easier through
which I.
Speaker 4 (37:24):
Think that needs to be on a T shirt. Thanks
on the destination, watch the obstacles. We'll new swag.
Speaker 2 (37:34):
Next time.
Speaker 4 (37:35):
You We're awesome.
Speaker 1 (37:44):
Thanks so much for listening to this edition of the Circuit.
Catch the full episode on Bloomberg Originals and travel with
us to Simo's hometown of set in France.
Speaker 4 (37:52):
It is absolutely stunning and.
Speaker 1 (37:55):
You can see how I handle holding a massive fishhead.
Speaker 4 (37:57):
I'm Emily Chang.
Speaker 1 (37:59):
Follow me on x and Instagram at Emily Chang TV.
You can watch new episodes of the Circuit on Bloomberg
Television or streaming on the Bloomberg app or YouTube, and
let us know what you think by leaving a review.
Those extra reviews really make a difference. I'm your host
and executive producer. Our showrunner is Lauren Ellis. Our producer
is Zeduina o'teira. Our editor is Alison Casey.
I'm Emily Chang, and this is the Circuit bien Venu,
to the south of France, with its seaside beauty, cobblestone streets,
and world famous cuisine. You're traveling with us along the
coast to visit set, a small fishing village where Fiji Simo,
the CEO of Instacart, grew up. So your family has
been involved here for generations.
Speaker 2 (00:23):
My grandfather has really instilled in all of us so
respect for Lexi's idea of feeding the world, and in
our family, li food is everything. It's love, it's how
we celebrate, it's the center of everything we do.
Speaker 1 (00:37):
Raised by fishingboat captains who instilled a sense of grip
at a young age, Simo catapulted herself out of this
charming Mediterranean harbor and into the sea suite of Silicon Valley.
Speaker 3 (00:48):
She rose through the.
Speaker 1 (00:49):
Ranks at Facebook as one of Mark Zuckerberg's top lieutenants.
Ten years later, she was tapped to become the CEO
of grocery delivery company Instacart, a seemingly perfect union of
her tech child with her foody upbringing. She's also on
the board of Shopify, and more recently joined the new
board of Open Ai. Sam Altman got ousted in this
(01:09):
bizarre cod now he's back. What aren't you advising them on?
What are you advising sam On?
Speaker 2 (01:14):
I spent ten years at the company that was under
very intense scrutiny, where we did a lot of things
right then we also made some mistakes, and so a
big part of what I am advising them on is
how to handle getting to the level of organizational maturity
that they need for the impact that they're having on
the world.
Speaker 1 (01:33):
After visiting Simoon in France, I caught up with her
back in San Francisco to talk about her unlikely path
to Silicon Valley CEO, the bet she's making to deliver
Instacart's next chapter, food Health, and the future of chat
GPT in our kitchens joining me on this edition of
the Circuit. Instacart CEO and chair Figcimo.
Speaker 4 (01:53):
Thank you so much for doing this. It's great to
see you here.
Speaker 3 (01:57):
Thank you for coming, and you're going home.
Speaker 1 (01:58):
After you know, spending time with you and France, so
thank you for having us here today.
Speaker 3 (02:02):
Thank you so much for being here. Guys.
Speaker 1 (02:04):
I want to start with your initial impressions of Silicon
Valley and the gig economy before you started working here. Obviously,
your companies like Uber and Instacart and Airbnb and door
dash were these sort of larger than life companies promising
so much potential for the gig economy. What was your
impression of gig work and what these companies were capable
(02:26):
of before you started working here.
Speaker 2 (02:28):
The thing that was really striking is I had a
lot of friends that had joined these companies, and we're
telling me that the reason they had joined is very
often because in the past they had struggling parents for
whom these gig jobs would have been totally life saving.
And as I dug it more because I joined the
board of insta cut before becoming CEO, as I dug
(02:50):
it more into that, it's definitely true that this is
an economy that has led a lot of people to
makeans meet, to find flexible work. And I talked to
shoppers in my current job about once a month. I
do like a educated call with them, and I hear
incredible stories of people who are prime time caregivers but
need to add a little bit of income, people who
(03:11):
wanted to travel across the US and they have a
job in every city with Instakolt, and so I think
this is an incredible new way of working that these
companies have enabled, and we need to really protect that.
Speaker 1 (03:22):
You joined the board of instacart and then six months
later became CEO.
Speaker 4 (03:26):
Why did it all move so quickly.
Speaker 2 (03:28):
I think it was a confluence of events. Just to
be clear, when I joined the board, I had absolutely
no expectations of becoming CEO. I didn't want to leave
Facebook at the time, but I really fell in love
with the company. And at the same time, you know,
my predecessor, Approva, was really looking to transition and figure
(03:49):
out if he could put his company in the hands
of someone who could get it to scale, who could
get it to be public and really take it to
the next level. And so that ended up being incredibly
good timing for both of us.
