Welcome back to Daily Palantir! It’s been a minute since we last talked, so let’s get into it…
The past month has been moving really fast for me, particularly because of my involvement in Palantir-focused events. The newsletter is back, and I’ll be publishing daily again. SO MUCH has happened for Palantir!
So, in May I was invited to the SCSP AI Expo. Palantir was the lead sponsor, and I got to meet Dr. Alex Karp while also getting a chance to interview Palantir CTO, Shyam Sankar.
While I was at that Expo, I got pitched an opportunity to host the “halftime show,” otherwise now known as Back Stage Pass, for the 4th edition of Palantir’s AIPCon. I said yes, and for the next few weeks I was practicing with the people you see in the photo above: Chad (AIP Architect), Jack (Forward Deployed Engineer) and Natalie (Customer Demand for Palantir).
If you want to view the halftime show, you can watch it here. The reason for doing the halftime show was because Sasha Spivak, who leads corporate dev at Palantir, wanted to switch things up and make AIPCon much more exciting during the in-person coffee break. It felt like a real show in the middle of the conference, thousands of people joined online to watch, and I got an amazing opportunity to moderate a panel between some awesome Palantir employees to discuss the presentations we just watched and preview the upcoming ones.
I am so grateful for the opportunity.
AIPCon Allowed Me To Talk To Palantir Employees
So, there’s a lot of news to cover about Palantir that I will get into over the coming newsletters. However, I want to spend this one discussing my takeaways from getting a chance to actually speaking to the Palantir employees.
I probably spoke to 50 different people, some who were at the company for a few years and others who had been there since 2009. I got many, many perspectives on why people work at the company, why they won’t leave the company, and how they think of the company’s overall moat. Let’s get into it:
The Ontology
We all hear about Palantir’s ontology product — which is the core thesis around their flagship product, Foundry.
However, I got a much stronger understanding of the product after having a chance to speak to many of the employees, including the CEO, Alex Karp.
Palantir's ontology is a powerful tool for businesses because it provides a structured framework to understand and manage the complex relationships and processes within an organization.
Here’s a few examples that made it even more clear to me why this is so valuable:
Library Catalog System - A library uses a catalog system to organize books by subjects, authors, titles etc., making it easy for patrons to find what they're looking for. Similarly, Palantir’s ontology organizes data across all aspects of a business so that users can easily access information relevant to their tasks.
Healthcare Management - In healthcare management, Palantir’s ontology could represent patients' records linked with treatment protocols and outcomes. This would be like having patient charts that automatically update with test results from labs (like receiving book updates directly into your library system).
Air Traffic Control System - Just as air traffic control tracks flights' positions relative to one another ensuring safe travel paths; Palantir’s ontology tracks different data points within an enterprise ensuring smooth operational flows without conflicts or redundancies.
Now, the employees I spoke to essentially told me that the ontology is what makes anything from a data perspective even useful for an enterprise. Many organizations have the ability to set up a datalakehouse, very few of them can ontologize your business so that the data becomes actionable. If data is the new oil…and data is what is necessary in order for AI to even become useful…then the ontology is what connects everything together.
One of the employees I spoke to who manages a group of supply chain clients described to me that the ontology took years for Palantir to build correctly. It’s very, very difficult — which is why Palantir has thousands of patents filed on how they uniquely built their ontology. It seems like most employees understand that the market may not fully get why an ontology matters, but when the market does figure that out, things will change…which is why many employees I spoke to said they weren’t selling a single share. Also, while the employees are obviously bullish, AIPcon had over 70 customers presenting how they are utilizing Palantir’s ontology + AIP to drive efficiencies in their business. The reason they even showed up to present was because they wanted to prove how valuable Palantir was for their business, and the conference gave me a better understanding of how employees and customers think of Palantir.
I got a few minutes to speak to CEO Alex Karp as well. He said he felt very confident about the company’s future even if they didn’t have hundreds of thousands of employees like Big Tech. When I asked why he was so confident about this, he said, “Because the rise of LLMs will operationalize the way ontologies work.”
This is essentially what Karp said in his recent Yahoo Finance interview. He believes the future of AI will be between chips and ontology. Chips are how generative AI becomes real. Nvidia and the semiconductor companies have won that game. The next level is software that makes AI meaningful for government, companies, etc. Karp believes the secret that the market does not understand yet is that LLMs mean nothing unless you have an ontology for the LLM to plug into — if he’s right about this, we will see more top line revenue growth supported via AI because customers will want to utilize LLMs but only can if they have an ontology. The market will eventually react to that when the growth comes.
A Culture of Autonomy
I asked many employees two questions:
Why do you work at Palantir?
Why haven’t you left Palantir?
The responses I got for the first question ranged from “Karp” to “I get to actually do what I want.” The answers for the second question ranged from “Why would I leave” to “Theres no where else on the planet that has this culture.”
Pretty much every employee described working at Palantir as a process that was not rigid, but constantly in motion. There are no defined roles. People are given tasks and then it is up to them to figure out how to navigate those tasks and many times they end up doing things for the company that are not part of their job titles.
Engineers began leading bootcamps 12 months ago and basically became the company’s sales reps because they were showing off product in real time for potential clients. Those engineers probably never thought they were going to be working with clients so intimately, but they ended up becoming pivotal to Palantir’s growth in the past year.
Most employees argued that the autonomy they have at the company to try new things, take risks, get out of their comfort zone — it just doesn’t exist at any other company, especially not the big tech companies. This gives them the ability to continue to feel as if they can achieve more, which really helps employees feel like they have a sense of purpose at the company.
A Culture of Innovation
The final thing I learned is that Palantir employees actually have the ability to innovate. It’s one of the reasons the company has not had to acquire a company for a decade, they’ve been able to come up with new products and ideas on their own.
I sat down with an employee during dinner who had left Google a decade ago. He told me that they tried to create new products, spent two years getting those products approved, and once those products were about to roll out…Google ended up having legal issues which prevented the products from being real.
This also explains why a company like Google let OpenAI come first to market with LLMs — they simply got too big and ignored competition. One of the reasons that employee left Google was because he felt Palantir actually allowed him to build products, try new things, and then ship those products into the world. When you are one of the smartest engineers on the planet, making sure your creativity actually reaches people via product is one of the most important things and it keeps you excited to continue working on very hard problems.
Palantir has this culture around innovation. This is also another reason we saw the launch of AIP just two months after ChatGPT went mainstream — Palantir has the talent and tools internally to launch a massive product that they would end up betting the company on because employees were allowed to innovate and immediately create product vs. being stuck in bureaucracy. That is a moat, and is incredibly important for a small company that is trying to become one of the most important in the world.
Overall, speaking to employees simply gave me a much better understanding of the company and allowed me to understand the people I was investing in. I personally could not be more excited to continue to invest in those people.
Here’s some more pictures of the event:
We’ll be back daily!
That’s it for today - see you tomorrow!
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Excellent Adventure! Party On! 🥳🥳🥳🥳🥳🥳🥳🥳✌️✌️✌️✌️✌️🫶🫶🫶🫶🫶❤️❤️❤️❤️❤️
Superb commentary. Thank you.
I have had the same frustrations in all the banks I worked for (Bank of NY, Morgan, Marine Midland) and the military. Unfortunately, I’ve aged out and now live vicariously on Palantir’s accomplishments.