Mar 8, 2023 · 56m · news
Glen Coates: Why Shopify Will Dominate Amazon; How Microsoft Made Smartest Move of 2023 | E986 · 20VC with Harry Stebbings
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of 20VC, Shopify's VP of Product Glen Coates shares his transition from founding the wholesale startup Handshake to leading core product engineering at Shopify. He outlines the strategic product frameworks, organizational structures, and technical breakthroughs used to scale Shopify's global commerce engine while maintaining software simplicity.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Harry holds 19.1% of the talking time here. How this is scored →
Harry as informed peer 3.1 Guest teaching 3.3 Guest disagreement 1.2 Harry pushing back 2.3
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 49:36 Founder head of product rule
Glen strongly dismisses the idea of a product founder delegating the Head of Product title, insisting it equals quitting or giving an employee a title death sentence.
Hardest push from Harry ▶ 37:05 Rejection of Shopify dotcom messagingHarry directly attacks Shopify's homepage tagline as bland like custard and refuses to accept standard corporate marketing framing.
Biggest teaching moment ▶ 43:00 Platform versus aggregator theoryGlen uses Stratechery's framework to educate Harry on why combining a core platform with a buyer aggregation engine creates a defensible market advantage over pure platforms.
Harry holds his own ▶ 37:25 Host pitches an empowered brand messageHarry demonstrates strong brand positioning expertise by improvising an inspiring alternate tagline for Shopify that wins explicit praise from the guest.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| Glen Coates' Winding Career and Handshake's Origins | 3 | 1 | 1 | 1 | Harry opens with a warm intro and offers an observation connecting game design experience to high-quality founders. Glen agrees and expands on the competitive mindset required for both. | |
| Handshake's Acquisition and Running 'Code Red' on Checkout | 2 | 3 | 1 | 1 | Glen details Handshake's acquisition and running a 'Code Red' on Shopify checkout, explaining how org charts impact code. Harry keeps the conversation light with alignment jokes while listening to Glen's explanation. | |
| Framework Pillars: Defining Principles and Assumptions | 2 | 4 | 1 | 1 | Glen outlines his framework of outcomes, principles, and assumptions. Harry acts as a guiding interviewer, prompting Glen to explain concrete trade-offs among merchants, developers, and buyers. | |
| Goal Setting Traps and Present vs. Future Balance | 5 | 3 | 1 | 2 | Harry demonstrates investor expertise by pointing out how goal setting can be gamed using a 20-meetings-a-week example. Glen validates this with his sales versus marketing funnel analysis and long-term platform planning. | |
| Retaining Product Simplicity Through Progressive Disclosure and Ecosystems | 2 | 4 | 0 | 0 | Glen breaks down product simplicity using progressive disclosure, anti-features, and third-party app ecosystems. Harry listlessly moderates as Glen provides a detailed explanation. | |
| Solving SaaS Extensibility with Shopify Functions | 1 | 4 | 0 | 0 | Glen delivers a technical explanation of WebAssembly and Shopify Functions. Harry listens passively, making a brief joke about Glen looking young. | |
| The Dunbar Number and Reorganizing Shopify Core | 4 | 3 | 2 | 6 | When Glen reveals he smushed teams into Core only to immediately re-split them into eight sub-teams, Harry directly challenges him on creating silos and communication friction. Glen defends the structure using Dunbar's number and escalation management. | |
| Leadership Style: The Senior Aimer vs. Bottoms-Up Culture | 5 | 3 | 2 | 5 | Glen advocates for top-down 'senior aiming' leadership. Harry pushes back on the practical efficacy of 'disagree and commit', drawing from his own friction-filled experiences. | |
| The Power of Authentic Storytelling in Product | 2 | 3 | 1 | 2 | Glen shares a story of an investor forcing him to articulate Handshake's value simply. Harry probes on how to adapt narratives across different audience personas. | |
| Shopify's Tagline, Scale, and Managing Up to Tobi Lutke | 7 | 3 | 3 | 7 | Harry aggressively criticizes Shopify's landing page copy as bland like custard and improvises a far more emotional, inspiring pitch on the spot. Glen concedes the pitch was good while defending enterprise positioning trade-offs. | |
| The Offline Sync Trap: Handshake's Biggest Strategic Error | 1 | 5 | 0 | 0 | Glen reflects candidly on Handshake's biggest strategic error: over-indexing on offline sync capabilities, which created severe tech debt once cellular data became ubiquitous. Harry listens to the post-mortem. | |
| Quickfire Round: User Delight, Shopify's Strengths, and Microsoft's Smart Move | 3 | 4 | 2 | 2 | In the quickfire round, Glen shares strong opinions on PM craft obsession and analyzes Microsoft's aggressive AI strategy against Google's search monopoly while Harry drives the pace. |
Statements from this episode (19)
Glen Coates quit business school after one day to focus on coding
“I basically applied to go to business school, went to business school, went for one day. And then I was like, actually, this is kind of not what I want to be doing. I'd actually rather be coding 12 hours a day. And so I quit business school”
Stebbings: The best founders have backgrounds in gaming or game design
“The best founders I work with have a background in either game design or being exceptional, like, game players themselves.”