Speaker 3 (04:00):
But certainly a surprise.
Speaker 1 (04:01):
Grocery is the biggest commerce sector in the US.
Speaker 4 (04:05):
But what did you see in terms of potential beyond groceries.
Speaker 2 (04:09):
People really think of instacrat as is like online grocery
delivery up and that's certainly a very big part of
what we do.
Speaker 3 (04:16):
We're on essential service for families.
Speaker 2 (04:18):
But what I saw when I joined the board was
the potential to really be a grocery technology company. The
things that are so special about what we do is
we integrate really deeply with fifteen hundred grocers. We provide
technology for them both in our marketplace but also powering
their own e commerce properties. So I saw the potential
to be the technology ally for the entire industry, including
(04:41):
not just online but also inside the store, and to me,
that's a massive opportunity.
Speaker 1 (04:46):
You worked at Facebook for a decade, you reported directly
to Mark Zuckerberg. What were some of the lessons from
the School of Zuch that shaped your thinking?
Speaker 2 (04:54):
Since the school is Zach was one of the best schools,
I would say the thing that Zach did incredibly well
and I'm really trying to replicate here is always be
focused on a very very long term vision, but also
have perfect execution in the short term, because you never
get to your long term vision if you don't have
perfect execution right now and the ability to combine both,
(05:17):
like I've yourized in the future, but sweat the details
right now is really important and a lot of leaders
don't manage to have both.
Speaker 3 (05:25):
That really showed us how to have both.
Speaker 1 (05:27):
Mark Zuckerberg has gotten so much criticism for so long
faced controversy after controversy.
Speaker 4 (05:32):
What did you learn from that?
Speaker 2 (05:34):
Well, I learned that, you know, when you have such
large impact on the world, it comes with a lot
of responsibility, and you need to get really ahead of
that and understand what your responsibility is and be proactive
about explaining to the world what you're doing, why you're
doing it, and really invest in making sure people understand
(05:55):
what you're doing. And that's something that Facebook ended up doing,
but it kind of and I wish we had done
it sooner.
Speaker 1 (06:02):
You became CEO at the top of the tech bubble,
we were in the middle of a pandemic. Instacart was
worth thirty eight billion dollars. How did you have to
reframe your expectations and your employees expectations of what this
company could be.
Speaker 2 (06:16):
It's interesting because on the one hand we had this
like giant valuation, but on the other hand, when I joined,
we were declining, like gross transaction volume declining double digits
because it was post pandemic. We had grown, you know,
four x, and people were wondering if we were going
to sustain that or if we were going to decline
back to prior levels. And we were kind of the
(06:36):
poster child for an unprofitable company. So really, the way
I reset with the companies to say, let's kind of
forget about, you know what the external world is valuing
us at and thinking, and let's talk about building a
generational company. And that means a company that can grow
sustainably and that is profitable.
Speaker 3 (06:55):
And that's exactly what we did.
Speaker 4 (06:56):
Then the bubble pops. Did you see that coming? Like,
were you kind of preparing for that possibility?
Speaker 2 (07:03):
I wish I could tell you yes, but no, I
think the thing that I was prepared for was that
we needed to build a sustainable company. And so my
philosophy is that you need to have a great company
under any macro ecrodomic environment. And that's exactly what we did.
We set the foundation to thrive under any macroeconomic condition.
(07:25):
But it was certainly a surprise because you know, a
lot of our employees were really expecting to go public
very soon, and we had to reset those expectations, both
because of the market, but also because at the time
I didn't judge as the company was ready to go public,
and we went public at a time where the company
was in a much much better shape to actually take
it public.
Speaker 1 (07:45):
You're technically not a founder of instacart. How is that
an advantage and how is that a disadvantage? Can you
still run the company in founder mode?
Speaker 2 (07:54):
Well, I'm very convinced that we need to have see
non founders acting in founder mode. Everybody is having a
different definition for founder mode, but the way I kind
of define it is like having a very long term vision,
not being swayed by the short term movements, being really
intense and being really in the details of knowing your
(08:16):
business and being really willing to make the very hard
calls to make sure that your company thrives, and that
I believe is something that you know every CEO should
and so for me, I think the advantage is that
I come with a lot of experience having seen scale
at a larger company. The disadvantage is that you don't
have all of the credibility that a founder has from
(08:38):
having created the company. You need to rebuild that and
that takes a little bit of time. I didn't get
that from day one, but I'm getting it by showing
that all of the new bets that have put in
place are now working, and that's you know very much.
Speaker 1 (08:51):
How I judge myself, what's your relationship with a poor
of today?
Speaker 4 (08:55):
How involved is he?
Speaker 1 (08:57):
Like, do you ever have disagreements and how do you
work through those?
Speaker 2 (08:59):
Yes, So it was on the board for quite a
period of time and then stepped down from the board.
So now it's a little bit different because I can't
really share with them private information but the company, so
we do talk at a very high level, and you know,
given our well in knowess the company is always good advice,
but it's less involved by definition.
Speaker 1 (09:17):
You did take instacart public, you push through. How big
of a milestone was that for you? I mean this
is when companies weren't going public yet.
Speaker 2 (09:27):
Yeah, being one of the first one, not the first
one was a little you know, stress in using But
I would say the IPO was just a moment in time.
Employees that worked really hard for that milestone. So I
wanted to celebrate that, but also not to lose sight
of the fact that the real goal is realizing this
(09:47):
long term vision, becoming a generational company. The IPO is
a means to an end, it's not the end in itself.
Speaker 1 (09:53):
It's been a year since the IPO. Instacart's now valued
at nine ish billion dollars. Wall Street's still skeptical. They's
skeptic of the growth potential. It doesn't compare to some
of the bigger gig economy players.
Speaker 4 (10:03):
What's your response to that.
Speaker 2 (10:05):
Yeah, I think we are still misunderstood, and for the
first year as a public company, that's not uncommon. But
I see my job as making sure that the market
understands how incredibly hard and complex grocery is. And I
think a big part of why there is a bit
of overhang on the stock is because people believe that
this is such a big market. We have a very
(10:27):
clear category leadership position, but that's going to be a
lot of competition coming up. And the thing that I
think the market underestimates is how hard it is to
sell customers and deliver groceries with accuracy, with speed, with selection,
with affordability.
Speaker 3 (10:41):
We've been at it for twelve years.
Speaker 2 (10:43):
And so even if we have new entrants coming into
the market, they are not able to do that at
the scale and at the level of quality that we're doing.
And I think the market is going to end up
realizing that while there will be intensified competition, we have
a very deep competitive advantage.
Speaker 1 (10:59):
Is it frustrating when the market is not where you
think it should be.
Speaker 3 (11:02):
You know, I tend to not focus on that.
Speaker 2 (11:04):
My philosophy is that when you focus on the obstacles,
they grow bigger. I tried to focus on the destination instead.
And so the thing that I really want is to
first build this incredible company, and then I think the
market takes care of itself once it becomes obvious. And
I think we're still at a time where, you know,
the new bets that I've put in place are just
(11:25):
starting to work. We talked about Keeper, we talked about restaurants.
They are just starting to take off, and the market
will end up realizing the strength of what we're building
over time.
Speaker 4 (11:35):
What were you right about and what were you wrong about?
Speaker 3 (11:39):
Great question.
Speaker 2 (11:41):
I think I assumed when I joined and it would
be much easier to move the market online because grocery
is a trillion dollar category but only thirteen percent penetrated online,
and that's lower than any other category of commerce. And
I think I was a bit naive in thinking like, oh,
of course, it's such a good service. We can accelerate
(12:03):
on an adoption much faster. And that has been harder
than I thought. But At the same time, the flip
side to that is that because it is so hard,
it's also a huge competitive advantage when you're a category leader,
because competitors have had a much harder time than I
thought entering this market, and so it's a double edged
sword how complex and hard grocery is.
Speaker 1 (12:25):
You have millions of data points on how people shop,
what sort of general trends are you seeing, what's working,
what's not working, what do people want?
Speaker 2 (12:34):
I think people value convenience enormously, so number one reason
why people come to instacart is convenience, and our entire
goal is to help families get life done, and they
are coming to instacott to save time. We are continuously
adding new services like restaurants so that they can save
more time, and that is something that's working really well.
(12:55):
We have twenty five million people who have used this
in the last year. I think that to get to
the next twenty five million people, we also need to
have a service for people who value price over convenience,
and that's why you're seeing as being very focused on
affordability and access, so that we're not just serving the
convenience buyer, but also serving the more price and site biers.
Speaker 1 (13:17):
You're hoping to be the premier technology provider for all
groceries and grocery store so that I might be able
to order directly from safewire, Albertson's or wherever.
Speaker 4 (13:28):
How do you make this bigger?
Speaker 2 (13:29):
First off, this is already very big. It's worth remembering
that the entire grocery industry is a trillion dollar market,
and our technologies don't just apply online, they apply inside
the store. So thirteen percent of the market is online,
eighty seven percent is in the store, and with skateboard cards,
we have the technologies to tackle that eighty seven percent.
Speaker 3 (13:49):
And then beyond that. I actually believe.
Speaker 2 (13:51):
That all the technologies that we've built for retailers are
technologies that can expand to the entire food supply chain.
They can expend to distributors, they can expend tos to farmers,
and you could imagine that if the entire food system
was technology enabled, was running with artificial intelligence, we would
have a food system that would be much less wasteful,
(14:12):
much more optimized, and everybody would benefit.