Coates Executed a 'Code Red' Fix on Shopify's Checkout in 2020
“So that was a year in which there was some really fundamental things in the checkout that needed to be fixed, like rather promptly. And so Toby asked me to move over and basically like run a, what's called a code red on checkout.”
Coates: Core products represent about half of Shopify's total R&D headcount
“Core is now about half of R&D in Shopify, right? And core is what the outside world would think of as like the built-in bits when you first, when you sign up for Shopify. So like the stuff you get in the box, it's like the online store, the checkout, all of th…”
Glen Coates: Product principles must resolve close 51-49 decisions
“Principles are probably the most difficult and counterintuitive, but principles are basically how are we going to make the very hard decisions, the 51 49 decisions, that reasonable people could take either side of in this project.”
Coates: Only progressive disclosure and app ecosystems let software scale from SMBs to enterprise
“The only two pieces of leverage you really have to allow that stretch is one is extremely good execution of progressive disclosure in the core product. So like features that appear at the right time only when you need them. A good example of this is something …”
Coates: Platform ecosystems fail if third-party apps cannot match first-party quality
“One is you need you need an app platform that allows apps to be built that are of equal quality to the core features of the platform. That is absolutely critical. And like, look at iOS. IOS is like a great example of this. Like when I open up a first party app…”
Coates: Shopify was first major SaaS platform to run secure third-party code
“And I, as far as I'm aware of Shopify was the first at scale SaaS platform to do that.”
Coates: Shopify Core has 2,500 employees divided into 10 teams
“Core is about two and a half thousand people, right? And there's now 10 of these teams inside core, so there are about 200 people each, which is about the Dunbar number, which is not a coincidence.”
Shopify's previous org structure required product escalations to go directly to CEO Tobi Lütke
“In the old org structure, the first point in the org chart where all those 14 teams actually, like, joined at the top was Tobii. So anytime someone has an escalation, the first point in the escalation tree was Toby”
Coates: Bottom-up management destroys product cohesion across multi-product software suites
“The problem with power to the edges and bottoms up decision making Is that the value of a product like Shopify, or the value of, not even a product, like a product suite, like, because Shopify has many products, right? And look at Apple, right? Like Apple is l…”
Coates: Employees who 'disagree and commit' execute at 80% speed
“They don't move down the field quite as fast, but there is a difference between moving down field at 80% speed and, like, literally digging your heels in.”
Coates: Audiences only retain three words at a time in communication
“You only get to lodge, like, a few words in someone's brain before, like, every word you add pops one out their other ear, and you only get to choose, like, maybe three words you can lodge in someone's brain at any given point in time, and you really need to c…”
Coates: Tobi Lütke is and will always be Shopify's head of product
“Toby, like all great CEO founders, is actually the head of product at Shopify, and will always be. I think the day that Toby's not running a product at Shopify is the day that he's not at Shopify.”
Coates: Competing with Shopify in e-commerce is terrifying due to its buyer aggregator engine
“These days I'm like, I'd be fucking terrified to be competing with Shopify in commerce. Not, we have a great platform, but like, we've got it joined at the hip to an incredible buyer aggregation engine, which is just hard to, it's hard to overcome how powerful…”
Coates: Shopify competes directly with Amazon today
“Well, I mean, Shafak meets with Amazon today. Oh, absolutely. Hundred percent. Hundred percent.”
Coates: Product founders who hire a Head of Product are quitting
“The minute that person says this other person is the head of product, they've done one of two things. They've either quit their job, or they have given that other person a title that everyone knows is bullshit, and they've basically given that person a death s…”
Coates: Shopify's key strategic weakness is lacking top-of-funnel control
“I think one of Shopify's challenges today is that we fundamentally do not control the top of the funnel, right? Like the top of the funnel for shopping on is something else, right? It's a social media site. It's a news site. It's an ad on Google. It's somewher…”
Coates: Microsoft's AI Bing launch is an asymmetric attack on Google
“Search is like a non-part of their business, but search is everything to Google. Like if search ads stop working, Google doesn't, is not a thing anymore. And so they are swinging for the fences with a completely novel approach, which might not work, but if it …”