Speaker 4 (14:15):
You mentioned Caper.
Speaker 1 (14:16):
You bought Caper, maker of these AI powered smart carts,
saw this really cute video of you shopping with a
smart cart with your daughter.
Speaker 4 (14:24):
How many people are actually using this?
Speaker 2 (14:26):
So right now we have hundreds of colts deployed and
in the next several months we're going two thousands of courts,
but were really already in deployment with a lot of
retailers as at Koger wakefern Schnarks, like lots of different
ones even Aldi internationally, And really the feedback we're hearing
is that consumers absolutely love the experience, not just because
(14:48):
they can skip checkout, which is great, but because there's
a screen on keeper cards that follows you around the
worst restore and can recommend things based on what's in
your basket based on the location you're at in the store,
and that makes for a much more fun experience, So
consumers love it. That results in higher basket size for retailers,
and therefore retailers are now starting to see the real
(15:10):
business case behind it. And as you can imagine, there's
a great advertising model that you can build on top
of that, and we would you know, share revenue with
retailers as part of that as well.
Speaker 1 (15:20):
Also only really nice to know how much you're spending
before you actually go to check out.
Speaker 4 (15:24):
There are so many times I'm like, ouch.
Speaker 1 (15:26):
Maybe I would have put a few things back.
Speaker 3 (15:28):
And you know, that's a great point.
Speaker 2 (15:29):
And initially I was worried that if we showed the totals,
that would just reduce your spend, and that's not the
case because there's a lot of people who are on
a budget and when they see their total, they're actually
maximizing getting to their budget. Whereas if they have to
go through a normal checkout, they never want to be
embarrassed to have to put items back and so they
end up buying a lot less to avoid the embarrassment
(15:51):
of putting items back at checkout. And so it has
actually provided a real deep service for people both on
the affluent side as well as people on a budget.
Speaker 1 (16:00):
There are now giants in this business, Amazon, Walmart. How
can instacart compete? Where will you win and where will
they So?
Speaker 2 (16:09):
First off, both Amazon and Walmart partners on our marketplace,
so we also sell them and we also help them
gain access to incremental customers. But I would say, you know,
the weak customers shop is very different when you look
at instagrat on average, instagoult customer shops at five retailers
and instacolt plus members shop at twice the number of
(16:32):
retailers as non instacout members, and that means selection is critical.
So the Amazon and Walmarts of the world might get
a fair share of people who love these particular banners,
but we cover fifteen hundred banners. And so if you
want to shop at multiple retailers, if your favorite retailer
op choice is a public so Kroger and al tho cents,
(16:52):
we really are the best place for that.
Speaker 4 (16:54):
You have a partnership with Uber, how's that going.
Speaker 2 (16:57):
It's been a fantastic partnership with them. We have been
able to really enter restaurant delivery overnight and help families
not just get groceries for the week, but also dinner
for tonight.
Speaker 4 (17:08):
How much revenue is it driving, how much business is
it driving?
Speaker 2 (17:11):
Well, well, not sharing that quite yet, but I would
say it has exceeded our expectations. And when you look
at the numbers, we are driving penetration of restaurants among
our grocery user base faster than the restaurant delivery platforms
are driving penetration of grocery amongst.
Speaker 3 (17:27):
Our user based.
Speaker 2 (17:28):
So we're really pleased with the results we're attracting new
customers to instagrat order frequencies up and our membership became
twice as valuable over night.
Speaker 3 (17:37):
So very excited about it.
Speaker 1 (17:38):
Could there be consolidation in the future, Could Uber buy Instacart.
Speaker 3 (17:43):
Well, you know, we don't.
Speaker 2 (17:44):
We don't comment on any of any rumor or speculation
in general. But what I'll tell you is we're very
excited about our independent paths. We have a really great
strategy and a lot of long term initiatives that are working,
and so we're very community to that path.
Speaker 4 (17:59):
Now.
Speaker 1 (17:59):
Bigger picture, groceries are so expensive.
Speaker 4 (18:04):
Everyone is feeling it. What's happening here? Why is everyone
hurting so much?
Speaker 2 (18:09):
I think there's been, as you know, just an increase
in prices over throughout the supply chain that ends up
hurting the end customer. The role that we play is
really trying to get savings for customers wherever they exist.
So we integrate with retailer's loyalty system. We help them
optimize their prices with our algorithms called eversight. We digitize
(18:33):
the circulars, you know, the weekly circulars with coupons. We
put that online so that people could get deals. So
we're doing a lot of these things, and in total,
we are actually saving people four dollars and seventy five
cents per order through all of these initiatives, because every
dollar counts when go through is are that expensive and
so we're very proud of that. And again that's something
(18:56):
that competition hasn't really done because it takes deep into
with grocers to be able to pass on all of
these like self pricing.
Speaker 1 (19:04):
That's that, and you can correct me if I'm wrong here,
but using instacar, my understanding is it makes everything more expensive.
It still seems like a luxury and not a necessity.
Why do you think people will continue to pay a
premium when they're already paying a lot?
Speaker 2 (19:22):
Well, first off, like when you look at the delivery
issues that you get to pay off your seep to
have the service. A lot of people tell us that
when you start factoring in the cost of gas to
go to the grocery store, the loss of time for
people who may be packing two jobs in one day,
and all of these factors, it's actually a.
Speaker 3 (19:42):
Really really good deal.
Speaker 2 (19:43):
And you know, we are at the point where forty
five percent of fur orders are picked by shoppers that
already at the store. Within the middle of the store,
so that means you have someone picking your orders by
the time it would take you to get to the
front door. That's extreme convenience, and so what we're seeing
is people are willing to pay for this time saving
because time is money, and that's the critical thing. One
(20:06):
thing that I'm really proud of is that when you
look at the split of demographics of instacart, they actually
closely mirror US population in terms of income.
Speaker 3 (20:14):
And that wasn't the case four years ago.
Speaker 2 (20:16):
Four years ago, You're absolutely right, it used to be
a luxury, but with all of the things that we've
put in place, we actually mirror US population much more
closely now, and we hear from people that are more
in the lower income buckets how critical instacut is because
these people might need money, but they are also time starved,
and if we can help them save time, that saves
(20:38):
them money.
Speaker 4 (20:39):
High level.
Speaker 1 (20:40):
Do you see consolidation coming in the grocery business and
what would that do to prices?
Speaker 2 (20:45):
I think the US grocery landscape is interesting because customers really.
Speaker 3 (20:50):
Love their local grocer.
Speaker 2 (20:52):
So you are seeing some consolidation happen with the big guys,
but there are still a lot of space for regional
players could favorites, and that's why you know, selection matters
so much.
Speaker 3 (21:04):
The rother markets.
Speaker 2 (21:05):
You know, Europe is a good example where there's like
two to three big players and that's it. In the US,
if you don't have the full selection of fifteen hundred grosses,
you can't really self customer needs.
Speaker 1 (21:17):
More broadly, gigwork for so many people has provide an
extra income flexibility.
Speaker 4 (21:24):
But there are still a.
Speaker 1 (21:25):
Lot of complaints and I'm just going to read some
to you.
Speaker 4 (21:29):
You know, this is a really hard job. There's people
that are complaining.
Speaker 1 (21:32):
Sometimes the item requested isn't there, they don't get enough orders,
people don't tip, they're going to strangers homes. They're complaining
about customer service, and then in the end they say
they don't make that much money. How do you respond
to all that? How do you address all of that?
Speaker 2 (21:45):
So that will always be complaints, but we really look
at the numbers to figure out if you're doing a
good job, and then we can always improved. You know,
being a shopper is a tough job. You are in
the store trying to figure out how to find twenty
plus items going on a customer chat and helping the
customers figure out if something is missing.
Speaker 3 (22:04):
On the shelves.
Speaker 2 (22:05):
So are truths and our technology are things that we
always invest in so that the jobs becomes as easy
as possible. And what we hear from more shoppers is
that the ones who decide to be shoppers on instacot
are very different than the ones who peak restaurant delivery.
Speaker 3 (22:20):
Or right sharing.
Speaker 2 (22:21):
There are people who are more customer service oriented, who
want to spend more time in the store interacting with customers.
Speaker 3 (22:27):
So there is also a lot of self selection happening.
Speaker 1 (22:30):
I know you've been a shopper yourself, and you go
back every so often to see what the experience is like.
Speaker 4 (22:35):
You're also a mom. More shopping falls to moms.
Speaker 1 (22:37):
What are the things that aren't perfect yet or that
you want to get better personally?
Speaker 4 (22:41):
Like, what are the things where you're like, oh.
Speaker 2 (22:43):
I think we have made a ton of progress on
like making the up just much more easy to use.
I think the number one thing they want is access
more earning opportunities.
Speaker 3 (22:53):
They want more.
Speaker 2 (22:54):
Orders, they want more taks to complete, and so there
are some things that we're looking at, like if they
are already at the store, other things that they can
do while they wait for an order inside the store,
and so things like that that really help them earn
while they're waiting for an order.
Speaker 3 (23:11):
That's the biggest thing that we keep hearing about.
Speaker 4 (23:14):
From the financial perspective.
Speaker 1 (23:15):
You know, back in the day, there was this vision
that you could make a living doing gig work, and
that sounded amazing, but now it seems like it's really
more just side hustle money or supplemental income at best.
Speaker 4 (23:25):
What do you think.
Speaker 2 (23:26):
I think we have a very small number of shoppers
who really want to do that full time, but nine
out of ten or work shoppers actually have other sources
of income. And the majority of work shoppers shop less
than ten hours a week with Instagram. So the average
use case really is supplemental income.
Speaker 3 (23:46):
And that's why the flexibility is so critical.
Speaker 2 (23:49):
These people are not looking for a nine to five jobs.
They are looking for something that fits within their complex
lives and that they can do on the go in
a very modular way.
Speaker 1 (24:01):
These workers don't have the same protections that you or
I do.
Speaker 4 (24:04):
Should they.
Speaker 2 (24:05):
I think there's a lot of protections they should have,
and in fact, when you look at the systems that
are put in place in a lot of regions, including
Prop twenty two in California. It's a way to balance
the need for flexibility, which is absolutely critical, with also
giving these workhouse of protection that they so deserve. And
so when you look at kind of policy agenda, it's
(24:26):
really about maintaining that flexibility, protecting the independent contractor status
that's so important to what they want, but giving them
the protection they so deserve.
Speaker 1 (24:36):
Instac Cart spend spending time at the White House time
in DC.
Speaker 4 (24:40):
What are you advocating for.
Speaker 2 (24:42):
The main thing that we are very focused on is
food access, and we have done a lot of work
with that, in particular by bringing the SNAP programs through
the Systems Program online and we are the first platform
that has allowed SNAP in all fifty states. This other
has required a lot of collaboration with the White House
(25:02):
on really modernizing this program to bring it online, doing
that with other programs in the future, and making sure
that we can maximize food access.
Speaker 4 (25:12):
How do you think about the global food system?
Speaker 1 (25:14):
So many people in the world don't have access to
enough They don't have enough food, they don't have access
to quality food, let alone have access to instacart. How
does that shape your thinking and your strategy.
Speaker 2 (25:25):
It's a very big part for strategy because we think
fundamentally the food system is completely suboptimized, it creates a
lot of waste.
Speaker 3 (25:34):
Therefore, it also creates the opposite.
Speaker 2 (25:36):
Sometimes to avoid waste, you end up not having products
on the shelf, and everyone loses when that's the case.
And when you think of all the technologies that can
be built and optimized through machine learning, through artificial intelligence,
we could have a food system that is fundamentally less
wasteful if all of the actors of the supply chain
were all connected, all optimized, and if some one was
(26:00):
collecting consumer data that feeds the entire system so that
the right things could be produced at the right volume.
Speaker 3 (26:07):
And we think we can be that player.
Speaker 2 (26:09):
We think that we have built the technologies for retailers,
for brands, and now we can extend them to the
rest of the food system. That's a big opportunity for
the company, but also a big problem to solve.
Speaker 1 (26:19):
You're offering instagrat benefits for people on food stamps through
the US Department of Health and Human Services. You're expanding
these food as medicine initiatives.
Speaker 4 (26:28):
How does this play out how does this work.
Speaker 3 (26:32):
Food as medicine is a great example.
Speaker 2 (26:34):
We as a country are spending about a trillion dollars
on healthcare costs for diect really disease. A trillion is
the same amount as the entire country spends on food.
That's pretty crazy when you think about it. That means
that there's a lot of money that's very poorly spent
and would be better spent helping people buy nutritious food.
(26:55):
And that is fundamentally an economic problem, but also a
technology problem because to scale those food as many in
program and distribute nutritious food to people all across the US,
you need a technology platform that can do that. And
we reach all of the US with fresh food in
under two hours.
Speaker 3 (27:11):
So that's why we took on the very.
Speaker 2 (27:14):
Big initiative of partnering with government, parnering with nonprofits, parnering
with our systems to really be the rails by which
this can happen. It's pretty crazy that today it is
easier for a doctor to prescribe medication than it is
to prescribe food, when we know food is such a
big driver of the condition. So again, we can solve
(27:34):
that to technology by making it as easy to do
one versus the other, and instagrat can fulfill that.
Speaker 1 (27:41):
Speaking of food as medicine, you co founded a health
clinic and research institute.
Speaker 4 (27:46):
This is personal for you.
Speaker 1 (27:47):
I mean you've been very public about your own struggles
with health.
Speaker 3 (27:50):
Yeah. Absolutely, I think you know.
Speaker 2 (27:52):
The plague of chronic illness in the US and worldwide
is a very very important problem, and while not in
particular in the US tackling it the right way, there's
not enough focus on preventative care. There's not enough focus
on the things that work, like diet, and while not
making it easy for people to actually adopt a better diets,
(28:13):
that end up changing their habits.
Speaker 3 (28:15):
So that's really what we're trying to solve.
Speaker 1 (28:18):
You also do many other things outside of your own instacart.
Speaker 4 (28:21):
You're on a new board of open Ai. Who approached too.
How did that happen?
Speaker 2 (28:26):
I was serving on the board of Shopify with Brett Taylor,
with the chairman of open Ai, so he's so many
action there and approached me to join the board of
open Ai. And it's been just a real privilege and
huge responsibility to be part of that journey.
Speaker 1 (28:41):
You joined during a very critical time. Sam Martman got
ousted in this bizarre coon Now he's back. What are
you advising them on? What are you advising Salmon?
Speaker 3 (28:52):
Well?
Speaker 2 (28:53):
I spent ten years at the company that was under
very intense scrutiny, where we did a lot of things right,
and we also made some mistakes. And so a big
part of, you know, what I am advising the man
is how to handle getting to the level of organizational
maturity that they need for the impact that they're having
on the world. But I have been really positively surprised
(29:15):
by how seriously they takes a responsibility, how they put
safety above everything else, And so as a board, it's
really odd job to really help them build all of
the infrastructure that they need for the massive impact.
Speaker 3 (29:29):
They are having but also well have in the future.
Speaker 4 (29:32):
How about them personally? Like, what's your impression of him
as a leader?
Speaker 2 (29:35):
Is an incredible visionary and I think we're talking about
founder mode earlier. Like the reason I was excited to join,
even though you know it's a board that requires quite
a bit of work, is because I love seeing founders
in action, and I love seeing someone who has an
incredibly long television who is really motivated by doing good
for the world and really helping him because there's going
(29:57):
to be a lot of bumps along that journey. This
is the first company is that's doing something really unprecedented
with a lot of challenges ahead, and so I don't.
Speaker 3 (30:06):
Think it's going to be an easy journey.
Speaker 2 (30:08):
But I think having someone that's a helm has so
much dedication to the mission is really critical.
Speaker 1 (30:14):
I think people look at him and see kind of
an enigma, and even he said you shouldn't trust me,
you know, how do we make sense of that?
Speaker 3 (30:22):
Well?
Speaker 2 (30:23):
First off, I think that kind of sounds familiar, right,
Like all of these very powerful people, we always feel
like they're enigmas. We always feel like they are quite
a bit of power, and therefore we want to understand
more about them. The same thing kind of happens tomorrow,
and I think with Sam, I think it's not just
about trusting one man. I think it's about trusting an
(30:44):
entire system, whether that's the board, whether that's how the
entire company works, whether that's the transparency of their processes
that they are releasing publicly. So I think while understanding
sam psychology mode is always great, I think the much
more important thing is really looking at what the entire
organization is producing what they're releasing publicly so that we
(31:05):
can understand their processes and the impacts are going to have.
Speaker 4 (31:08):
You know, that's from your earliers of Facebook.
Speaker 1 (31:10):
When there's this explosion in technology or an explosion of
a platform, there's so many different companies now trying to
do this. There's talent moving all over the place. Like,
what should we make of all these people living open
ai are getting reported.
Speaker 4 (31:21):
On leaving open ai? Why shouldn't we be worried?
Speaker 2 (31:24):
I think, you know, every time that all this like
new big technology changes, you see talent moving around. And
the thing that I think we need to look at
is like, look at the talents that's currently at open Air,
and it's just absolutely incredible talents, like just the smartest
people I've worked with, and they are really committed to
(31:44):
the mission and really committed to achieving the mission in
a really, really safe way. And so we need to judge,
I think, based on the outcome. And that's why transparency
is critical, because if we release all of the results
of analysis and are very transparent on what we're seeing
in this model, the public is going to be able
to judge, you know, whether trust us or not.
Speaker 4 (32:05):
Do you think AI will be good or bad for
the world.
Speaker 2 (32:08):
I think it's up to us to make it good.
I think it will be absolutely fantastic for the world,
but I also think that there will be a lot
of risks that we need to actively mitigate. I do
not believe that this is something that happens to us.
I believe that this is something we get to drive,
and I believe in our ability to maximize the good
and minimize the bad.
Speaker 1 (32:29):
People have been using chat schipit to generate recipes. What's
the potential for AI in the full world.
Speaker 2 (32:35):
There's so much potential, And as I've talked to you about,
I think in SET, I see technology not for technology's sake.
I love technology for like the concrete thing that it enables,
and I think with AI, it's the same in the
food world. To me, it has to solve the problem
of families wondering what to put on the table and
really figuring out what's for dinner. And I think with AI,
(32:58):
we have the opportunity to personalize the experience to such
an extent that someone could be able to come to
instacot and just say, hey, I have a family of
three kids, one of them is lectos intolerant mama's diabetes
or on this budget and really get back a set
of ingredients, a set of recipes that are perfect for
that family and that show up at their doors. So
(33:19):
I see AI as a way to really remove friction
and help people get there on its field in natural
language kind of the way they deal with that in
their head. But now we have computer interfaces that are
able to interpret that and act on their behalf.
Speaker 1 (33:35):
There are so few female taxeos, even fewer French female
text see are going very niche, but really it seems
that the community is getting even smaller. Does it ever
feel to you like we're going backwards?
Speaker 3 (33:53):
It's such a tough topic.
Speaker 2 (33:55):
I think I don't feel it that way because again,
as I told you earlier, I don't tend to focus
on the obstacles.
Speaker 3 (34:03):
I tend to focus on the destination.
Speaker 2 (34:05):
And I think what we're seeing is many more female leaders,
and to their credit, some male leaders as well, really
lifting women up.
Speaker 3 (34:13):
You know.
Speaker 2 (34:14):
Like a good example is like my board is not
majority women, and it's not that I decided that was
the number one party. It just happens that a lot
of women are in my network, and they are all
fantastic and that's why, you know, my end up on
my board, and so I think there's some hope that
you know, the women that are in power now are
actually doing the right things to make sure that they
(34:36):
are role models for the next generation.
Speaker 3 (34:37):
And they leave these women.
Speaker 1 (34:38):
Up well, and what do you know, You have more
women in power and they elevate more women.
Speaker 4 (34:43):
That's how it happenedsolutely. How would you describe your leadership style?
Are you tough as nails? Do you access over the details?
Are you a big picture thinker? Like what's your vibe?
Speaker 2 (34:53):
That's a great question. I definitely obsessed with all the details.
My team would tell you that whenever they send me
period documents, there's like at least one hundred comments in
the details. And I think that's important because I think
if you're not in the details as a CEO, you
lose the grasp of all the things that are going
to make your business tick. And I think customers notice
(35:15):
if you sweat the details or not. And so I
am very into the details, but I think it's important
to combine that with also the long term visions of
like you know, ten twenty years old and it's a
combination of the two that makes for great companies.
Speaker 3 (35:29):
So I think that's one saying.
Speaker 2 (35:31):
And then on the toughest nails, the thing I try
to do is stretch them because I really see the
magic in my team and I want them to fulfill
the around potential, which can sometimes feel extremely hard. But
also I support them in taking risk in doing that.
So I think it is when I talk to them,
(35:51):
they say that it's certainly not a work in the
park work for me, but they know I have their back,
and that's I think that's the right balance to strike because.
Speaker 4 (36:00):
They more of a kill them with kindness.
Speaker 3 (36:03):
I just not kill them but be kind. Yeah.
Speaker 2 (36:09):
Absolutely, I mean to me, it's that's about kindness, of
course kindness, but to me, it's about like having the
back and supporting them to take risks because the best
careers are built on mistaking, are built on stretching yourself.
I believe you're more fulfilled when every year you're a
new version of yourself. And so I want to show
them that I set the bar very high for them
because I see the magic that they could get to,
(36:32):
and I'm here to support them when it gets hard
to get there.
Speaker 4 (36:35):
What about honesty.
Speaker 1 (36:36):
I think we will Heerd is the one who said
honesty is kind.
Speaker 2 (36:40):
Honesty is kind absolutely. I mean we have this value
at instagrat. That's pretty it all on the table. And
I believe you cannot make good decisions, you cannot help
people if you're not absolutely direct with people. And I
totally agree. You know, sugar cutting things has never helped anyone.
It's much better to deliver it straight and then you know,
(37:02):
people get to do what they want with that.
Speaker 4 (37:05):
What's your advice to the next Fiji, Simo.
Speaker 3 (37:08):
I think it's it's the thing I said earlier. Focus
on the destination.
Speaker 2 (37:14):
What you put your attention on grows, and if you
focus on the obstacles, the obstacles will grow. If you
focus on the destination, the destination will get easier through
which I.
Speaker 4 (37:24):
Think that needs to be on a T shirt. Thanks
on the destination, watch the obstacles. We'll new swag.
Speaker 2 (37:34):
Next time.
Speaker 4 (37:35):
You We're awesome.
Speaker 1 (37:44):
Thanks so much for listening to this edition of the Circuit.
Catch the full episode on Bloomberg Originals and travel with
us to Simo's hometown of set in France.
Speaker 4 (37:52):
It is absolutely stunning and.
Speaker 1 (37:55):
You can see how I handle holding a massive fishhead.
Speaker 4 (37:57):
I'm Emily Chang.
Speaker 1 (37:59):
Follow me on x and Instagram at Emily Chang TV.
You can watch new episodes of the Circuit on Bloomberg
Television or streaming on the Bloomberg app or YouTube, and
let us know what you think by leaving a review.
Those extra reviews really make a difference. I'm your host
and executive producer. Our showrunner is Lauren Ellis. Our producer
is Zeduina o'teira. Our editor is Alison Casey.
Host
Emily Chang
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